VNDA

Thank you for standing by. My name is Jordan, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Q1 2026 Vanda Pharmaceuticals Inc.'s earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session.

If you'd like to ask a question during this time, simply press star followed by the 1 on your telephone keypad. If you'd like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Vanda's Chief Financial Officer, Kevin Moran. Please go ahead.

Thank you, Jordan. Good afternoon, and thank you for joining us to discuss Vanda Pharmaceuticals' Q1 2026 performance. Our Q1 2026 results were released this afternoon and are available on the SEC's EDGAR system and on our website, vandapharma.com. In addition, we are providing live and archived versions of this conference call on our website.

Joining me on today's call is Dr. Mihael Polymeropoulos, our President, Chief Executive Officer, and Chairman of the Board. Following my introductory remarks, Mihael will update you on our ongoing activities. I will then comment on our financial results before we open the lines for your questions. Before we proceed, I would like to remind everyone that various statements that we make on this call will be forward-looking statements within the meaning of federal securities laws.

Our forward-looking statements are based upon current expectations and assumptions that involve risks, changes in circumstances, and uncertainties. These risks are described in the cautionary note regarding forward-looking statements, risk factors, and management's discussion and analysis of financial condition and results of operations, sections of our most recent annual report on Form 10-K, as updated by our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K, and other filings with the SEC, which are available on the SEC's EDGAR system and on our website.

We encourage all investors to read these reports and our other filings. The information we provide on this call is provided only as of today, and we undertake no obligation to update or revise publicly any forward-looking statements we may make on this call on account of new information, future events, or otherwise, except as required by law.

With that said, I would now like to turn the call over to our CEO, Dr. Mihael Polymeropoulos.

Thank you very much, Kevin. Good afternoon, everyone. Thank you for joining us today for Vanda Pharmaceuticals' Q1 2026 earnings conference call. Vanda delivered strong commercial execution in the Q1, highlighted by 26% year-over-year growth in Fanapt sales, the groundbreaking U.S. launch of NEREUS with its pioneering direct-to-consumer platform at nereus.us, and the FDA approval of BYSANTI.

We believe that these achievements, combined with meaningful pipeline progress and our raised 2026 revenue guidance, position the company for continued growth and value creation. Financial highlights, the total net product sales reached $51.7 million in the Q1 of 2026, a 3% increase compared to $50 million in Q1 2025. Fanapt net product sales were $29.6 million, up 26% year-over-year.

Full year 2026 revenue guidance was raised to $240 million-$290 million, including $10 million-$30 million from newly launched NEREUS. Key commercial highlights. Fanapt saw continued strong momentum with total prescriptions, TRX, up 32% and new-to-brand prescriptions, NBRx, up 76% versus the Q1 of 2025.

In April 2026, weekly TRX for Fanapt reached an 11-year high of over 2,600 prescriptions for the week ending April 24th, 2026. NEREUS is now commercially available nationwide through nereus.us, Vanda's innovative direct-to-consumer platform. This pioneering patient-centric model enables convenient ordering online with rapid direct delivery, eliminating traditional pharmacy barriers and providing a seamless modern access experience.

As the first new prescription therapy approved for the prevention of vomiting induced by motion in adults in more than 40 years, NEREUS represents a breakthrough in both science and patient access. Some key regulatory and clinical development highlights. BYSANTI, milsaperidone, received FDA approval for the treatment of bipolar I disorder and schizophrenia. BYSANTI is protected by data exclusivity through February 20, 2031 and multiple patents, the latest of which expires on May 31st, 2044.

Vanda's ongoing late-stage clinical studies are progressing rapidly and are expected to generate top-line results in 2026 or early 2027, including the phase III study of BYSANTI as a once-daily adjunctive treatment for major depressive disorder with results expected in Q1 2027. The Thetis Phase III study of NEREUS for the prevention of vomiting in patients receiving GLP-1 receptor agonist therapies, with results expected in 2026.

The Phase III study of VQW-765 in the treatment of adults with social anxiety disorder, with results expected by the end of 2026. The FDA accepted the biologic license application for imsidolimab in generalized pustular psoriasis with a Prescription Drug User Fee Act target action date of December 12th, 2026.

The results of the pivotal clinical study were published in the April 28th, 2026 issue of the New England Journal of Medicine Evidence. In summary, 2026 is developing into a transformational year for Vanda with an extensive and diversified portfolio of commercialized products that include Fanapt, HETLIOZ LQ, PONVORY, NEREUS, BYSANTI and potentially imsidolimab by year-end. Our recent innovative launch of NEREUS through the nereus.us platform revolutionizes customer experience through a convenient ordering system at a significantly discounted cash pay price.

Finally, our late-stage pipeline with several late-stage Phase III studies are poised to further diversify our pipeline and strengthen Vanda's commercial presence for years to come. With that, I'll turn now to Kevin to discuss our financial results. Kevin.

Thank you, Mihael. I will begin by summarizing our Q1 2026 financial results. Total revenues for the Q1 of 2026 were $51.7 million, a 3% increase compared to $50 million for the Q1 of 2025, and a 10% decrease compared to $57.2 million for the Q4 of 2025. The increase as compared to the Q1 of 2025 was primarily due to growth in Fanapt revenue as a result of the continued commercialization efforts for Fanapt in bipolar I disorder, partially offset by decreased HETLIOZ revenue as a result of generic competition.

The decrease as compared to the Q4 of 2025 was primarily driven by the impact of insurance plan disruptions and deductible resets that are typical in the industry at the beginning of the year. Let me break this down now by product.

Fanapt net product sales were $29.6 million for the Q1 of 2026, a 26% increase compared to $23.5 million in the Q1 of 2025, and an 11% decrease as compared to $33.2 million in the Q4 of 2025. The increase to net product sales relative to the Q1 of 2025 was attributable to an increase in volume, partially offset by a decrease in price net of deductions.

Fanapt total prescriptions, or TRXs, for the Q1 of 2026, as reported by IQVIA Exponent, increased by 32% compared to the Q1 of 2025. Fanapt new patient starts, as reflected by new to brand prescriptions, or NBRXs, for the Q1 of 2026, as reported by IQVIA Exponent, increased by 76% compared to the Q1 of 2025.

The decrease to net product sales relative to the Q4 of 2025 was attributable to a decrease in volume and price net of deductions. Fanapt TRX for the Q1 of 2026 decreased by 1% as compared to the Q4 of 2025.

The decrease in volume was primarily driven by the impact of insurance plan disruptions and deductible resets that are typical in the industry at the beginning of the year, and that we have observed with Fanapt and the broader atypical antipsychotic market in prior years. Historically, Fanapt inventory at wholesalers has ranged between three-four weeks on hand, as calculated based off trailing demand.

As of the end of the Q1 of 2026, Fanapt inventory at wholesalers was slightly above four weeks on hand, which was generally consistent with the level of inventory weeks on hand as of the Q4 of 2025, but slightly above the historic range. Turning now to HETLIOZ. HETLIOZ net product sales were $15.9 million for the Q1 of 2026, a 24% decrease compared to $20.9 million in the Q1 of 2025, and a 3% decrease compared to $16.4 million in the Q4 of 2025.

The decrease to net product sales relative to the Q1 of 2025 and the Q4 of 2025 was attributable to a decrease in volume as a result of continued generic competition in the U.S., which has contributed to declines in dispenses for both comparative periods. Of note, for the Q1 of 2026, HETLIOZ continued to be the leading product from a market share perspective despite generic competition now for over three years.

HETLIOZ net product sales continue to be impacted by changes in inventory stocking at specialty pharmacy customers from period to period. HETLIOZ net product sales have fluctuated and may continue to fluctuate from quarter-to-quarter, depending on when specialty pharmacy customers need to purchase again. HETLIOZ net product sales may decline in future periods, potentially significantly, related to continued generic competition in the U.S. Finally, turning to PONVORY.

PONVORY net product sales were $6.2 million for the Q1 of 2026, a 10% increase compared to $5.6 million for the Q1 of 2025, and an 18% decrease compared to $7.6 million in the Q4 of 2025. The increase to net product sales relative to the Q1 of 2025 was attributable to an increase in volume and price net of deductions.

The decrease to net product sales relative to the Q4 of 2025 was primarily attributable to a decrease in price net of deductions, partially offset by an increase in volume. The specialty distributor and specialty pharmacy inventory on hand levels during these periods were in line with normal ranges.

Of note, underlying patient demand was essentially flat between the Q4 of 2025 and the Q1 of 2026, even in light of the negative impact of insurance plan disruptions and deductible resets at the beginning of the year. Additionally, as we have previously discussed, an amount of variable consideration related upon PONVORY net product sales is subject to dispute, of which approximately $3 million was recognized for the three months ended December 31st, 2024.

For the Q1 of 2026, Vanda recorded a net loss of $48.6 million, compared to a net loss of $29.5 million for the Q1 of 2025. The net loss for the Q1 of 2026 included income tax expense of $0.1 million, as compared to an income tax benefit of $7.9 million for the Q1 of 2025.

As a reminder, the company recorded a one-time tax charge in the Q4 of 2025 to establish a valuation allowance against all of Vanda's deferred tax assets. Tax expense is expected to be nominal going forward until such time that a valuation allowance is no longer required. Operating expenses for the Q1 of 2026 were $101.9 million, compared to $91.1 million for the Q1 of 2025.

The $10.8 million increase was primarily driven by higher SG&A expenses related to spending on Vanda's commercial products as a result of the continued commercialization efforts for Fanapt in bipolar I disorder and PONVORY in multiple sclerosis, expenses associated with the preparation for NEREUS and BYSANTI commercial launches, and higher legal expenses.

These increases were partially offset by lower R&D expenses on our imsidolimab program, partially offset by an increase in expenses for our BYSANTI major depressive disorder program, VQW-765 social anxiety disorder program, and other development programs. The Q1 of 2025 included an upfront payment to AnaptysBio for the exclusive global license agreement for the development and commercialization of imsidolimab.

On the commercial side, during 2024 and 2025, we conducted a host of activities as a result of the commercial launches of Fanapt in bipolar I disorder and PONVORY in multiple sclerosis, including an expansion of our sales force and the development of prescriber awareness and comprehensive marketing programs. Additionally, in the Q1 of 2025, we launched our direct-to-consumer campaign, which has driven meaningful gains in brand awareness for the company and our products, Fanapt and PONVORY.

Throughout 2025 and the Q1 of 2026, we maintained strategic investments in our commercial infrastructure, including increased brand visibility through targeted sponsorships, with the goal of supporting long-term market leadership and future commercial launches. Vanda's cash equivalents, and marketable securities, referred to as cash, as of March 31st, 2026, was $202.3 million, representing a decrease of $61.5 million compared to December 31, 2025.

The decrease to cash was driven by the net loss in the Q1 of 2026, as well as a one-time milestone payment of $10 million made to Eli Lilly in the Q1 of 2026 for the approval of NEREUS in the U.S.

Seasonal compensation and benefit payments, which generally hit during the Q1 of the year, of approximately $7 million, and payments to third parties for manufacturing of commercial and clinical product of approximately $11 million, which is significantly higher than recent quarters. As a reminder, payments made in advance of production are capitalized as a prepaid expense. Commercial products are capitalized as inventory on our balance sheet after production, while pre-commercial products are generally expensed as research and development costs as incurred.

The timing of manufacturing of pre-commercial products may result in future variability of our R&D expense, depending upon the timing of production. When adjusting the decrease in cash for these items, the change in the Q1 of 2026 would have been closer to $40 million.

With regard to the launches of Fanapt in bipolar I disorder and PONVORY in multiple sclerosis, as I mentioned, the launches were initiated in 2024, and we continue to enhance our commercial efforts through the Q1 of 2026, with the impact of these commercial efforts contributing to revenue growth in 2025 and expected to continue to contribute to our revenue growth in 2026 and beyond. We have already seen significant growth in our commercial activities.

Several lead indicators suggest a strong market response to our commercial activities related to Fanapt for bipolar I disorder, including total prescriptions, or TRX, increased by approximately 32% in the Q1 of 2026 as compared to the Q1 of 2025.

In April of 2026, weekly TRXS for Fanapt reached an 11-year high of over 2,600 prescriptions for the week ending April 24th, 2026. New patient starts, as reflected by NBRxs, increased by 76% in the Q1 of 2026 as compared to the Q1 of 2025. Of particular note, Fanapt was one of the fastest-growing atypical antipsychotics in the market throughout 2025 and in the Q1 of 2026 based on several prescription metrics.

Our Fanapt sales force continues to expand. Our Fanapt sales force numbered approximately 160 representatives at the end of 2024 and increased to approximately 300 representatives at the end of 2025. These expansions have allowed us to significantly increase our reach and frequency with prescribers.

To that end, the number of face-to-face calls in the Q1 of 2026 was more than 80% higher than the number of face-to-face calls in the Q1 of 2025. In addition to our Fanapt sales force, we have established a specialty sales force to market PONVORY to neurology prescribers around the country. We have grown this sales force to approximately 50 representatives.

Fanapt performance remains the focus of Vanda's commercial initiatives and encourages us to continue to invest in this differentiated medicine and the franchise-extending launch of BYSANTI. Before turning to our financial guidance, I would like to remind folks that with Fanapt, HETLIOZ, PONVORY, and now NEREUS already commercially available, and with BYSANTI recently approved for bipolar I disorder and schizophrenia, and a biologics license application for imsidolimab now under review by the FDA, Vanda has five products currently commercially approved and could have 6 products commercially approved by the end of 2026. Turning now to our financial guidance. Vanda is raising its full year 2026 total revenue guidance to reflect the potential contribution of newly launched NEREUS while maintaining prior ranges for Fanapt and other products. Vanda expects to achieve the following financial objectives in 2026.

Total revenues from Fanapt, HETLIOZ, PONVORY, and NEREUS of between $240 million and $290 million. The mid-point of this revenue range of $265 million would imply revenue growth in 2026 of approximately 23% as compared to full year 2025 revenue. This compares to the previous guidance of total revenues from Fanapt, HETLIOZ, and PONVORY of between $230 million and $260 million.

Fanapt net product sales of between $150 million and $170 million. The midpoint of this revenue range would imply Fanapt revenue growth in 2026 of approximately 36% as compared to full year 2025 Fanapt revenue. This guidance is consistent with the previously communicated revenue guidance.

Assuming consistent gross to net dynamics between 2025 and 2026, the bottom end of the range assumes high single-digit to low double-digit sequential quarterly TRX growth for Fanapt in the remainder of 2026. The top end of the range assumes mid-teen to high-teen sequential quarterly TRX growth for Fanapt in the remainder of 2026. Other net product sales of between $80 million and $90 million.

This range assumes a further decline of the HETLIOZ business due to generic competition and modest growth of the PONVORY business, where we are seeking to significantly improve market access to the product. Depending on our success in these efforts, we could see meaningful improvements in patients on therapy, prescriptions filled, and prescriptions written by prescribers. This guidance is also consistent with the previously communicated revenue guidance. Finally, NEREUS net product sales of between $10 million and $30 million.

This guidance was not previously provided and is being introduced as part of the Q1 earnings update. Vanda is currently making conditional investments to facilitate future revenue growth, both in the form of R&D investments, commercial manufacturing, and potentially outsized commercial investments, which could vary moving forward depending on the success of these commercial strategies.

As previously communicated, Vanda is not providing 2026 cash guidance at this time. However, it is likely that Vanda's 2026 cash burn will be greater than the cash burn in 2025. With that, I'll now turn the call back to Mihael.

Thank you very much, Kevin. At this point, we'll be happy to answer your questions.

As a reminder, if you'd like to ask a question during this time, simply press star followed by 1 on your telephone keypad. Your first question comes from the line of Olivia Brayer from Cantor Fitzgerald. Your line is live.

Hi, good afternoon. Thank you for the question. Can you run through what the pushes and pulls are that you're using for that $10 million-$30 million guidance range for NEREUS? It seems like somewhat of a big range, just given that it's so early in the launch. I'm curious what the higher end of the range assumes versus the lower end.

On BYSANTI's launch, what's the progress on getting that to patients at this point? Should we assume that any contribution from BYSANTI this year is essentially embedded in your Fanapt guidance, or is it just too early to start attributing revenues there?

Maybe Olivia, I will start off by saying, it is very early on the NEREUS launch, we have seen that we're approaching it as a broadly available commercial product with a direct to consumer platform, which is in the early days. Of course, we're working through all the dynamics and logistics of that. We'll have a better idea on progress by our next call.

In terms of the $10 million-$30 million, we're excited about the opportunity. We know we're tapping at a market of potentially 70 million people with motion sickness and a good percentage of them suffering from severe motion sickness that is not properly treated today.

The $10 million-$30 million is a relatively wide range, but it is not informed by experience. It is more modeling from the total market opportunity and other treatments for motion sickness. I'll turn it on to Kevin.

Yeah. That's right, Olivia, that's what's driving the range there is it's obviously not informed by actual data at this point. It's informed by modeling and what we've seen in some of our, you know, qualitative and quantitative research. As we gather more information there, obviously, we'll be able to provide, you know, additional context, as the year progresses. Maybe on the BYSANTI side, what we previously communicated there is that we were looking to have the product available in the back half of the year, and that's still on track. We're working to bring that product to market.

As far as the revenue contribution goes, obviously, still pre-launch, so a little bit early on this, but I wouldn't necessarily think about it being as embedded in the Fanapt revenue item because we expect that we'll see demand for BYSANTI independent of Fanapt. For any demand that we see for BYSANTI that replaces Fanapt demand, we're expecting to see meaningful net price favorability, which obviously would lead to a larger revenue contribution from a BYSANTI unit versus a Fanapt unit.

Okay, got it. For BYSANTI specifically, is it just a matter of waiting until it's officially commercially available before providing any sort of revenue numbers around that? Is 2026 maybe just a little bit too early to start modeling BYSANTI?

I think it's going to be. Obviously, we're not committing to providing revenue guidance on BYSANTI at any point in time, but obviously the launch is, I think, going to be critical to us having better visibility into providing revenue guidance. We'll be looking to provide additional updates on that. I don't think it's necessarily too early, depending on the time which we launch the product.

Okay. Thank you, guys. Appreciate it. Helpful.

Thanks, Olivia.

Your next question comes from the line of Raghuram Selvaraju from H.C. Wainwright. Your line is live.

Thanks so much for taking my questions. Firstly, I was wondering if you could provide us with some additional color regarding the timeline to reporting of top-line data for the tradipitant study, assessing its ability to attenuate nausea and vomiting, and other GI side effects associated with GLP-1 drugs.

Yep. Thanks, Raghuram. What we've communicated there is that in the press release today, we said results by the end of 2026 and our timing, you know, obviously is consistent with that, consistent with what we communicated in our most recently in our initial launch of the program. And obviously we're actively enrolling patients at this point, so that's informed by actual activity.

Can you talk a little bit about what your expectations are for that data set? What you would consider to be a clinically meaningful result, if you are also gonna have additional information regarding the impact of tradipitant use on adherence and efficacy outcomes on the GLP-1s for patients enrolled in study?

Thank you, Raghuram. This is Mihael. First of all, the Thetis study is of a very similar design like the phase II study for which we reported positive results in November. That is a week of pre-treatment with tradipitant or placebo, and then a single injection of Wegovy at 1 mg and follow on for another week. What we aim to do with this study is confirm the previous finding of the significant reduction in vomiting episodes that we'll saw. Certainly, that was highly clinically meaningful. On your question, whether this will improve adherence, of course, with this short study, we will not have this information.

It is widely known that this GI decreased tolerability, especially around dose escalation to higher doses, is a significant contributor to decreased adherence.

Just two other things on that front. Can you comment on the possibility or likelihood of any off-label use of tradipitant, given the fact that it is now an approved drug for motion sickness among those folks taking GLP-1 drugs, who may potentially have obtained them, you know, via some consumer health initiative, potentially to assist them in achieving long-term adherence?

First of all, you know, the key word here is off-label. Of course, we don't have any use for use information. We cannot promote off-label, especially in the midst of clinical studies, and certainly not before approval in that indication. You know, we cannot have any insights for that. We certainly hope that upon approval, there will be a significant interest of the use of the drug.

Last question from me is with respect to the long-acting injectable formulation of iloperidone, can you provide us with an update on that and how rapidly you expect to be able to advance the product candidate in this context at this juncture?

Yes. Thank you. For context, this is the long-acting injectable iloperidone being used in a study to measure relapse prevention in schizophrenia. The study is ongoing in the U.S. However, it is going slowly and slowly recruiting. We think that is a phenomenon of the field of these studies and the required design of a placebo-controlled. I know you're quite familiar with this type of designs, but we're highly concerned that this exact model that has worked extremely well for Fanapt and other antipsychotics is becoming less and less amenable to studying new drugs.

What we're thinking and potentially discussing with the FDA soon, is that not only recruitment has become slower in the U.S. for this type of placebo-controlled schizophrenia relapse prevention study, but the rate of relapse has historically been significantly reduced. We observed a significant rate of relapse on placebo in the study that was completed in 2015.

We've seen since with other drugs that followed this design, a significant reduction on placebo. It is too early for us to say what the exact placebo rate will be in this study, but certainly, we already believe it will be much lower rate of relapse than the oral REPRIEVE study of iloperidone.

All these go together to say that we are concerned about the timing of and the progress of the study. We do have several ideas. We plan to engage the FDA in a constructive discussion and perhaps even modify the development plan.

Thank you so much.

Of course.

Your next question comes from the line of Madison El-Saadi from B. Riley. Your line is live.

Hi, guys. Thanks for taking our question. Maybe I'll ask about the recent New England Journal publication on imsidolimab in GPP. You know, we're looking at a potential Christmastime approval again. Are you taking steps now to kinda lay the groundwork for a potential year-end commercial launch? Will this likely be something where, you know, there's like a one-quarter cushion before the launch? Is the expectation that you would receive approval in both the acute and the maintenance settings out of the gate? Thanks.

Thank you very much, Madison. You're correct. We're very excited with the publication in such a high-caliber journal, the NEJM Evidence, on this result. A testament of, you know, peer review scrutiny around this very impressive data. I will answer the question on indication first. We believe that the data that we've seen from the GEMINI 1, GEMINI 2 studies do support both immediate treatment of acute flares with a 1 injection and maintenance of that relapse in responders with the once every 4 week injections. That is our proposed indication with the FDA.

We're also making progress with towards regulatory filings in Japan and in Europe, but they're much earlier than the FDA submission. In terms of launch timing, this is of course a complex project to manufacture, being a monoclonal antibody. We do not expect that we will be commercially launching right after the PDUFA date. There will be some lag time, but hopefully we can do that within the first half of 2027.

Understood. Then if I may ask, on the Fanapt prescription data, this kind of reacceleration in April, BYSANTI was approved late February. Just wondering if there was maybe some type of a halo effect that could have fed into that or if that was purely kind of the sales force that you described earlier. Thanks.

Yeah.

Madison, thanks for the question on that. The reminder there is that historically, including this year, we've seen the Q1 have seasonality with both Fanapt and the broader atypical class. This Q1 was no exception. In line with our expectations, we saw a flattish Q1 on prescription demand which is again consistent with what we saw last year and in years prior to that. What we saw last year was after the Q1, we saw an acceleration and sequential quarterly growth in the double-digit range in the second, third and Q4 of last year.

That's our expectation of what we'll see this year, and that's supported by what we see on the April data, which includes our highest TRX prescription number in over 11 years, which was over 2,600, right? The pattern that we've seen in prior years and expected to see this year is what we've seen play out to date, you know, as the year's gotten started here.

Yeah. I agree with all that. Also I want to emphasize that the commercial infrastructure is mature. We have approximately 300 representative sales force, which is now well trained, mature, developing their relationships in the field, and supported by both a significant awareness speakers program, but also our brand awareness direct-to-consumer marketing.

Understood. Thank you.

Thanks, Madison.

Sure.

Your next question comes from Les Sulewski from Truist Securities. Your line is live.

Great. Thank you for taking my questions. 1st on Fanapt, do you have a sense of what portion of the TRXs and NBRx are coming from bipolar versus schizophrenia? With inventory running above normal, should we expect any wholesaler destocking in 2Q? On BYSANTI, can you rank the launch priorities, new patient starts versus switches from Fanapt and targeting the Medicaid-heavy patients? 3rd, I see the MDD readout was moved to the Q1 of 2027 from year-end 2026. What drove the timing shift? I have a follow-up. Thank you.

Thanks, Les. Maybe I'll start with the first two, and then Mihalis can take the one on the MDD. First on the split. While we don't analyze the data at an indication level, our expectation on the Fanapt growth is that the primary driver is going to be the bipolar label expansion that we got in 2024. That's what we've seen, and that's what's informed our targeting strategy, and, you know, call points and call guidance. The expectation would be that the growth that we're seeing in the Fanapt business is driven by increased demand from the bipolar patient population.

As far as the stocking question goes, just to point you to what I said in my prepared remarks there, historically, we've seen the Fanapt inventory levels at, you know, three to four weeks. What we've seen at the end of the Q1 of 2026, Q4 of 2025, and as far back as the Q4 of 2024, is that the inventory levels were at or slightly above four weeks on hand.

Actually, the inventory at the end of the Q1 is largely consistent with what we've seen over the recent period, and what we would expect to see for a product that's growing, right? Because as you're measuring this, it's based off a trailing demand figure, but if the demand is growing, then it's actually, you know, on a lag.

I wouldn't expect that. I'd expect the inventory levels to maintain at this as long as Fanapt continues to grow. The second question you had there was around the prioritization of new patients versus switches from Fanapt on BYSANTI. What I would tell you there is that we're gonna be prioritizing both. That's because with BYSANTI being launched as a newly approved atypical antipsychotic, we're certainly going to be detailing it in that light. As part of that, we'll be deploying commercial strategies to, you know, have prescriptions moved from Fanapt to BYSANTI, you know, as appropriate.

The last kind of point I would make on that is that with the NEREUS or sorry, with the BYSANTI launch in the back half of this year and the Fanapt potential loss of exclusivity at the end of next year, you know, we've got five quarters or so where both products will be in the market, and we can, you know, execute on a switch strategy while executing a launch strategy as well. With that, Mihalis, I think, can address the question on the MDD timing.

Yeah. Les, you're correct. We moved the timing of end of study and results for the MDD study to the Q1 of 2027 from end of 2026. We're still working hard to get the results as soon as possible. It could be by year-end, but we have better data now on recruitment speed, and especially bringing on new sites, and those in Europe as well. It is a reflection of projections from the actual recruitment data.

That is helpful. Thank you. On NEREUS, commercialization and motion sickness, can you provide some color around the patient access to the drug and how net pricing looks like outside of the website via the retail pharmacy channel? Lastly, maybe just kind of curious on your pricing strategy, given the competing NK1s out there and how this would translate to the GLP-1 adjunct opportunity. Thank you.

Yep. Thanks, Les. As we look at the insurance reimbursement landscape, obviously with the product, you know, relatively recently approved, that'll be a process that plays out over coming, you know, quarters and years as the payers conduct their clinical assessments and then their, you know, their periodic reviews. I expect to have more information to share on, you know, NEREUS access and progress on that front as we move further into the launch.

It's certainly something that we're, you know, would like to secure as well in addition to the cash pay model. The cash pay model is our immediate focus for the actual NEREUS launch with the innovative platform that we've deployed. I'm sorry, Les, what was the second question after that?

The pricing strategy, around, and read-through for the GLP-1 opportunity.

Yep. Yep, sorry. Thanks, Les. Yeah. As we kind of evaluate the space and we look at the competitive class for the NK1s, you know, they range anywhere per dose from the $200 range up to about the $600 range. With our pricing strategy there, we're kinda deployed, you know, in the, in the middle on the lower end. And we think with an eye towards gastroparesis potentially, if we're able to be successful on the regulatory front there and with the GLP-1, you know, that pricing would put that at a, you know, competitive market price to service those patients as well.

Certainly the considerations for us as we launched the pricing were, you know, having the appropriate price for the motion sickness market, but having an eye towards the potential for a gastroparesis market and a GLP-1 market hopefully in the near future.

What I would add is a couple of things. We chose this commercial model because we believe motion sickness is a prototypical consumer product. As you can see on our website, we provide the product in increments of 2 capsules, which may be enough to supply somebody for their business or personal travel where they may experience motion. So that's important to us and we're receiving good comments on being very patient-centric. While in recent, I would say years or year, we've seen a model of cash pay at discounted prices coming on, especially for drugs like the GLP-1 analogs.

This is the first instance we know that you can directly coordinate with manufacturer. This is a innovative system that we have built up at Vanda and works in conjunction with a mail-order pharmacy that can get expeditiously the product to patients. We also are working to continue to add value-adding measures, including a telemedicine platform, so that patients can conveniently obtain the prescriptions. It is all focused on the customer experience and we want this to be really an example for others to follow. You mentioned, I think briefly, other NK1 antagonists and yes, there are other approved drugs in the class.

None of them have ever been studied or approved in motion sickness or as a adjunct to a GLP-1. The lead product there has been Emend or aprepitant by Merck in chemotherapy-induced nausea and vomiting and post-operative nausea and vomiting. There are some key things and key differences on the label that can make potentially NEREUS more attractive for our consumer base.

What I'm alluding to is the absence of interaction in the ondansetron study, which actually differentiates NEREUS from Emend on Emend's contraindication or warning around contraceptive use. That and other items on the prescribing information, we believe, can make the product attractive especially for this approved indication.

That's very helpful. Thank you for that. Just to clarify one thing. Does it seem that you would weigh out the option of a dual model approach for GLP-1 adjunct opportunity? Meaning you could roll it out with a DTC plan and also a traditional insurance channel as well.

Well, first of all, our premise here is broad access. Any way people want to acquire the product, we want to make it available for them. At the same time, we recognize the difficulties people are going through with all the, let's call it middlemen. The benefits, pharmacy benefits organizations, their own plans, pharmacies and all the markups of prices that go along. We know there's a national discussion around that. As Kevin said, the WAC price, the list price of $255 a capsule, is within the range of other NK1 antagonists.

However, on the cash pay, we're offering it at about a more than 65% discount from $255 to $85 a capsule, making it affordable for folks who travel for business or pleasure, engage in these motion sickness activities. At the same time, we are making the drug available to pharmacists, and we ensure that wholesalers will either stock the drug or will make it available upon demand. The premise here is access, but access is not just insurance negotiations. It is appreciating independence and convenience by individual patients in accessing this drug. We think this dual model can achieve that.

Very helpful. Thank you.

Thanks.

Your final question comes from the line of Andrew Tsai from Jefferies. Your line is live.

Hi, this is Faye on for Andrew. Thanks for the update, and thanks for taking our questions. We have two questions. Number 1 is about milsaperidone. We want to gauge your views on its likelihood of success in the phase III MDD trial. We know that not all antipsychotics work in MDD, do you want to talk about your confidence why milsaperidone should succeed? Is there any existing Fanapt data to support any of its benefits as an antidepressant?

Yeah. We think actually, we're quite confident. That's why we're running this study. We're running it with the once a day BYSANTI. We think the study is properly powered to detect a clinical meaningful improvement in symptoms of depression. Generally, atypical antipsychotics are effective as an adjunctive treatment in major depression.

There are individual receptor binding properties of BYSANTI that differentiate it and may increase the ability of effectiveness. That is not only the dual dopamine and serotonin receptor antagonism, but also the strong and unique in the class alpha-one receptor antagonism.

Whether this will be necessary to achieve the effect or not in major depression will remain to be seen. We remain very confident on the ability of BYSANTI to achieve the effect.

Okay. Thank you. The second question we have is for NEREUS. It launched earlier this month, and you briefly touched on the pricing strategy, but can you talk about the sales cadence for this drug later this year moving into 2027?

Yeah. Obviously with us launching, you know, mid Q2, we would expect, you know, the revenue to grow as the year progresses. That's both with, you know, the passage of time but also with the increase of our promotional activities associated with the product launch. One of the key elements to the commercial strategy here is a direct-to-consumer campaign which we have worked on implementing over recent quarters but will be continued to investing in as the year goes on.

Certainly we're optimistic about the prospects for NEREUS, and we expect the revenue cadence to increase and accelerate as the year goes on.

Okay. Thank you.

Thank you.

There are no further questions. I'd now like to turn it over to Vanda Pharmaceuticals management for closing remarks.

Thank you very much all for joining this call and for your questions. We look forward to talking to you soon.

That concludes today's meeting. You may now disconnect.