Good day, ladies and gentlemen, and welcome to ACADIA Pharmaceuticals' Fourth Quarter and Full-Year 2020 Financial Results Conference Call. My name is Giji, and I will be your coordinator for today. At this time, all participants are in listen-only mode. We will be facilitating a question-and-answer session towards the end of today's call. [Operator Instructions] I would now like to turn the presentation over to Mark Johnson, Vice President of Investor Relations at ACADIA. Please proceed.

Thank you so much. Good afternoon, and thank you for joining us on today's call to discuss ACADIA's fourth quarter and full-year 2020 financial results. Joining me on the call today from ACADIA are Steve Davis, our Chief Executive Officer, who will provide an overview of our 2020 financial performance, a review of our business, and our outlook for 2021. Following Steve, Elena Ridloff, our Chief Commercial Officer, will then discuss our financial results and guidance. Also joining us today is Amanda Morgan, our Chief Revenue and Customer Officer; and Charmaine Lykins, Global Product Planning and Chief Marketing Officer, who will provide updates on our commercial initiatives. Dr. Serge Stankovic, our President, will then discuss our pipeline progress before turning it back to Steve for final remarks, and opening the call up for your questions. I would also like to point out that we are using supplement slides, which are available on the Events & Presentations section of our Web site. Before we proceed, I would first 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 the 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.

Thank you, Mark. Good afternoon, everyone, and thank you for joining us today. Please turn to Slide 5. We had a great year in 2020 with significant progress across our three strategic pillars. Our strong financial performance positions us well for a pivotal year in 2021, as we prepare for the transformative impact of our potential DRP launch, while advancing our pipeline of innovative programs. For the full-year 2020, we achieved net sales for NUPLAZID of $441.8 million. This represents a 30% year-over-year increase. These results are due to the focused execution of our commercial team, which continues to perform at a high level despite the challenges of the ongoing pandemic. Since launching in 2016, we've achieved consistent linear growth year-over-year in net sales of NUPLAZID for patients with Parkinson's disease psychosis or PDP. Additional highlights from 2020 include our submission of an sNDA for DRP. The FDA review is progressing as expected, and we look forward to the potential NUPLAZID becoming the first and only approved treatment for this indication, and the first new treatment in the dementia space in over 15 years. We progressed our Phase 3 program for trofinetide and Rett syndrome and initiated ADVANCE-2, our Phase 3 study for pimavanserin in the negative symptoms of schizophrenia. These are two indications with high unmet need and no approved therapies. We also further expanded our pipeline with strategic business development. We acquired CerSci Therapeutics, brining us the first-in-class non-opioid pain program. And through our collaboration with Vanderbilt University, we brought in a novel muscarinic receptor program. Both represent high science approaches within CNS and large potential market opportunities. Please turn to Slide 6. In 2021, to deliver on our mission, we're focused on three strategic pillars: first is driving the growth in NUPLAZID for patients with Parkinson's disease psychosis; second, delivering on the dementia-related psychosis opportunity; and third, developing the next wave of breakthrough therapies by advancing our development pipeline and acquiring new assets. Let's review these further on Slide 7. The significant potential of pimavanserin, combined with our clinical pipeline, will drive meaningful long-term growth. We continue to grow NUPLAZID sales, and based on our 2020 performance and current outlook, we're providing net sales guidance for PDP in fiscal year 2021 of $510 million to $550 million. We're on the cusp of a potential approval in DRP, a significantly larger market opportunity for which our teams have been preparing for approximately two years. We will be ready to execute on Day 1. In addition, we're advancing our pipeline with clinical trials across five separate indications. Today, we have two late-stage and two early-stage programs focused on the treatment of neurological and psychiatric indications in areas of significant unmet need. As we look to expand our pipeline, we will leverage our CNS expertise and have ongoing efforts dedicated to evaluating new business development opportunities. And with that, I will now turn it over to Elena to discuss our financial performance and guidance.

Thank you, Steve. Today, I'll discuss our fourth quarter and full-year 2020 results and our 2021 financial outlook. Please turn to Slide 9. In the quarter, we recorded $121 million in net sales, an increase of approximately 23% compared to $98.3 million in net sales in Q4 of 2019. This was driven by strong performance of NUPLAZID in the office space prescription channel and continued stabilization in the long-term care channel. Overall, year-over-year volume growth in Q4 was approximately 12%. The gross-to-net adjustment for Q4 was 18.3%. Recent inventory in the channel at the end of the fourth quarter were slightly higher than the previous quarter, but consistent with historical ranges. Moving down the P&L, GAAP R&D expenses increased to $62.1 million in the quarter, compared to $57.5 million in Q4 of 2019. GAAP SG&A expenses increased to $120.8 million in the fourth quarter from $91.9 million in the fourth quarter of last year. Non-cash stock-based compensation expense during the quarter was $21.2 million compared to $19.8 million for the same period in 2019. Please turn to Slide 10. For the full-year 2020, we recorded $441.8 million in net sales, an increase of 30% compared to $339.1 million in net sales in 2019. This was driven by 18% year-over-year volume growth. The gross-to-net adjustment for the full-year was 17%. GAAP R&D expenses increased to $319.1 million in 2020 from $240.4 million in 2019. This is primarily due to the upfront expenses related to the CerSci acquisition and the license and research collaboration with Vanderbilt University. GAAP SG&A expenses increased to $388.7 million in 2020 from $325.6 million in 2019. This is largely due to increased advertising and promotional costs, DRP launch preparation expenses, as well as an increase in personnel and related costs. Non-cash stock-based compensation expense for 2020 was…

Thank you, Elena. Today, I would like to review our full-year 2020 commercial performance, which reflects the solid foundation of our business and positioned us for long-term growth. Please turn to Slide 13. Over the past several years, we have built and developed a best-in-class commercial field organization through a high-performance culture that is focused on results. In 2020, we achieved $441.8 million in net sales, representing 30% year-over-year growth. I'd like to point out two key drivers of our success. First, despite the pandemic, we've broadened our prescriber base at double-digit growth rates, leading to double-digit volume growth year-over-year. Second, we increased our market share and meaningfully expanded the size of the overall PDP market by approximately 4% to 5%. This is a direct result of our PDP disease education and NUPLAZID's promotional efforts. In 2020, we grew across all segments of our business. This was led by office space prescriptions, which grew as a result of new patient start performing at or exceeding pre-COVID levels and we continue to observe high fulfillment rates for continuing patients on NUPLAZID. As we have discussed previously, the long-term care channel has been impacted by the ongoing pandemic. In Q4, our LTC business remains stable, and this is continuing as we enter this year. According to the latest IQVIA data, NUPLAZID has continued to outperform a market basket of branded LTC products. While census numbers remain below pre-pandemic levels, they have stabilized and we believe this will be a temporary situation. As we work through the pandemic, we remain confident in our growth potential for 2021 as we're well positioned to reach patients, wherever they're located, whether in the community or long-term care setting. Now let's discuss our NUPLAZID 2021 growth initiatives and priorities in PDP. Please turn to Slide 14. Our successful commercial execution and 2020 positions us well as we carry this momentum into 2021. This year, we'll continue to focus on growing our base of new prescribers, driving growth in the size of the overall PDP market and increasing NUPLAZID's market share. We'll accomplish this through a number of commercial initiatives including stimulating conversations to bridge the communication gap between patients, caregivers and healthcare professionals, continuing to engage with our customers, both virtually and in-person, and amplifying our healthcare professional and consumer campaigns. Throughout the year, we will leverage the strong foundation we have built in PDP to lead a successful launch in DRP. To discuss our DRP initiatives further, I'll now turn it over to Charmaine.

Thanks, Amanda. Please turn to Slide 15. Having led several successful product launches in CNS over the years, I'd like to emphasize how excited I am about this launch in particular and how experienced and well-prepared our team is. Our marketing and broader commercial teams have been working hard to deliver on the mission ahead of us. Patients are waiting. And last year approval of pimavanserin for the treatment of hallucinations and delusions associated with DRP will represent a significant breakthrough for patients and caregivers. And the pivotal HARMONY study in DRP pimavanserin demonstrated robust efficacy and importantly we see this efficacy without any negative impacts on cognition or movement. The physicians we have spoken to are eager for a treatment option with clinically established efficacy and the differentiated safety profile. We have an important mission ahead of us, and we look forward to delivering these compelling messages upon approval. A key focus of our DRP launch will be building disease awareness for both healthcare professionals and caregivers. For healthcare professionals, or HCPs, disease state education is the top priority. And these efforts are foundational to helping HCP to recognize and discuss the early signs and symptoms of DRP with their patients. Our disease state education website created by and for HCPs MoreThanCognition.com continues to see increasing engagement with approximately 450,000 views since launch in October 2019. Our virtual disease state education events targeted for the HCP audience have been very successful with impressive online attendance. Our team has engaged nearly every dementia center of excellence in the United States and all national long-term care associations have participated in DRP disease state awareness programs. When it comes to caregivers and the patients they care for prioritizing the caregiver and our consumer outreach is an important area of focus. When we…

Thank you, Charmaine, and good afternoon everybody. Please turn to Slide 18. First, I'm pleased to report that we are on track for the April 3 PDUFA date with our supplemental NDA for the dementia related psychosis. Beyond DRP, we are focused on developing innovative new treatments with high unmet need, and that is reflected in our growing and advancing pipeline. In 2021, we will have ongoing clinical programs across five indications. I would like to discuss now our pipeline progress in more detail, starting with our trofinetide program on Slide 19. As we've discussed, Rett syndrome is a highly debilitating, rare neurological disorder with currently no FDA approved therapies. Our Phase 3 program with trofinetide is progressing well with top-line results from our LAVENDER study expected in the fourth quarter of this year. With LAVENDER we are seeking to confirm the positive results of the Phase 2 study using the same validated endpoints to show improvement on the core symptoms of Rett syndrome. As a result, based on the end of Phase 2 meeting with the FDA, if LAVENDER is positive, we plan to submit an NDA. The negative symptoms of schizophrenia remain a very significant unmet need. Please see an overview of our program on Slide 20. There are over 700,000 patients in the United States, who are currently treated for schizophrenia, but still have persistent and potentially debilitating negative symptoms such as social withdrawal, lack of emotion and blunted affect among others. Approved antipsychotics primarily address the positive symptoms, namely hallucinations, delusions, agitation, but importantly do not control negative symptoms. As part of our Phase 3 program, we have one positive pivotal study already ADVANCE-1 and are enrolling our second pivotal study now ADVANCE-2. If positive, pimavanserin could be the first and only FDA approved therapy indicated…

Thank you, Serge. Please turn to Slide 25. Today, we were executing on our promise to deliver NUPLAZID to patients with PDP while preparing for a potential second indication in DRP. It allows us to help a greater number of patients and their caregivers. Our long-term growth strategy reflects the continued momentum of our NUPLAZID franchise and progression of our broad pipeline, which addressed disorders of high unmet need. Additionally business development remains a critical pillar of our strategy and we will continue to execute high science deals that expand our pipeline. In closing, I would like to thank our employees for their accomplishments in 2020 and their continued commitment, and passion as we continue our mission to elevate lives. I'll now open up call for questions. Operator?

[Operator Instructions] Our first question comes from the line of Cory Kasimov from JPMorgan. Your line is now open.

Great. Good afternoon, guys. Thank you for taking my question. I wanted to ask you more about your market research around DRP, and kind of what you see as the initial intent to prescribe, and maybe what you would expect to be the biggest impediments to initial uptake? Thank you very much.

Yes, thanks much for the question, Cory. Charmaine, do you want to take that?

Sure. Overall, I'd say we've had very good feedback from KOLs up until now, be it the advisory boards we've had or market research. Physicians are excited to be able to prescribe NUPLAZID for dementia-related psychosis once it's approved. And ideally because of the dual efficacy that seen through the HARMONY study with three times less chance of relapse compared to patients on placebo when it comes to symptoms of psychosis. The safety profile as well is one that differentiates from the off-label agents that are used out there in the market. So overall, I would say, very positive feedback with regards to physicians that we've spoken to in market research.

Great. Thank you.

Thank you. Our next question comes from the line of Ritu Baral from Cowen. Your line is now open.

Hi, guys. Thanks for taking the question. I wanted to ask about sort of the first steps that you would take on the DRP launch, especially as it relates to long-term care centers and what is potentially a COVID-off environment. What are you seeing in those dynamics? Are patients moving back into the long-term care center for retail? Could it be disruptive? And how will that fit into your first launch activity?

Yes, thanks so much for the question, Ritu. Amanda, do you want to take that?

Yes. Thanks, Ritu, for the question. What I'll share is that the situation in LTC is temporary and linked to the pandemic. We believe that the availability of the vaccine and the distribution of the vaccine will be a key element to returning to pre-pandemic conditions. What I'd like to share with you is, and remind you of, is that really NUPLAZID has done very well throughout 2020, and outperformed the market regardless of the pandemic. And so when you look at it compared to the market basket, 13 of 15 products experienced declines. So just looking at that situation, looking at how we performed in 2020, and looking into 2021, we'll continue to leverage that foundation.

Ritu, it might just also -- just to remind everyone, we ship drug directly to patient, so that's always been our distribution model, so they get it directly at their homes. So we can access patients whether they're in a long-term care facility or at their home. And I think what we've seen through the pandemic is our ability to do that, our ability to reach out to patients, work through the challenge of the pandemic, and we expect that the learnings that we've garnered there to carry through as we launch into DRP as well.

Helpful. Thanks.

Thank you. Our next question comes from the line of Tazeen Ahmad from Bank of America. Your line is now open.

Hi, guys. Thanks so much for taking my question. So, you guys are not going to be providing guidance for DRP, understandable. But assuming that you do get approved and you do start detailing right away, could we expect to see some detail at least in the early parts of the launch, that scripts being written specifically for that indication, so that we have a sense of sort of a cadence of pickup, at least, in the early days, so that we have some expectations on how we should think about modeling? Thanks.

Yeah, thanks much. Elena, you want to take that?

Sure. So, Tazeen, it's a little premature at this point to comment on what we'll provide as far as early launch metrics, but we will do our best to provide dynamics and insights into the launch and we are eager and excited to launch on approval.

Thank you. Our next question comes from the line of Charles Duncan from Cantor Fitzgerald. Your line is now open.

Hi, Steve and team. Congrats on a good year of progress despite the challenging market. Thanks for taking my question. I had a question for Serge relative to DRP regulatory progress, and I know you're probably not going to provide a lot of color. But you said that you were on track for the April 3 PDUFA date, and I'm kind of wondering how you know that is the case? Are you in label discussions? And then can you provide any color on how you imagine the label, if it's an approved label, to accommodate use in a dementia patient population?

Serge, two questions there. You want to take them? Serge, I think you may be on mute.

Yes, I'm sorry, I was on mute. Hi, Charles, and thanks for the question. As it is customary, we are not really providing the details or commenting on the ongoing review, unless, obviously, there is something material. So to that extent, we are not going into details on the day-to-day interactions with the FDA. But we are, based on all, everything, we are on track for the April 3 PDUFA date. In regard to the label, as we have been commenting earlier, we are not only anticipating the broad label, broad indication to other types of the dementia-related psychosis, but we -- or across the dementia subtypes. But we are also had basing that on the interactions and agreements that we had with the FDA from the beginning, starting with our end of Phase 2 meeting and the pre-sNDA meeting. So, from that perspective, we are, however, reliably anticipating that we will receive the broad label with based on the study that we submitted with a part of the supplemental NDA.

Sounds good. Thanks for taking the question.

Thank you. Our next question comes from the line of Neena Bitritto-Garg from Citi. Your line is now open.

Hey, guys, thanks for taking my question. So I just had a question about the gross-to-net. And thanks, Elena, for giving us some good detail around how to think about it for the first quarter and the rest of the year. But I guess I'm just curious about how we should think about where the gross-to-net could kind of settle out in like the second through fourth quarters this year, just given the DRP launch and the dynamics of kind of new Medicare patients coming on drug in potentially large quantities? Thanks.

Yes, Elena, you want to take that?

Sure, thanks. So maybe I'll break it out just to give you a little more context for PDP versus the dynamics for DRP. So, for PDP, we there expect a very similar gross-to-net dynamics as well as a rate as 2020, so high teens for PDP. When you look at DRP, since the patient mix will be different as we'll have more new patients, and this is a heavily a Medicare population, there'll be a higher proportion of donut hole obligation for us. So, the DRP proportion of revenues will have a higher gross-to-net, and it'll likely be in the mid-20s, again because of the patient mix, so over time that would change.

Perfect. Thank you.

Thank you. Our next question comes from the line of Jason Butler from JMP Securities. Your line is now open.

Hi, thanks for taking the question. Just one outside of the long-term care setting, can you just give us an idea of what the level of overlap between PDP and DRP prescribers is? And essentially, is it our subset of prescribers here that already has a relatively high level awareness of DRP and the pimavanserin data. And then just a quick follow-up does your guidance assume for PDP any return to growth in a long-term care setting in 2021? Thanks.

Sure. Amanda, you want to take the first question and Elena you want to answer the question on guidance?

Sure. Thanks for the question. So as we prepare for DRP, we're going to leverage our current compelling and then we'll expand further into psychiatry, LTC, and then our CNS focused primary care physicians. Elena, you want to take the second point.

Sure. So, we've incorporated a range of scenarios within our guidance. And as Steve and Amanda mentioned before, importantly, we can reach patients wherever they are, whether they're at home or in a long-term care setting. So there's a range of scenarios incorporated in our guidance with regards to long-term care, returning to growth and we're confident in the range and the dynamics of the lower end versus the upper end will partially be determined based on what we see as far as long-term care census and the rate towards that improves throughout the year.

Got it, great. Thanks, Elena. Thanks for the question.

Thank you. Our next question comes from the line of Jeff Hung from Morgan Stanley. Your line is now open. Q – Jeff Hung: Thanks for taking the question. Can you just provide an update on levels in-person activity in the last couple of months and what kinds of differences you're seeing by region or channel? Just curious if that's changed over time. Thanks.

I'm sorry. You were breaking up on line. Could you ask the question again? Q – Jeff Hung: Yes, sure. So I was just wondering if you could provide an update on the level of in-person activity in the last couple of months, and I'm curious if that's changed over time and what kind of differences you're seeing by region or channel?

Got it. Yes, thanks very much. Maybe you want to take the question on in-person activity?

Yes, thanks for the question. So the market's dynamic as we navigate this pandemic, we're seeing some return on face-to-face or in-person interactions, but we'll continue just like we have throughout 2020 and 2021 to adjust to the market and maneuver from virtual to in-person to hybrid.

Thank you. Just to echo Amanda's thoughts there, on the in-office side, we are seeing things shift more and more towards in-person visits. On the long-term care side, things are pretty much unchanged on that front where it's very restricted getting for understandable reasons, getting to long-term care facilities. Having said that I think is we're all see in the press vaccines being distributed more and more broadly, particularly focusing on elder care and patients in long-term care facilities. This temporal situation we'll clear and we'll have the ability to do more in-person visits in long-term care facilities. And just one additional thing that we've mentioned before, I just want to remind you of long-term care is a little bit of a different call point than calling on a physician's office. It's more of a -- there's several constituents that need to be engaged in long-term care, the long-term care pharmacy medical director or nursing staff at the facility, and of course the prescribing physician. We have relationships with all of them and many of those relationships do not require us to be in a facility. So, as we indicated before, we feel very well positioned to continue to drive the business in long-term care. And as since this numbers come back there, we expect to return the same kind of gross profits that we had there before the pandemic. Q – Jeff Hung: Great, thanks.

Thank you. Our next question comes from the line of Salveen Richter from Goldman Sachs. Your line is now open.

Could you provide your view on how you see with DRP launch trajectory playing out versus what you saw with the PDP launch recognizing differential factors, including COVID and existing partial footprint, but any color you can give us here would be helpful.

Sure. Elena you want to take that?

Sure. So, we expect very similar dynamics to what we've observed with PDP, but of course on a much larger scale. If you recall, when we launched in PDP, we said with these kinds of drugs, particularly when you're entering a new space, but there's been nothing approved before, you should expect the progressive linear type of sales growth. And that's exactly what we've seen with PDP. And this is really just because of two primary factors, one more educating both on the disease state as well as getting physicians familiar with prescribing a new drug. And as we start to get more of that familiarity, then the prescriber base grows and your depth of prescribing grows. So, we expect the same thing to be true for DRP. And we're very much looking forward to launching in following the PDUFA.

Thanks.

Thank you. Our next question comes from the line of Marc Goodman from SVB Leerink. Your line is now open.

Elena, can you talk about the SG&A increase from 2020 to 2021 to some push and pulls. I mean, I'm curious number of reps that we're adding, are we adding roughly 250 reps? Are they coming in around the middle of the year? Are they coming in at the beginning of the year? With respect to the advertising promotional event dollars that you're doing, I mean is the PDP dollars going up year-to-year in addition to obviously, we're layering in DRP. I'm just kind of curious or as DRP coming in with PDP kind of moving down, I'm just kind of curious how you guys are thinking about this, and how it plays out throughout the year as well?

Sure, so you've hit on two of the primary drivers. So let me just first, so first the primary driver for sure is the DRP launch. Our PDP spend year-over-year is very similar. And the key drivers to that increase are the field expansion. You have the numbers, right, we're going from 200 to 450.Our marketing launch investments, which include our DRP DTC plan, which we think will be important, and we've had a lot of success with PDP on both unbranded and brand new campaigns. And we plan to implement a similar strategy for DRP. And then lastly, our medical affairs investments, Phase 4 studies for DRP and MSL expansion. So those are the primary drivers and as far as the cadence for the year, you should expect SG&A to grow through the quarters throughout the year.

Thanks.

Thank you. Our next question comes from the line of Vamil Divan from Mizuho. Your line is now open.

Great, thanks for taking my question. Thanks for all the thoughts on DRP because they'll take us over the next six weeks or so. So I think maybe I could just shift gears, you also have the trofinetide data coming out at the end of the year here. Can you maybe just sort of frame your thoughts on what would be clinically meaningful results from that trial? And then there's several companies working on products for Rett syndrome. Now, obviously, there's a huge unmet need. Can you just maybe talk about where you see this product being differentiated from the others? Thanks.

Sure. Thanks much, Serge, you want to take that?

Yes, thanks Vamil. I'll start by the first part of your question in terms of what are our expectations in terms of being for most of the results. Just to remind you in the agreement with the FDA, the primary outcome of our Phase 3 trial is actually measurement of the symptoms by two separate outcome measures, one being Rett Syndrome behavioral questionnaire, which is a validated caregiver assessment for symptoms of Rett Syndrome. And the other is clinical global impression of improvement, which is a clean initial assessment of the overall improvement of symptoms. So by virtue of actually not only assessing the core symptoms of the Rett Syndrome by rating scale, but also these clinical assessment of the improvement gives the meaningfulness to the outcome of the measure obviously providing that we observe significant difference between placebo and drag in this regard following treatment. So that's as far as the first point goes. In regard to the second question, one of the distinctive characteristic of the benefit that we're anticipating to replicate in our Phase 3 trial from the initial data that we have in Phase 2 is that trofinetide addresses multiple areas of the core symptoms of Rett Syndrome. As you know, Rett Syndrome in its nature affects the multiple system motor, respiratory seizures are important symptoms, the ability to articulate as well as other neurological symptoms that occur. So, from that perspective, we're really distinctive characteristic of trofinetide is that addresses these multiple symptoms, which is somewhat different from what we have seen with some of the other development programs that are specifically targeted to one specialist area like either addressing seizures, or respiratory symptoms or things of that nature. So, this ability to address the core symptom and thus improve overall functioning of the patient is important feature that we are anticipated to be able to demonstrate through with the data from our Phase 3 trial.

Okay, thank you very much. Thanks.

Thank you. Our next question comes from the line of Paul Matteis from Stifel. Your line is now open.

Hey, thanks a lot for taking my question. Since pimavanserin is on the market and insurers know well, how much can you formalize reimbursement agreements, or at least semi-formalize them ahead of approval and I guess in April, May, June, what do you think access will look like? Do you think that the physician pretty soon will be able to write this and get a patient on it within a reasonable period of time? Or could we be months away from that after the PDUFA? Thank you.

Sure, thanks for the question, Paul. I'm going to answer part of the question, and I'm going to ask Charmaine to answer the second part regarding just access in the early going. So as we've indicated before, although DRP is a dramatically larger population than PDP, I wouldn't expect, I wouldn't assume that we'll have any change in price there. Today, we enjoy very good access with payers. We're already on formularies with PDP and with DRP, we expect very similar dynamics with payers and very similar payer mix, when I say we expect very similar dynamics, payers get with PDP, there was no drug approved, DRP there is no drug approved. Used in both cases off label use of the atypical antipsychotics is very problematic in use in those populations. And we've always priced NUPLAZID based on the value that provides for patients and their caregivers, and as you know, we enjoy very, very good access today. So I'll let Charmaine talk a little bit about the mechanics of just what will happen as we move past and approval and payers make adjustments to their access, Charmaine?

Sure. Yes, sure, thanks Steve. So first of all, we have to recognize that DRP will be a line extension for a product has already approved it on the market, and NUPLAZID is part of a protected class as well. So, both of those pieces of information are important here. Payers will simply add an additional usage criteria for dementia related psychosis to NUPLAZID's existing formulary status because of the situation. Now for Medicare, the largest payer of course, considering the demographics, that is expected to happen within 90 days or so of approval. On the commercial side with commercial payers, it may take up to a year, but we don't anticipate it happening taking it that long with the commercial payers. In the interim, we've got patient services programs set up to Acadia Connect and we're well equipped to support patients no matter where they may be, as I mentioned before, be they in long-term care setting community or whatnot and also with different types of payers.

Thank you.

Thank you. Our next question comes from the line of Gregory Renza from RBC Capital Markets. Your line is now open.

Hey guys, thanks for all the color tonight. Congrats on the progress and thanks for taking my question. Just wanted to follow-up a bit on [indiscernible] just perhaps from taking a step back, and just from a higher level, just wondering if you could just characterize how perhaps important you see the Lavender readout as it perhaps reads through to your efforts and thesis around finding those next waves of breakthroughs and your external business development model using that as essentially the initial case study for growth beyond pimavanserin, how it suggests and how you're looking at assets going forward and beyond to build the pipeline? Thank you very much.

Yes, thanks much for the question, Greg. So, I would say, as is the case, with any clinical development program, we operate in an environment where nothing is 100% certain, having said that, so with any program, we recognize that there's a certain risk profile and cost benefit profile with any program that we pursued. In the case of trofinetide, we really liked the profile, we really liked that opportunity, we would make those more of those investments, we find those particular types of opportunities. And by that, I mean when we brought in that program, the very intriguing Phase 2 data and we're in a situation where if we can replicate those same results in Phase 3, then we should have a drug, we should have the first drug for the treatment of Rett Syndrome. So given the investment that we made, and have made since doing that deal, and the opportunity, we'd like those kinds of investments. So, in response to your question, what impact would that have on our business development activities, positive or negative, it wouldn't have any, quite frankly, if it's positive, we'll be very thrilled. And we'll move forward to try to get this medication to a population that desperately needs the treatment. If it turns out that unfortunately, we're negative, which is just a risk to our -- that's endemic to our business, right? If that were the case, it wouldn't change our strategy; it wouldn't change anything that we're doing on the BD front. BD is we've described as one of the three pillars of our business strategy, it's extremely important to us, we're putting a lot of effort into it, you'll see more deals from us. And as we've indicated before, we have a foothold both in neurology and psychiatry. We have a foothold both in broad indications as well as rare disease. We're fairly modality agnostic, and have a lot of internal expertise across the broad array of CNS opportunities. And there are a lot of things in the CNS space, we wouldn't want to own. There are a lot of things, there are other things that we think are really interesting, and some really, really interesting science going on right now. So we're very optimistic about the growth plan that we have fueled by business development.

That's great. Thank you very much, Steve.

Thank you. Our next question comes from the line of Sumant Kulkarni from Canaccord. Your line is now open.

Good afternoon. Thanks for taking my question. And thanks again, for all the details you provided on the gross to net and potential payer dynamics. But could you talk about your philosophy on the actual magnitude and frequency of price increases of NUPLAZID and whether that might have changed in any way, given that DRP approval is around the corner? And that indication is much larger relative to PDP?

Yes, thanks so much for the question. As I indicated earlier, I wouldn't, it's a little premature to comment on pricing, but I would assume that we'll change price or in other words, make pricing concessions in DRP even if the dynamics are very similar and the payer interactions we've had so forth so far indicate that they get it, that they understand there's nothing approved and use of the anti-psychotics offlabel is very, very problematic in this population. And so, as we go forward, I would expect that the kind of price increases that you might see from us as we go forward and even larger populations would probably be consistent with what you'll see across the pharmaceutical industry in general. And of course, as we move into DRP, we're very eager to get this medication to the very large population that that has nothing to treat this disorder today. And, as I indicated, based on the payer work we've done so far, and it's been extensive. We feel like there's a very strong alignment and the understanding of the value proposition that we're bringing.

Thanks.

Thank you. Our next question comes from the line of Chris Howerton from Jefferies. Your line is now open.

Hi, there. Great, thanks so much for taking the question. I guess this is for Serge. If we could just have maybe a little more color on the Phase 2 trial designs for 044 the pain program? And in particular, I'm interested to know if you're going to evaluate multiple dose strengths and what the treatment duration and frequency would be?

Yes. Thanks, Chris. Just to remind everybody, our Phase 2 program based on the preclinical data that we have and potential of benefit of ACP-044 both in the models of acute pain as well as chronic pain in the Phase 3 are planning to conduct clinical studies both in the acute pain model and in the chronic pain model. For the acute pain study, we are planning to conduct post-surgical study following by neurectomy. This will be all placebo controlled study that will evaluate different dose levels and treatment regiments. I at this point wouldn't go into much detail on that, but beyond this. And for the chronic pain study, we will be evaluating the osteoarthritis pain. Both studies will have approximately in the range of a couple of hundreds of patients involved. And there we will be as well evaluating different dose levels and dose regiments. We anticipate that top-line results from the acute pain study being shorter, obviously and we will have the top-line results by the end of this year, 2021. And for the chronic pain study that we'll be initiated in the second quarter of this year to over the middle of the year, we will be starting that a little later. So we are anticipating the results sometimes in 2022, and we'll obviously update better once we initiate the study and start the recruitment.

Okay. All right, well, thanks for that. I appreciate it and we'll look out for more details as both study start.

Yes.

Thank you. Our next question comes from the line of Yatin Suneja from Guggenheim. Your line is now open.

Hi, guys. This is [Eddie] [Ph] on the Yatin. Thanks for squeezing me in here. Just as a quick follow-up to the previous question on the label, can you talk about what your ideal wording would be for an updated label with respect to the Black Box warning for increased mortality in elderly patients, and sort of how that wording may affect any uptake? Is there additional education that needs to be done? Or is there any negotiation that can be done on what the wording in that black box looks like? Thanks.

Yes, thanks for the question. Serge, do you want to take the first part? I'll take the second part of that question.

Yes, absolutely. Related to the box warning, I will start by saying that we have a high level of confidence in the safety data that we have submitted with our supplemental NDA. First of all, this particular application, we have much larger dataset both in terms of safety as compared to our initial NDA. And in addition to that, we have now years of post-marketing experience with a safe deal pimavanserin [indiscernible] elderly population. So, however with that confidence in the safety data that we submitted, we also have a level of the realism that it's very difficult to remove the box warning, particularly when we're talking about black box warning and as it's the case here. So, I cannot really comment what FDA ultimately will decide in this regard, but I will share that we anticipate that at the minimum there will be some modification in the wording of box warning. Just to remind you currently, class black box warning consists of two statements; one stating that the risk of mortality death in this population is increased in elderly patients with dementia and dementia-related psychosis, and the second sentence clearly states that such, and so, so-and-so drug is not approved in patients with for do with dementia related psychosis. So, obviously when we received approval for hallucination treatment of the hallucinations and delusions in Parkinson disease psychosis that that second sentence had to be modified in some sense. And we had a carve-out for the patients with Parkinson's disease dementia. So if you look at the specific box wording in the case of pimavanserin that second centers contain that carve out. We do anticipate obviously with the approval of pimavanserin for treatment of hallucinations and delusions in patients associated with dementia related psychosis. That that second sentence will have to be clearly removed and some modifications to the overall box warning wording will have to be included.

Yes, I'm sorry. I know we're running all short on time, so I'll try to make this quick. So as Serge mentioned in two symptoms, second symptoms would need to be removed because we would be approved for DRP. The first symptoms, if that remains and it's unclear at this point, whether just where we in the FDA would come out on that, but if that sentence were to remain it would be very similar to the situation we have in depression today where every anti-depressant has a box warning indicating that young people who take anti-depressants are at higher rates of suicide and suicidality. And so physicians are very, Physicians well-positioned to make that kind of risk benefit assessment when they're looking - when they're evaluating individual patients, same thing is true in PDP today where we have the class Box Warning in physicians make the determination and are well positioned to do that in a variable position to do that. In DRP today, there are about 800,000 DRP patients that are taking off-label atypical anti-psychotics that in addition, not being approved DRP also have the very class warning that we're talking about indicating a higher risk of mortality, and that that drug is actually not approved for that indication. So I think if we're approved and that it's clear in the label that, that we're approved to treat DRP patients even if we have some box warning that relates to mortality we think we'd be very well positioned to and HCPs would be very well positioned to make that same value judgment.

Thank you so much.

Thank you. We have time for one more question. Our next question comes from the line of Joseph Stringer from Needham & Company. Your line is now open.

Hi, everyone. Thanks for taking our question. For DRP, would you expect a long-term care channel to comprise a similar percentage of overall scripts and as seen in PDP and also do you expect similar persistence and compliance rates for DRP relative to PDP? Thank you.

Yes. Thanks so much for the question. In terms of long-term care, long-term care represents about 25% of our PDP business today, and we believe in DRP, it will be in the 40% to 50% range of the DRP business. And I'm sorry, the second question was?

It was on the persistence and compliance rates and DRP versus gap. Thank you.

Got it. Okay, perfect. Elene, do you want to take that?

Yes, sure. It's a little premature to comment. There'll be able to have greater clarity once we're in the market, but based on what we see and these of off-label anti-psychotic in the DRP market we would expect largely similar dynamics to what we see in PDP, as far as persistency and compliance. And we'll be able to provide more color as we get into the DRP launch.

And just as a reminder, in PDP, this is a really sticky drug. So once you get passed the first couple of months of therapy, we have a meaningful drop-off with all drugs of this type. Our fulfillment rates are very high in PDP. And as Elena mentioned, once we get through a launch in DRP, we would anticipate we'll have a similar type of adherence.

Thank you. Mr. Davis, please proceed to closing remarks.

Great. Thank you, Operator. Thanks again, everyone for joining us today. We appreciate it. Look forward to updating on our progress.

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