Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) Q4 2022 Earnings Call Transcript

So we continue to have high expectations for the product and its growth potential as time goes on. As far as the drivers for 2023, as I mentioned earlier, I mean, some of the key factors are, for example, the continued penetration from a prescription perspective, the size of prescription is going up because of the daily doses also going up, especially as we penetrate further into the adult segment because the average daily dose there could be as close to the 500 on the pediatric side, adolescent side, closer to the 300, 400-milligram level. And then you combine that clearly with the sales force expansion and deeper penetration and coverage of the ADHD market. We still have a lot of physicians in our call on universe that haven’t really started even prescribing.

So we have a lot of potential out there for us to start turning a lot of these physicians, let them try the product, let them get the experience with it. Because actually, once these physicians try the product and get some experience with it and we have this information from our running survey among prescribers. There is a level of satisfaction that is truly incredible, about 90% satisfaction level among physicians who use Calgary. And that actually compares to about 51% for Strattera interestingly by these same physicians who have used Strattera for years. So it really shows you that once they try Qelbree, the experience there typically is positive. And clearly, that will encourage them to have a much wider penetration within their practice as far as putting more patients on Qelbree.

So all these factors combined, and then in the end, the gross to net improvement and so forth should certainly deliver a very robust growth in net sales.

Andrew Tsai: Great. Great. Thank you. And so speaking of the expansion of sales force, your current guidance of OpEx, I think $460 million to $490 million, it’s incrementally a little bit up versus $450 million, I believe, in 2022. So does your 2023 guidance incorporate a new DTC launch? Or is it primarily driven by the sales force assumption and expansion. And assuming there is a new DTC launch, then the question would be, do you think 2023 OpEx could be kind of part of my choice of where it’s maybe the peak expense year for the, let’s just say, short to medium term, the next 2 to 3 years? Or is that not necessarily the case?

Jack Khattar: Yes. Regarding the commercial side, so sales force and marketing and the heavy investment that we put in behind Qelbree, obviously, in 2021 and 2022, we will continue with that in 2023. I’m not going to be able to be too specific on DTC and how much and whether because some of these decisions are in progress, and it’s a fluid at this point process for us. But basically, we will continue the strong support behind Qelbree and GOCOVRI clearly. On the sales force, the expansion partial — part of that cost is going to be covered by the fact that we don’t have a third sales force anymore that we used to have in 2022, because as you recall, we have stopped the in-person sales effort behind Trokendi XR and Oxtellar XR.

So that sales support and the costs associated with that sales support will not continue into 2023, but some of it will go towards the coverage of the expansion in the Qelbree sales force. But another main component in that $460 million to $490 million is R&D. R&D, if you look at 2022 was much lower than 2021. We do expect in 2023, and hopefully, we’re correct that enrolment will speed up on SPN-820, SPN-817, spending is going to start to increase as we start all these trials. So we expect a bump in R&D that is part of the increase that you see from the $450 million in 2022 going up to the $460 million to $490 million in 2023. So that’s another big component there as well.