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Hello and welcome everyone joining today's Neurocrine Biosciences third quarter 2026 earnings call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. To register to ask a question at any time, please press star one on your telephone keypad. We ask that please limit yourself to one question. Please note this call is being recorded, and we are standing by if you should need any assistance. It is now a pleasure to turn the meeting over to Todd Tushla, Vice President of Investor Relations. Please go ahead.

Thank you, and happy Monday, wherever it is that you may be. Welcome to Neurocrine Biosciences' third quarter 2026 earnings call. Joining me on today's call are Kyle Gano, Chief Executive Officer, Matt Abernethy, Chief Financial Officer, Eric Benevich, Chief Commercial Officer, Irie Roberts, Chief Medical Officer, and Samir Sedanti, Chief Business Officer. During today's call, we will be making forward-looking statements. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. I encourage you to review the risk factors discussed in our latest SEC filings. In addition, some of the information discussed today includes non-GAAP financial measures that have not been calculated in accordance with U.S. GAAP. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the tables at the end of our earnings release issued earlier today. which has been posted on the investor relations page of the company's website. Following prepared remarks, we'll be happy to take your questions. With that, I'll hand the call off to Kyle.

Good afternoon, everyone. Nearly two years ago, on my first earnings call as CEO, I shared my optimism about Neurocrine's future and the significant opportunities ahead. Today, that confidence has only grown stronger as I remain deeply confident in our ability to drive sustained growth and create long-term value for our shareholders. Our strategy to build a leading biopharmaceutical company is grounded in execution and delivering meaningful results. In the third quarter, we generated record net product sales of more than $1.1 billion and record profitability. These results underscore the strength of our diversified portfolio of three first-in-class medicines and our growing ability to reach and serve more patients than ever before. This momentum positions us well to drive continued growth across Ingresa, Quinesity, and Vicat XR in 2027 and beyond. The strength of our growing commercial business and financial position also enables us to continue investing in our industry-leading pipeline. with several important clinical milestones anticipated in 2027, including phase three data readouts for Osevanpator and major depressive disorder and directly in schizophrenia, we believe Neurocrine is approaching a potentially transformative period, one that could further expand our pipeline, strengthen our long-term growth prospects and extend our impact on patients. Overall, Neurocrine's third quarter performance exemplifies the strength of our strategy, the discipline of our execution, and the significant opportunity it had to create long-term value. As we close out the year, we look forward to hosting our 2026 R&D Day in New York City on December 15th. The event will feature a VicatXR panel discussion with Dr. Jennifer Miller, Professor of Pediatric Endocrinology and Director of the Potter-Willy Syndrome Program at the University of Florida College of Medicine, as well as an update on our pipeline. I look forward to sharing our progress, engaging with the investment community, and discussing the opportunities ahead as we enter what promises to be a catalyst-rich 2027. With that, I'll turn the call over to Matt.

Thank you, Kyle, and good afternoon, everyone. The third quarter reflects Neurocrine's continued evolution into a diversified, highly profitable biopharmaceutical company. As Kyle mentioned, we delivered record net product sales exceeding $1.1 billion, up more than 40% year-over-year, alongside record operating profitability. Our three commercial products provide a growing foundation to invest in innovation and prepare for a data-rich 2027. Starting with Ingresa, third-quarter sales were $801 million, up 17% year-over-year, driven by continued volume growth with record new and total prescriptions. Underlying Ingresa performance continues to exceed our own internal expectations leading to another full-year Ingresa guidance increase to $2.9 to $2.925 billion. Third quarter sales included a $20 million benefit from customer order timing which we expect to reverse in the fourth quarter and is reflected in our full-year guidance. Overall, 2026 is turning out to be a remarkable year for Ingresa with prescription growth expected to be in the high teens underscoring the strength and durability of the Ingresa franchise in the Tardive Dyskinesia market. Looking ahead to 2027, we expect continued double-digit Ingresa volume growth to more than offset anticipated mid to high single-digit net pricing headwinds, supporting another year of revenue growth. As customary, we will provide formal 2027 sales guidance in February. Chronicity delivered $211 million in third quarter sales, supported by steady patient additions, strong persistency, and favorable reimbursement. Over 15% of the estimated diagnosed classic CAH population has now been prescribed chronicity, highlighting the opportunity that we still have ahead. For VicatXR, we delivered $107 million in third quarter sales reflecting sequential growth driven by new patient demand. We remain focused on our efforts to support appropriate patient identification, physician and caregiver education, and patient support. We believe VicatXR offers a meaningful opportunity for long-term growth to help many patients with this devastating condition. Turning to the financials, record revenue drove non-GAAP earnings above $3 per share. This reflects significant operating leverage while continuing to invest in commercial growth and our R&D pipeline. We ended the quarter with approximately $800 million in cash, generating $400 million in operating cash flow, and deploying approximately $100 million to repurchase shares and offset dilution from our share-based compensation. Our capital allocation priorities remain driving commercial growth, advancing high-value pipeline programs, and pursuing disciplined business development. Overall, with three growing commercial products, expanding profitability, and a broad pipeline, Neurocrine is well positioned for durable growth and important clinical catalysts in 2027. With that, I'll turn the call over to Eric Benevich, our Chief Commercial Officer. Eric?

Thanks, Matt. Our record third quarter performance reflects strong performance across all three of our first-in-class medicines, Ingresa, Crinicity, and VicodXR. While each is at a different stage of commercialization, all three continue to address significant unmet medical needs and contribute to Neurocrine's commercial diversification and revenue growth. Starting with Ingresa, quarterly sales surpassed $800 million for the first time. driven by strong demand with record new and total prescriptions. Remarkably, nine years into launch, Ingresa continues to deliver double-digit prescription growth. With full-year sales guidance raised once again, 2026 is shaping up to be another outstanding year for the brand. Chronicity also reached a new milestone, exceeding 200 million in quarterly sales for the first time. The rate of new patient starts have remained steady throughout the year, and we estimate more than 15% of U.S. patients with classic congenital adrenal hyperplasia have now been prescribed chronicity. Just seven quarters into the launch, we're making meaningful progress towards establishing chronicity together with low-dose GCs as the standard of care treatment for classic CAH. Now turning to Vicat XR, quarterly sales exceeded 100 million for the first time. Since the acquisition, our commercial and medical teams have focused on HCP education, including appropriate PWS patient selection, dose titration, careful monitoring, and management of potential adverse events while setting expectations for both the timing and nature of treatment response. These efforts reflect our commitment to maximizing patient safety and treatment results. As newcomers to the PWS community, We're listening to all stakeholders and gaining insights from clinicians, PWS scientific thought leaders, and the Prader-Willi Syndrome patient and family community. We're confident in Vicat XR's benefit and its longer-term potential in our rare endocrine franchise. 2026 will no doubt end up being the strongest commercial year in neurocrines history, and we look forward to carrying this momentum into 2027. I want to thank our entire commercial and medical organizations, including our newest VicatXR colleagues, for their unwavering dedication to patients and outstanding execution. And with that, it's my pleasure to turn the call over to our Chief Medical Officer, Dr. Eiry Roberts.

Thanks, Eric, and good afternoon, everyone. First, I want to thank Kyle and the Board of Directors for the opportunity to return as Chief Medical Officer. During my previous tenure, I had the privilege of helping advance chronicity through clinical development and approval, as well as generating positive Phase 2 data and initiating the Phase 3 programs for both Osovanpator and Erectilidine. I'm excited to build upon the team's recent progress as we advance the deepest and most diversified pipeline in Neurocrine's history. I'd like to begin today with Vicat XR, the first and only FDA-approved treatment for hyperphagia in patients age four and older with Prader-Willi syndrome. Since Neurocrine's acquisition of this medicine in May, Our clinical and medical teams have worked closely with expert clinicians, regulators, and the PWS community to support the safe and appropriate use of this important new medicine. As real world experience grows, we remain committed to ongoing safety monitoring, collaboration with the FDA, and timely communication of important new information. To further advance our understanding, We plan to initiate a study in 2027 evaluating VICA-XR in people with PWS and complex health issues. Continued engagement with advocacy organizations including FPWR and PWSA USA remain central to our efforts also. Turning to the pipeline, we recently initiated a phase two study of NBI567. are M1 preferring selective muscarinic agonist as an adjunctive treatment for cognition in Alzheimer's disease. In obesity, we initiated a phase one study of NVIP 1968, our investigational triple G agonist. This program has the potential to complement our CRF2 agonist, NVIP 2118. Also in phase one, as we explore differentiated combinations to treat obesity. Finally, NBI 223, a Friedrich's ataxia gene therapy program in collaboration with Voyager Therapeutics, is expected to enter phase one in the coming months with initial patient-level data anticipated in 2027. As Kyle mentioned, we will close out the year with our 2026 R&D Day in New York City on December the 15th. I look forward to sharing our progress and reengaging with the investment community as we prepare for a data-rich year in 2027. With that, I'll turn it back to Todd. Todd?

Thanks, Eiry, and welcome back to the role. We're happy to have you here. Apologies for the slight delay in the distribution of today's earnings release. We appreciate your patience and look forward to your questions. So, Nikki, let's take the first question.

Thank you. And at this time, if you would like to ask a question, please press Star 1 on your telephone keypad. You may remove your question by pressing Star 2. In the interest of time, we ask you please limit yourself to one question. We'll take our first question from Phil Nadeau with TD Cowen. Please go ahead. Your line is open.

Good afternoon. Thanks for taking our question and congrats on our really strong quarter. Question on ingressive trends and guidance. So if we back out the 20 million that you mentioned of orders this quarter, even taking that out, it does look like the top end of guidance assumes a sequentially down Q4. And so I guess we're curious why that would be. Was there something else that was lumpy in Q3 beyond just the 20 million? or are there other headwinds you expect in the fourth quarter for Andresa? Thank you.

Yeah, it was a really strong third quarter across the board and would anticipate in the fourth quarter to have similar underlying TRX growth somewhere in the mid-teens. So the only other item is seasonally there's always a growth in that dynamic in the fourth quarter, but overall you take a step back and you see we started the year at $2.7 billion in guidance. going all the way up to $2.9 billion in guidance feel quite good with how we're positioned, and we're in a place to have strong momentum headed into 2027. That's helpful.

Thank you.

Thank you. We will move next with Paul Matisse with Stifel. Please go ahead. Your line is open.

Hey, great. Thank you so much, and congrats on the quarter. I wanted to ask a question about VICAT. Obviously, it's been discussed in the media and the press, related to its safety profile. I was curious from your perspective, are you comfortable that going forward in the next set of quarters that VICAT will continue to be sort of a resilient grower? And maybe just as a sub-question to that, is there any thought that at some point there could be engagement with regulators around some of the post-marketing safety reports? And maybe you could just give a little color there. Thank you.

Yeah, hey, Paul. It's Eric. So, you know, certainly we know that in orphan diseases, launches aren't always linear. And I think we're about, what, two and a half quarters now post-acquisition, so we're still getting our arms around the VICAT business, and we're still in the thick of the integration. However, you know, given the recent external events, you know, we do anticipate a return to growth, but it might be a little bit more delayed. Ultimately, we still have very strong conviction in the benefit of ICAT, and we're working through making sure that everyone understands both the benefits and how to safely use it. Anything to add?

Yeah, thanks, Paul. I mean, patients... We take every adverse event and every outcome very seriously, and we continuously monitor safety in the post-marketing environment. That said, we're very confident in the benefit-risk profile that we have for Vicat XR, and we believe that the current label describes very effectively how to use the medicine safely and effectively in the relevant patient population. Obviously we continue to collect ongoing information and in particular note I draw your attention to what we mentioned in that at the end of this year in our R&D day we will have a focus on understanding PWS and particularly hyperphagia more for the community by engaging with Dr. Jennifer Miller and several patients from the community and I think that will be helpful in that regard. In addition, we are planning to initiate a study starting next year in patients with Prader-Willi who also have significant other comorbidities and other conditions that make them obviously at higher risk generally in terms of their disease to understand how to safely and effectively use BICAT-XR in that population.

Great. Thanks, Eiry. Good to talk to you.

Thank you.

We will move next with Tasin Amar with Bank of America. Please go ahead.

Hi. Good afternoon. Thanks for taking my question. Just wanted to get any color on 2027 INGREZA contracting, particularly weather access and net price impact or tracking with what you would have expected. Any color would be great. Thanks.

Thanks, Tazeen. This is Kyle. It's hard to not talk about 2027 pricing without starting with access because they are linked. For this year, as you know, we have about 70% of Medicare lives covered under the contracting that we executed on in 2025, and that gave us great momentum here throughout the course of this year, and we think that will continue to be the case as we close out Q4 into 2027. So when we think about 2027, We do expect that underlying momentum to lead to, again, double-digit volume growth for 2027, and that reinforces really the durability of Ingresa as a product in TD as well as continued revenue growth. When it comes to contracting now for 2027, we're nearly at the end of our discussions with payers. We do have pretty good visibility in terms of our formulary status for 2027. and what we see is a really strong year in terms of coverage and access allies, at least as good as this year. So we're looking forward to a really strong access year for 2027. In terms of the net price, We'll get into the details of that as we move into the new year. But roughly speaking, we're looking at a mid to high single digit price concession for 2027. But that will be more than offset by our double digit revenue growth for next year. So this will be playing out in our assessment of performance as we move through Q4 into the new year when we talk about guidance at our February meeting. But overall, really strong year ahead for 2027.

Thank you.

We will move next with Brian Abrahams with RBC Capital Markets. Please go ahead.

Hi, team. This is Kevin. I'm for Brian. Thank you for taking our questions. Maybe just back on BICAD. Considering some of the on-the-ground dynamics that you're seeing this quarter being the first full quarter with BICAD, just maybe can you share your latest thoughts on how the potential opportunity, the peak opportunity in PWS may be, whether Your thoughts now are a bit more refined on what that opportunity could look like and the timelines around that. Thank you.

Sure. Hi, this is Eric. So, you know, kind of taking a step back, thinking about the Prader-Willi population, you know, we estimate that there's roughly 10,000 to 12,000 patients in the U.S., The majority of them have hyperphagia. Not everyone, though. Obviously, patients that are very young typically don't experience hyperphagia until they get to be four or five or six years old. And certainly, there are some patients that would not be considered appropriate for treatment based on, as Iry said, significant comorbidities. Ultimately, though, we feel that the majority of patients with hyperphagia secondary to PWS are candidates for treatment. And this is a medication that's still relatively early in its launch. It's only been out there a little over a year and a half. And there's a lot of providers in the community that we're still reaching and educating and also within the patient and family community. So I don't know that we've really altered our thinking around the opportunity. We still have really strong conviction in the potential for this medication. As you know, it's the first and only approved treatment for hyperphagia and PWS. But we do recognize that we do have a lot of work ahead of us in terms of educating and continuing to generate data to understand how to best use this medication.

Thank you. We will move next with Brian Scorny with Baird. Please go ahead.

Hey, good afternoon, guys. Thanks for taking my question, and congrats on a great quarter. Maybe on VICAT, you mentioned growth coming from new patient starts, but wanted to hear anything you could say about discontinuations. I know there's sort of this bolus effect to new patient starts at the launch running into maybe a headwind in terms of discontinuations from that initial bolus once they reach therapy. Do you think we're through that at this point? And are you expecting more of a normal number of patients discontinuing per quarter because that roll-off is no longer coming from the initial bolus? Just want to get an idea of how to think about the balance between starts and discontinuations at this point. Thanks.

Yeah, I would say, I'd start by saying we're still learning about the dynamics here. As I mentioned, this product's only been on the market for a little over a year and a half. and certainly there was a bolus of starts in the first quarter or two when Vicat was launched last year and then you know we did see sort of a increase in discontinuations from that bolus of early starting patients. Since then we've seen pretty consistent and steady starts and it's hard to say whether Q3 was any different from a discontinuation standpoint because Numerically, it was similar to prior quarters. So I would say stay tuned.

Thank you.

We will move next with Anupam Rama with J.B. Morgan. Please go ahead.

Hey, guys. Thanks so much for taking the question, and congrats on the quarter. Look, it was a nice beat on Ingresa, and even if you back out that $20 million one-timer, it was still going to beat consensus. So If you see any outside growth in the various segments, psychiatry, neurology, long-term care, that you'd want to highlight.

Thanks so much.

Yeah, thanks for the question. You know, I think you see growth potential across all the prescriber segments, and as we've said before, The majority of patients out there with tardive dyskinesia have yet to be, well, now we're actually approaching a point where about half of the patients out there have been diagnosed and the other half have yet to be diagnosed, but there's still substantial opportunity to drive diagnosis, recognition, and treatment. In addition, only about 10-ish percent of the total TD prevalent population is currently on either of the two VMAT2 inhibitors. So lots of headroom from a growth potential perspective. Obviously, you know, we see the psychiatry segment as the main growth driver, and within psychiatry, in particular, advanced practice providers are really important in terms of recognizing and treating TD with Ingresa. So, you know, I think that that reflects sort of the deployment of our sales team. The biggest team is focused on psychiatry. We've also seen really, you know, strong and consistent growth in long-term care. So, you know, we're excited about the opportunity, as Kyle said earlier, We're going to carry the momentum into 2027, but we expect to see continued strong volume growth across all the segments, psychiatry, neurology, and long-term care.

Thank you.

We will move next with Corey Kasimov with Evercore ISI. Please go ahead.

Hey, this is Josh on for Corey. Thanks for taking our question. On chronicity, growth has been really steady here. Wondering if you can comment on where growth is coming from. Is it new prescribers? Is it returning prescribers? Any color you can give. Thanks.

Yeah, you know, chronicity has been remarkably consistent. Ever since the early days of the launch, you know, we've seen a real steady pace of patient ads. We've also seen favorable reimbursement. And lastly, and critically important, really strong persistence. And I think all those elements combined have led to what's been a really strong launch in the first, you know, we're a year and three quarters now into the chronicity launch. So it's still early in its commercial ramp. But ultimately, at the very beginning of the launch, most of the growth was driven by new prescribers. and to this day, there are still the majority of prescribers have only one or two patients that are on treatment. However, we are seeing increased depth of prescribing. And so as we go forward, those practices that have more than a handful of patients, we're continuing to drive adoption of the majority of their patients within those practices. So we've done a really great job, I think, in the pediatric endocrinology segment and that does represent the majority of patient starts. However, as of late, you know, we've continued to see growth and adoption within the adult endo practices and now we're at a point where roughly half the patients out there on chronicity are adult patients. So we're going to continue to, you know, to do our work. We're going to drive education and we've got a lot of remaining opportunities. We said in the prepared remarks Over 15% of the population with classic CH has now been offered treatment and are on medicine.

Great, thanks.

Thank you.

We will move next with Jay Olson with Oppenheimer. Please go ahead.

Oh, hey, congrats on the quarter and welcome back, Irie. Looking forward to seeing you all in December. We had a question about 567. Can you just talk about, now that you have the Phase II study initiated, what would be a clinically meaningful result on the 12-leak neuropsychological test battery? Thank you.

And it's great to be back. On 567, that's our M1 preferring muscarinic agonist. And as you mentioned, that study will be a study of phase two just started in around 135 adults. age 50 to 85 with mild to moderate Alzheimer's disease who are receiving stable treatment with acetylcholinesterase inhibitors but still have evidence of cognitive decline. We're actually looking at a range of different endpoints in the context of the study and looking at a change from baseline for that adjunctive treatment at week 12. The primary endpoint we're looking at is a neuropsychological test battery composite score and the goal will be to compare the two treatment groups within the study to placebo and look for any clinically significant trend or statistical significance in difference on that endpoint to placebo. In addition, however, though, we're going to be looking at the totality of the data that we generate in that study, including ADAS-COG, measurements, and clinical dementia ratings, coupled with, obviously, tolerability, given that in this patient population for acetylcholine esterase use, tolerability is one of the most significant issues that impacts use of that medication currently. We haven't talked specifically about bars or barriers in terms of the endpoints, but obviously we'll be looking holistically at the data that we generate.

Great. Thank you.

Thank you.

We will move next with Akash Diwari with Jefferies. Please go ahead.

Hi, this is Phoebe on for Akash. We had a question on the announcement of a 5x higher dose of imbraclidine in the phase 2 schizophrenia study. I guess, number one, what is your take on this given there is kind of an unclear dose response in imbraclidine and in MBI-568's data? And then also, can you provide kind of thoughts on where you think the comparable M4 inhibition levels of imbraclidine at this dose Thanks so much for the question.

So we have our M4 selective orthosteric agonist, direclidine, which we anticipate top line data from the first short-term study next year. Timelines are on track there. Really excited about that data. In relation to what's out there with the competitive landscape, we believe that This could offer potential benefit for patients without some of the side effects that those are experiencing with the existing commercial product, CoBenfi. With regards to your questions on other competitors like AbbVie with Imraqidine, certainly watching the landscape there and wish them the best, but for right now, we're focused on our program.

Thank you.

Thank you.

We will move next with Mohit Bansala with Wells Fargo Securities. Please go ahead.

Hi, this is Susan On for Mohit. Thanks for taking our question. On BICAT this quarter, you guys had commented that trends were similar, but you definitely did better than expectations. Can you just talk a little bit about maybe where some of the upside came from? Is it pricing, inventory, net ads?

Yeah, I mean, the way I would characterize it is we exited the quarter with more patients on treatment than we started, so it's net ads, not pricing.

Great, thank you. I'm sorry, since I was really short, if I may. What is the rationale for this additional study in Potterwilly with comorbidities? Is it more for medical education and just answering some of the questions there, or is there an opportunity for label expansion?

We think the current label really accurately reflects the benefit and risk of VicatXR in the population that was studied. And we do believe that there is room still for education, particularly when it comes to selection of the appropriate patients to treat with VicatXR with hyperphagia in Prader-Willi syndrome. Also, guidance on safe and effective titration Dose titration and also understanding how to monitor more closely for adverse events that may occur during the course of treatment and manage those effectively from the outset. It's also really important to note that not very much is known about hyperphagia in Prader-Willi syndrome and so there's a lot of education that we need to do around understanding hyperphagia, understanding the impact that hyperphagia has on both the patient and their family. It's very much a behavioral disorder. And as such, I think we have to set expectations around what sort of behavioral changes can we expect to be seeing in patients when this medicine is improving the hyperphagia symptoms for them. So for all of those reasons, I think we're interested in continuing to expand the knowledge base of patients treated with VICAT, including those who have other complex conditions such as obesity respiratory disorders, etc.

Thank you. We will move next with David Salem with Piper Sandler.

Please go ahead.

Thanks. How would you articulate your top business development slash M&A priorities as we move through 2027? I think, Kyle, early this year you talked about being over index in psychiatry. Post-Salino, do you still think and what therapeutic areas within your core focus areas are you prioritizing? Thanks.

Thanks, David. Appreciate the question. Maybe I'll have Sameer share his thoughts here.

Hi, this is Sameer. You know, what I'd say on the BD focus is that we really want to remain focused and disciplined on future opportunities. What we're looking for are opportunities with differentiated innovative science and strong IP within our areas of expertise. So what we term that right now are neurology, psychiatry, endocrinology, and soon to be immunology here. Transactions that we're looking at must create value for our shareholders. So we remain engaged and prepared to act if something opportunistic comes up. We've got a lot of financial flexibility. We don't feel like we have to do a deal right now.

Thank you. We will move next with Mark Whitman with Learing. Please go ahead.

Hi, everyone. This is Alyssa. I'm for Mark. Thank you for taking our questions. On chronicity, could you talk about the discontinuation rates in the third quarter relative to prior quarters, and how are you thinking about persistency trends looking forward? And on VICAT, could you comment on the current dose distribution in which maintenance Doses are most commonly used. Thank you.

So I'll comment on the persistency trend. What I had mentioned earlier was that chronicity has been a remarkably consistent medication in terms of persistency and certainly above average when you look at other rare disease drugs. In fact, that's one of the important drivers of growth. We've had consistent patient ads. We've had favorable reimbursement, and we've had really strong persistency, and it was no different in Q3 versus prior quarters. Obviously, we hope to see that continue into the future, though we're still early in the commercial ramp for chronicity, but I have no reason to believe that it's going to be any different going forward.

Yeah, on Vicat, I would just guide you to around 250 milligrams is what we're seeing on average per patient at this point. So I think that that's a good proxy that gets you to a whack of around $550,000 per year.

Very helpful. Thank you.

Thank you.

We will move next with Ash Burma with UBS. Please go ahead.

Hi. This is Soyeon Ahn for ASHE. Thank you for taking our question. For VICAT, what's the best way to identify the frequency of side effects reported for the drug in the real world? In the FAERS database, we see that the total AEs and serous AEs are both up for 2026 compared to 2025. Can you share if this is because of the drug use is increasing or is the absolute frequency of AEs higher? in 2026 versus how much it was in 2025. And also, if we can also get your latest thoughts on VCAT IP, how confident are you on the IP runway here? It seems like the 895 patent post-grant review for a generic challenging disk patent was instituted recently, and it's not likely to go into a PCAP trial. What do you expect as the outcome here? Thank you.

Thanks for the questions. Lots of questions in there. So I'll try and I think I may share the stage with my colleagues on the IP front. But let me start with some of the questions you asked around adverse events. You know, going back to the, you know, safety is our primary focus with respect to patient safety. Thank you very much. Thank you very much. Thank you for joining us. are known to be associated with disoxide use. And so I think we have a well-controlled environment to enable patient support and the support of their families and clinicians as well as we go through that process.

And on the IP front, this is probably too early to talk about any of the challenges on existing patents, but in terms of our overall view on exclusivity, we've commented that we feel good about that going out to the mid-2040s on patents to be published and issued, and I think we're confident with what we have there.

Thank you so much.

Thank you. We will move next with Myles Minter with William Blair.

Please go ahead.

Thanks for taking the question. Congrats on the quarter. Just curious about the terminology about a collaboration with the FDA when you're talking about BICAT-XR. Was the study in PWS and complex health issues the result of those collaborative talks and they wanted you to do it? Or is this something that literally you're proposing that will definitely help use of BICAT-XR in this high arm and knee patient population? Thanks very much.

This was our proposal in collaboration with the several key opinion leaders in the field. And I think it reflects the fact that given that this is the first and only approved medicine to treat hyperphagia and Prader-Willi syndrome, there was a desire to understand the breadth of the population that could be served effectively by this medicine beyond those individuals who are included in the clinical process. Thank you very much. and an article that gives guidance around the use of Vicat XR in a broader patient population in the real-world setting already. And that's already something that we're using in support of the community as we educate out there in the field.

Awesome. Thanks very much, Ari. Congrats.

Thank you. We will move next with Sean Flaman with Morgan Stanley. Please go ahead. Sean, your line is open. Sean Lamond, your line is open. Please check.

Let's go to the next question.

We will move next with Sumed Kulkarni with Canaccord. Please go ahead.

Good afternoon. Thanks for taking our question. I think Sumed alluded to some aspects of this, but given the somewhat muted launch for CoBENFI in schizophrenia, Does this change your market outlook for direct leading and schizophrenia at all? And what would you most like to see in phase three that could make you excited about the product's competitive profile in the schizophrenia market?

Thanks, Amant. This is Sameer. Let me start with the, excuse me, the bar for the phase three study here. Really what we're looking for is a positive study. What we've seen in psychiatry is that medicines that make it across the finish line tend to have strong and high uptake, particularly if they have a novel mechanism of action, which we believe our M4 selective orthosteric agonist does. Really, where we're going to win here is on safety and tolerability. We've got a drug that's administered once daily, no titration. If you look at the Phase II data, we saw limited GI side effects relative to placebo. We think that this is going to be a best-in-class, very convenient, easy-to-use medicine for patients with schizophrenia that will offer a novel mechanism in a patient population that hasn't had many treatments for several years here. So very excited about the first study data to come next year. Eiry, anything you want to add there?

No, the only thing I'll add is that we continue to be doing very well in terms of the progress of the phase three program. And with reference to what Samir said about the importance of safety and tolerability here, I will comment that in the context of that program, we've had several DMC meetings to look at safety and tolerability of the program. And we've not had to make any changes to the program as a result of those. And also, if you look at discontinuation, which we know is an issue for CoBEMPHY in the context of some of the tolerability issues that are seen there, we have a low discontinuation rate of 3% or less in our current program. And so we're very confident about the profile that we're seeing there.

Thank you. We will move next with Yigal Nokomovitz with CD Group.

Please go ahead.

Hi. Thank you for taking the questions. I just wanted to return to a topic that was first introduced back at your R&D day in San Diego last year, and that's your early obesity program. I'm just wondering if you could comment on the two programs, the CRF2 and the GGG. How are you thinking about those in terms of development? Is it sort of a bake-off between the two? are going to serve different patient populations and what would you want to see in the early phase one data to determine how to take one or both of those programs forward? Thank you.

No, I appreciate the question. This is Kyle. So our leading CRF2 agonist is MBIP2118. This is a subcontinuous Thank you so much for joining us. but with quality weight loss, with the loss of weight coming from fat, not muscle, so muscle mass preserving. We've seen also preclinically additional benefits in the cardiac and renal area as well that could offer some differentiating properties, but certainly not going through the GLP pathway. We're also looking for a more favorable safety and tolerability profile. So there's a lot to like about the mechanism, and obviously we know a lot about CRF1 and 2 as a company and want to be able to leverage that moving forward Real GGG, where our GGG program, which is NBIP 1968, comes into play, is a mix and match type of strategy. We know that mechanisms are used in combination in the real world, and that's probably where this space will go over time. So having our own GGGs is something that's important for our program. We have that as a standalone medicine that can be paired. with 2118, and we've also combined the two in a univalent molecule that could be single medicine that could be taken forward as well. So we're excited with what we have, but right now it's all about getting into the obese population and seeing if we can replicate that earlier profile. We're really excited what we have, and being at this particular stage of the program is exciting.

Thanks, Kyle.

Thank you. We will move next with Sean LaMann with Morgan Stanley. Please go ahead. Sean, your line is open. Please check your mute function.

All right, Sean. This is Todd.

You can give me a call later. Let's go to the next question, please.

We will move next with Danielle Brielle with Turist. Please go ahead.

Hi, this is Tyler. I'm for Danielle. Thanks so much for the question. With the Salesforce expansion now a couple of quarters into deployment, how much of the recent growth reflects this investment, and is there still meaningful productivity upside ahead?

I assume that you're referring to Ingresa? Yeah, I would say that, you know, obviously we've seen strong growth in Q2 and Q3 subsequent to the deployment of the expanded sales team. However, historically, you know, our experience has been that it takes a few quarters to have the full impact or see the full impact of the expansion. So I would expect that, you know, Q4 would be more impact from the sales force and really carrying that into Thank you. We will move next with Rudy Lee with Wolf Research. Please go ahead. Thanks for taking my question.

So for PWS, can you provide additional color on the growth trajectory for Y-CAT into fourth quarter 2027 when patient starts and discontinuation rates? Should we expect meaningful sequential growth from fourth quarter into 2027, or is it most likely into the second half of the year? Thanks.

Yeah, the way that I would characterize it is, you know, first of all, that we do see that there's a lot of potential with this medicine. And there are a lot of untreated patients yet with hyperphagia and PWS. You know, given the recent external events, you know, we do think that it's going to delay somewhat the growth trajectory that we're expecting. But, you know, ultimately, you know, I think we're doing the right things from an educational standpoint. from a promotional standpoint to continue to drive growth with this medicine. So just feeling good about the potential of Vicat in hyperphagia. And we had a growth quarter this quarter, and like I said earlier, every quarter we want to see more patients on than the prior quarter.

Thanks. Congrats on the quarter.

Thank you. We will move next with Delma Fajari with Guggenheim.

Please go ahead. Hi. Thank you for taking my question, and congrats on the quarter. So maybe one on 569 in Alzheimer's psychosis. What do you need to see in Phase I on both efficacy and safety to move to Phase II? And since elderly patients tend to be more sensitive to muscarinic side effects, How are you thinking about dosing and titration in this population? Thank you

So it's a little bit early days really to understand what we're going to see in terms of dosing, in particular whether we even need to do dose titration. I mean, that hasn't been the case for other muscarinic agonists to date. So just answering that last piece first. We're still in phase one. A lot of phase one work, as you know, is focused on understanding safety and tolerability and helping us choose the appropriate dose for a phase two study. And so right now, we're working through that. I would say that 569 has been well tolerated in the patient population to date, and we're accomplishing the dosing regimen that we need to do in terms of going into the next stage of development. But obviously, we won't know for certain until we complete that work.

Thank you.

We will move next with Laura Chico with Whitbush Securities. Please go ahead.

Laura Chico Good afternoon. Thanks very much for taking the question. When back on the obesity franchise with 1968 and 2118, I apologize if I missed this, but what is the scientific rationale for pairing a CRF2 agonist with the GGG agonist? And then I guess kind of related to that, What is, I guess, the R&D spend that you're willing to commit to for obesity, just given the other events you've got going on in psychiatry? Just curious if you can kind of elaborate there. Thank you very much.

I think on R2 in 2118 and 1968, I think we appreciate at the stage of development that we are, and we still have a lot of unanswered questions in terms of how R2 can work as a standalone treatment or potentially Thank you. Thank you. Thank you for joining us. So we think there's a good opportunity here for us to identify which programs we can take into later stage phase two and phase three development and knowing what those profiles look in comparison or in contrast to our psychiatry program. So it's a nice way to strategically diversify neurocrine. I use that word strategically here. deliberately because we're moving into a broader foundation that we've already set with chronicity and endocrinology and we're leading into the biology that we already know in CRF.

Thanks very much.

Thank you.

We will move next with Ami Fadia with Needham and Company. Please go ahead.

Hi, this is Poonah on for Ami. Thank you for taking our question and congrats for the quarter. For chronicity, what is the headroom for growth in the male adult population and how are you targeting these patients? And also, what additional proportion of the market can you capture with the ages under four study? Thank you.

I'm sorry, can you clarify which population were you asking about?

The ages under four?

Oh, the male.

The male adults, yeah.

Yeah. So obviously there's a lot of headroom in the adult population. And, you know, I said earlier in response to a different question that we're now at a point where roughly half the patients on treatment are adults. skewed slightly towards females. So there's still a lot of opportunity really across all the different patient populations, roughly 15, north of 15% now of the overall classic CH populations on treatment. And we're only about seven quarters into the launch. So there's a long way to go and a lot of headroom here. I'll let Irie comment on the opportunity below four.

Yeah, we're just initiating our study in the under four-year-old patient population. And I mean, I think the belief is that in order to gain Thank you very much. can be very detrimental for patients. And so that's why we're very keen to get that study up and running. We're working on that now with the goal of being able to expand the label to an earlier age group.

Thank you.

Thank you. We will move next with Greg Subanovich with MISU.

Please go ahead.

Great, thank you for taking my question. Congrats on the quarter and the overall progress. A question on chronicity, please, and its growth prospects. As you look out over the next several years, can you just remind us how you were thinking about the potential impact of competition and particularly the vertex kinetics candidate for CAH? And while I realize we don't have phase three data yet for that asset, what are your thoughts around differentiation between the two assets? What is your market research telling you about, like, BID dosing that you have versus QD dosing? Thank you.

Yeah, this is Kyle. I appreciate the question. It's one of these instances where I like talking about competition because I get to bring up all the good data that we have. Crinesity has really set a very high bar out there, not only for competition, but our own next-generation programs in the pipeline. That's actually concerning to me because we're investing in those in our pipeline right now. If you look at efficacy, safety, and tolerability, we have patients out to five years now in our long-term data. We have from our two-year data, which is turning into three-year data that we'll be able to publish on, 70% of patients are on a physiological dose of their GC. 70% of patients have normal levels of androgens. We've seen sustained and control levels of ACTH and cardiometabolic improvements as well as improvements on pediatric growth trajectory. So there's a lot to get excited about with chronicity. And Eiry and her team did a great job pulling those themes through a very simple and broad label that allows us to treat pediatrics, the adult patient population, and we have multiple formulations. So I really feel good and happy about the position that we're in, regardless of its competition or our own next generation medicines in the portfolio. I think we really have an excellent opportunity here to change the standard of care. And with the demand that we see, we have plenty of runway here to do so over the next couple of years.

So that's where the focus is for now.

Thank you.

We will move next with Evan Sligerman with BMO Capital Markets. Please go ahead.

Hi, I'm Malcolm Hoffman. I'm for Evan. Thanks for taking our question. I wanted to touch again on the muscarinics that you have in your pipeline. I saw that you had discontinued 986, the M4 antagonists for movement disorders. And I was just wondering if you could give a little bit of color. Is that, you know, due to a safety or tolerability issue or just more of a broad strategic decision for the pipeline? Appreciate it.

Thanks for the question. So 986 was an M4 antagonist, which was focused on the potential use in movement disorders, including dystonia and potentially Parkinsonian tremor. We completed the phase one program on that medicine, and we were able to look at pharmacodynamic markers in addition to the PK and tolerability. And looking at all of those data in totality, We didn't really meet the bar that we had set ourselves to be willing to go forward into a phase two study in Parkinsonian tremor. And for that reason, as we were doing our portfolio prioritization, we paused and discontinued the development of that molecule at this time. There was no particular safety issue that per se stopped the program. It was basically the review of all of the data in aggregate.

Appreciate it. Thanks, guys.

Thank you.

Our last question comes from David Huang with Deutsche Bank. Please go ahead.

Hey, this is Sam Huang for David. Congrats on the corner, and thanks for taking our question here. I'll try to be brief. Just on chronicity as use broadens, how much of the real-world challenge here is now kind of around tapering glucocorticoids appropriately and how should we think about dynamic as it relates to prescribing and I guess potentially capping penetration down the road. Appreciate it and congrats again. Thanks.

Yeah, I don't see it as an impediment to prescribing. Actually, I think it's the promise of treatment. You know, certainly the label isn't specific in terms of that process and it's very much individualized on a patient-by-patient basis. A few months ago, we published essentially an expert opinion piece on how to down titrate The GCs for these patients. And I certainly think that that was well received in the community in terms of helping to provide a little bit more guidance. But ultimately, I don't see that as a deterrent at all. I think it's the promise. And frankly, you know, we are seeing great results as reflected in the two-year data that was recently released. Anything to add, Irie?

I think it is really encouraging to see that a significant proportion, majority of patients can reach physiologic dosing. And that's done in a safe and effective way without the risk of adrenal insufficiency, which is obviously what these patients are concerned about. And so we have not seen any increase or issue around adrenal insufficiency, which has been very encouraging. So to Eric's point, I do think this is the promise of the treatment rather than an impediment.

Great. Thanks so much.

Thank you. I will now turn the call back to Kyle Gano for closing comments.

Thanks, everyone, for joining our call today and for your thoughtful questions. As you heard, we continue to demonstrate strength across our commercial business and R&D pipeline. We're delivering strong commercial performance while advancing an increasingly broad and innovative pipeline of potential new medicines. In fact, we remain on track to deliver six Phase 1s along with five new Phase 2 starts this year. Never in Neurocrine's 35-year history have we achieved this level of R&D productivity in a single year. With that, thank you again for your continued interest, and I look forward to connecting with many of you at the remaining investor conferences this year and certainly at our R&D day next month. Thanks again.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.