Good morning and welcome to the Alkermes Plc First Quarter 2016 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 Sandra Coombs, Director of Investor Relations at Alkermes. Please go ahead.

Good morning. Welcome to the Alkermes Plc conference call to discuss our financial first quarter 2016 financial results. With me today are Richard Pops, our Chief Executive Officer; and Jim Frates, our Chief Financial Officer. Before we begin, I encourage everyone to visit 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 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 these forward-looking statements. Please see our press release and 10-Q issued today and also our 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, future results or developments. Today, Jim Frates will then discuss our financial results; and Richard Pops will provide a brief update on the company. After our remarks, we will open the call for Q&A. Now, I'll turn the call over to Jim.

Thanks Sandy. Good morning everyone. We're happy to report solid first quarter results. Our base royalty and manufacturing business performed well and as we expected. On top of that foundation, our commercial products VIVITROL and ARISTADA are in phases of significant growth and will be the key drivers of top-line in the coming years. This quarter results was also marked by steady investment in our late stage pipeline and reflects launch spending on ARISTADA, where you can begin to see as the opportunity ahead. As our proprietary products grow our topline significantly and we leverage our efficient infrastructure. As our commercial products grow and our late stage pipeline comes to market. We had significant operating leverage in our business in the years ahead. Let me start with an overview of our key financial highlights for the first quarter. We generated total revenues of a $156.8 million, the 10% increase over last year when we exclude our divested Gainesville business. For the quarter we recorded a $24.6 million non-GAAP net loss, these results are also inline with our financial expectations for 2016 and reflect the investments we're making this year in Phase 3 portfolio and the launch of ARISTADA. The key driver of our financial performance during the quarter was VIVITROL, our novel once monthly injectable product for the treatment of opioid and alcohol dependence. In the quarter, VIVITROL had net sales of $43.8 million, compared to $31.1 million for the same period last year, demonstrating growth of 41%. On a sequential quarter basis net sales grew 15%. We're seeing growth in both the commercial business and in the Medicaid business. Over the last 12 months the contribution of Medicaid sales to our VIVITROL revenues doubled to approximately 30% and continues to grow. We think this is great news because the…

That's great. Thank you, Jim. The strength and resilience of the business we build became very evident this past quarter. The here and now of the business, the foundational base of manufacturing and royalty revenues coupled with VIVITROL and ARISTADA represents an unusual and compelling growth story from products that received FDA approval and are growing as key players in important markets. When you add on top of that are highly diversified pipeline of CNS candidate, anyone of which could gap our evaluation significantly, the upside of this company is as clear as ever been. As we move into the remainder of the year, we'll be entering a catalyst rich period for the pipeline and we expect to see exciting growth of VIVITROL and the launch of ARISTADA continue to build momentum. Jim cover the existing progress of VIVITROL earlier, but I just want to give you a sense of how we see the grounds as well as support for VIVITROL building through some of the statistics regarding media coverage throughout the country during just the first quarter. 400 media pieces, print articles, broadcast segments and radio segments on VIVITROL have appeared in 39 states so far in 2016. This is more than three times the number of stories and nearly double the number of states compared to Q1 of last year. We exceeded 1 billion estimate media impressions in Q1, a fourfold increase from Q1, 2015. The absolute numbers and the growth rates well, they speak for themselves. They are important because the ultimate size of VIVITROL opportunity will be determine to a great extent by public awareness of the existence of a different criminal alternative for a serious epidemic. This is beginning to happen around the country and it's exciting to absorb. Turning to ARISTADA, the nation-wide launch…

Thank you. Brendon, will you please open the line for questions.

Thank you, Sandy. [Operator Instructions] And from Credit Suisse we have Vamil Divan. Please go ahead.

Yeah. Great. Thanks so much for taking the questions. I have one question on 5461. You mentioned the ASCP meeting in June and I’m just curious the decision to present that data before FORWARD-5 is completed and maybe you can just talk through why getting it up with that in anyway, maybe risk impacts and the placebo effect you might see in FORWARD-5? So if you could just discuss why presenting the numbers later would be helpful?

Good morning, Vamil. No, it’s a good question. As you know, mitigating placebo response is a central design feature of this study. We made the decision really for two reasons. One is that we feel like the enrollment and much of it in lies phase of FORWARD-5 will be substantially complete by that time. And we don’t expect a lot of media coverage of that particular meeting. The second is that FDA attends that meeting and has historically and it’s a really good venue for the community to get together and review data. And we’ve heard from our key opinion leaders that it is quite important that we keep educating the committee as to the viability of 5461 because as you know, we feel very strongly of this drug is advancing in development and we want to make sure that the community understands the progress that we are making.

Okay. So, you know with the fast track designation, I guess more they get in the community will help with their discussion with the FDA on that front because I’m afraid with fast track you are having the discussions with the FDA without having to present the data publically.

Well, I think that it’s a very small community actually, particularly those involved in the clinical research we are in, in our antidepressant products. And we have a lot to do with this drug over time and we really believe this whole new area, this mechanism of opioid modulation for the treatment of new disorders is a different way of treating the disease and we need to continue to build the kind of the scientific, academic foundation of support for this approach. So this is a major program. It’s been ongoing for years. We’ve been updating this community consistently over the years and it is business as usual so we are going to keep going.

Okay. And then just one more on ARISTADA if I could and then I will drop off. Just, I guess the comments you made around uptick so far on the payer side, is there any more color you can just provide on the success you’ve had and you said you will kind of keep updating as for the course of the year but we get a lot of questions on sort of anymore details you could provide where you have had wins and kind of when we could expect more from that? Thanks.

Well, let me try to give you some sense of where we stand with respect to Medicare Part D, management acada [ph], whatnot and so it’s important. Think of it in two stages. First stage is getting access at all, which we’ve been quite successful in the first quarter as I mentioned. Many of that first stage of access is still subject to prior authorizations. So then in stage 2, then is to move into parity access with other LAIs and we read about 3 of 10 of the major programs and many of the plans are preparing for the 2017 formulary by submissions that happen in the next few weeks. So there is a lot going on as we move into the early part of the summer to kind of prepare the index for 2017. So, even as we get wins in 2016, sometimes it doesn’t drive formulary behaviour until as we move into 2017. That’s why we’ve always set along. It takes about a year to get on but I’d say it’s just steady progress and each month, we will turn over more cards and we expect to exit the year in a very good position.

Okay. Thank you.

From JPMorgan we have Cory Kasimov. Please go ahead.

Hey. Good morning, guys. Thanks for taking the questions. So, Rich, first on VIVITROL, just curious how much are you able to do on your end to help further accelerate the adoption of state programs, or is this something that you kind of sit there and support and enable but kind of needs to kind of play out by itself?

Good morning, Cory. We are so fast and of course in 10 years to be an overnight success with VIVITROL. We’ve been doing the step for six years now on the opioid side and lay the foundation for that. So, we can do a lot. So, when we actually makes the plane take off the runway after lumbering down for long time is the fact that as Jim mentioned in his remarks, it starts to become a little bit organic that other jurisdictions see what’s happening and they begin to start pushing for implementation of VIVITROL programs on their own without our help. As you further say, we are in 100 programs in 30 states but Jim will correct me. I think there is something on the other 3,100 counties in America. So, when you think of the denominator being at 3,100 and the numerator being a 100, we are just getting going. So there is no way we can from a personal point of view, blank at 3,100 counties in America, what happens is that it becomes self propagating. So that’s what exciting. So to answer your question is we can do a lot but in doing a lot the ideas that is actually there is a multiplier effect.

Okay. All right. That’s interesting. And then just one other big picture question. We’ve been talking about your relatively big balance sheet and potential BD opportunities for while you had the deal you talked about a little bit, a little update this morning. Are you starting to see more opportunities though in the emerging CNS space and do you think that the opportunities in maybe 2016 are better than they have been for you in the last couple of years? Obviously, you’ve had the downtick in valuations but just more on the emerging platform and new candidate side?

I think there is more activity in the earlier development of CNS compounds that would be of interest to us. But I wouldn’t go so far to say is that it’s a target rich environment. It’s still selective. A lot of stuff that we see is the derivative of prior development programs and we really don’t have any interest in repurpose molecules or things that are shades of the same color what already exist. So, I think to gain reimbursement and access and pricing and all of things you’ve heard us talk about over the years, as we think about our business through the perspective of the four pillars, we really need highly differentiated medicines. And I think there is a growth in those opportunities but it’s always going to be very selective.

Okay. All right. Makes sense. Crazy earning days. So, I will stop there and hop back in the queue. Thanks a lot, Rich.

Okay.

From Barclays, we have Jon Eckard. Please go ahead.

Good morning. Thanks for taking my questions. So on ARISTADA, I think you made a comment that you are seeing a lot of diversions from other allied long-acting injectables and you also said that you are seeing more conversions of physicians who converting patients from samples to -- from samples to commercial products. And I think the number of samples went up at least 4,000, I think from the last update. Going forward, what metrics can we look for on an ongoing basis maybe to there could be an indication that you are getting more of these conversions from commercial to from a commercial to you know from free product to commercial products. And then I have a question on VIVITROL.

Good morning, John. I think the simplest thing is just wash his grips and so we are doing this for a reason. And obviously the sampling intensity will decline as we gain more and more access. This is really a way to get physician’s experience with the drug and while access is still difficult across the country. And the sampling program has -- it’s not a one to one. Every sample we give does not convert into prescriptioners, inherent kind of uncertainty in the whole thing. But so far we are really pleased with what we’ve done and to put that number into perspective, I think we said 14, 500 samples is against the backdrop of selling on the order of 500 or so samples a week. So we’ve put a lot of product out there for people and we think that people getting experience with the product hands on, the flexibility, the ease of use and what not is really, really playing a strong foundation for accelerated growth on the back end of the year. But ultimately the only thing that matters is the prescription trends as the plane takes off the runway.

Great. And then on VIVITROL if I heard it right, I thought it was a really interesting statistic that 50% of sales from [Indiscernible] if I heard it right. And again I’ve been monitoring a lot of these -- the vast number of VIVITROL related news events and you know programs that are up in coming. Is there also an effective way that we can track overtime between quarters on how or new VIVITROL programs is there some kind of centralized place for you where people are -- where these are being announced or we can follow them, so we can track them….

There really isn’t o -- unfortunately John there really isn’t and the most prudent way of doing is just by attracting in Google alerts or whatever you are looking at VIVITROL and what you’ll see is just an amazing amount of coverage about the price, some of that coverage includes activities in state and county jurisdiction where they will be funding more other measures to facilitate the use or fund the use of VIVITROL, but we haven’t put together a central repository of it yet.

And then in Washington you know President Obama has been quite vocal about the need to increase treatment, [Indiscernible] treatment for opioid addiction. What about on the congressional front? I believe there’s been something that a bill had passed through the Senate but still waiting for Congress, I mean, can you give us an update on anything that might be in the works done in Washington to help improve access for these products.

Yes there’s two major -- two or three different legislative routes that VIVITROL is deeply embedded in. The one you referred to the comprehensive addiction recovery act is a piece of bipartisan, by camera [ph] legislation focussed on a number of different approaches addressing the opioid epidemic in the country. And there is some provisions in there, they are very favourable to VIVITROL, that depending on the existence of floor time over the next few weeks, we think there is a high probability that, that because of the broad support that that bill to get passed. In the judiciary side, of course the criminal adjusted system we have interest in facilitating more programs that focused on non addictive medications like VIVITROL being the central one in the Criminal Justice System which has not been historically got amendable to the use of methadone or Suboxone. And the third and just in basic -- the basic blocking attack on your appropriations and on those funding each year, we saw last year the first funding that directly applied to VIVITROL and we expect that continue going forward. So it’s really -- it’s a dual pronged approached from a policy point of view. At the federal level as you know that really augments what’s happening at the state level, but ultimately the federal allocations get pulled through in the form of grants to states. So it’s important that the states be prepared and ready to implement VIVITROL programs and to tap into that funding. So we’ve been working at both levels from multiple years.

Perfect. I’ll get back in the queue [Indiscernible] other questions. Thank you. Good luck.

Thank you, John.

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

Great. Thanks guys, appreciate it. I have a couple of questions, my first is on ALKS 3831, I was wondering if you could run through a little bit more detail on the two Phase 3 designs I know one of these has a co-primary endpoint. It seems clinical trials.gov and then based on that what kind of labelling language you are hoping to attain relative to Zyprexa.

Morning, Paul. Yes, the two studies, the first study which is the acute study versus the primary comparison is ALKS 3831 versus placebo in a four and five week acute setting looking and demonstrating its clear antipsychotic properties, and of course that's a fairly straightforward, 130 patients per ARM, we're running a olanzapine arm in that as well, just although we not powered for non-inferiority just to have that data point because payers will be interested in that as well. And as you know, we've shown non-inferiority olanzapine in our previous large Randomize Phase 2 study. That's call Enlightened 1. So that's up and running. Enlightened 2 is the weight study and Enlighten 2 as you say has co-primary endpoint but they co-vary that's why it's not that really different. We're looking at what we showed in phase 2 which is A, a change in median weight change from baseline compare of ALKS 3831 versus the control arm which is olanzapine in this case. And the second is been as you shift that curb to percentage of patients who the categorical cut of patients who have greater than 10% body weight. And we, as you saw, we saw a strong correlation between those two statistical parameters in Phase 2 and I think both are important, like both were in terms of labelling, because as you know some of the early responses to our Phase 2 that where you saw mean change of the certain number of pounds or certain percent people will say, what's the trivial amount, even though they doesn't -- without recognizing it represent, it’s a profound shift in a curb, as you shift the curb, those tails go down significantly, so that categorical cut at 10% which you could say is really clinically meaningful cut is also really important. And we expect both of those to be in the label, because they are the primary endpoint of one of the pivotal studies.

Okay. Thanks. That's helpful. And maybe a follow-up on that, Rich, shat doses of a olanzapine are you comparing 3831 to. And maybe to put in a context, how does that compare to the dose that was use in the KD study?

We have flux dosing on the olanzapine, so we're co-formulating multiple olanzapine doses with 10 milligrams of samidorphan.

Okay. And for olanzapine arm in the trial?

Yes. So the [Indiscernible] dose is high there were and we expect to median dosing to be between I'm guessing 10 and 20 milligrams, and I think will compared favourable to what we saw in KD [ph].

Okay. Got it. And then maybe just one follow-up on the BD deal for the orexin modulators. There's been others in development. I think J&J has one. Maybe can you speak to just what about this technology stuck out here and what's interesting and what indications you plan on positioning this mechanism and going forward?

Yes. We like the biology. We like the company really, really scientifically excellent and working on both positive, negative allosteric modulators of the orexin receptors. We have probably the most proximate clinical utility of that you would think immediately with respect to orexin is in narcolepsy, but there is a range of things not all which we're going to disclose. But we've got some time. We're doing chemistry. We're working on lead identification, but it’s a fine group of scientists and we're excited about the collaboration.

Okay, great. And I hope you don't mind, I just want one quick follow-up on 3831, I realized I miss one of my questions. On these two main studies what are you looking at with respect to metabolic syndrome, I know you're doing a separate study for that, but in the two lead studies what are you examining there?

I'm not exactly sure of all of those various chemistries. We look at the – basically the rule we're looking lipids and probably glucose and simple things like that. Although in a long six months study in patients who has schizophrenia, that's not the right setting if we're looking at metabolic parameters that's why we're going to go, drill down in a much more intense way doing what we're doing in the animals and try to replicate in the human, because we're finding some really, really important finding with respect to what olanzapine is doing to trigger metabolic changes in the periphery and also help 3831 or samidorphan component of 3831 is a nearly rating and mitigating those effects. So, we're quite excited about that and as I've mentioned we'll ask together its probably one of the largest preclinical scientific programs within the company, because we think the story of 3831 is far more than just about an ameliorating weight, its effect on weight is derivative of a more fundamental effect on metabolic changes in the organism.

Okay. Do you plan to presenting preclinical data some times?

Absolutely. We're publishing and we're presenting, although I wouldn't expect anything on that until the fall at least.

Okay. Great. Thanks Rich.

You're welcome.

I think we have time for one more question.

From Jefferies we have Biren Amin on the line. Please go ahead.

Yes. Thanks for taking my question. Rich maybe I'll just start with FORWARD-5, have you discuss the changes in the study design with FDA? And also would you think company needs to hit in terms of P value. Would you need to like less than 0.01 to support a strong case for FDA approval?

No, not at all, so FORWARD-5 will present the data and ASCP as I mentioned were from FORWARD-3 and FORWARD-4, we'll submit the statistical analysis plan to FDA for FORWARD-5 normal course sometime before we unblind. But the operational changes that we may or making within the program really don't required FDA interaction. They are quite straightforward and they're just based on learning and adapting from what we saw in FORWARD-3 and FORWARD-4. With respect to P value I think [Indiscernible] is the ticket into this discussion, because what you'll see is that -- remember when we're talking about statistical separation for placebo in these types of clinical trials its against the backdrop of placebo response is quite powerful even in study designs where you mitigate placebo response. So, statistical separation from placebo is the most important thing. Then of course you go into the various sub-group analysis in teasing a part where you see more accentuated evidence of efficacy. But I think that it's not just a question of P value per say, it's about robustness and consistency of the data. For example, if you want to achieve a P value based on a single time point that you happened to chose as your primary endpoint, but the rest of the time points were not significant has much difference than seeing continuous drug effect over an extended phase of the clinical trial. So I think it's too simplistic to focus simply on P value but just know the [Indiscernible] is what you need.

Okay. And then question on 6428 when we get data from this trial and do you expect the data would be label enabling for VIVITROL? And would you expect that this data would give you some leverage with especially the government's effort in tackle opioid addiction?

So 6428 is for those who don't know, it’s a very kind of elegant taper kit based on very small doses of naltrexone to enable people to transition from opioid agonist treatment to VIVITROL recognizing the people need to be detoxified from opioid before you can initiate with VIVITROL. So it's basically think of like Z pack [ph], it’s a series of daily dose of increasing levels and decreasing levels of naltrexone and opioids. We expect data from the first study in Q1 of 2017, Sandy Tells me. And we think this is just part of as VIVITROL gets more and traction around the country. We start expanding the shelves of physicians who are interested in using VIVITROL. In the beginning we didn't need a taper kit, because the only doctors that are using VIVITROL quite expertise in detoxifying patients. As more and more doctors get trained and more and more people interested in VIVITROL a simple you would have though that there is an established protocol for transition from opioid in the communities but there really isn't. And so, 6428 is part of the tool kit to help more and physicians to be able to transfer transition patients offer low opioids on the VIVITROL. So we think we'll have a good effect but part of another brick in the wall as we build the foundations for VIVITROL.

Great. Thanks for taking my question.

Thank you, Biren.

Great. Thank you everyone for joining us on the call today. If you have any questions, please don't hesitate to call [Indiscernible] company. Thank you.

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