Avadel Pharmaceuticals plc (NASDAQ:AVDL) Q3 2023 Earnings Call Transcript

So we’re going to stay hyper-focused on where sort of the oxybate volume is today. But clearly, as time goes on, we see the opportunity to gain more people to come into the prescribing base as well.

Operator: Our next question comes from Francois Brisebois from Oppenheimer.

Francois Brisebois: Congrats on the early progress here. Can you maybe touch on — we talked about the 3 buckets of patients and where they’re coming from. But can you maybe help us understand how the AGs are maybe affecting each bucket and what you’re seeing so far in terms of a patient going through an authorized generic first?

Richard Kim: Yes. Frank, thanks for the question. So yes, super pleased with the progress so far. And it’s nice that we are seeing enrollment in the ones coming from all 3 of those patient buckets, as you mentioned. So Obviously, what’s been nice is from all 3 segments. But the AG overall, we are actually also converting patients who are currently on AG coming on to LUMRYZ. And as far as discontinues, we have seen that many AGs who have discontinued to have been relatively new. So the source of the AGs is predominantly coming from those who are switching from an oxybate. And we are also seeing, clearly, naive patients never being exposed to any first-generation oxybate as well. So it’s still a bit early, but the real source for us where AGs are concerned are these switching from current oxybate patients. And we really haven’t sort of seen what I would tell as seen as an impediment of AGs impacting the ability to get on to LUMRYZ thus far.

Operator: Our next question comes from Marianne Belgie with LifeSci Capital.

Unidentified Analyst: Congratulations on the progress. So my question is around payers. Congratulations again on gaining preferred status with CVS. Just can you provide a little more detail with regard to discussions with theirs? And if you have any kind of what’s your expectation for other payers when it comes to preferred status? Is this something you’re actively trying to achieve? And quick other question, just more color on the pediatric opportunity. What are the main reasons there for not taking an oxybate? And are the dynamics different from adults when it comes to both sodium and middle of the night dosing?

Richard Kim: Sure, Martha. I’ll start with the payer question. So yes, our overall strategy with payers has been to sort of have unencumbered access through any oxybate to sort of be at the best sort of status with the best of the oxybate thus far. So thus far, with the first 3 of the GPO contracts, that’s what we’ve achieved, and that is our goal going forward as well. I mentioned the fact that we have ongoing conversations with MSR and the United Optum lives. So whatever is the best status, which is generally a preferred status for oxalate, that is our goal. And thus far, we’ve been very pleased with what we’ve been achieving thus far. I’ll turn the pediatric question over to Jen.

Jennifer Gudeman: Thanks so much for the interest in pediatrics. We have heard for years now of the desperate need for a pediatric form of sodium oxybate that does not require waking up in the middle of the night. That has been the primary driver for an expanded indication. In regard to whether it’s different, the clinical needs compared to adults. While it’s really important for adults to not have to chronically wake up, and it’s true that sometimes an adult patient waking up, they also wake up their bed partner. The reality is for children who are 7 to 17, they are typically having at least one parent, if not both parents, chronically waking up in the middle of the night to administer the dose. I’ve had conversations with parents who were happy to submit letters of support for the pediatric supplement, describing how challenging it was to never have an uninterrupted night’s sleep for those children and for themselves.

For the second part of the question in regard to sodium. What we see with clinicians is they may identify a very small subset of their adult population who they consider to be sodium sensitive. This has not been an issue as we’ve been discussing sodium with the many KOLs to import us to bring this option to them as quickly as possible.

Gregory Divis: Yes. The only thing I would add regarding pediatrics is really just I would characterize it as unbelievably consistent, albeit anecdotal, which is every time you talk to a physician about LUMRYZ in narcolepsy, the next 2 questions you get from them universally, is “When are you going to get pediatrics and when are you going to study it in IH?” So it’s very consistent when we talk to doctors about that. So hence, why we’re going down those paths.

Operator: Our next question comes from David Amsellem from Piper Sandler.

David Amsellem: Just a few here. One is can you talk about sales force sizing longer term? And also how you’re thinking about any DTC spend [indiscernible] view that your competitor [indiscernible] disease awareness lay the groundwork for you with its initiatives. Talk about that. And that’s number one. Number two is, I may have missed this. Can you talk about the mix between ? Are you getting any traction in one subgroup versus another? And what’s your expectation regarding the mix between the 2 going forward?

Richard Kim: Yes. Thanks, David. So as far as sales force size is concerned, to your point today, we’re at 49 sales representatives. We also have our field reimbursement team. Once again [indiscernible] really going against the opportunity for oxybate right now, that 4,500 prescribers, our 49 representatives sort of allow us to cover up to about 6,000, maybe 6,500 physicians. So that gives us the space to cover our current opportunity and benefit. I’d say longer term, I mean, right now, that’s pretty where our focal point is, is getting oxybate-experienced prescribers comfortable with using LUMRYZ as well. Longer term, we’ll sort of see what the mix is. But I would say, for the foreseeable future, we really don’t see the need to expand the size of our sales force.

Now when it comes to DTC, we wouldn’t really call it more sort of patient activation and patient media here. First, any news and media on narcolepsy, we think, is a good thing for a rare condition. Secondarily, our plans have really been to try to meet patients where they are, and they spend a lot of time digitally being active as well. So we’ve been very targeted about placing media and engagement through the sources where they go, Reddit, Facebook and other sources. And we have a couple of other novel approaches that we’re doing in and around sleep specialist offices as well. So our approach with patients is, I would say, a little bit more surgical than as a cost shop approach. And as far as the NT1, NT2 is concerned, and it’s a little bit level from our data as you’re looking to that.