Jazz Pharmaceuticals plc (JAZZ) Q4 2017 Earnings Report, Transcript and Summary

Welcome to the Jazz Pharmaceuticals Plc fourth quarter and full-year 2017 earnings conference call. Following an introduction from the company, we will open the call to questions. I will now turn the call over to Kathy Littrell, Head of Investor Relations at Jazz Pharmaceuticals.

Thank you, Taquia. Thank you for joining us today on our investor call. Today we reported our fourth quarter and full-year 2017 financial results and provided financial guidance for 2018. The press release and the slide presentation accompanying this call are available on the Investors section of our website. On the call today are: Bruce Cozadd, Chairman and CEO; Matt Young, CFO; Dan Swisher, President and COO. Mike Miller, our Executive Vice President U.S. Commercial; and Karen Smith, our Executive Vice President of R&D and Chief Medical Officer will join for the Q&A session. I'd like to remind you that some of the statements we will make on this call relate to future events and performance rather than historical facts and are forward-looking. Examples of forward-looking statements include those related to our future financial and operating results, including: 2018 financial guidance and goals; corporate development efforts; future growth and growth strategy; future product sales and volumes; litigation and intellectual property-related events; inventory and supply challenges; product launches; expected benefits of the U.S. tax reform; ongoing and future clinical trials; and other product development and regulatory activities and the timing of these events and activities. These forward-looking statements involve risk and uncertainty that could cause actual events, performance, and results to differ materially. They are identified and described in today's press release and the slide presentation accompanying this call and under Risk Factors in our Form 10-Q for the quarter ended September 30, 2017 and our Form 10-K for the year ended December 31, 2017, which we will file shortly. We undertake no duty or obligation to update our forward-looking statements. On this call, we will discuss several non-GAAP financial measures, including: adjusted net income and related per-share measures; adjusted SG&A and R&D expenses and measures derived there from; adjusted net interest expense; and adjusted effective tax rates. We believe these non-GAAP financial measures are helpful in understanding our past financial performance and potential future results. They are not meant to be considered in isolation or as a substitute for comparable reported GAAP measures. Reconciliations of GAAP to non-GAAP financial measures discussed on this call are included in today's press release and slide presentation found in the Investors section of our website. I'll now turn the call over to Bruce.

Thanks, Kathy. Good afternoon, everyone, and thank you for joining us. 2017 was a pivotal year in the continuing evolution of Jazz as a fully integrated biopharmaceutical company, with significant advancements on many fronts. We received two marketing approvals, Vyxeos in the U.S. and Defitelio in Canada, and completed key regulatory submissions, including our NDA for solriamfetol in the U.S. and our MAA for Vyxeos in the EU. We continued to make substantial progress in multiple late-stage clinical programs in both sleep and hematology/oncology, and announced positive results in three Phase 3 studies of solriamfetol for the treatment of excessive sleepiness, or ES, in narcolepsy and obstructive sleep apnea or OSA, and the Phase 2/3 study of Xyrem in the pediatric narcolepsy population. We also announced multiple corporate development transactions, including our collaboration with ImmunoGen on three innovative antibody drug conjugate programs and with Nippon Shinyaku to develop and market Defitelio and Vyxeos in Japan. We enhanced our debt structure to provide significant capacity to move quickly on opportunities to expand our business. We are excited to carry our momentum into 2018, advancing pre-clinical and clinical development activities, moving forward with multiple regulatory submissions, further investing in the commercialization of our products, and evaluating corporate development opportunities to expand our portfolio. We are also pleased with the expected benefits of the U.S. Tax Cuts and Jobs Act, should allow us to increase our investment in new innovative therapeutic options for patients. After providing more detailed updates on key commercial, legal, regulatory, and development activities and highlighting key events expected before year-end, I'll turn the call over to Matt to review financial results and provide 2018 financial guidance. Before moving on, I want to take the time to thank Russ Cox for the strong leadership that he brought to Jazz for seven years, initially leading the U.S. Commercial organization and most recently as our Chief Operating Officer. We wish Russ all the best. I also want to welcome Dan Swisher, our President and Chief Operating Officer, who many of you had the chance to meet at the JPMorgan conference earlier this year. Dan is working with other members of our strong leadership team to drive an efficient and effective global organization that is positioned to support our continued growth. So let me start with our heme/onc therapeutic area. 2018 should be a great year for our global heme/onc business, with revenues of approximately $500 million and expected advances in our pipeline. Let me start with Vyxeos. We were pleased to see demand accelerate in the fourth quarter, driven by continued growth in key academic institutions as well as higher than expected early adoption in select community hospitals. During the initial four and a half months of launch, 50 of the top 75 accounts ordered product. Through the fourth quarter, academic centers represented the highest number of ordering accounts by type as well as the highest volume of orders. To ensure the continued coverage of all key academic accounts while we expand our reach to high-potential community accounts, we are positioning our AML sales force to focus solely on Vyxeos by adding a dedicated transplant team for Defitelio. On the formulary front, we continue to observe positive outcomes in P&T committee reviews, and majority of our top decile accounts now have Vyxeos on formulary. We were very pleased with the NCCN Guideline recommendation for the treatment of AML. We believe the Guidelines are supportive of our label and provide a strong level of evidence for the use of Vyxeos in the induction and consolidation phases. For treatment induction, the NCCN Guidelines now include a Category 1 recommendation for use of Vyxeos for patients 60 years of age or greater with newly diagnosed therapy-related AML or AML MRC, and a Level 2a for consolidation and groups of patients beyond our labeled indication. Given the importance of these Guidelines, we believe these recommendations provide further validation of our data and the benefits of Vyxeos. The Vyxeos MAA was submitted in November under an accelerated pathway. We are working with the EU regulators to maintain our accelerated timing. And if successful, we anticipate a mid-year approval, which would enable us to begin our EU rolling launch and our pricing and reimbursement efforts in select countries in the EU during the second half of this year. Our R&D efforts are focused on positioning Vyxeos as the new backbone of AML therapy. We plan to support multiple investigator-sponsored trials and oncology cooperative group studies in 2018 to evaluate Vyxeos both alone and in combination with targeted therapies in a variety of AML patient populations. As one example, we intend to support a cooperative group Phase 2 study in MDS in high-risk patients, with planned initiation in the second half of the year. Now I'll turn to Defitelio. We continue to make progress in our commercialization efforts, with additional new accounts ordering Defitelio. In the U.S., awareness and use of pediatric centers is high. However, we are underpenetrated in adult centers. Our global efforts are focused on disease awareness and medical education to expand healthcare providers' knowledge and recognition of veno-occlusive disease, or VOD, and the urgency to treat patients, including adults, experiencing this life-threatening complication of stem cell transplant. As mentioned earlier, we plan to modestly expand our U.S. hematology/oncology sales force with a dedicated and specialized transplant team for Defitelio. We expect this team to be in place at the beginning of the second quarter. The introduction of new hepatotoxic agents for the treatment of leukemia has increased awareness of VOD, providing us an opportunity to reinforce the value and importance of Defitelio. Defitelio remains an important growth opportunity for us globally. In 2017, Defitelio became available in Canada, and we submitted for marketing approval in Brazil. Our global team continues to identify further geographic regions for expansion. At the 2018 BMT Tandem meetings in Salt Lake City last week, we had a strong presence, with six defibrotide-related poster presentations building on the scientific evidence for defibrotide, including the final data cut from the treatment IND in adult and pediatric patients post-HSCT as well as important data on outcomes based on severity of multi-organ dysfunction, supporting our medical education initiatives to expand healthcare providers' knowledge and recognition of VOD, and reinforcing the urgency to treat patients upon diagnosis. On the development side, our programs are focused on identifying rare life-threatening conditions related to endothelial cell damage where defibrotide may have benefit. Our Phase 3 study for the prevention of VOD continues to enroll well. We activated sites in January for our Phase 2 proof-of-concept study for the prevention of acute graft-versus-host disease and enrolled the first patient earlier this month. We also announced our plans to evaluate defibrotide for the treatment of transplant-associated thrombotic microangiopathy, which is another rare disease associated with endothelial cell damage following stem cell transplant. These patients have a very high mortality rate and can have significant morbidity as a result of renal damage. We are working toward finalizing the clinical study protocol by mid-year and anticipate beginning to activate study sites during the fourth quarter. Now on to Erwinaze. Throughout 2017, including in the fourth quarter, we continued to experience global supply challenges for Erwinaze. We are currently experiencing temporary supply disruptions in numerous markets, and there may be further temporary disruptions for the balance of the year. We continue to work with the manufacturer of Erwinaze to increase the predictability and timeliness of product releases, with the ultimate goal of increasing capacity and ensuring consistent supply for patients in need of Erwinaze. During 2017, we added 40 new Erwinaze accounts in the U.S., and all but one of these accounts treated adult patients. In 2018, our global sales force will continue to educate healthcare providers on the importance of recognizing hypersensitivity reactions and appropriately switching to Erwinaze in both pediatric or adolescent and young adult populations. Because asparaginase is an important part of the treatment regimen for patients with acute lymphoblastic leukemia, we are also progressing our R&D programs aimed at identifying a new and improved crisantaspase or asparaginase product candidate to advance into clinical development. We are working with multiple companies toward the goal of improving the target profile and reliability of supply. Also in the heme/onc space, our partner, ImmunoGen, is currently enrolling a Phase 1 study of IMGN779 in AML patients and recently began enrollment in a Phase 1 study of IMGN632 in patients with CD 123-positive hematologic malignancies, including AML and blastic plasmacytoid dendritic cell neoplasms. Now on to our sleep therapeutic area, starting with Xyrem; Xyrem delivered 7% sales growth during the fourth quarter and full-year 2017 compared to the same periods in 2016. Xyrem bottle volume growth in the fourth quarter was flat compared to the fourth quarter of last year and grew less than 1% in 2017 compared to 2016. Volume growth in 2017 was impacted by the loss of some government-pay patients throughout the year and an operational issue with the central pharmacy in the second half of 2017 caused by implementation of a new automated phone system that delayed some prescription fulfillment. The central pharmacy operational issue was resolved in the fourth quarter. We expect that bottle volume growth will normalize in 2018, and expect low to mid-single-digit volume growth for the year. The average number of active Xyrem patients increased to 13,525 in the fourth quarter of 2017, up 5% compared to the same period in 2016. During the fourth quarter, we experienced consistent high payer reimbursement approval rates and stable patient enrollment levels. We believe that our unbranded narcolepsy disease awareness efforts are helping patients, as evidenced by the increase in newly diagnosed narcolepsy patients during the investment period. Following the success of our 2017 unbranded disease awareness program, a 2018 program is underway and planned for the full year. The increase in the number of newly diagnosed narcolepsy patients and the positive trend we observed in new patient enrollments during 2017 give us confidence that we will continue to generate positive volume growth. Finally, our field reimbursement team continues to positively impact the trends and approval rates for prior authorizations and targeted accounts across the country. Let me give a brief legal and intellectual property update on Xyrem. In January 2018, we entered into a settlement with a fifth ANDA filer, resolving our patent infringement litigation and related proceedings against Par Pharmaceutical, Inc. In connection with the settlement, Par was granted the right to sell a limited volume of an authorized generic, or AG, version of Xyrem in the U.S. for a term beginning July 1, 2023 and ending December 31, 2025. Par's AG volume will be limited to an annual amount equal to a low single-digit percentage of Xyrem sales volume during the year preceding the AG entry date, and we will be entitled to receive meaningful royalties on net sales by Par over the AG sales period. We also granted Par a non-exclusive patent license to launch its generic sodium oxybate product as of December 31, 2025. These entry dates could be accelerated under certain circumstances. Patent litigation is ongoing against the remaining four of the nine companies that have filed ANDAs for a generic version of Xyrem. Three of the remaining filers, Amneal, Watson, and Lupin, are in a consolidated case. Although no trial date has been set in that case, trial could be scheduled for as early as the third quarter of this year. Next, I'll give you a brief progress report on our oxybate-related development programs. We are on track to submit the planned sNDA for Xyrem in pediatric narcolepsy patients with cataplexy and excessive daytime sleepiness in mid-2018, including our response to FDA's pediatric written requests. We continue to advance both JZP-258 and JZP-507, and believe that our reduce-sodium oxybate product candidates could provide potential improvements in patient safety. In addition to the well-accepted relationship between dietary sodium and high blood pressure, the recently published 2017 hypertension guidelines stress that excessive consumption of sodium is independently associated with an increased risk of stroke, cardiovascular disease, and other adverse outcomes. The development of a reduced-sodium oxybate product is a priority for us, part of our commitment to provide narcolepsy patients with new and improved therapeutic options for this highly debilitating disease. Our lead candidate, JZP-258, has 90% less sodium than Xyrem. We expect to complete enrollment of our Phase 3 study of JZP-258 in the fourth quarter and anticipate an NDA submission in 2019, assuming positive safety and efficacy data. JZP-507 has 50% less sodium than Xyrem while demonstrating bioequivalence, and we can be ready to submit an NDA as early as midyear. We are continuing development of both of these product candidates and look forward to identifying the best reduce-sodium option for patients with narcolepsy. Our efforts to develop an oxybate product with once-nightly dosing also continue. Finally, we plan to initiate a Phase 3 study of JZP-258 in idiopathic hypersomnia in the second half of 2018. Idiopathic hypersomnia is an area of significant unmet medical need with no approved therapies. We will provide more details as we finalize the study protocol. Our significant progress with solriamfetol, previously referred to as JZP-110, during 2017 was highlighted by our December submission of an NDA for the treatment of excessive sleepiness in narcolepsy and OSA. We continue to anticipate FDA approval in late 2018 and expect to be ready for U.S. launch as soon as DEA schedules the product, which typically occurs a few months after approval. In preparation for launch, we have begun pre-commercialization activities. We have worldwide rights to solriamfetol other than in certain Asian jurisdictions, and we are preparing for an EU regulatory submission late this year. We remain enthusiastic about the potential of solriamfetol to offer patients an important new therapeutic option as the first new potential medication for the treatment of excessive sleepiness in narcolepsy and OSA in the U.S. since 2009. We continue to enroll patients in our Phase 2 proof-of-concept study of solriamfetol in excessive sleepiness and Parkinson's disease, and our objective is to complete enrollment by year end. We believe there is a large market opportunity for solriamfetol in excessive sleepiness, in narcolepsy, OSA, and Parkinson's disease. Because solriamfetol is a highly differentiated product candidate with a unique mechanism of action, we are evaluating multiple opportunities in other debilitating diseases where there is significant unmet medical need. In 2018, we plan to invest aggressively in driving strong performance of our key products, continuing the evolution and expansion of our global commercial organization, advancing our promising R&D pipeline, and bringing additional innovation to our R&D portfolio. Our strong cash position, low leverage, and anticipated cash generation from our current and near-term products of approximately $2.5 billion over the next three years enable us to pursue significant opportunities to broaden our portfolio through corporate development activities, with a continued focus on long-lived, medically differentiated products aimed at a targeted prescriber base. At the same time, we believe that the oxybate portfolio, including the Xyrem and our low-sodium oxybate product candidates, will remain a significant contributor to our business for many years. As we move into 2018, we look forward to continuing this significant progress made last year toward bringing innovative new products to patients and driving sustainable long-term growth. Matt, let me now turn the call over to you.

Thanks, Bruce, and good afternoon, everyone. 2017 total revenues increased 9% compared to 2016, driven primarily by higher sales of Xyrem and Defitelio as well as the launch of Vyxeos in the U.S. Net sales of Xyrem for 2017 were $1.19 billion, up 7% from $1.11 billion in 2016. Net sales of Xyrem for the quarter were $312 million, up 7% from $291 million in the fourth quarter of last year. 2017 Xyrem net sales and volume growth compared to 2016 were impacted by the loss of some government-pay patients through 2017 and operational changes at the pharmacy during the second half of the year. Excluding these factors, volume growth would have been in the mid-single-digit range in 2017. Our Xyrem net sales guidance for 2018 is in the range of $1.31 billion to $1.34 billion, representing expected growth of 10% to 13% over 2017. This guidance reflects the 7% price increase that we took in early January and our expectation of low to mid-single-digit volume growth for 2018. For 2018, I'll remind you that first quarter Xyrem net sales have historically been impacted by payer churn across our industry for specialty products as well as higher gross-to-net adjustments that typically occur during this period. Turning to Erwinaze, worldwide net sales for 2017 were $197 million compared to net sales of $201 million in 2016. Fourth quarter net sales were $48 million, a decrease of 16% compared to net sales of $57 million in the fourth quarter of 2016. Fourth quarter 2017 net sales were negatively impacted by a supply disruption. And, as a reminder, the higher than usual fourth quarter 2016 worldwide net sales reflected increased ordering upon re-availability of supply following an extended supply disruption. Keep in mind that the timing and duration of interruptions in ordering patterns can increase variability in our reported net sales. Our Erwinaze net sales guidance for 2018 is in the range of $190 million to $220 million. The midpoint of our guidance reflects year-over-year growth of approximately 4%. This guidance reflects our expectation of temporary supply disruptions in 2018. Defitelio net sales for 2017 were $134 million, an increase of 23% from $109 million in 2016. 2017 sales reflect an increase in sales volumes and a full year of U.S. Defitelio sales after launch in April 2016. Fourth quarter net sales increased 22% to $36 million from $30 million in the same period of last year, mainly due to an increase in volumes outside of the U.S. We continue to expect inter-quarter variability in Defitelio net sales. Recognition, diagnosis, and early treatment of VOD with multi-organ dysfunction in the U.S. remain an educational priority. Our Defitelio net sales guidance for 2018 is in the range of $145 million to $165 million, and we expect the U.S. contribution to be approximately 30% of this guidance. The midpoint of our guidance reflects year-over-year growth of approximately 16%. Vyxeos net sales were $34 million in 2017 and $24 million in the fourth quarter following the U.S. launch in August of 2017. Our Vyxeos net sales guidance for 2018 is in the range of $130 million to $155 million. This guidance includes minimal European net sales following the anticipated start of the rolling launch in the second half of this year. Prialt net sales in 2017 were $27 million compared to $29 million in 2016. Fourth quarter net sales in both 2017 and 2016 were $6 million. For 2018, we expect strong top line growth, with estimated total revenues in the range of $1.86 billion to $1.93 billion, up 15% to 19% from 2017. Turning to operating expenses, adjusted SG&A expenses for 2017 were $455 million or 28% of total revenues compared to $405 million or 27% of total revenues for 2016. Adjusted SG&A expenses for the fourth quarter of 2017 were $121 million or 28% of total revenues compared to $108 million or 27% of total revenues in the same period of 2016. For 2017, the increase in adjusted SG&A was primarily due to the expansion of our business, including higher head count and the launch of Vyxeos in the U.S. For 2018, our adjusted SG&A expenses are expected to be in the range of $525 million to $555 million, or 27% to 29% of 2018 revenue guidance. Adjusted SG&A expenses are expected to increase in 2018, primarily due to investments in the continued U.S. launch of Vyxeos, the planned launch of Vyxeos in the EU, solriamfetol U.S. prelaunch activities, and label expansion activities for Xyrem pediatric narcolepsy patients. The incremental spend for these commercial growth initiatives is in the range of $55 million to $65 million, and we would expect a return on these investments in coming years. I'll also note that adjusted SG&A expense as a percentage of revenue has historically increased in the first quarter due to our typical higher pattern of spending and the revenue impacts related to Xyrem payer churn. Adjusted R&D expenses for 2017 were $162 million compared to $146 million in 2016 or 10% of total revenue in both periods. Adjusted R&D expenses were $43 million in the fourth quarter of 2017 compared to $40 million in the same period of 2016, or 10% of revenue in both periods. Adjusted R&D expenses in 2017 included costs related to solriamfetol, the defibrotide prevention of VOD study, asparaginase and sleep-related R&D programs, and Vyxeos regulatory activities, as well as an increase in head count required to support these activities. The increase in adjusted R&D expenses in 2017 compared to 2016 was partially offset by the completion of the solriamfetol Phase 3 studies in 2017. For 2018, our adjusted R&D expenses are expected to be in the range of $205 million to $225 million, or approximately 11% to 12% of 2018 revenue guidance. This guidance includes expenses related to the solriamfetol and Vyxeos EU regulatory submissions, advancing early and late-stage development programs, including JZP-258, Vyxeos, defibrotide, and asparaginase programs, our continued support of ImmunoGen programs, and the advancement of programs utilizing our CombiPlex platform. We're excited by our top line revenue growth opportunities and the important investments we plan to make in 2018, and believe that over time this will lead to margin expansion and P&L leverage as we move beyond key product launches. For the full year and fourth quarter of 2017, income taxes on a GAAP basis included a net benefit of approximately $149 million, or $2.43 per diluted share, resulting from the remeasurement of our deferred tax assets and liabilities and the one-time negative impact of taxation on previously unrepatriated earnings of foreign subsidiaries, in accordance with the U.S. Tax Cuts and Jobs Act. This benefit has been excluded from adjusted net income and the related per-share measures for the full year and fourth quarter of 2017. Lastly, on the tax front, as a result of this new legislation, we expect that our 2018 adjusted effective tax rate will be lowered to a range of 17% to 19% based on our current business profile. Adjusted net income for 2017 was $677 million, or $11.04 per diluted share, compared to $627 million, or $10.14 per diluted share, in 2016. Fourth quarter 2017 adjusted net income was $180 million, or $2.95 per diluted share, compared to $166 million, or $2.71 per diluted share in the fourth quarter of 2016. We estimate our 2018 non-GAAP adjusted EPS will be in the range of $12.65 to $13.25 per diluted share which represents growth of 15% to 20% compared to 2017. In the fourth quarter, the main uses of cash included $42 million for the repurchase of our shares. In 2017, we spent approximately $105 million for upfront and milestone payments and $99 million for share repurchases. We had $183 million remaining under our share repurchase program at the end of the year. As of December 31, the outstanding principal balance of our long-term debt was $1.8 billion, and we had approximately $601 million in cash, cash equivalents, and investments, and $1.25 billion undrawn under our revolver. We expect 2018 adjusted net interest expense will be in the range of $40 to $50 million. In closing, our key corporate development investments over the last several years led to multiple milestone events in 2017. Between 2012 and 2017, we deployed approximately $4 billion in capital and significantly expanded our business with the addition of Erwinaze, Defitelio, Vyxeos, and solriamfetol. In general, we have met or exceeded our deal model expectations to-date, as illustrated by our achievement of key development, regulatory, and sales-related milestones. These transactions have diversified our portfolio and allowed us to build a deep therapeutic expertise in sleep and hematology/oncology-related diseases. We expect these and other investments such as CombiPlex and our ImmunoGen collaboration to drive further value over time. Corporate development efforts to further expand the current portfolio, along with our growing capabilities and expansion of our global, commercial, and R&D infrastructure, set us up for an exciting future. We look forward to identifying additional attractive assets, executing on our commercial initiatives, and delivering meaningful therapeutic options for patients and sustainable growth to shareholders. Thank you for joining us on the call today, and I'll now turn the call over to Kathy.

Thanks, Matt. We request that you limit your questions to two at a time, and then feel free to reenter the queue if you have further questions. With that said, I'll turn the call back to the operator to open the line up for your questions.

Thank you. Our first question comes from the line of Ami Fadia with Leerink Partners. Your line is now open.

Hi. Good evening. Thanks for the question, two questions. First of all, just on the recent settlement with Par, could you elaborate a little bit about what ability Par has to launch its own generic starting the end of 2025 and whether they would need to have their own independent REMS program in order to launch that? And separately, just on Erwinaze, what is your near-term and longer-term solution for the continued disruptions in supply? Thank you.

All right. On the first question, I believe you were asking when Par is free to launch its own generic. As of December 31, 2025, will they need their own REMS? And the answer is yes. We assume that REMS would be the waiver REMS that exists on paper right now as a result of some of the early approvals of ANDAs. But the answer is yes, they would need a separate REMS. On Erwinaze, continuing supply disruptions, I'll say it remains one of the great disappointments of our team that we have been unable working through our contract supplier to fully remedy that situation to-date. And I can only tell you we're doing everything we can on the quality side, on the capacity side, in many ways to improve availability of product for patients, both near-term but also long-term. And I'll remind you that our efforts are not limited to just the existing Erwinaze product. We continue to look for potential ways to improve upon that product while also improving supply availability for patients in the future. So I don't have a good short-term answer for you, which is why we are predicting some supply disruptions throughout this year. But I can tell you we're doing everything we can think of to solve that problem as quickly as we can.

Thank you. And if I may ask a follow-up on the comment about the settlement with Par. Does that in any way impact your settlement terms with Hikma?

No, and I'll just say your question about the need for a separate REMS would have been the exact same answer as if you had asked about the previous settlements we reached for December 31, 2025, entry date. Same thing goes with respect to those.

Got it. Thank you.

Thank you. Our next question comes from David Risinger with Morgan Stanley. Your line is now open. David R. Risinger - Morgan Stanley & Co. LLC: Yes, hi. Can you hear me?

We can. David R. Risinger - Morgan Stanley & Co. LLC: Great. So I was hoping that you might be able to provide a little bit more color on specifically your plans to launch JZP-110, the timing of that relative to, I guess, the FDA action date will be in December of 2018, and then just how you think we should start to think about the first year of launch of that product. Thank you very much.

On timing of launch, as we said, we need two things to launch. We need an FDA approval. We also need DEA scheduling. Our best estimate is that would happen within 90 days of FDA approval, which brings us to a planned first quarter 2019 launch. Mike, I don't know what you want to say at this point in terms of how to think about early launch of solriamfetol.

Yes, so we would begin this year to look at what would be the extent of sales force expansion. There are a lot of efficiencies already built into our current call audience, since we call on specialists. We would expand to maybe some of the pulmonology audience members. I think we would be doing – we're working right now on the value prop. We'll be working with creating awareness around excessive sleepiness in OSA and narcolepsy. But we're very, very excited about the product and the launch. David R. Risinger - Morgan Stanley & Co. LLC: And could you just remind us – excuse me, how you've talked about the longer-term commercial potential for the product? And I don't know if you've quantified sales potential long term, but if you could discuss the opportunity as you see it, that would be very helpful.

Sure, the opportunity we have not discussed sales forecasts. But we have – when you look at the OSA population in the U.S., it's quite extensive. When you look at it on a worldwide basis, it's pretty remarkable. It's about 9 million patients with OSA. And many of them have excessive sleepiness associated with OSA We believe that the unique mechanism of action of this molecule will, I think, perform very well in those patients. And we think that it also serves a very important role as a daytime med for narcolepsy patients suffering from ES as well. David R. Risinger - Morgan Stanley & Co. LLC: Great, thank you.

And then as we think beyond that initial launch, of course we're already studying the drug in excessive sleepiness in Parkinson's, which would be one of a number of other conditions that have significant associated excessive sleepiness. We've hinted that we may go beyond excessive sleepiness. If you look at where other stimulants and awake-promoting agents have been studied, here we have another drug that we think has strong efficacy and might have use in other arenas. And then of course, there's the geographic potential of the product. We mentioned submitting an MAA late this year in the EU. So if you think about the initial desired label of excessive sleepiness in narcolepsy and OSA, that's the starting point, moving broadly to excessive sleepiness perhaps beyond that to other indications. And moving from the U.S. to a global market gives you a sense for the potential of the molecule longer term. David R. Risinger - Morgan Stanley & Co. LLC: Great, and just one more, Bruce, since you mentioned it. What's the timing for the Parkinson's data?

We said we want to complete enrollment this year. David R. Risinger - Morgan Stanley & Co. LLC: Okay, thanks again.

Yes.

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

Hey, guys. Thanks for taking my questions. I have two. First is can you talk about your confidence in the clinical trial for JZP-258 in idiopathic hypersomnia? I'm curious if there is any evidence of Xyrem working in these patients, and also whether they're a homogeneous group with a predictable degree of sleepiness in the absence of treatment. And then the second one was just I'd just be curious if you can give any color on the proportion of the labeled patient population for Vyxeos that you assume is treated when you guide to $130 million to $155 million this year? Thank you.

Okay. So let me have Karen talk a little bit about the potential for JZP-258 in idiopathic hypersomnia. And then maybe, Mike, you can comment on the Vyxeos question.

So hi, Jess. It's Karen here. When you think about idiopathic hypersomnia, there are a couple things to think about. One is that it's definitely a debilitating disease, and it's an area of significant unmet need, which at present doesn't have any approved therapies. When you think about why this could actually apply in this patient population, if you look at the idiopathic hypersomnia patients, you can see that there's definitely an overlap in terms of the potential that we could use this compound in this patient population. The current treatment patterns are generally very similar to that of narcolepsy, but there's no approved therapy in this area, and what physicians are looking for is a new treatment option. So when you also add that together with the clinical experience that we have and the anecdotal evidence along with single cases, also recent case series and the literature that we've seen, our own clinical trials instead of looking at the patients that could be diagnosed in idiopathic hypersomnia as opposed to with just narcolepsy, then we're actually seeing a signal in these patients. And then you overlay that with JZP-258, which has an improved safety profile, and I think that we believe that it would be a good product candidate for these patients.

And, Jess, I would just to say it's a little harder to answer your question about is it a homogenous group. I'm not sure we'd say the narcolepsy group is a completely homogenous group in terms of a variety of severity of different symptoms and response to treatment. And I would just say in general the idiopathic hypersomnia population is probably a little less well-characterized than that of the narcolepsy population. Mike, do you want to take a shot at the Vyxeos, or did you want to add something, Karen?

I was just going to add, just adding to what Bruce has just said that it is a fairly well-defined chronic neurological disorder, and there is a degree of overlap. When you go to diagnose these with these patients and remembering these are sleep docs that would be diagnosing with idiopathic hypersomnia, much of them would be diagnosing narcolepsy. And there is definitely an overlap in terms of the types of clinical parameters that you'd look at with these patients. So what is the MWT, what is the MSLT, these sorts of things they're looking at, and they're seeing the overlap. And that's why we know there are some patients who we have seen coming through clinical trials or have been treated in the past perhaps diagnosed as a narcolepsy patient. When the physician goes back and relooks at the patient, actually it's perhaps more of idiopathic hypersomnia. And the other thing to note too is that one of the classic hallmarks of idiopathic hypersomnia is that these patients have this excessive sleepiness, and excessive sleepiness is beyond feeling tired. This is an uncontrollable need to sleep, and this has to persist for more than three months. So there are clear diagnostic parameters around identifying this patient population versus narcolepsy, and there are clear signals that we have for this molecule that it could be effective. Mike?

Hi, Jess. It's Mike. And I would say that Vyxeos to date I think has very much been being used according to label. A lot of that has to do with the cost difference between Vyxeos and the 7+3 and the P&T oversight of that. I would say that the reason NCCN Guidelines, which strongly support our label but also include some other populations, I think we have to monitor that as we go forward. We have not done chart studies. We don't know what the spontaneous use will be. We'll continue to monitor that, but we are pleased with the NCCN Guideline output.

Great, thank you.

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

Hi, thanks so much for taking my questions. Bruce, how many patients on Xyrem had become free patients in 2017 because of the foundation issues? And since January 1, how many of them have actually rolled back to being commercial patients? I guess what I'm trying to get at is in this 2018 guidance for Xyrem, is there any contribution from foundation patients included already or not, number one? And secondly on Vyxeos, my question is, are you seeing utilization in MDS and/or in patients younger than 60 years of age? Thank you very much.

So on the first question, Umer, we don't necessarily know where patients that end up in our free drug program come from. They're not tracked in the way you're asking the question. But to respond a little bit to what we're seeing in the first quarter, we are seeing better trends with respect to government-pay patients, which is the change in patient mix we saw, particularly starting in the first quarter last year, although it continued throughout the year. So we're seeing actually more government-pay patients at this time in 2018 than we did in 2017. So I think that trend is essentially going the opposite direction from how it did last year. Now, we're only part way through the quarter. Our guidance is for the full year, so let's see how things play out. But that's the best sense I can give you right now for how that's playing. Mike, on the MDS question?

Sure. As I've said, I think most of our – we have not done a chart study yet, but I believe most of our use of Vyxeos to date has been very much around the label.

Thank you very much.

Thank you. Our next question comes from Randall Stanicky with RBC Capital Markets. Your line is now open.

Great, thanks. Bruce or even maybe Matt, just a bigger picture question, the top line is clearly growing, but when we look at the spend, obviously this is a big investment year. So how do we think about on a multiyear basis the operating leverage in the business from what has been mid-50% operating margins? And then the follow-up is just a quick question for Bruce. On the once-nightly dosing oxybate, is that a low-sodium formulation? Thanks.

So I'll let Matt take the question on margins, and I'll just quickly answer the second question, which is yes. So the once-nightly program does incorporate a low-sodium version of oxybate.

Thanks, Bruce. Randall, as it relates to margin trend over time, as we tried to elucidate in the numbers this year, $55 million to $65 million of increased spend in SG&A is tied very specifically to launch and prelaunch-related activities in various geographies for various products. I think if you were to fast-forward to more of a mature point in the sales curve across our portfolio, you'd clearly start to see significant P&L leverage emerge. The G&A embedded inside of the SG&A is actually as a percentage of revenue going down. So we are seeing that in the base G&A. The sales and marketing-related activities and some related to medical, which is – much medical spending is in your SG&A line are going the other direction, and we're making some significant investments there. So again, that would assume a static portfolio, so not continuing to launch products, which we of course hope to bring in and secure a more diversified set of product drivers over time. So while we may have other launches we'll be funding certainly across the existing portfolio, we would expect P&L leverage to emerge as we get past a pretty heavy period of launches, which would of course also include solriamfetol in 2019. So I think you'd start to see more of that leverage emerge really post-2019 on the SG&A side.

Okay, great. Thanks.

Thank you. Our next question comes from David Maris with Wells Fargo. Your line is now open.

Hi. Bruce, maybe you could just tell us a little bit about the deal flow that you're seeing and whether or not the pickup in M&A so far this year has had any impact on the prices that folks are demanding or some of the recent deals by larger pharma defy some traditional financial metrics. Does that make it more difficult for you, or are you still happy with what you're seeing? And we've heard for a while about the likelihood of completing more deals. Are you as confident as you have been? Thanks.

David, I would say while this year, as has been true of many years in the past, we have seen the occasional deal priced at a level where our math wouldn't work to earn a return for our shareholders. That doesn't mean that we aren't seeing lots of opportunities that we think are actionable at prices that would in fact provide really nice returns for us while achieving a number of our strategic objectives to broaden our portfolio and diversify the business. I think the deal flow is really good. You can argue that a couple transactions at high prices may increase people's expectations about what they've been paid. It also of course encourages a lot more people to think about transacting, which itself can be helpful. Am I as optimistic as I've been historically? I am. Matt detailed the $4 billion in transactions we've done over the past number of years, and I talked about the cash flow we've got upcoming over the next couple years in addition to our existing balance sheet strength. So I think we've got the capacity. Financially, I think we've got the capacity organizationally to do a range of transactions across commercial products, R&D programs, global deals, Europe deals, U.S. deals, collaborations, licensing, a variety of things that I think all go in the direction of broadening our business and putting capital to work in ways that we believe do earn good returns for our shareholders.

Okay, thank you very much.

Thank you. Our next question comes from David Amsellem with Piper Jaffray. Your line is now open. David A. Amsellem - Piper Jaffray & Co.: Thanks, just a couple on solriamfetol. First, any color on where you think the controlled substance designation will shake out? I wanted to get your thoughts on whether you think it will be a Schedule III or a Schedule IV in particular. And then, some commercialization questions, how heavily do you expect to contract with payers? And maybe just remind us the mix between Medicare Part D and commercial. Thanks.

So on the first part of your question on scheduling, not our decision. We believe the data we're submitting would support a Schedule IV. But we'll wait and see where that turns out. In terms of exact details of our contracting, I'm sure Mike's ready to share all that, so let me turn it over to Mike.

Look, we're right now building the value proposition for the product, which we think is significant. We believe that ES is an important unmet medical need that I think commercial payers will respond well to. And I think the product's efficacy sparkles quite frankly. So I think when we put that together, I think we'll feel very good going into the year.

And then payer mix, Mike?

Payer mix is predominantly commercial. David A. Amsellem - Piper Jaffray & Co.: Okay, thank you.

Thank you. Our next question comes from Liav Abraham with Citi. Your line is now open.

Good afternoon, just a couple of quick ones. Firstly, Matt, can you give some color on R&D expense trends beyond 2018 as we think about modeling? There's an uptick this year. I just want to get a sense of whether this is expected to continue at the same level beyond 2018. And then just to follow up, Bruce, on some of your comments on your capital allocation strategy a few minutes ago. Just curious as to whether you're still interested in adding a so-called third leg to the company, especially given your investments in SG&A and R&D this upcoming year. Is this still the case, or is your focus from a capital allocation perspective on your current therapeutic areas? Thank you.

Thanks, Liav. With respect to R&D, we'll try not to give long-term guidance for just that metric. But I would say, as we've indicated in the past, R&D as a percentage of our sales has been increasing over the last few years. We want to make sure we balance that financial line item with measuring operational capacity and making sure we make investments that we believe can earn an attractive return. So we're excited to see our pipeline growing and the portfolio of investments we're making grow across the spectrum in terms of phase and across our therapeutic areas. So I would expect we will continue to make the most of our existing molecules as well as bring other molecules into the company, as we have with our ImmunoGen collaboration. So I would expect we'll continue to certainly see the dollars spent on R&D going up, given we are growing revenues right now as we guided this year 15% to 20%. Obviously, going up as a percentage of revenue means it's going up even faster than that. Whether that will persist will come down to what our portfolio review says internally our operational capability and what molecules we're identifying externally. But we're certainly open to that idea and continue to believe that deploying capital to grow and diversify our business over time through innovation is a very important thing for the company.

And then on the second part of your question in terms of interest in entering a new therapeutic area, I think, if you think about a sustainable growth strategy over a three-year, five-year, 10-year period, I would say it's almost certainly true that we will enter a third therapeutic area. Will that be in 2018? Hard to say. We know we're going to do it at some point. If we found the right opportunity to do so now, another area where we see a good fit with our strategy and our capabilities, an area where we see a good lead commercial product to bring us into that, a therapeutic area with other opportunities we can see on the horizon to add to the commercial portfolio and have an R&D portfolio behind it, if we see all that, we certainly would act to do that. But it's not a must-do in 2018. It's a must-do over time to meet our longer-term growth objectives.

All right. Thank you.

Thank you. Our next question comes from Dana Flanders with Goldman Sachs. Your line is now open. Dana Flanders - Goldman Sachs & Co. LLC: Hi. Thank you very much for the question. So my quick one here, just to follow up on OpEx and maybe just specifically on the ex-U.S. build-out and opportunity. I mean how should we just think about what's needed to launch Vyxeos ex-U.S. into 2019? And then will that commercial strategy that you've employed here in the U.S., will that mirror what you plan to do in Europe, or are there any key differences? Thank you.

Dana, I would say probably too early to address that question. Remember that we're talking about submitting for solri in Europe late this year, which would put it a full year behind the U.S. as a starting point. We're gearing up now with pre-commercial activities for a U.S. solri launch in early 2019. We need to be talking about a European launch that would be lagged from that. And I think we'll want to leverage our learnings in the U.S. as well as take into account some of the differences in the European market but probably a little early for us to be trying to comment in particular on ex-U.S. commercial plans.

Thank you. Our next question comes from Marc Goodman with UBS. Your line is now open.

Hi. Could you give us a little more color on Defitelio? It just seems like this product is not growing that much, and I'm curious whether we've reached a point of high penetration and we should expect very slow growth from here. I mean U.S., what were U.S. sales in the quarter? It looks like if you put up $10 million or $11 million or $12 million in the quarter, you'd hit $40 million something and you're guiding to $40 million something in the U.S. for 2018. So maybe you can talk about the U.S. and then specifically you could talk about Europe separately. Thanks.

Marc, I would say we have been experiencing and we are expecting growth both in the U.S. market and in the ex-U.S. market. I think we've seen in the U.S. market over the first year and three quarters of being on the market something fairly similar to what we saw in the early years of our European launch, which started back in 2014, which is pretty rapid pediatric uptake, a little slower to get traction in the adult accounts, although we have succeeded in Europe in gaining some momentum there, and we've seen really good growth in Europe, but that took some time. It took some educational efforts. We had to change some minds in terms of recognition of incidence of severe VOD and the need to intervene quickly and treat completely until resolution or 21 days. But we've made real progress. And in the U.S. again I think we saw rapid pediatric penetration. I think it's a tougher go on the adult side. You heard in our comments today that a separation of our efforts on the adult side with Defitelio to have a dedicated transplant-focused sales team I think will benefit Defitelio in the same way that it benefits Vyxeos. So we're doing it in part to give ourselves more bandwidth on Vyxeos beyond the core academic centers, but I think it will also help us on Defitelio as well. So we remain really optimistic about what we can do with this molecule. Again, much like you heard me describe our opportunity for solri, part of it is how do you continue to make progress with your existing label. Part of it is how do you explore new indications. We talked about three new indications we're exploring through clinical work with defibrotide, and there may be more coming in the future. We talked about geographic expansion. Obviously, we're trying to take Defitelio into Japan as well over time and investigating other markets. So as with all our molecules, optimize within your existing indications, look at promising new indications, explore those appropriately, and then expand geographically. I feel good about the growth potential for Defitelio for a long time.

What were U.S. sales in the quarter?

$10 million.

Thank you.

Thank you. Our next question comes from Annabel Samimy with Stifel. Your line is now open. Annabel Eva Samimy - Stifel, Nicolaus & Co., Inc.: Hi. Thanks for taking my question. On Vyxeos with the new NCCN Guidelines, can you help us understand? Is that a tool that you can use to help facilitate changes to the DRG payment? Is that something that's in your control at all? And how are you talking to I guess the P&T committees looking at Vyxeos and seeing that patients may be staying in the hospital a little bit longer on the tail end? Thanks.

So, Annabel, I'm going to cheat a little bit and go back and add an answer to Marc's question just before we move on. I do want to point out that we have experienced and expect to experience continued intra-quarter variability of Defitelio sales. And I would say don't get too excited when they pop way up, which happened at least once last year, but also don't get too discouraged when they're a little bit low for a quarter. It will bounce around. It's an ultra-rare condition. We've seen that over time and expect that going forward. On the first part of your question, Annabel, on the NCCN Guidelines, those don't effectively or a directly impact DRG rates. Remember that DRG rates are set looking back a couple years at actual data. Right now, that doesn't help us because we're looking back at periods when there was no Vyxeos available. A couple years from now, they'll be looking back at periods where Vyxeos was available. And so DRG rates do tend to reset over time. Of course, there is a mechanism to bridge that, which is NTAP. We've applied for it. We don't know that we'll get it, but that's a possibility. But even without that, realize that over time, DRG rates do reflect actual spending in prior periods. Mike, do you want to talk a little bit about Vyxeos treatment time and what you're hearing from payers on that?

Sure, so the P&T committees have gone very well for Vyxeos, and that was even before the NCCN Guidelines. The NCCN Guidelines were only a recent event, and we feel very good about those, but P&T interactions have been very positive. And what we're actually seeing is more consolidation in the community setting and the outpatient setting. We had expected that, but we didn't expect it quite as early as we're seeing it now. So this is a great event for patients and their loved ones that the patient does not need to be in the hospital. It also saves the system some money, and the patient can go home after consolidation treatment in an infusion center. So it's really a great benefit of the product.

Thank you. Our next question comes from David Buck with B. Riley FBR. Your line is now open.

Yes, thanks for taking the question. Bruce, can you remind us how the launch of your follow-on reduced-sodium products are going to be impacting the settlements with Xyrem and just the timing of that? And separately, for solriamfetol in 2019, can you talk a little bit about as opposed to generic orals in that category, how you're looking at things like direct-to-consumer advertising and what the timing of that might be?

Sure, so on the first question, David, I think you're bringing together a couple concepts. One is what do we expect in terms of results from a launch of a reduced-sodium version of oxybate, and of course, we're not quite ready to talk about that yet. We haven't submitted yet. But clearly, we think this could be a benefit to patients with narcolepsy who currently have no choice but a therapy that has very, very high sodium levels. And we know the long-term health benefit of avoiding that high salt intake is considerable. So we're looking forward to that opportunity both to offer a better product to current patients but potentially to expand the number of patients who receive therapy because we know doctors tell us today that there are patients for whom they think oxybate would be a great therapy but for the sodium load and don't prescribe it for that reason alone. You're talking then about what impact that may have on existing settlements. There is a provision in our existing settlements I think that's pretty typical for generic settlements, which is a market decline provision that protects generics against significant erosion in the market for the product where they're sitting on the sidelines waiting for a future launch date. And there's a mechanism that if sales fall precipitously that they can enter the market sooner. That is not tied in any way specifically to our low-sodium products. That could be anything that happens to sales of our existing product, other competitors' changes in treatments, new safety findings, I don't know what else to bring up but anything that could impact sales. So I wouldn't link the two directly. We have a successful product out on the market in Xyrem that we think is helping a lot of patients. We'd like to come along with products that are even better for patients and continue to expand that franchise for many years to come.

And, operator, let me speak for a minute before we go to the next person.

Let's take the second part of the question too, which was thinking about solri launching into a genericized world, Mike.

So launching solri into a market that would have a generic, a new visual and core visual as well as branded in both those products, we would envision probably a Tier 3 step-at-it process, largely done in a retail pharmacy setting. You had one question around DTC. And I think to be clear, branded DTC in the first year would not be something we would look at. But we are big believers in disease awareness, and I think an unbranded disease awareness around ES is an important component of the launch, and it can be done at a fraction of the costs as a branded DTC would.

And we have a number of people on the line still. And so we want to be able to give everybody a chance to get in a question. So if you all would, please help us by limiting to one, unless there's an absolutely urgent second one. We'd appreciate that. Thank you.

Thank you. And our next question comes from Gary Nachman with BMO Capital Markets. Your line is now open.

Hi, thanks. On Vyxeos, I know right now it's mostly on label. But how long before we get data on combination with some of the targeted therapies for AML that might lead to some of that use? Could that potentially come this year? Will it be next year? It's just something that we've heard physicians excited about. So I'm curious about that. Thanks.

This is Mike, and I'm looking at Karen. I think I agree with you there's excitement around it and there is interest. And, Karen, maybe you can speak to that.

I think we are equally excited about the potential to utilize Vyxeos as the backbone of therapy. And certainly there, we've had a lot of inbound interest in the form of IST. So at the moment, we have over 20 ISTs that are running some of those, do look at things like Vyxeos in combination with a FLIP-3 (1:09:34) or other combis that currently are utilizing a 7+3 regimen. So I think that we are equally excited by the potential there.

Okay. And is it something we can see this year, or probably it wouldn't be until next year...

It's difficult to say...

...in terms of data?

...because we don't control the timing of an IST.

Okay, all right. Thank you.

And different types of data take different amounts of time to get. You can start a trial and get some reviews as to how patients respond initially safety data to get long-term survival data. It's not going to happen this year, but there are various types of data that will come out over time.

Okay, thank you.

Thank you. Our next question comes from Greg Fraser with Deutsche Bank. Your line is now open.

Great, thanks for taking the question. It's Fraser on for Gregg Gilbert. On Xyrem, of the 50,000-plus patients that are diagnosed with narcolepsy in the U.S., what proportion would you say are candidates for Xyrem? You know that the average number of patients on Xyrem was north of 13,000 last year. I'm just wondering how penetrated do you think the current diagnosed population is.

So given the indication of Xyrem, which is to treat excessive sleepiness and cataplexy and narcolepsy and given that all narcolepsy patients have excessive sleepiness, theoretically just about every patient is a potential candidate for Xyrem therapy. We know also that the drug has limitations and risks, including a black box warning. That black box warning warns against, among other things, concomitant use of alcohol as a depressant, which would be dangerous used in combination with sodium oxybate. So you can eliminate patients who are unable or unwilling to give up alcohol, patients with a history of drug abuse or other things that would cause them not to be good candidates for this controlled substance. We certainly know docs are more likely to try other therapies first, including daytime use of stimulants and awake-promoting agents. So while I can't say there's a huge fraction of the patients that you couldn't get to, I think practically, the product tends to get used in a smaller fraction of patients. That fraction has grown over time to be closer to 20% to 25% of patients, whereas that used to be once upon a time 10% to 15% of patients. And as we've said, we continue to think we can grow volume and maybe grow volume faster than market growth. But is that suddenly going to jump up to close to the diagnosed and treated patient population? No, we don't think so. Mike, do you want to add anything?

Yeah. I would just say that, again, we remain very encouraged around the disease awareness campaign and the response of the diagnosis claims to it. So we're going to do that full year in 2018.

Yes.

So while we continue to grow our penetration in the diagnosed population, we also look to grow the diagnosed population.

Got it.

So, Gary (sic) [Greg], the other part of the equation is what about the 100,000-plus patients out there who haven't yet received an accurate diagnosis of narcolepsy who should they get that diagnosis might become future candidates for Xyrem therapy.

Great, thanks for the color.

Thank you. Our next question comes from Bill Tanner with Cantor Fitzgerald. Your line is now open.

Thanks for taking the question. Just quickly, Bruce, on solriamfetol in PD, so you get Phase 2 POC data, and I'm wondering. Obviously, it's going to depend on the data, whether you'd be inclined to move straight into Phase 3 knowing what you know about the compound and about sleepiness, and then if that would create a new physician call point to where it might make sense to bulk up with PD with maybe another asset. Thanks.

Good questions, Bill. Let's see the data out of the POC trial. We clearly went into this disease because we believe the unmet medical need is very significant here, and we think it's an interesting place to study. Solriamfetol, given some of the things we know about PD patients and we know about the mechanism of action of this drug, so there certainly is that potential that we would move right into a registration trial. But let's wait and see the data. On your second part of your question, with success, would we potentially be moving into a slightly different call audience, and might that bring opportunities to have a different selling point and to potentially bring other products in development or other commercial products along with that move? Absolutely.

Okay, thanks very much.

Thank you. Our next question comes from Douglas Tsao with Barclays. Your line is now open.

Hi, good afternoon. Thanks for the question, just maybe a quick question on Erwinaze. Obviously, you've been supply-constrained for some amount of time now. If you had unfettered or unlimited supply, Bruce, do you think that this – would you be able to be growing the product? I know it's certainly a more mature product than others in your portfolio. But how much additional opportunity do you think there is with Erwinaze? Thank you.

It's a great question, Doug, and the answer is an emphatic yes. We absolutely could be growing this product. We're limited in our willingness to invest resources behind trying to grow it right now because we don't want to create demand we can't fill. That's not fair to our customers and patients. But as we said for some time, while we think there's good appreciation of the use of asparaginases, including Erwinaze, on hypersensitivity in the pediatric population, we think there's less appreciation for the use of asparaginases in the adolescent and young adult population, and we see real opportunity there. And with reliable unlimited supply, we would, for sure be investing in generating that, I think, better treatment outcome for those adolescent and young adult patients. And potentially over time, you could imagine even broadening beyond the core ALL market. But right now, we've got to address the near-term supply issue.

Okay, great. Thank you very much.

Thank you. I'm showing no further questions in queue at this time. I would like to turn the conference back over to Kathy Littrell for closing remarks.

Thank you again for joining us today. We really appreciate it, and we will be participating in the upcoming Cowen conference as well as the Barclays Healthcare conferences and hope to see many of you at those conferences. This will now end our call.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes today's program. You may now disconnect. Everyone have a great day.