Eva Stroynowski - Investor Relations Contact Richard F. Pops - Chairman & Chief Executive Officer James M. Frates - Senior Vice President & Chief Financial Officer.

Jonathan M. Eckard - Barclays Capital, Inc. Paul A. Matteis - Leerink Partners LLC Cory W. Kasimov - JPMorgan Securities LLC Biren Amin - Jefferies LLC Ami Fadia - UBS Securities LLC.

Good morning and welcome to the Alkermes Plc Fourth Quarter and Year End 2015 Financial Results Conference. My name is Brandon, and I'll be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference is being recorded.

And I will now turn it over to Eva Stroynowski, Director of Investor Relations at Alkermes. You may go ahead..

Welcome to the Alkermes Plc conference call to discuss our financial results for the quarter and year ended December 31, 2015. With me today are Richard Pops, our Chief Executive Officer; and Jim Frates, our Chief Financial Officer.

Before we begin, I encourage everyone to go to the Investor Section of alkermes.com to find our press release and related financial tables, including a reconciliation of the GAAP to non-GAAP financial measures that we'll discuss today. We believe the non-GAAP financial results better represent the ongoing economics of our business.

Our discussions during this conference call will include forward-looking statements. Actual results could differ materially from those forward-looking statements.

Please see our press release issued today and our annual report on Form 10-K for the year ended December 31, 2015 for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements.

We undertake no obligation to update or to revise the information provided on this call as a result of new information or future results or developments. Today, Richard Pops will provide introductory remarks. Jim Frates will then discuss our financial results; and Richard will close with a brief update on the company.

After remarks, we will open the call for Q&A. Now, I'll turn the call over to Richard..

That's great. Thank you, Eva. Good morning everyone.

So, since our release last month of the top-line results of the first two FORWARD efficacy studies for ALKS 5461 for major depressive disorder, we've talked to many of you, in some cases, multiple times, but I still wanted to start today's call by acknowledging the significant decline in our stock price and in the biotech market in general, and reaffirming the strength of our company.

The first is, we built this company to last, to be able to withstand and even thrive in tough market conditions, and to endure setbacks in any of our development programs. Our business is comprised of a portfolio of differentiated commercial products, novel product candidates in development and substantial and growing revenue streams.

We built this over many years, and we're continuously adapting it in order to create additional value. In the current environment, the resiliency of Alkermes becomes apparent.

We have a robust and growing base business, generating more than $400 million of manufacturing and royalty revenues from our partners; J&J, AstraZeneca, Biogen and Acorda, for patented medicines that will persist into the 2020s.

On top of this base, we're launching ARISTADA into a rapidly growing long-acting atypical antipsychotic market, bring distinctive features important to physicians, nurses, and patients at a time when the huge economic burden and human suffering associated with schizophrenia is becoming even more evident in our communities.

The most directly comparable product in terms of flexibility and dosing features, INVEGA SUSTENNA, is already a $1.3 billion drug in the U.S. and growing rapidly.

VIVITROL is beginning to hit its stride, generating nearly $145 million of revenue last year and growing at a 40% rate, providing a one-of-a-kind treatment alternative for opioid dependence at a time when politicians at the federal and state level, the media, and healthcare and criminal justice systems around the country are mobilizing to address what has become a national crisis.

We have great expectations for this medicine and it's gratifying to see the numbers beginning to bear this out. So from a financial and strategic perspective, we believe we've never been stronger. We are in a phase of launching and growing products, and growing revenues off of an already-strong foundation.

We're diversified, we have plenty of cash, and we're building capabilities for the future in very distinctive segments of huge therapeutic markets. The second point is with respect to our development pipeline. We have arguably one of the most diverse medically and economically important late-stage CNS pipelines in the industry.

We're tackling serious chronic diseases with devastating consequences for patients and families and we're making excellent progress. Three medicines are in pivotal study, ALKS 5461, for major depressive disorder, ALKS 3831 for schizophrenia, and ALKS 8700 for multiple sclerosis.

Each of these is based on a foundation of scientific evidence that is substantial and growing. This is true for 5461. As you've heard me say over the last several weeks, we believe that we're dialing in on the dosing, testing and analysis of 5461 in the setting of treatment-resistant depression.

We've had time to analyze the data more completely and share it with experts who were more convinced than ever that we have unambiguous evidence of activity.

At the same time, I've also told you that you should be skeptical as to whether FORWARD-5 will be successful as it's clear that we have not eliminated a potential for high placebo response even with our advanced study designs. But you should know that our scientists, statisticians and clinicians are excited to keep going.

This is science, we're learning and adapting in a difficult indication where many, if not most, active drugs frequently fail to separate from placebo in clinical trials. We would stop in a second if we thought this medicine did not have the chance to potentially help many, many people suffering from a very serious condition.

But we believe that it does, and we think it's revealing itself through these experiments. I'm going to turn the call over to Jim now to provide the financial overview and guidance. But I wanted to set the stage this morning with this perspective. This is a very strong company, and we're in the process of building it into something special.

When Jim is finished, I'll have some additional detail on the individual elements of the commercial and development portfolios. I'll give it to Jim..

Thanks, Richard. Good morning everyone. 2015 was an important year for us.

We continued the evolution from a business built around partnered products to a proprietary model that would drive our own top-line growth marked by the expanded use of VIVITROL and our newest proprietary product ARISTADA, which received FDA approval and was subsequently launched in October.

We also continue to invest in our future growth, by advancing our late-stage pipeline of CNS medicines.

Financially, our results for the fourth quarter and year ended December 2015 were in line with our expectations and were characterized by strong revenues from our base business of commercial products and focused investments both in our proprietary commercial portfolio and in our pipeline.

We believe our strong and growing commercial business, together with our diversified CNS pipeline, will drive significant growth and profitability over the next few years. Let's start with our key financial highlights.

In 2015, we generated total revenues of $628 million, a 12% increase over last year, when we exclude our divested Gainesfield business, and we recorded a $53 million non-GAAP net loss. For the fourth quarter, our total revenues were $163 million and we recorded a non-GAAP net loss of approximately $23 million.

Let me now review some of the key drivers of our financial performance during the quarter, starting with VIVITROL, our novel once-monthly injectable product for the treatment of opioid and alcohol dependence.

In the fourth quarter, VIVITROL had net sales of $38 million, compared to approximately $30 million for the same period last year, demonstrating growth of 29%. On a sequential quarter basis, unit growth was 7% while net sales growth was 1% as a result of increased Medicaid reserves in the fourth order, as our government business accelerated.

This is a positive development, showing our success in accessing this important public payer market, which will be a key part of VIVITROL's long-term growth. If we look at the net sales growth for VIVITROL over the entire year, the underlying trend is more apparent, where VIVITROL grew 53% year-over-year.

Turning to 2016, we expect VIVITROL net sales to range from $180 million to $200 million, representing top-end growth of nearly 40% and reflecting our belief that VIVITROL is still early in its growth phase. Let me just elaborate a moment on the trends that we see behind the accelerating growth in VIVITROL.

It's being driven by two main factors, the commercial business and the public sector. First on the commercial side, physicians' and systems' increased experience using our product is driving more adoption and we've seen a steady expansion of the depth and breadth of the key accounts using VIVITROL.

Our commercial business is growing at a steady rate of 20% across the country with certain states growing as much as 58% where key plans have improved access by changing prior authorizations and fail-first policies. Second, we're beginning to see our work in the public sector lead to increased treatment with VIVITROL.

Growth in state-funded and Medicaid programs is accelerating. As an example, our Medicaid business doubled this year and now makes up almost 30% of our total business.

This is encouraging for us because in large measure this is where the majority of patients are covered and we believe we're still only in the early stages of tapping into this important market.

Turning to ARISTADA, we see the long-acting injectable, or LAI, market in schizophrenia as another exciting opportunity where our medication can support patient care in a market that is currently plagued by poor outcomes. We believe our launch is off to an excellent start.

Our team of 175 territory business managers is targeting a well-defined group of physicians who have a history of prescribing LAIs for the treatment of schizophrenia.

And while prescriptions in these early weeks number in the hundreds, we have distributed more than 11,000 samples nationwide to meet the request of healthcare providers, treating patients in the outpatient setting and in our Hospital Inpatient Trial Program.

These programs will play an important role in raising awareness about the attributes of ARISTADA and we believe they will help us achieve long-term success. The key to this market is securing access to reimbursement, and this happens gradually over the course of the calendar year.

Because of the patchwork of Medicare Part D, Managed Medicaid, and Medicaid fee-for-service plans in all 50 states, we expect to have more than 200 planned meetings in 2016 with more than 50 happening in the first quarter alone with payer decisions to be made over the next few months.

We're confident that our commercial team has in-depth knowledge of the commercial dynamics here, and a sophisticated strategy to address them to assure a successful launch. As a result of this work, we're off to a solid start for ARISTADA with $4.6 million of net sales, which included wholesaler stocking.

We would also – excuse me, we would expect Q1 2016 sales to be lower sequentially over this past quarter due to inventory drawdown, as well as a normal launch process of gaining formulary access. Looking more broadly at 2016 for ARISTADA, we'll provide more specific net sales guidance during the year as we gain further experience with the launch.

We would note as a reference point that the most recent product launched in the LAI class achieved U.S. net sales of around $60 million for the second through fifth quarters of its launch. And we believe the shape of its launch curve and early results are a reasonable benchmark for ARISTADA's early launch phase.

Moving on to our key partner products, we saw overall revenues of $401 million in 2015, an increase of 10% from last year. Revenues were driven by $250 million from our partnered long-acting atypical franchise and $105 million from AMPYRA and FAMPYRA.

In terms of expenses, our total operating expenses for the fourth quarter of 2015 were $230 million, compared to approximately $191 million for the same period in the prior year.

This increase in operating expenses was driven primarily by the focused investment in clinical studies, investment in the launch of ARISTADA, and investment in profitable growth of VIVITROL. For the full year, we had R&D expenses of approximately $344 million and SG&A expenses of approximately $312 million.

Turning ahead to 2016, we expect R&D expenses to be in the range of $370 million to $400 million.

This expectation reflects investment in the recently initiated pivotal development programs for ALKS 3831 and ALKS 8700, while also continuing the ongoing FORWARD-5 efficacy study for ALKS 5461, as well as the advancement of our earlier-stage candidates, ALKS 7119 and RDB 1450 into the clinic.

For SG&A, we expect to be in the range of $360 million to $390 million. This increase is primarily driven by the full year cost of the ARISTADA field sales team. Turning to our balance sheet, we're in a strong position and ended the fourth quarter of 2015 with close to $800 million in cash in total investments and approximately $350 million in debt.

So, looking forward to 2016, we're well-positioned to execute on our plans to drive the next stage of Alkermes' growth while maintaining our financial strength. With that, I'll turn the call back over to Richard..

That's excellent. Thank you, Jim. Let me wrap up quickly with a review of our business and some of our upcoming milestones and let's start with ARISTADA. As you heard Jim say, the nationwide launch is well underway and early returns are good. Physician feedback on the product has been encouraging and consistent with our expectations.

ARISTADA embodies key attributes important to patients and healthcare providers. Efficacy, flexibility with a range of doses and durations and a simple, ready-to-use format. We designed ARISTADA to have features that address the real-world needs of patients and healthcare professionals.

That pursuit continues with the positive news on the potential two-month dosing regimen of ARISTADA that we announced this morning.

Based on these results, we plan to submit a supplemental NDA in the second half of 2016 for the 1064 milligram dose, which will expand the current offering to three dosing intervals, four weeks, six weeks, and eight weeks. This is an unprecedented range of options for treatment with aripiprazole.

The opportunity that ARISTADA represents for us is clear, it's transformed our commercial presence, and has established a new foundation for our growth. It's an important medicine, well-positioned to compete in a $2 billion U.S. market that is growing rapidly, and has the clear potential to become our most significant product yet.

Moving now to VIVITROL, we are seeing a groundswell of enthusiasm and clearly expanding use of this medicine. It's growing because of its increasing use in a wide variety of settings, as the U.S. treatment system begins to change in response to the growing prescription opioid and heroin epidemic.

What's most exciting is how an expanding array of states, counties, and municipalities are beginning to integrate the use of VIVITROL into their criminal justice and healthcare systems. More than 100 programs are ongoing in 30 states, many of which are just getting going.

These are the harbingers of the future and have the potential to dramatically change and expand the way addiction is addressed in our society. VIVITROL is a one-of-a-kind product, on patent until 2029, whose value is coming into focus. So in many ways, we see this as just the beginning for VIVITROL.

Now, on to ALKS 5461, our once-daily oral investigational medicine for patients with major depressive disorder and an inadequate response to standard therapies. As I mentioned earlier, we believe that we are dialing in on the dosing, evaluation and analysis of 5461.

While we did not meet the pre-specified primary endpoint for either FORWARD-3 or FORWARD-4, the two studies provided us with a wealth of new data from over 800 patients. We have been analyzing results and feel quite confident that ALKS 5461 administered as the 2 mg/2 mg dose continues to show clear signs of efficacy.

We see FORWARD-4 as a supportive study. And its comparison to FORWARD-3 is instructive. We're excited to share this data with you and the scientific community, and we've submitted the results to the American Society of Clinical Psychopharmacology Meeting or ASCP which will take place at the end of May.

This was just recently accepted for an oral presentation. The path forward is as follows; FORWARD-5 continues to enroll; we have a significant increment of new data to inform our analysis plan. We will increase the study size slightly and now plan to enroll approximately 420 patients, and we should report top-line data by year end 2016.

In the case of a clear positive outcome for FORWARD-5, we will proceed to meeting with FDA.

We believe the evidence provided by a positive FORWARD-5 trial and a previously completed successful randomized placebo-controlled Phase 2 study, together with supportive evidence from FORWARD-4 collectively could provide substantial evidence of efficacy for 5461 in the treatment of major depressive disorder.

Developing new drugs for the treatment of refractory depression is difficult and it's risky. We're clearly not immune to that, but it's also important. We believe that we're harnessing one of most compelling new mechanisms for treating this disease in the past 30 years. Millions of patients stand to benefit. We think we're going to figure this out.

We may not. And if the data begins to suggest that we're wrong, we'll stop. But I want you to know that we're far from that today. Turning now to ALKS 3831, our novel oral broad-spectrum antipsychotic drug candidate for the treatment of schizophrenia. Both of the core studies in the Phase 3 program are now underway.

The first is a four-week study, evaluating the antipsychotic properties of 3831 in approximately 390 patients with schizophrenia. The second study initiated two weeks ago is evaluating weight gain with ALKS 3831 compared to olanzapine in approximately 540 patients with stable schizophrenia over six months.

These two core studies will enroll throughout 2016 and, like we've done with past clinical programs, we will update you on our progress and our estimated completion window as we get further underway.

This is a very streamlined registration program for an exciting new medicine for schizophrenia, one with the potential to bring the proven efficacy of olanzapine with a differentiated safety profile, with favorable weight and metabolic properties. Beyond these two studies, we're further interested in elucidating the metabolic profile of ALKS 3831.

Our preclinical work has demonstrated that 3831 has favorable metabolic properties compared to olanzapine, and we're gaining an understanding of samidorphan's role in mitigating olanzapine's central and peripheral effects. We plan to conduct a metabolic study of ALKS 3831 in adult volunteers as part of the pivotal program later this year.

Also enrolling in its pivotal program is ALKS 8700, our monomethyl fumarate, or MMF, for the treatment of multiple sclerosis. 8700 is an oral molecule that's designed to rapidly and efficiently convert to MMF in the body, and offer differentiated features as compared to the current marketed dimethyl fumarate, TECFIDERA.

Our registration pathway is based on a 505(b)(2) strategy referencing TECFIDERA. Pharmacokinetic bridging studies, as well as a two-year safety study in approximately 600 patients with MS, are underway. In addition, we're very interested in determining the gastrointestinal tolerability of 8700 compared to TECFIDERA.

So we're choosing to conduct a randomized head-to-head comparison in approximately 420 patients, which we plan to initiate mid-2016. We expect to be able to submit the NDA for ALKS 8700 in 2018. Beyond the pivotal stage clinical programs, we continue to develop compelling new medicines from our R&D engine.

Two earlier-stage candidates are moving into man (20:09) this year, ALKS 7119 and RDB 1450. For 1450, our immuno-oncology candidate, we will file the IND this quarter and plan to initiate clinical testing in the second quarter.

ALKS 7119, our novel chemical entity for the treatment of Alzheimer's agitation and other psychiatric indications, is now in the clinic. We expect data from the study in the second half of this year.

So, in conclusion, the business is strong with a major product launch underway with ARISTADA, VIVITROL continuing to grow, a diversified and growing base business, and three late-stage development candidates in pivotal development, we're incredibly excited about the prospects for Alkermes in 2016 and beyond.

So I'll finish there and turn it back over to Eva for questions..

Thanks, Richard. We'll now take your questions.

Operator?.

Thank you. We will now begin the question-and-answer session. And from Barclays we have Jon Eckard on the line. Please go ahead..

Good morning. Thanks for taking the questions..

Good morning, Jon..

Real quick on VIVITROL guidance for 2016. Based on the 30% Medicaid mix that Jim referenced, what does the new guidance reflect with regards to unit growth versus dollar growth because of the change in the gross and net? And I have a question on ARISTADA after..

Yeah, Jon, good morning. It's Jim. I won't go into specifics on the unit growth, obviously because we're giving a range. But it actually contemplates continued rapid growth in the share of Medicaid business that we're getting. So I think that's why you're seeing – we feel like VIVITROL is doing very well.

Its growth has accelerated from 2014 into 2015 in terms of units and we still see that unit growth accelerating at those rates going forward, a little bit less growth maybe on net sales, because again, the Medicaid proportion is still growing fast.

Does that make sense?.

It does, thank you..

Yeah..

And then quickly to you again, Jim, your comments about the ABILIFY MAINTENA quarters two through five being like a reasonable guide or proxy to – for an ARISTADA launch..

Yeah..

I'm guessing that number for what you're saying for ARISTADA, would exclude the 11,000 samples that you referenced? And, based on your competitive intelligence, what's the level of sampling that was done with ABILIFY MAINTENA so that we could do a more clear apples-to-apples comparison for the demand of the two products?.

Yeah. That's really an important point, Jon. I'm glad you asked about it. So, there wasn't a sample program that our competitor launched with back in 2013. And first, let me take a further step back. They launched in March. If you remember, we obviously launched in October.

As we are moving into our quarters two through five, as you line up the launch curves, it makes sense to look at their quarters two through five, right? That's trying to line up apples-to-apples. The thing that's different is we have 11,000 samples in the field and they had zero.

So all their demand came through net sales, which is obviously going to be part of that roughly $60 million for the first year. And we haven't yet seen our samples start to pull through.

So, that's one of the things – it's one of the reasons why we may be trailing now, but it's also one of the things that our market research showed us that was really, really important, is that people want to be able to use samples and, before the reimbursement gets worked out, they want to be able to use it in the right patients and their practice and that's where they can use samples.

So, it's not exactly apples-to-apples, but, again, we're early in the launch phase. These are just guides, and we think that the important point is that the full year of reimbursement cycle that we need to get through these government payers before people start to make conclusions about how big the long-term potential in this product is..

If I could squeeze in one quick. I noticed that the scripts for ARISTADA are mainly – are mostly driven towards a high dose, is there anything to look into for – from that mix of the different doses that being used? And that would be my end. Thank you very much..

Hey Jon, it's Rich. I'll just take that one. Yeah, it's interesting to see that some of the first trials that we're getting from physicians using ARISTADA has been to take patients that have not been getting adequate clinical coverage from other medicines and trying them on a higher dose.

And early returns are they're getting a good experience with that. We think that's great. I think at equilibrium, we expect a more even distribution across the doses, but I think the fact that we're starting at 882 mg with so many first trials, represents a need in the marketplace..

Thank you very much..

Thank you..

From Leerink, we have Paul Matteis on the line. Please, go ahead..

Great. Thanks very much.

Can you hear me okay?.

Sure, Paul..

Great. Thank you. I have a few. One is on 5461.

I'm wondering – so you talked about FORWARD-4 being supported at a study of the 2 mg/2 mg dose, to the degree that you're able, could you expound upon the actual magnitude of drug placebo difference you saw in that study, in light of other drugs like SEROQUEL and ABILIFY that saw two point to three point differences on the (25:36) between them and placebo?.

I won't, other than to say we think it's a very healthy response and you'll see the data when we present the data at ASCP. And so why don't we talk about it as you see it.

Because what I really want people to understand is that these analyses of FORWARD-4 are only really relevant in the context of a submission that would come with a positive FORWARD-5 or a subsequent study. So, in that setting, I think that you'll be able to take a look at the data and make your own conclusions.

But I think there's very little ambiguity from our perspective and our KOL perspective the 2 mg/2 mg dose is separating really nicely in FORWARD-4..

Okay. Thanks. That's helpful. And then, you, Rich, and I'm not sure if you specified this in your prepared remarks, but for FORWARD-5 you talked about making a few changes. One of them was increasing the end, and another one was actually tweaking the stats plan.

So for increasing the end, I know one concern was the potential for an associated increase in variability. So maybe you could address that.

And secondarily, with the stats change you've made, can you just confirm that the new statistical analysis plan for this study would be something that you think the FDA would okay and has approved other drugs in this area?.

Well, I think it's a fairly obvious statement that we wouldn't submit a stat plan if we didn't think the FDA would approve them also. In fact, the final stat plan has not even been submitted for FORWARD-5, so it's flexible up until the time that we underlined.

But, what was the first part of the question, I forgot that?.

Just the end, and does that include (27:03)?.

That's right. Yeah, the decision we made to increase the end is really based on kind of looking the way the study is proceeding right now. So, we would not add new sites or new investigators in order to drive them.

So this is kind of a naturalistic, logical landing place if we let the well-enrolling sites that are doing a good job continue on their enrollment path for a reasonable period of time. So that's why I'd say it's a gentle increase in the sample size.

The studies architecture is still its basic architecture and so, I think that the primary change will come from this modest increase in sample size and a more refined statistical plan that incorporates the learnings from the additional 800 patients' worth of data..

Okay. Thanks for taking my question..

You're very welcome..

From JP Morgan we have Cory Kasimov on line. Please go ahead..

Hey, good morning guys. Thanks for taking the questions.

I just – I guess, Rich, want to first follow up on FORWARD-5 and just try to get a better sense of, what ultimately drives the decision to modify the statistical plan and analysis for that study? Is it just the continued learnings that you're getting from 3 and 4, is it – are you waiting for feedback from kind of your consultants on that? Or it's – because it sounds like this kind of has been ongoing – a decision hasn't been finalized yet.

I'm wondering kind of what the additional variables or inputs are that may make that decision for you..

Yeah, I think it's not particularly esoteric. It's just the fact that when we first designed this statistical analysis for FORWARD-3 and 4 it was based on a 142-patient randomized study in Stage 2 – in Phase 2, which was quite successful. But that's a certain-sized data set and we provide the way of modeling the two curves.

Now, with another 800 patients' worth of data, we just have a more nuanced way of looking at the analytical plan over that distribution. So, I think it's really just a way you do the math. And we'll continue to refine it statistically and figure out the best way to do it.

And what I'm also struck by is the fact within FORWARD-4, recall that we tested three – there were three treatment arms, there was placebo, there was the 2 mg/2 mg dose, as well as the 0.5 mg/0.5 mg dose which was ineffective in that study.

So, within the setting of a single study, we can actually can see what an efficacious dose looks like at 2 mg/2 mg and ineffective dose of 0.5 mg/0.5 mg compared to placebo. So, we're just getting a little bit able more resolution statistically in the best way to model this and to demonstrate the difference in a large study..

Okay, all right. Great. And then quickly on ARISTADA, really just wondered if you could characterize the physician feedback your sales force has gotten on the product.

You guys have been very clear for some time on the marketing message that you'd have and the differentiating features, how has that been resonating with doctors and considering that you're going into – you're at least initially targeting prescribers of LAIs, is there much education or do they kind of get it right away?.

I think it's really consistent with what we would have hoped for given the kind of explicit differences and attributes that ARISTADA has versus the competition.

And the point I made about the 882 mg, I think underscores – I think it's probably the most interesting new learning since we've been in the real world of the marketplace, which is how many physicians are interested in exploring that higher dose.

But the fact that we have this range of intervals, the existence of the six-week dosing interval is instructive, because it's not just the physicians say, I can go ahead and dose it every six weeks. It reflects the fact that there's a little bit more dosing forgiveness on the back end, because the PK profile is different than other products.

So the fact that 882 mg can be dosed every six weeks just underscores the fact that we've got a different wave form of presentation in ARISTADA. So I think the flexibility of three doses, and that being underscored by the range of intervals.

And then, of course, while not in the marketplace at all, but I think today's data on the two-month at a higher mass just underscores the fact that ARISTADA is going to be a really, really robust product family, more analogous to what SUSTENNA has brought to the market on the risperidone side. And that's a $1 billion drug in the U.S.

and growing rapidly. And I think that we've mimicked those features and that flexibility in the ARISTADA side of – in the aripiprazole side of the market, and that's why we're so confident against the backdrop of a market that's growing so rapidly, given the features that we have in the product that are kind of self-evident.

You don't really need to explain them at great length and to draw distinction between one dose and multiple doses, and multiple durations. I think we're going to do just fine..

Okay, great. Thanks for taking the questions..

You're welcome..

From Jefferies, we have Biren Amin. Please go ahead..

Yeah. Thanks guys for taking my question.

On the ARISTADA two-month data, are you planning at all to – evaluating a switch study from MAINTENA to this two-month dosing schedule as a way of potentially transitioning and trying to convert patients away from MAINTENA?.

I think the switches from MAINTENA will come naturally, based on limitations that physicians are seeing with MAINTENA to the extent those exist. Now, I think that the two-month is really, as you've heard us say before, Biren, you think about it this way.

If you're going to initiate a patient on a LAI, initiating one on one like ARISTADA, where if your patient is compliant and enjoying being on that medicine, you can cut their number of injections in half each year. That's really the offering rather than we're going to try to shift the market toward two-month.

In the same way that we see in INVEGA, SUSTENNA's three-month we think the two-month will do that for us as well. So, I guess, the answer to your question, which I didn't answer directly, which is, no, I don't see immediately, we'll leave it to the team. I don't think immediately the need to run the study, to switch people from MAINTENA..

Thank you..

Thank you..

Operator, it looks like we have time for one more question..

Thank you. From UBS we have Marc Goodman. Please go ahead..

Hi, good morning. This is Ami Fadia on behalf of Marc. Couple of questions, firstly, on ARISTADA, in your guidance – well, you didn't give specific guidance.

But, as you thought about your 2016 guidance, how much more sampling are you anticipating in 2016? And if you could just give us the amount of inventory stocking in the fourth quarter, that would be helpful. And then I have another one..

Ami, why can't you ask a question on behalf of Ami? No, we're not going to disclose our sampling plan, that's competitive in 2016.

Jim, did you want to answer that?.

Yeah. Well, and I would say on inventory – again, I mentioned, I think, there has been some stocking. Obviously, that's being worked through. We think the second quarter of launch, this 2016's first quarter will be down a little bit from last year. But, again, we won't give specifics. I think IMS has started to track the data quite nicely.

And, again, these are very small numbers. So through the year, we're quite comfortable. We don't think there are high inventory levels right now..

Okay.

So, now, all the sort of prescriptions are being pulled through?.

Yeah, I think that's a fair statement. And again, in a normal base, because it's going to be growing much more than we believed than the $4.5 million in sales we saw last quarter..

Got it.

And then just another question on 5461, have you had conversations with the FDA around kind of some of the outcomes of the FORWARD studies and how the FDA might look at a positive FORWARD-5 study along with Phase 2, would that be enough for them to really approve a drug?.

Yeah, we will. We haven't yet. One of the reasons we want to present at ASCP is that the FDA typically attends ASCP. It's a fairly small community of folks that are involved in these studies around major depressive disorder. But what we would do with a positive FORWARD-5, well we have a pre-NDA meeting with FDA, and discuss the filing package.

But we – yes, we do think it would be sufficient and based on historical precedent, we think that there's a pathway absolutely for 5 and for successful registration based on that clinical trial program..

Got it. And then just thirdly on VIVITROL, the drug has been continuing to grow nicely.

Have you changed your thinking around the sales resources behind that product? Do you need to put in more? Or do you feel like it's at a steady-state and you don't need to and you could probably repurpose some of them towards ARISTADA or some other product?.

Well, I think that there's a couple different alternatives in there. One thing we're not going to do is repurpose people. What's happening with VIVITROL, VIVITROL has an enormous amount of excitement within our commercial team and I think increasingly in the country. And it's still promoted in the U.S.

with a very small team of people in the field, on the order of 70 people. What we've been augmenting over the past couple years has not the field team as much as it's been on the policy at the state and the federal level, and that's going to continue.

I think there's no question that if VIVITROL continues to grow at this rate, we will expand the field base force, as what happens typically is a territory will get particularly lively and we'll break a particular territory into two, as opposed to opening new parts of the country that were not being covered.

So I think it will happen organically, and all of that's embodied in the guidance that Jim has given you..

All right. Thank you everyone. That's all the time we have today. If you have any questions, please don't hesitate to reach out at any time..

Thank you, ladies and gentlemen. This concludes today's conference. Thank you for joining. You may now disconnect..