Good day, ladies and gentlemen, and welcome to the ACADIA Pharmaceuticals Fourth Quarter and Full Year 2018 Financial Results Conference Call. My name is Christie, and I will your coordinator for today. [Operator Instructions]. I would now like to turn the presentation over to Elena Ridloff, Senior Vice President of Investor Relations and Interim Chief Financial Officer at ACADIA. Please proceed.

Thank you, Christie. Good afternoon, and thank you for joining us on today's call to discuss ACADIA's fourth quarter and full year 2018 financial results. Joining me on the call today from ACADIA are Steve Davis, our Chief Executive Officer, who will provide a brief overview of our strategy, recent achievements, pipeline opportunities and financial performance; Michael Yang, our Chief Commercial Officer, who will provide updates in our commercial initiatives of NUPLAZID; and Dr. Serge Stankovic, our President, who will discuss our pipeline progress. I will then discuss our financial results before turning it back to Steve for his final remarks and opening the call up for questions. I would also like to point out that we are using supplemental slides, which are available at Events & Presentation section of our website. Before we proceed, I would like to remind you that during our call today, we will be making a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including goals, expectations, plans, prospects, growth potential, timing of events or future results, are based on current information, assumptions and expectations that are inherently subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially. These factors and other risks associated with our business can be found in our filings made with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which are made only as of today's date. I'll now turn the call over to Steve Davis, our Chief Executive Officer.

Thank you, Elena. Good afternoon, everyone, and thank you for joining us today. In 2018, our team executed in all 3 of our strategic pillars. First, to grow. While NUPLAZID is the only FDA-approved treatment and standard of care for patients with Parkinson's disease psychosis or PDP. Second is the leverage, leverage of the potential of pimavanserin and additional indications with unmet need. And third, is to expand our pop on quarter through focused business development in CNS disorders, again, with high unmet needs. Let's take a look at the progress we've made in advancing each of these pillars on Slide 6. We continue to grow NUPLAZID in PDP and achieved $59.6 million in net sales in the fourth quarter of 2018, a 37% increase over the same period in 2017. Net sales for the full year 2018 were $223.8 million, which represents a 79% increase year-over-year. This growth was fueled by our commercial initiatives, including the launch of our 34-milligram capsule in August. In late November, we launched our direct-to-consumer TV ad campaign and expect to benefit new patient starts in 2019. Based on the execution and the growth we're seeing in 2019 as we enter the year, we are providing NUPLAZID net sales guidance of $275 million to $300 million for the full year 2019. Last year, we continue to leverage pimavanserin in clinical development for additional CNS indications. This was highlighted by our positive Phase II CLARITY results in adjunctive treatment of major depressive disorder. In addition, we recently completed our end-of-Phase-II meeting with the FDA, and we'll be initiating two Phase III trials in the first half of this year. Importantly, in our end-of-Phase-II meeting, we confronted with the FDA that our Phase II CLARITY trial can be submitted as pivotal trials to support a supplemental…

Thank you, Steve. Please turn to Slide 9. Today, I would like to provide you with an update on the progress we are making with our commercial activities that are driving continued growth of NUPLAZID. First, we are in the process of completing the transition to the 34-milligram capsule from the 17-milligram tablets. The single 34-milligram capsule was launched to provide patients with a single dosage form to achieve the once daily 34-milligram dosing recommendation for the treatment of PDP with NUPLAZID. The introduction and adoption of the 34-milligram capsule is done very well. The commercial team has successfully facilitated smooth health care professional and patient transition to the single 34-milligram capsule, and we believe this has resulted in a more positive patient experience. We are focusing on driving new commercial initiatives across the business, leveraging the introduction of the 34-milligram capsule in Q3, and the FDA reaffirmation of the positive benefit risk profile. As Steve mentioned, we launched a branded direct-to-consumer campaign at the end of November, an important time of the year when extended families gather together and would expect to notice changes in their loved one. We look forward to seeing this positively impact new patient starts and revenue in 2019, along with our other commercial initiatives. Beyond these efforts, I'd like to point out that the Movement Disorder Society recently published an update through recommendations for treatments for non-motor symptoms of Parkinson's disease. Within this update, NUPLAZID is the only treatment listed as both efficacious and having an acceptable level of safety risk without specialized monitoring for the treatment of psychosis. This conclusion adds to the level of confidence we have been establishing with physicians that their patients suffering with PDP should try NUPLAZID first. Of the roughly 125,000 patients who received treatment for PDP, currently…

Thank you, Michael. I'm extremely pleased with our R&D progress in 2018. Equally, I'm really looking forward to the next several quarters as we will be reporting results from a number of our ongoing late stage clinical trials. Let's start with Slide 14. Pimavanserin is the first-in-class selective seratonine inverse agonist. Antipsychotics were primarily by blocking dopamine and then particularly problematic in Parkinson's patients who suffer from the lack of dopamine. In addition to PDP, pimavanserin has already shown the indication of efficacy in all 4 clinical categories we are pursuing that are currently evaluating in the late stage programs. Furthermore, our expertise in drug development for CNS, we license the rights to trofinetide in August. Trofinetide is a novel synthetic of the amino terminal tripeptide of the IGF-1 insulin like [ph] growth factor. Trofinetide has positive Phase II data in its target indication of Rett syndrome. In total, we have 5 late stage programs that we are advancing this year. On Slide 15, are just the few reasons that near term highlight I wanted to share with you. First, we recently completed our end-of-Phase-II meeting with the FDA to discuss pimavanserin as adjunctive therapy for major depressive disorder. I am happy to report that, as we expected, the FDA agreed that the CLARITY trial would serve as 1 of the 2 pivotal trials for our supplemental NDA submission. As always is the case, the end-of-Phase-II matters are ultimately subject to NDA review. We initiated our Phase III program as planned in the first half of this year. Second, we confirm with the FDA our study design for Phase III trial with trofinetide, which we will initiate in the second half of 2019. And third, we remain on track to announce top line results from our ongoing Phase III ENHANCE…

Thank you, Serge. So I will discuss our fourth quarter and full year 2018 results in our financial outlook. Please turn to Slide 29. In the fourth quarter of 2018, we recorded $59.6 million in net sales, an increase of $16 million or 37% compared to the $43.6 million of net sales in the fourth quarter of 2017. The gross-to-net adjustment for Q4 2018 was 16.8%. Recent inventory channel at the end of Q4 consistent with Q3. Moving down the P&L. Total operating expenses, including cost of goods sold, were $126.8 million in the fourth quarter of 2018 compared to $113.6 million for the same period in 2017. These amounts included $20.4 million and $22 million of noncash stock-based compensation expense, respectively. GAAP R&D expenses increased to $48.2 million in Q4 2018 from $43.2 million in Q4 of 2017. Fourth quarter R&D expense benefit from the timing of certain clinical trials-related costs, which will now be realized in the first quarter of 2019. GAAP SG&A expenses decreased to $74.3 million in Q4 2018 from $66.7 million in the fourth quarter of last year. The increase was primarily due to an increase in marketing expense related to our branded direct-to-consumer advertising program. For the full year of 2018, on Slide 30, we reported $223.8 million in net sales, an increase of $98.9 million or 79% compared to the $124.9 million in net sales in 2017. The gross-to-net adjustment for the full year 2018 was 16.6%. Total operating expenses, including cost of goods sold, were $471.3 million in 2018 compared to $417.3 million in 2017. These amounts included the $81.6 million and $75.5 million of noncash stock-based compensation expense, respectively. GAAP R&D expenses increased $187.2 million in 2018 from $149.2 million in 2017. The increase was primarily due to additional clinical studies…

Thank you, Elena. Please turn to Slide 33. In closing, our team is focused in executing on all three of our strategic pillars in 2019. One, growing NUPLAZID and Parkinson's disease psychosis; two, leveraging pimavanserin, the additional large market CNS indications; and three, additionally expanding our pipeline through disciplined business development. As always, we appreciate the dedication and hard work of all of our employees who are committed to improving the lives of the patients and caregivers with CNS disorders. I will now open up the call for questions. Operator?

[Operator Instructions]. Your first question comes from the line of Cory Kasimov with JPMorgan.

This is Matthew on for Cory. My first question is on the Phase III MDD program. Can you discuss your decision to run on both the U.S. and an EU trial and how this might prefer irrespective of each other? And the Phase II CLARITY study in terms of patients on the criteria?

Sure. serge, do you want to take that?

Yes. Thanks, Matt. Both Phase III trials are essentially identical in design and matched very closely almost identically to our stage 1 Phase II trial that we just performed. So in terms of the patient population that we are addressing, in terms of the measures, the outcome measures, it's a very similar design.

Got it. And then turning to schizophrenia. ENHANCE study. Curious to get your general level of confidence going to this read out and curious to what you're seeing so far with the proportion of patients that are either dosed up or dosed down with the possible dosing.

Yes. I have to say I have always a very high level of confidence with every trial we do, otherwise we'll probably would not do that. So we do have, I do have a conviction that pimavanserin can bring the benefit to patients with schizophrenia in an adjunctive treatment paradigm. Of course, I've been long in this business to know that it's clinical trial actually its own challenges. So I would say that I'm reasonably optimistic about the outcome of this trial. From the perspective of what we see in the trial in a blinded fashion, in terms of the dose, one thing that I can say that majority of patients are ending up on the 34-milligram dose, on the higher dose, with a smaller proportion of patients on the lower dose. I would also say that we are seeing a nice retention with quite a bit of a confidence in terms of the quality of trial and execution of the trial.

Our next question is from Ritu Baral with Cowen.

Serge, can you discuss a little bit of the conduct of the HARMONY study? And I know you had a discussion about [indiscernible] for the interim. But how should we think about the probability of success at the interim, especially given the positive feedback that have reached gotten from [indiscernible].

Serge, did you hear the question?

I did not understand the last part of your question, Ritu. If you could repeat, please.

Yes. Just curious how did the probability of success at the interim that have good things to say about pimavanserin and the indication. I've seen we recently confident that it all depends on how you are letting the outlook?

Right. Again, a couple of comments in that respect. I mean, I will just read to treat my general optimism about the trials that we are conducting and potential of pimavanserin in this indication. There are a couple of considerations one has to take here. As we previously mentioned that we -- the interim analysis of our threshold is fairly high. So we did not want to have a high alpha spend at the interim analysis. So we put that threshold rather high. And although quite possible, it's something to consider when thinking about the probability of success at the interim analysis. The second consideration is, of course, there are not too precedents? Although there are a lot of precedents in schizophrenia and depression in terms of the prevention trial and the rate of success as interim analysis, which is fairly high. This is, combined this, only the second relapse prevention trial in the area of dementia psychotic psychosis or psychosis with agitation. Previous trial, there were not trial with risperidone with psychosis and 100 patients. So from that perspective, we don't have a long historical record with probability of success. Having said all of that, I think it's reasonable to expect that there is a fair chance that this trial is going to end up at that point.

And trial conduct in drop out so far?

The trial is progressing very well. And as you know, one thing we can certainly see because the first three months is open label trial, and we had seen quite a nice success in terms of the ideology of pimavanserin to stabilize these patients, and their ability to then meet criteria for the organization [ph]. So we are quite pleased with those results. And due to that, trial is progressing quite well in terms of planned enrollment, as well as randomization.

Got it. And my follow-up is on the DTC program. Are we going to get or are you guys tracking any metric that will measure the success of the DTC program?

Michael, do you want to take that?

Yes. Thanks for the question. And I would just say that we're really pleased with the earlier indicators we are seeing, and I think that really is reflected in our guidance. We're hearing consistent reports that the patients are requesting NUPLAZID by name, and we're seeing a significant amount of increased traffic on our consumer and our physician websites. So we are tracking a number of different early indicators. Of course, you're starting to see some reflection of that maybe perhaps in the [indiscernible] brand.

Our next question is from Tazeen Ahmad with Bank of America Merrill Lynch.

The first, Steve, if you can give us some color with regards to what is any impact that you're seeing from your last year's media articles? And I don't know you could comment on what your sales force is hearing from physicians and whether or not you're seeing any questions coming in from insurance providers. And then I have a second question.

Yes, thanks for the question, Tazeen. I think if would just go back to 2018, when we had some media articles, we said at the time that we do not anticipate any long-term effects on the brand. We said that we're very confident in the safety profile of the drug and that we have the best information available to asses that. The FDA did a thorough evaluation as I think everyone is aware of last year. And they concluded three things. One, they saw no additional safety concerns; two, they reminded patients, if you're taking the drug, you should keep taking it under the advice of your health care professional. And three, the reminded patients that drug approved for treatment of PDP. So as our -- what we thought in 2018 [indiscernible]. We continue to have high confidence in the growth of the brand. When we launched the drug, we said, expect to see more of a linear progression. And that's what we've seen generally throughout the course of the drug. So we remain very highly confident in the longer term prospects of the drug. And as we discussed on this call and on the last call, we are seeing some really encouraging indications of new growth. And finally, I just want to address your question around payers and the sales force. we Are not seeing any change in our payer status. And at the junction, the sales force, obviously, as I mentioned, is positioning the FDA reaffirmation of our safety profile, and that's being well received by the physicians in terms of confirming what they are really suspected and already knew. So no change in the attributed of the physician, nor the guidance by payers.

Okay. Thanks, Michael. And may be another one for you. As the launch is progressing, you had some time to take a look at prescribing trends. And I guess based on what you know so far, are you making any changes to your targeted physician they are coming longer? is it becoming shorter? And do you have a preference on whether you would like to see prescriptions from as many doctors as possible and they don't necessarily need to be multiple prescriptions? Or would you rather have certain physicians be prescribing patient of the drug to more of their patients?

Great question. First of all, I think, we have seen quarter-over-quarter, and we saw in the fourth quarter a significant growth in new time of prescribers, first-time prescribers. So we are still seeing additions to through our brand. But as a priority, we are now, I think, moving to a period where we want to get more depth. There's still a cohort physicians we'd like to reach, but we're starting to get into a situation where many people have dabbled with the product and working deeper and I think these guidelines we just talked about will help drive further confirmation of the use of NUPLAZID first line. That's where we are. It's kind of moving more physicians deeper into first-line usage with NUPLAZID.

Our next question is from Charles Duncan from Cantor Fitzgerald.

Quick question commercial and then 1 in R&D. With regard to guidance, $275 million versus $300 million, could you give a sense of kind of what the pressure points are around that or key determinants of that range? And then if you have any certain success goals that you'd like to share with us with the branded DTC, I'd like to hear them.

Charles, I think we heard the first question. Could you repeat the second question regarding DTC?

Yes. So say if you have any certain success goals with that, if you could outline those.

Sure. Got it. Okay. Elena do you want to take the first question?

So Charles, with regards to the guidance range, obviously, early in the year. So we account for a number of potential scenarios within our range. We think about the range we provided today, at the low end it assumes mid-teens annual year-over-year volume growth, and at the high-end, mid-20%, as I mentioned previously, around 20% the midpoint. We obviously, incorporate a range of expectations with regards to growth, both in the specialty pharmacy channel and the long-term care specialty distribution channel, and as well as possible considerations with regard to price. I think you know we took a price increase for the first time in the year at the end of December 2018.

Yes, Charles. Just a follow-up on your question at DTC. So the first step is that we do when we evaluate the campaign is can we execute the media targets that we have? So we have a certain amount of reach and frequency and media wave. We are executing on that with our campaign. That move then into building the awareness with the target audience, and then that's called action. The first of the call to action is investigation. And that's where referred to with the significant traffic we had intentionally on our websites and our digital properties. Importantly, an important component of that is what we call high-value actions. So more than just regular hits, but people who have downloaded videos, discussion guides, seeking their physician, et cetera. We then measure that in terms of action in the office, and from there, we convert that action into patient support. And we're hearing, as I mentioned, more physicians indicate that patients are asking for NUPLAZID by name. So those are just some of the kind of goalpost along the way. But ultimately, our evaluation of this campaign is success will be business ability to arc the business in terms of paid starts.

Okay. Well, we'll look forward to seeing that in the course of the year. And then just a quick question for. Serge. I'm wondering if you could share with us what you'd like to see out of schizophrenia inadequate response trial kind of the effect size that would be clinically meaningful? And then also, just kind of share with us on the DRP study, why would you do an interim read? What is really the practical implications of that?

Yes. Thanks, Charles. On the schizophrenia, if you look at the meta-analysis of the effect sizes for all of the current antipsychotics that are all in monotherapy treatment paradigm, the effect size is anywhere from as low as 0.3 to majority of the effect sizes that we see at about 0.5, with a couple of exceptions above 0.5 going up to 0.8. Those are the exceptions being for real. So where I would be between an adjunctive paradigm, quite excited if we see that level of average FX of around anywhere between 0.4, 0.5 will be a quite exciting for us to see that effect size. Obviously, that depends on many elements, and there are other data that we will be looking in the overall results of the trial to determine the overall benefit because one of the benefits that we don't particularly discuss often is that in this combination, we may see some benefit on the safety and tolerability side and this combination, and that's something that we will be also looking when you look at the overall results of the trial. on the DRP side, first of all, all of the randomized withdrawal trials because of its nature of the design, where patients are stabilized and active treatment and then treatment is withdrawn for at least half of the patients in the design. There are some ethical considerations of and concerns not to prolong the implementation and the execution of the trial if you already reached the evidence of efficacy. So from that perspective, interim analysis is sort of a mainstay in the design of the randomized withdrawal or relapse prevention trial. And secondly is the power of the trial is such that, as I mentioned earlier, at least the schizophrenia trial and in the depression trial, this happen more often than not. So from that perspective, historical, there's also expectation that, that interim analysis makes a whole lot of sense.

Okay, but there are no changes that could occur with the interim analysis, such as numbers of patients involved or statistical analysis plan changes?

Absolute not. What will occur is interim analysis will be performed, and that will you be done by firewall group that will report to our data safety monitoring committee, and they will inform us whether the interim analysis yielded positive results, in which case, we will stop the trial and unblind, analyze the data and before the data, or were if the provisions for stopping the interim analysis for efficacy are not met, the trial will continue without any changes. So I think as Serge mentioned earlier, the right way to think about the inter-read, the study has got power for the interim reading course is there is a very small part of the alpha there. If we hit that, a very high bar right the studies over. We'll move to submission. The only reason we will stop studies on the positive read in interim read. If we don't stop of the study at interim read, that's fine, we'll just continue executing the trial as planned. And the bar at the end of the study, of course, is much lower than that.

Our next question is from Salveen Richter with Goldman Sachs.

This is Andrea on for Salveen. Our first one is in light of your fiscal year '19 guidance, which reflects about 28% year-over-year at the midpoint, can help us think about drivers of growth? I know you've mentioned a couple but on the forward duties more of the reflection of the true organic growth or a consequence of increasing pricing?

Michael, do you want to take that question?

Yes, we see this as a reflection of organic growth.

Can you speak a little bit more about the core drivers?

Yes. Of course, the one that I mentioned, we see great enthusiasm and greater ability to penetrate our long-term care channel, and we're seeing great traction with that and continue to drive on those levers. The other would be the extension of the 34-milligram launch, which is, in itself, a obviously, put up, but it's way to refresh the efficacy and safety benefit message, combined with the FDA reaffirmation statements and fueled by external resources now citing NUPLAZID as being a drug of choice in the category for PDP. So we'll be levering that. And of course, then tied together with our large lever, which is closing the PDP awareness gap, on which DTC is one lever of it. But we're doing a number of other things to reach consumers and patients to educate them around the symptoms. And so those are the core kind of drivers for greater organic growth in '19.

Great. And just a follow up to that. For your direct-to-consumer campaign, I think, previously, you had mentioned that there was a greater effect observed for your specialty channel that you were observing. Is this still the case? And how to better target the long-term care channel?

I didn't quite hear the first part of your question.

So just in terms of the effect of your direct-to-consumer campaign, previously you have mentioned that there was a greater effect observed for your specialty channel. So just wondering if that is something that is still the case? And how you would go about targeting the long-term care channel?

Right. Great question. And good memory, yes. The first campaign that we had is with the disease awareness campaign. Our research indicated that we didn't really see much effect from the long-term care channel. We're evaluating that now on the branded side, and there may be evidence that we can share later that might be impacting the long-term care channel. But a lot of data still has we have distal assess that. Our strategy for long-term care is in terms of increasing penetration is mainly at the institutional education level. These are systems of care, the delivering networks and we are largely integrating NUPLAZID into treatment protocols and as a highly regulated environment. And so we're working within those regulations to increase the selection of NUPLAZID as a preferred agent in PDP for patients to get a long-term care. So that's going to be more of an education kind of system sell, and we're doing other things in regards to patient education in long-term care.

May be just stated differently. One very significant opportunity in PDP in the specialty pharmacy is the normal doctor office channel of the business. Is that there is this very large information gap between patients recognizing symptoms and having the discussions with their physicians. There's less of gap in the long-term care channels and other mechanisms for continuing to educate the community on NUPLAZID.

Our next question is from Danielle Brill with Piper Jaffray.

This is [indiscernible] on for Danielle Brill. Apologies in advance if you have already covered this. I have joined a little late. But I just wanted to get a little bit of information about the DTC campaign, specifically how, one, it will be running to? And then when the four effect should be taking place?

Sure, Michael?

Yes. Well, as I mentioned, we launched the campaign on Thanksgiving day. And our campaign is going to be running through the first quarter. So that's kind of where we're going to stop and assess the program, and the effects, we believe, we've given it a very large four month wait on the campaign and it's a significant investment.

Just to echo Michael's thoughts. What we'll do when we complete the campaign that we are finding now is will assess, of course, as we get closer to the end of that the return on investment is from the campaign and that some of that assessment will pass the end of the campaign. And it will determine what options we're going to pursue going forward for the remainder of the deal.

Got it. Okay. That's great. And the last question I had, and this is just sort of for myself. Just to remind myself, is when will the ENHANCE trial data be expected?

ENHANCE trial? Our schizophrenia [indiscernible] response trial, we'll report midyear.

Our next question is from Alan Carr with Needham & Company.

A couple of them. One, around the pattern with new starts in your specialty pharmacy. You had particularly strong first quarters for a little while, I'm wondering if you can comment on that. And then also with respect to Europe, I think said in the past that you wanted to wait until you had more data and more indications at least Phase III data and more indications. So at what point do you make a decision around Europe? Is it after second indication? Around third one?

Yes. Alan, I'll take the second one, and then I'll ask Michael to respond to your first question. With respect to the second question, there's no change in terms of our plans for following outside of the U.S. As we indicated earlier, we are [indiscernible] filing and the objective is to try to get data on more indications. So as we've said, as get more and more data, we'll continue to reassess that. But at this point in time, we'll continue to frame shift our strategy outside of the U.S.

In regards to the first quarter, I don't think there's any associated magic with the first quarter versus other quarters, except to say that when we ran the last campaign a year ago, we ran this campaign, it is important for us to leverage that family gathering in the fourth quarter. And so that tends to, I think, create more enthusiasm a more patient identification opportunities when we go to our campaigns. So we've got on the campaign outside of the like late fourth quarter or into the first quarter. So I really can't comment on how that would affect other quarters in a comparison basis. But obviously, the first quarter is super important in this business in a chronic nature business, because the more patients we're going to acquire early in the year, the more impact it has to the positive benefit in our revenue.

I understand. Just a little bit of additional color there. I think last year, the first quarter of 2018, we have made a number of adjustments, which we spoke to previously in the second half of 2017. And I think those adjustments, look, we were not surprised to the first quarter, we are in the first quarter 2018, because of the adjustments we've made and the early indicators that we've seen leading to that. It's a little bit different situation and we're coming to the first quarter of 2019, where we're seeing some really encouraging early indicators of growth but to later a little bit from the indicators that we've seen last year.

Our next question is from Paul Matteis with Stifel.

This is Nate on for Paul. May be first, can you mentioned I think in December you took a price increase for the first time this year. How are you thinking about approaching pricing as you start to move in some of these potentially much larger indications?

Michael, do you want to take the question?

Yes. Obviously, we think there is great potential in the, let's say, larger indications like DRP or MDD. And the benefit that NUPLAZID can provide these patients given the clinical profile is substantial. And if you take MDD, we believe commercially, that could be the best-in-class and adjunctive therapy for the reasons Serge already subscribe. If you take DRP, there's no asset to approve there. There is a significant unmet need for patients with psychosis that is not going to have [indiscernible] cognitive impairing therapy. So we believe that in both categories, significant unmet need, conversely then we're talking about players and looking at situations with large patient populations, and we believe in our early done with payers, given the clinical profile and our ability to use pricing mechanisms with the payers that we believe we can find that right price point for those different audiences that would be sequenced from PDP to DRP to MDD potentially. So we believe they can work with the payers to get the right access points for those patient populations. It's important to note, on the MDD side, that will be an expansion of our audience to a more commercial/younger population. In that setting, we have more ability to negotiate in the context of not having a Medicare patient population. So that's a different nuance.

Got it. That's helpful. And then maybe one more. Could just elaborate a little bit on the end-of-Phase-II comment with the FDA? In terms of getting alignment on CLARITY as a pivotal? And then, kind of specifically, I'm interested, how much discussion there was around its SPC design and, in particular, the stage 2 results?

Well, going into the end-of-Phase-II meeting, we already knew the position of the division in regard to how they consider the specific designs and trials. And what are the really important elements of the trial but they are particularly looking as an evidence of the efficacy of the drug. All of that came very clearly in the advisory committee meetings. So we had a very good sense where their position is, and considering that our trial was positive overall, especially in design, as well as very robustly positive stage 1, which FDA really consider as a real evidence of efficacy for the drug in the context of specific design. There is very little discussion, actually, about use of our trial, Phase II trial, as one of the pivotal. I mean, that align with exited the almost before the meeting. So that wasn't a subject of any particular exchange.

Our next question is from [indiscernible] from JMP Securities.

I'm in for Jason Butler. Just hopefully 1 quick question. Just one, how you guys are thinking about the regulatory fast-forward and negative symptoms of schizophrenia?

Great. Serge, do you want to take that question?

Yes. As we stated, there is nothing approved for a negative symptoms schizophrenia at this point, particular -- and there is nothing in adjunctive paradigm for that. We're obviously, considering a variety of shops and in terms of the regulatory fast-forward. But a lot of that will depend on actual data and results when we read out our Phase II trial. And based on the strength of that data, we will determine the exact path forward in terms of our regulatory approach.

Mr. Davis, please proceed to closing remarks.

Great. Thank you, Operator. And thanks to each of you for joining us today. We look forward to updating you on our progress next quarter.

Thank you for your participation in today's conference call. This concludes the presentation, and you may now disconnect. Good day.