Ladies and gentlemen, thank you for standing by, and welcome to the Intra-Cellular Therapies Second Quarter 2021 Earnings Conference Call. At this time, all participant lines are in a listen-only mode. After the speakers’ presentation, there will be a question-and answer session. . We ask that you please limit yourself to one question and one follow up.

Please be advised that today’s conference is being recorded. . I would now like to hand the conference over to your host today, Juan Sanchez, VP of Corporate Communications and Investor Relations. Please go ahead..

Good morning and thank you all for joining us for today’s conference call. Our earnings press release provides a corporate update and details of the company’s financial results for the second quarter ended June 30, 2021. This press release crossed the wire a short time ago and is available on our Web site at intracellulartherapies.com.

Joining me on the call today are Dr. Sharon Mates, Chairman and Chief Executive Officer; Mark Neumann, Executive Vice President and Chief Commercial Officer; Dr. Suresh Durgam, Senior Vice President and Chief Medical Officer; and Larry Hineline, Senior Vice President and Chief Financial Officer.

As a reminder, during today’s call, we will be making certain forward-looking statements.

These statements may include statements regarding, among other things, the efficacy, safety and intended use of the company’s product development candidates, our clinical and non-clinical plans, our plans to present or report additional data, the anticipated conduct and results of ongoing and future clinical trials, plans regarding regulatory filings, future research and development, our plans and expectations regarding the commercialization of CAPLYTA, the potential impact of the COVID-19 pandemic on our business, and possible uses of existing cash and investment resources.

These forward-looking statements are based on current information, assumptions and expectations that are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements.

These and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports. You are cautioned not to place undue reliance on these forward-looking statements and the company disclaims any obligations to update such statements. I will now turn the call over to Sharon..

Thanks, Juan. Good morning everyone and welcome to today’s conference call. We are pleased with our strong results in the second quarter.

Across all fronts, we are continuing our progress and are excited about what lies ahead, including the potential expansion of our CAPLYTA label for the treatment of bipolar depression, with a PDUFA date for this indication later this year.

If approved, this will mark a significant milestone in our plans to move CAPLYTA beyond its first indication for the treatment of schizophrenia into the much larger bipolar depression market and later into major depressive disorder pending ongoing clinical development results.

In addition to our commercial performance, we'll also highlight our progress in lumateperone late stage programs and provide a brief update on the rest of our pipeline, which we will cover extensively at our upcoming R&D Day in the fall.

I'll start with an update on CAPLYTA’s commercial performance where we drove a 22% quarter-over-quarter increase in total prescriptions in Q2, in spite of continuing COVID challenges. Total revenues in Q2 grew to $20 million.

CAPLYTA’s growth trajectory continued with second quarter net revenues reaching $19 million compared with $15.6 million in the first quarter of 2021 and $1.9 million in the same period last year. We expect continued growth in the second half of this year. Larry Hineline and Mark Neumann will provide further details in a few minutes.

Looking ahead to our potential new indication for CAPLYTA, we're especially encouraged by the significant progress made in the second quarter. The FDA accepted our supplemental new drug applications or sNDAs for CAPLYTA for the treatment of bipolar depression and has set a PDUFA action date of December 17, 2021.

Our commercial team is making excellent progress in preparing to launch immediately following FDA approval. This approval would represent an important milestone for ITCI and a major advance for patients. If approved, CAPLYTA will be a promising new medicine for more than 11 million adults in the U.S. living with bipolar I or bipolar II disorder.

Bipolar depression is a chronic serious condition with one of the highest rates of suicide amongst psychiatric disorders. CAPLYTA is a great product with a compelling clinical profile having demonstrated efficacy along with a favorable safety and tolerability profile.

In our clinical trials, lumateperone improved depressive symptoms in patients with bipolar disorder. Results are similar to placebo for changes in weight, fasting glucose, total cholesterol, triglycerides, prolactin and EPS, including akathisia.

CAPLYTA has the potential to safely treat a broad range of patients with bipolar depression in a large patient population that remains underserved. We have advanced our lumateperone program in major depressive disorder, or MDD.

We are very pleased to announce that patient enrollment has initiated in Study ‘501, evaluating lumateperone for the treatment of MDD. Patient enrollment in our second Phase 3 trial, Study ‘502, is anticipated to begin shortly.

These Phase 3 double blind global studies evaluating lumateperone 42 milligrams versus placebo as adjunctive treatment with antidepressants to treat MDD, the primary endpoint for these trials has changed from baseline at week six on the Montgomery-Åsberg Depression Rating Scale, or MADRS, total score versus placebo.

More than 17 million adults experienced at least one major depressive episode and about half of patients have an inadequate response following initial therapy with only one-third achieving remission. Our goal is to provide a new treatment option to meet the needs of these patients.

We're very enthusiastic about the prospects of this program and the possibility to substantially expand the opportunity for CAPLYTA.

Lumateperone has already shown efficacy in the treatment of major depressive episodes in patients with bipolar disorder and in the treatment of depressive symptoms in patients with schizophrenia with comorbid depression.

Additionally, we're expanding our efforts in depressive disorders with our ongoing monotherapy Study ‘403 in patients with major depression or bipolar depression, who exhibit mixed features. An estimated one-third of these patients exhibit mixed features during their depressive episodes.

These patients typically respond poorly to antidepressants, suffer greater symptom severity, have a higher risk of suicide attempts and experience severe illness with many comorbidities. A significant unmet need remains for effective, safe and well tolerated medicines. We anticipate results from Study ‘403 in the second half of 2022.

To complete this lumateperone update, we have an ongoing Phase 1 safety and pharmacokinetics study with our Lumateperone Long Acting Injectable formulation and anticipate initial results in the second half of this year.

Finally, I'd like to provide highlights on our additional pipeline programs, which we will further expand upon in our upcoming R&D Day in the fall. We are advancing ITI-1284-ODT-SL, a deuterated form of lumateperone. This is an orally disintegrating tablet delivered sublingually.

We plan to initiate our program for the development of ITI-1284-ODT-SL for the treatment of behavioral disturbances in dementia in the second half of 2021, and plan additional studies in dementia-related psychosis and certain depressive disorders in the elderly in 2022.

Our phosphodiesterase 1 or PDE1 inhibitor program is focused on investigating the therapeutic potential of this mechanism of action across a variety of diseases, including neurological and cardiovascular diseases, as well as cancer.

We plan to initiate a Phase 2 clinical trial in Parkinson's disease this year, and we will share with you the trial design details in the upcoming months.

Our objective for the program is to study the drug’s ability to improve motor symptoms without causing troublesome dyskinesia, improve cognition and preserve and restore neuronal function which may lead to disease modification.

In Q2, we presented preclinical data at the American Association for Cancer Research Annual Meeting describing the antitumor effects of our PDE1 inhibitors when administered in conjunction with checkpoint inhibitor immunotherapy.

We are currently evaluating our PDE1 inhibitors in other cancer models and are developing potential biomarkers that may assist in the translation of these data to the treatment of human cancers. Lastly, ITI-333 is a promising asset in our pipeline being developed for the treatment of opioid use disorder.

ITI-333 acts as a modulator of serotonin and new opioid receptors, and as shown efficacy in animal models in both opioid use disorder and acute and chronic pain. Our Phase 1 single ascending dose study evaluating the safety, tolerability and pharmacokinetics of ITI-333 in healthy volunteers is underway.

Initial results from this study are anticipated in the second half of this year. We ended the quarter in a strong financial position with $556.2 million in cash, cash equivalents and restricted cash.

In summary, our continued commercial performance and growing portfolio confirm the strength of our team as well as our long-term commitment to developing and commercializing innovative therapeutics to improve the lives of patients with neuropsychiatric and neurological disorders. I'm proud of what our team has accomplished during this time.

Mark will now share details of our ongoing commercial activities in schizophrenia and future plans in bipolar depression. Following his remarks, Larry will provide additional details on our Q2 financial performance.

Mark?.

Thanks, Sharon. It's a pleasure to be here today with all of you to share our commercial progress. As Sharon noted, we were pleased with CAPLYTA’s market performance in the second quarter despite continuing COVID marketplace challenges affecting the medical care of patients with schizophrenia.

All of our launch fundamentals are strong and remain on track. We continue to successfully execute our hybrid commercialization model combining virtual and in-person engagements. Medical education, DTC and social media campaigns complement our efforts.

CAPLYTA continues to have a positive impact on patients, and our market research shows that psychiatrists continue to rate CAPLYTA highly on efficacy, safety and tolerability and dosing. As a result, CAPLYTA total prescriptions increased by 22% over the prior quarter, at a time when the overall antipsychotic market grew slightly by about 1%.

Market conditions improved incrementally during the second quarter with increases in patient visits, new patient starts and in-person detailing. While these trends have been encouraging, we are monitoring the recent increase in COVID cases and are prepared to adjust our commercial strategy, if needed.

In summary, we continue to be pleased with CAPLYTA’s performance in the schizophrenia market. And we are actively preparing to launch in bipolar depression immediately following FDA approval. This potential approval would represent an important milestone for ITCI and a major advance for this underserved patient population.

And here's why we're confident that this launch will be significant. First, CAPLYTA is a great product. In clinical trials, lumateperone showed efficacy and safety in treating depressive episodes associated with bipolar I or bipolar II, both as a standalone treatment as well as in combination with lithium or valproate.

Results were similar to placebo for changes in weight, fasting glucose, total cholesterol, triglycerides, prolactin and EPS, including akathisia. Physicians consider efficacy and safety in selecting which drug to prescribe, and in deciding to change treatments in bipolar depression.

And to this point, recent market research and an expert advisory board both rated lumateperone favorably for efficacy and safety, including its low risk of weight gain, metabolic changes and movement disorders.

Underscoring the need for new treatments, physicians also cited the limited number of approved drugs to treat bipolar I depression and noted there's only one drug currently approved to treat bipolar II depression. Secondly, bipolar depression represents a significant market opportunity. As Sharon noted, more than 11 million adults in the U.S.

live with bipolar I or bipolar II disorder. These are debilitating conditions with more frequent and longer lasting depressive episodes than manic and hypomanic episodes. This patient population is well informed and much larger than schizophrenia.

In addition to efficacy, patients with bipolar depression are concerned about safety and tolerability, particularly weight gain and movement disorders.

The third reason this launch will be significant, we are committed to achieving a competitive share of voice with our promotional activities that will drive lumateperone awareness and adoption in bipolar depression.

We are expanding our sales force and our managed care account team continues to successfully educate commercial and other payers on bipolar depressions, unmet patient needs, and the limited availability of approved treatments. In short, we are on track and this is a very exciting time for our company.

I’ll now turn this call over to Larry to deliver further details on our financial results.

Larry?.

Thank you, Mark. I will review our financial results for the second quarter ending June 30, 2021. Total revenues in Q2 grew to $20 million compared to $1.9 million of total revenues for the second quarter of 2020.

CAPLYTA’s growth trajectory continued with second quarter net product revenues reaching $19 million compared to $15.6 million in the first quarter of 2021 and $1.9 million in the same period last year. Cost of product sales were $2 million in the second quarter of 2021 compared to $0.1 million for the second quarter of 2020.

Research and development expenses for the second quarter of 2021 were $17.3 million compared to $25.2 million for the second quarter of 2020. This decrease is due primarily to a decrease in lumateperone clinical trial costs.

Selling, general and administrative expenses were $69.9 million for the second quarter of 2021 compared to $41.4 million for the same period in 2020. This increase is primarily due to an increase in commercialization and marketing costs.

Net loss for the quarter ended June 30, 2021 was $68.7 million compared to a net loss of $63.7 million for the quarter ended June 30, 2020. Cash, cash equivalents, restricted cash and investment securities totaled $556.2 million at June 30, 2021 compared to $658.8 million at December 31, 2020. This concludes our prepared remarks.

Operator, could you please open the line for questions?.

Thank you. . We ask that you limit yourself to one question and one follow up. Please stand by while we compile the Q&A roster. Our first question comes from the line of Brian Abrahams with RBC Capital Markets. Your line is now open..

Hi. Good morning. Thanks for taking my questions and congrats on the continued progress.

I guess first off on schizophrenia, would love to learn a little bit more about some of the metrics that you're seeing on the ground? In particular, whether you're starting to see pull through in terms of longer persistence for the better tolerability, whether growth is coming from new accounts or represcribing? And then if you could maybe also expand upon how the waxing and waning in COVID has impacted your, as well as patient's ability to engage with physicians, and how that might influence back half of this year growth?.

Great questions, Brian. Good morning and thank you for the questions. I'll ask Mark.

Mark, do you want to take that?.

Yes, sure. Thanks, Sharon. And thanks for the question, Brian. So a couple of different components in there of your question. I'll try to take them in the order that you had asked them.

So from a persistency perspective, we've been pleased since the very early stages of the launch to see that compliance and persistency with CAPLYTA has been very good and has been outpacing the benchmark launches of prior antipsychotic launches, and that has continued.

This was something that we hypothesize would be the case, given the very favorable safety and tolerability profile for CAPLYTA. And as we track the TRx to NRx ratio, that has continued to look very good and continued into the second quarter.

From the perspective of where we're sourcing our business, we continue to source new patients as well as the refills continuing to look very strongly.

Patients come from all lines of therapy, including new patients where the patient's insurance will allow that newly diagnosed patient with the vast majority of the business coming from switch patients coming from other antipsychotics, and they come from a variety of different antipsychotics, so not just from one or two in particular ones.

So we see that as a very healthy dynamic that CAPLYTA is sourcing patients from a wide variety of lines of therapy as well as prior antipsychotic use. In terms of the impact of COVID during the second quarter, as Sharon noted in her comments, we did see notable improvements in the second quarter.

We saw improvements in patient visits, we saw improvements in new patient starts as well as improvements in in-person detailing by our sales force. So this is something obviously that we're monitoring very closely with the recent rise in cases.

But we do expect to see continued improvements in the second half of the year, and do expect to continue to grow the brand quarter-over-quarter during that time. So, Brian, I hope I hit on all the things that you had asked. If there's something that I missed, just let me know..

No, Mark. That was really helpful. Thank you. And then maybe just a quick follow up on bipolar as you prepare for the launch. I know you've talked about, a little bit about the sales and marketing strategy in the target audience. I was wondering if you could expand further on that.

I guess how you capitalize on having a potential bipolar II indication included in the label. And whether or not you're preparing for primarily a telemedicine or an in-person environment or some sort of hybrid, how that might impact the cadence of SG&A spend as well? Thanks..

Yes. So I'll start there, and perhaps Larry or Sharon could comment on the SG&A spend, and I'll start with the second part of your question in terms of our preparation for the launch. Our preparations are going very well, very much on track.

We have initiated the expansion of our sales force, the process for doing so and expect to have that expansion in place prior to approval, so we can hit the ground running as soon as we're approved hopefully on the PDUFA date in December.

We've said before that the target audience that we will be deployed against is going to grow from approximately 23,000 today to about 44,000 with the addition of physicians who treat a lot of bipolar depression, but do not treat a lot of schizophrenia. So those plans are very much underway and going according to plan.

The second major area of activity has been with our market access team who have been engaging the payers across Medicare and Medicaid, and especially in commercial, to educate payers on the very significant unmet need that continues to exist both in bipolar I and bipolar II, and the limited availability of approved products for both of those, but in particular, in bipolar II.

And I guess what I would say there is, we do expect to be approved for a broad range of patients, including bipolar I and bipolar II, both as monotherapy and as adjunctive therapy.

And bipolar II is one element of what I consider to be a very strong profile, emerging out of the clinical trials in bipolar depression, where we saw robust efficacy and a safety and tolerability profile that essentially replicated what we saw in schizophrenia with favorable results on both the metabolic and weight gain side, essentially comparable to placebo, as well as on the movement disorder side.

And we do know patients with bipolar depression may even be more sensitive to things like weight gain and movement disorders than even patients with schizophrenia. And so we feel very confident in the profile that's emerged from the clinical trials in bipolar depression. So, again, I hope I answered your questions.

I don't know if Larry or Sharon would like to comment on the SG&A expense..

Hi. This is Larry. Sharon, go ahead please..

I was just going to add a comment on telemedicine. Brian asked about telemedicine.

Mark, do you just want to comment a little bit on what we have found from KOLs and physicians on the differences of schizophrenia patients and bipolar patients in response to, and their ability to use telemedicine?.

Yes, absolutely. And Brian, I'm sorry. I did miss that piece in my response to your questions.

So first of all, we are planning to continue with the hybrid commercialization model that we've been operating with pretty much since the beginning of launch where our sales representatives as well as our physician speakers for medical education, when they can engage physicians in person, they do so.

But if physicians are working remotely and not available for in-person interactions, our representatives and our speakers pivot very adeptly to virtual engagements. They've been doing that very well throughout the launch. And we'll just have to see what the conditions are as we launch the bipolar depression.

We just feel confident that we'll be able to deliver, regardless of the conditions that exist at that time. As Sharon mentioned, we've been doing a lot of market research. We've had several different advisory boards.

And when you think about the interaction of a bipolar patient with the psychiatrist in a telemedicine setting, it's actually quite different than a patient with schizophrenia in that same telemedicine setting. And by that, the bipolar depression patient is a patient who is very well informed of their condition. They are advocates for their own health.

They ask a lot of questions. They're very communicative. They're able to articulate any issues that they're having with their current treatments.

And so the physicians that we've spoken to about this feel that in the telemedicine setting, the bipolar depression patient is actually somewhat easier to manage than, in general, a patient with schizophrenia. So that's something that we've learned in our market research and through discussions in our advisory boards with psychiatrists..

And Larry, do you want to comment on the SG&A?.

Yes. We do expect the SG&A expenses to increase in the second half of the year as we continue the schizophrenia commercialization, but also in preparation for the possible approval for bipolar indication..

Great. Thank you so much for the detailed answers..

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

Thanks for taking the question. Good morning. And congratulations, Sharon and team, to all the progress in the quarter. Nice trends. I had a quick commercial question and then one pipeline question. Regarding the commercial question, in terms of script growth, I think Mark mentioned new patient adds as well as refills.

And I guess I'm wondering if you could expand on that.

Were those new patient adds coming from broader set of writing physicians or deeper within a practice? And then regarding expanding the sales force, do you have any quantitative metrics on that? What we could expect with bipolar approval?.

Yes. Thanks for the question, Charles. Thanks, Sharon. Sorry to jump the gun there. So, Charles, at this stage of the launch, we continue to be pleased with both the breadth of prescribing as well as the depth of prescribing.

We continue to add new prescribers week-over-week in a very steady fashion, and the existing prescribers to continue to increase their depth of prescribing. So in a nutshell, we see the new patient starts coming both from improved breadth as well as improved depth.

In terms of the question on the sales force, we'll share more details of that as we get closer to the potential approval later in the year.

But just to remind the group of what we've said before, we are expanding our call panel from approximately 23,000 physicians for schizophrenia to 44,000 in bipolar depression, so essentially doubling the size of our call panel.

However, we don't expect to double the size of our sales force because of some of the efficiencies that our sales force has gained, and some of the conditions that exist with telemedicine. It will be a significant expansion. That expansion is underway. And at a later date, we'll come back to you with some more of the details around that..

Okay. Thanks for that additional information. Regarding the pipeline, I guess I’m kind of fast forwarding beyond BPD and considering lumateperone in major depression disorder.

And I guess I'm wondering if with regard to Study ‘501 and eventually ‘502, what do you think is the best source of reducing patient heterogeneity in those studies? Is it perhaps a screening measure of burden or other call it approaches? And given the large number of MDD studies ongoing, I guess I’m wondering how are you ensuring that you're working with centers that are going to deliver you patients that are, call them, quality patients for those studies?.

I think we heard your question, Charles. I'm sorry. You keep sort of fading in and out. But I think we heard it. And I'm going to ask Suresh, if you'd like to start. And I can chime in as well, if you couldn't hear some of it.

Suresh?.

Yes, I can. Thank you, Sharon. Regarding the heterogeneity, that is true. There are patients who are very heterogeneous in this population. In order to enroll the right number of patients, one of the key criteria is to enroll the right patients for the trial. So for that, we have a lot of things included in the protocol and in the trial.

That goes from selecting the right site and also looking at different things within the protocol by including adjudication process that we have a sponsor involved in enrolling every patient and reviewing the right patient inserted in the trials. And there's also an ongoing review of every patient that comes into the trials..

Regarding including the right patients, are you using a MADRS scale or some other screen and a certain, call it, level of burden?.

There is a whole range of things we are including in the trial. MADRS is one of them. There are other scales and other screaming things we are including in the trial. There is also a review form that we review each patient individually..

Thank you. Our next question comes from the line of Andrew Tsai with Jefferies. Your line is now open..

Okay, great. Thanks. Good morning. First question is just on the launch, which is great to see. You're continuing to see quarterly upticks.

But my question is, despite COVID dynamics, do you remain comfortable in seeing a potential sales acceleration in the second half of the year I guess? Can you talk a little bit about what you're seeing in July, August in terms of the trends and how those trends are looking compared to your expectations? Thanks..

So, hi, Andrew, and thanks for the question. And I'll start and then I'll ask Mark if he has anything to add. And really what you're asking is for some color on the landscape. So let me give that to you. As an overall first, we had a solid Q2. And as you heard, we had strong execution and solid growth.

The patient experience with CAPLYTA has been very positive. We believe it’s a great product with a compelling profile performing as expected in a real world setting, which is very important. We do expect CAPLYTA prescriptions and revenues to continue to grow quarter-over-quarter throughout the rest of the year.

And COVID has very much impacted the care of patients with schizophrenia. As we've said before, we've seen notable improvements in market conditions, and particularly in Q2. We believe we continue to see improvement throughout the rest of the year.

But to your question, the magnitude of these improvements is dependent on the COVID impact and conditions over the next few months.

Mark, do you have anything you want to add to that?.

Maybe just to continue on with that, we have seen notable improvements during the quarter in new patient visits, in new patient starts, in in-person, in detailing.

With the recent wave of increases in cases, in particular in some of the central parts of the country, we are seeing geographic pockets where patient visits have slowed and there are some restrictions being placed on representative access in certain offices.

But we've seen that throughout the launch where it's sort of waxes and wanes and you get some spots that get more restrictive, and then they open back up. And so we're just going to have to see what happens with the current COVID situation and the current conditions. But as Sharon mentioned, we have been encouraged by what we've been seeing.

We do expect to continue to grow quarter-over-quarter. And the commercial team will adapt to whatever conditions are in front of them. And we feel confident that we'll be able to continue the excellent execution that the team has been doing. So hopefully that helps, Andrew..

Thank you. Our next question comes from the line of Jessica Fye with JPMorgan. Your line is now open..

Hi, guys. Good morning.

Can you talk about your goals for commercial coverage for CAPLYTA in bipolar depression? And how fast do you think we can get there?.

Mark, again for you..

Yes, sure, Sharon. Hi, Jessica. Yes, our goals for the commercial channel are to have essentially the same broad coverage that we achieved early on in the launch of schizophrenia in both the Medicare and Medicaid channels.

To that end, as I mentioned in my prepared remarks, our market access team has been actively engaging payers, particularly in the commercial channel, and have been in discussions both in educating the payers on the unmet need and the limited availability of approved options for bipolar, to both bipolar I and bipolar II, and are engaged in discussions to broaden the current access that we have in commercial.

And we'll be providing updates on that as we get closer to the launch, and immediately following the launch..

And for -- I didn't hear you expand a little on commercial on how we are now speaking with those payers as well.

Do you want to say anything more about that, Mark?.

Yes, just that we’re actively engaged with the commercial payers to improve the access to CAPLYTA in a similar fashion that we did with Medicare and Medicaid during the schizophrenia launch.

Jessica, as you'll recall that in schizophrenia, the two major channels are Medicare and Medicaid where roughly 70% to 85% of all schizophrenia prescriptions flow through. With the addition of bipolar depression, that mix will begin to shift in favor of the commercial channel.

Medicare and Medicaid will continue to be very important for bipolar depression as well. But whereas about 15% to 20% of patients with schizophrenia prescriptions come through the commercial channel, that grows to our estimates of roughly 35% to 45% of bipolar depression prescriptions coming through the commercial channel.

So it becomes an increasingly important channel for us. And our team is actively engaged with the payers to achieve a level of access that is similar to what we have today in Medicare and Medicaid for CAPLYTA..

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

Hi. Thanks for taking my question. It’s Rudy on the line from Marc. First, congrats on the strong quarter. I just have one question regarding the pipeline. So can you provide some color on upcoming Phase 2 study of ITI-214 in Parkinson's? Maybe just remind us about a study design. And then I have one quick follow-up question..

Right. Thanks, Rudy, for the question. As you know, we are developing one of our PDE1 inhibitors ITI-214 for Parkinson's disease. In our Phase 1/2 study, we saw that motor symptoms of Parkinson's disease improved on top of optimized Parkinson's therapy. Dyskinesia symptoms improved in patients with levodopa‐induced dyskinesia at baseline.

We'll share details of the design of the upcoming trial later this year. But the principal objective of the study is to study parameters of motor symptom improvement without worsening dyskinesia.

The objective of our PDE1 program in PD extends beyond motor symptoms, however, and encompasses the exploration of cognition and potential disease-modifying effects that result from the anti-inflammatory effects in the CNS, which we've demonstrated occur with this mechanism of action in our PDE1 inhibitors..

Thanks. Then I have a quick follow up for CAPLYTA.

Just wondering what’s the gross to net for the quarter and for 2021?.

I'm sorry. I didn't quite grasp the question.

What's the what?.

The gross to net?.

Gross to net?.

Gross to net, okay.

Larry, do you want to take that?.

Yes. Our gross to net historically has been between the mid 20s and low 30s. So it's in that range and we expect it to continue in that range..

Thank you. Our next question comes from the line of Umer Raffat with Evercore. Your line is now open..

Hi, guys. Congrats on the quarter. Thanks for taking my question. Maybe just to get a little more specific about the trends going into the back half of the year with the COVID increase. On new patient adds at the new brands, it looks like the trends are fairly consistent. And, of course, you're growing off a bigger base.

So I guess my question is, by our math, it does look like you're probably still growing double digits at a lower pace, but at still double digits into the third quarter. Is that consistent with data you are seeing internally as well? Number one.

And secondly, as we think about the Long Acting Injectable initial data in the back half of the year, one of the things I was trying to figure out was simply the bioavailability. So I know the oral bioavailability was low and just trying to think through the dose choices you guys decided to go with on a sub-Q in a Phase 1 trial. Thank you very much..

Okay. Hi, Umer, and thanks for the questions. I'm not sure that we are prepared at this point to give you specific numbers about the growth in the second half of the year. We do agree that we expect to see continuing growth.

Mark, do you want to comment on that?.

I think Umer, generally you characterized it well. As you go through these different periods of COVID, you see some acceleration, you see some deceleration, but the overall picture is continued growth. And we expect that to continue in the second half of the year..

Right. And then on the bioavailability, obviously, that's why we're doing this study is to look at the safety and tolerability as well as the plasma levels of drugs. So I wish I had the answers to give you, but then we probably wouldn't need to be doing the study. We have, of course, our animal data.

But in just a couple of months, we'll be able to tell you in humans. So maybe we could stay tuned. And we are looking to see sustained plasma levels for one month, of course. But I think rather than speculate, let's just wait for the data that we'll have soon..

Thank you. Our next question comes from the line of Graig Suvannavejh with Goldman Sachs. Your line is now open. And pardon me. Graig Suvannavejh, your line is now open..

Hi, sorry about that. I was on mute. Good morning. Thanks for taking my questions. A couple, if I could. One, just on the bipolar depression opportunity. And I realize that Delta variant for COVID is an unknown at this stage.

But as we think about the launch of that product, anything that you can say about the shape of that uptick curve, whether it's relative to kind of the shape that we're seeing for schizophrenia, or relative to the shape that we've seen for other analog drugs that have gotten the bipolar depression indication. So that's my first question.

And my second question just has to do with your current prescription dynamics. And you've got -- I think comments you've made before about having patients who are new to therapy and that are getting CAPLYTA but are also getting switches.

And I'm wondering, from an intracellular perspective, is there a certain focus by the company in terms of which patients you would prefer to get on therapy? And for those that are on therapy, are there any differences in persistence and compliance, just trying to get a sense of -- these patients switch a lot, and I'm just wondering if it's more common that you're seeing switching away once they're on CAPLYTA, either from the new patients or from those that have switched? Thanks..

Okay, a lot of questions. Mark, I think that most, if not all of them, are directed to again..

Yes. Let me take a shot at this, Graig. And if I miss something, Sharon, you can pick me up on those or Graig, you can ask a follow-up question.

Regarding the potential shape of the curve once we get approved for bipolar depression, I think if you look historically at the two most recent antipsychotics that were approved in bipolar depression, Latuda and then more recently Vraylar, you saw a very significant inflection in their prescription uptake immediately upon receiving the approval in bipolar depression.

And we have every reason to believe with CAPLYTA and the profile that's emerged from the clinical trials, that we will see a similar inflection. And so we're very excited about the potential to help patients in this area and very excited about what that could mean for the potential adoption of CAPLYTA and the business of CAPLYTA.

In terms of the current prescriptions and the patients that are being placed on CAPLYTA, yes, it is a mix of newly diagnosed patients as well as switch patients with what I would say being the vast majority of patients being switched patients coming to CAPLYTA.

We are encouraged to see that there are newly diagnosed patients being placed on CAPLYTA where the patient's insurance will allow that. But the dynamics in the antipsychotic area and in schizophrenia, in particular, is that the magnitude of switches is much greater than the number of new patients that are diagnosed each year with schizophrenia.

So we're not surprised to see the majority of patients coming as a switch from another antipsychotic rather than from newly diagnosed patients. We don't have a preference. We believe CAPLYTA is a great product and can be helpful to virtually any patient that the product is indicated for.

But it's just a matter of the dynamics that there are 2.4 million adults with schizophrenia. They are frequently discontinuing their existing antipsychotic and moving to a new one.

And whenever they do that, that's an opportunity for CAPLYTA with its efficacy profile as well as its very favorable safety and tolerability profile for the physician to consider CAPLYTA as the agent that they go to.

I think you also had mentioned about, do we see a compliance and persistency difference depending on the type of patient that is placed on CAPLYTA? I can't say that we do. It's probably still a little early to understand those dynamics all the way down to that patient level.

But overall, we're very pleased with the compliance and persistency that we see from patients that are placed on CAPLYTA. So, Graig, I don't know if I hit on all of the elements of your question. But if I haven't, please follow up..

Just to remind you, the order of magnitude of newly diagnosed patients is small compared to the overall schizophrenia patient population with only 100,000 new patients diagnosed with schizophrenia..

Thanks, Sharon..

Thank you. As a reminder, in the interest of time, we ask that you please limit yourself to one question. Our next question comes from the line of Ashwani Verma with Bank of America. Your line is now open..

Hi. Thanks for taking our questions. I apologize if this has been addressed before. I've been circling on calls.

Are you still comfortable with the CAPLYTA consensus for 2021? I understand that you expect CAPLYTA to grow sequentially, but could the TRx flow, for example, surpass the 42% seen in the second quarter?.

Yes. Hi. Thanks for the question. We did address this earlier. And we said that we have seen notable improvements in market conditions and in particular in Q2, and hence leading to our strong quarter. We do believe that we will continue to see improvement throughout the year.

But we've said that the magnitude of these improvements in second half the year is really dependent on COVID impacts..

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

Good morning. Thank you for taking my question. And nice to see all the progress that the company is making. I’ll ask my one question on your pipeline.

On your programs related to behavioral disturbances in dementia and dementia-related psychosis, it might still be very early, but how is the organization thinking about approaching specific groups in dementia versus dementia as a whole in your clinical trial programs? And have you received any input from the FDA on this topic?.

Hi, Sumant. Thank you for the questions. We do believe that 1284 is an NMA that we are exploring behavioral disturbances in patients with dementia. We are in discussions with the FDA right now over the design of these studies. And so if you can stay tuned, we will have further information on that.

We do think -- just to give you a little more detail on 1284, we do think that it's very well suited to study in many populations. And we've just started with the elderly population, which we included in the Phase 1 studies that we reported to you in an earlier call.

So I think we're very excited about 1284 and about the development program in behavioral disturbances in patients with dementia as well as psychosis in dementia and depressive disorders in the elderly. And as I mentioned on the first program, we are in discussions right now and we'll get back to you soon..

Got it. Thank you..

Thank you. This concludes today's question-and-answer session. I will now turn the call over to Sharon Mates for closing remarks..

Okay. Thank you, operator, and thank you everyone for participating in today's call. We are very excited about the prospects of CAPLYTA and of our development pipeline moving forward.

We are excited for the opportunity to be helping patients and we think that we are developing new medicines to help the lives of patients, and we look forward to updating you as we go forward. With that operator, you can now disconnect the call..

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect..