Good day everyone and welcome to today’s program. At this time, all lines are in a listen-only mode. However, later in the program, you will have the opportunity to register to ask a question. Today’s conference is being recorded. And now, it is my pleasure to turn the conference over to Kevin Gorman. Please go ahead sir.

Thank you very much, and welcome everyone to Neurocrine’s Q1 earnings call. I’m joined today by Tim Coughlin, our CFO; and Chris O’Brien, our Chief Medical Officer. We’ll go through an update of the financials and also our R&D programs. Before we get started, I would like to Jane to read our Safe Harbor statement.

Good afternoon. I want to remind you of Neurocrine’s Safe Harbor caution. Certain statements made in the course of this conference call that state the company’s or management’s intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements, which are subject to risks and uncertainties. Information concerning factors that could cause actual results to differ materially from those contained in or implied by the forward-looking statements is contained in the company’s SEC filings, including but not limited to the company’s Annual Report on Form 10-K and quarterly reports on Form 10-Q. Copies of these filings may be obtained by visiting the Investor Relations page on the company’s website at neurocrine.com. Any forward-looking statements are made only as of today’s date and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. Kevin?

Thank you, Jane. Tim, do you want to give a financial update?

Sure, good afternoon everyone and thank you for joining us today. Our first quarter operating results were exactly what we had expected, our net loss for the quarter is $11.8 million or $0.17 per share, net loss from the first quarter of last year was $12.1 million or $0.18 per share. There are two main drivers in our financial results when comparing the first quarter of 2013 to the first quarter of 2014. The primary drivers lower external development cost. During the first quarter of 2013, we had our two Phase II studies in tardive dyskinesia Kinect 1 and Kinect 2 in the midst of recruiting in treatment. The placebo controlled portion of both of these studies were substantially completed in December of last year, and that first quarter of 2014 has been devoted to ramping up these two studies as well as preparing for the End-of-Phase II meeting with the FDA. Both of these efforts are more internal focused with our employees completing a lot of the work, thus resulting in lower external development expenses, we typically see during the quarter. Now external development cost for the first quarter of 2014 were $2.5 million lower than the same quarter in 2013. This decrease in external development cost was offset by an increase in share-based compensation expense. We typically grant annual equity awards in the first quarter of the year, this year we granted approximately the same number of time based equity awards as we had in prior years. However, because of our stock price on the date of the grant the Black-Scholes valuation for each equity award more than doubled over 2013 levels resulting in a significant increase in non-cash expense for the same number of awards. Additionally, I should add that our average option burn rate over the…

Thanks Tim. So early in the year, we released the positive results from Kinect 2 and since then we’ve been working diligently on all facets of the business to set the stage for pushing VMAT2, the entire program forward Tim just talked about, how we thought prudent in order to raise additional capital to be able to do this. And now Chris will take us through the activities that have been taking place for the balance of this quarter to get us ready for Phase III. Chris O’Brien: Thanks Kevin. And good afternoon, thanks for joining the call. So as Tim and Kevin have mentioned, we’ve been intensely focused internally on getting ready for our upcoming End-of-Phase II meeting for tardive dyskinesia. What that means is that we’ve spent the early part of this year working on closing out the safety follow-up and the closeout activities around the Kinect and Kinect 2 study. We’ve spent a lot of time working on the PK, PD modeling that is the basis for dose selection and dose justification that we will bring to the FDA in our proposal for Phase III. We’ve been completing some study reports, doing some additional integration of Phase I, Phase II safety data set and working with our regulatory and other consultants preparing for this End-of-Phase II meeting. As you may be familiar, the process for this type of meeting is a type of AbbVie meeting and we have successfully submitted our meeting request to the FDA with the specific questions that we seek there consensus on those kinds of questions relate to the nature of the Phase III trial and the Phase III program, the population of subjects that were interested in studying the duration of the trial, the number of subjects, the primary end point, the…

Thank you, Chris. So, we’re very pleased with the -with the progress that’s going on both with our partner and also our internal projects just to add on a couple of things, as we go forward into our End-of-Phase II meeting on PD, we completed the manufactured drug substance, we are manufacturing the drug product right now as Chris said, we’ve also developing the pediatric formulations for going into Tourette in addition. And we’ve had good interactions with agency, the carcinogenicity committee at the agency and so we’ve reached full agreements on the two year carc trial design – study design and that was kicking off just next month as when we get going with those and I’ll remind you that we do have Fast Track with the PD indication and that is lead to enhance interaction with the agency that’s been very useful to us over the last couple of years. So with that, I would like to open the lines up for your questions.

Thank you. [Operator Instructions] And we’ll go first to Ian Somaiya with Nomura Securities. Your line is open. Ian Somaiya – Nomura Securities: Thanks, just a couple of questions. First on the VMAT2, can you walk us through your base assumption for the Phase III trial design and then maybe highlight any areas or opportunities to accelerate the program? And then I just had one follow-up. Chris O’Brien: Hi Ian, thank you. So the base assumption going into our discussion is that the Phase III design is a 12-week trial to see both control one-to-one randomization of active and placebo. The primary end point is the change -change from baseline in the triple blinded video rating as the abnormal and voluntary movement skill. And that will have two doses of drug, everybody will start on one and there is an opportunity for a single titratable fixed dose adjustment after a certain period of time. The – after the 12-week double blind placebo controlled period, there is an opportunity for a continued dosing with active drug through the end of the year, one year time period. Now, so that’s the general outline of the program, it’s a study that would include a study population of moderate and severe tardive dyskinesia subjects screened by external reviewers not the investigators using the video screening method and that this will allow subjects into the trial with a multitude of underlying psychiatric diagnosing. So, we’re not segregating by pull their subjects, depression subjects, dyskinesia subjects they are all potentially eligible for the trial as moderate and severe tardive dyskinesia. We will stratify by underlying diagnosis, but we will approve them all in this trial. Now, you asked about opportunities to accelerate the program, there are couple of possibility here, one is that, we still don’t…

We will look for a partner at the appropriate time where we’re not currently actively engaging any partners. We plan on keeping this in the U.S. completely ourselves and getting approval and marketing it here alone. Ex-U.S. we -well we are talking to certain parties that have contacted us, do not look for a partnership from us this year. Ian Somaiya – Nomura Securities: Okay, just longer term strategies is that something you are willing to comment today or just?

No longer term strategy I certainly think, certainly in Asia, we would be partnering and then we’ll look at Europe also. Ian Somaiya – Nomura Securities: Okay, thank you.

Thank you. And we’ll go next to Robyn Karnauskas, Deutsche Bank. Your line is open. Please go ahead. Robyn Karnauskas – Deutsche Bank: Hi, guys. Thanks for taking my question and congrats on all the progress. I guess the lot of questions on my inbox are all about the timing of the elagolix data. And I know this is in AbbVie’s hands, but here are the questions as follows, the number one, can you confirm that AbbVie will allow you to release top-line data or at least whether or not the trial works are not ahead of the second Phase II? And the second question is, will that be released be at the three month end point which is primary end point or at the six month end point and the naïve others as well?

Okay, so Robyn, you’ve probably and imagine the people who have -who have put those questions in have read reports were AbbVie as stated that they have concerns about the amount of data and the timing of data that they will release from that first Phase III clinical trial, because there will be the second Phase III that’s ongoing. And it is a subjective endpoint they don’t want to influence the placebo group there. We’re in discussions with that, about the extent of the release that they will do and the timing of the release and when I have more color on that, then I’ll be able to let you know about that or AbbVie will in their releases as we lead up to that. They do understand that, the data is quite important to us and we would like to share that with our shareholders. The second question is that, is the -is the top-line data coming at the three month primary endpoint or is it coming at them, after the six months of placebo controlled. And the data that AbbVie is talking about is after the six month placebo controlled portion of the trial has completed. Robyn Karnauskas – Deutsche Bank: So the earlier see the data then it would be six months from like say ended the month plus sometimes. So that would be more that would be more fourth quarter or at least this quarter.

That’s correct. Robyn Karnauskas – Deutsche Bank: Okay. And then the next question is, what is the process so as you complete the trial, how much time typically does it take to analyze these data sets I mean a pretty big study, so could it -could we really be talking about only this year, early into next year how much time typically for these type of studies?

And you know Robyn I could give you a good estimate about what Neurocrine would do and I know our process and Chris could then talk to you about it and give you some guidance on that. But, we’re talking about AbbVie as our partner, we do not have insights on their processes and so I can’t really speak to you about the timing of how quickly they can close that out for top-line results and get that out. Robyn Karnauskas – Deutsche Bank: Okay, another question that you may not be able to answer, as I know there is a lot of readouts post the six month, and that would be relevant to safety. And so two questions there. So number one, what will we learn -what is critical to learning about the side effect profile that we’ll get at six months versus a year? Number two, when do we have any sense of what kind of readouts will occur after the six months should AbbVie allow that to be released? And then number three, when you think about safety, what does the FDA or when will we know how much safety or longer term data the FDA needs before approving the product?

Well I’ll take a couple of those, first ones and maybe Chris to comment on the last I don’t know. But, basically what do you want to get out of the study from a safety standpoint and you’re going to win all the typical safety measures and we’ve treated patients continuously out of six months and we’ve shown that we have relatively minor effects on bone and then otherwise the drug is very well tolerated. Now AbbVie is going to be taking that out to 12 months of continuous dosing, so clearly one is going to want to see what is the impact on bone now out to 12 months of continuous dosing. And then because, they are in such large numbers now you’re also going to have the opportunity that as with any drug if there is any rare or unusual safety issue then that’s what it’s in these longer bigger trials that they can come up. But that’s true with any drug. When AbbVie would release all of that data, I have no idea on when they would release that. In your question about longer term trials as far as the FDA… Chris O’Brien: I think Robyn asked two questions one was about the longer term data, so at the end of 12 months of continuous treatment, because of the legacy safety concerns for drugs like Lupron, the FDA had said do some post to treatment follow-up for potentially up to 12 months after stopping treatment. And so that’s simply to make sure there is no lingerie, no residual adverse events or bone changes or anything that, they needed to be aware of, whether that truly needs to be 12 months or 6 months that remains to be seen that’s obviously something that AbbVie will discuss with the agency. As far as the size of the safety data set, we haven’t been involved to direct discussion with the FDA since the end of our collaboration in partnership. So, I honestly don’t know whether AbbVie has had any additional discussions that would be a good question to ask me. Robyn Karnauskas – Deutsche Bank: Great. Thanks a lot.

And we’ll go next to Thomas Wei with Jefferies. Your line is open. Thomas Wei – Jefferies: Thanks, just on the VMAT Phase III program, if you housekeeping things just in your proposal, how many patients did you propose, what you think the estimated timeline there is and what are your latest thoughts on seeking an SPA? And then I had a follow-up on the primary end point. Chris O’Brien: So let me, this was in reverse order Thomas, thanks. I don’t plan on asking for an FDA, we don’t have -lot of contentious issues here on the study design and in this division, it doesn’t have a long track record of using FDA. So hopefully that’s not an path that we need to go down, we should seek consensus at the End-of-Phase II meeting and get good agreement on to this trial design endpoints and statistical methods. As far as the sample size, there is always a balance, there three or four competing forces, you want enough patients to contribute to your safety data set, you don’t want so many patients that you’re grossly over powered and you want a reasonable timeline for recruitment and completion of the study. And finally you want enough data to have interruptible efficacy and safety information to guide clinicians in a product label. And so, I believe that for a Phase III trial that balance is somewhere around 200 subjects for a single trial, the question is how many total subjects well we need for overall NDAs filing and that’s something we’ll seek agreement on from the FDA at the meeting in June. The timeline for that as I mentioned meeting in June IRB and study site contracting and activities over the summer starting the pivotal program in the fall and the rough…

Thomas you had another part to your question. Chris O’Brien: The first part of that. Thomas Wei – Jefferies: It’s okay, I’ll -I can follow-up later on that, to labor my questions. Thanks very much.

Okay.

Thank you. And we’ll go next to Phil Nadeau with Cowen & Company. Your line is open. Phil Nadeau – Cowen & Company: Good afternoon and thanks for taking my questions as well. First, the VMAT2 towards trial in the prepared remarks I think you mentioned that you were going to go after a specific target population in Tourette. Can you give us your preliminary thoughts of what -who makes up that target population and how it’s defined? Chris O’Brien: Sure, thanks Phil. Tourette, as you know is generally a pediatric disorder with onset range being 3 to 21, by definition 21 is the cut-off. Obviously adults have Tourette’s, but most people with tic disorder and Tourette syndrome are in the kind of eight to 16 year range. And so our interest is in fact going after pediatric that’s why we’ve done all this pre-clinical safety work to support our ability to do chronic dosing in the young children. And while we obviously haven’t started those studies, my estimate is that we will be in the six to 18 year old age range, since that’s the kind of the -the most common earliest onset is age 6, the average onset age of diagnosis is 8 and by the time your 18 your moving into adult. Phil Nadeau – Cowen & Company: Okay. That’s very helpful. And then second is on elagolix uterine fibroids press release mentions that the Phase IIb is ongoing there. Do you have any clarity from AbbVie when that trial might complete and what their data disclosures were actually is going to be? Chris O’Brien: So I can tell you what on clinicaltrials.gov uterine fibroid Phase II program is related as that the completion of the clinical portion associated with the primary assessment is July of this year and that’s 520 or so subjects, Kevin is shaking his head.

Yes. That’s the part of clinicaltrials.gov that AbbVie is yet to update with that trial, because they doubled the size of the trial, but they level at July date in there. That date can’t be correct any longer, we don’t think and that AbbVie at some point I’m sure is going to update that. We do a back of the envelope and we see it as being early next year is when that trial can read out with its top-line. But AbbVie has not yet updated clinicaltrials.gov. But, I’m sure they will be. Phil Nadeau – Cowen & Company: Okay. And have they communicated to you in anyway whether they are going to release these data, I know we haven’t seen the Phase IIa data somewhat if we’ll get to see the Phase IIb?

As it is with the Phase III program that is part of our discussions with them in order to find out exactly what amount of data and when they plan on releasing in the U.S. program also. Phil Nadeau – Cowen & Company: Okay great, thanks for taking my questions. That was very helpful.

[Operator Instructions] And we’ll go next to Marko Kozul with Leerink. Your line is open.

Hi, this is DD in for Marko Kozul. So I just have one quick question. And looking at the Kinect 2 trial, did you use a central reading process to screen patients, and if yes what was the screen failure rate in Kinect 2 versus Kinect? Thank you.

In all -in both Kinect and Kinect 2, we used a central review process to screen patients to assure that they met the infusion criteria of moderate or severe tardive dyskinesia. The screen fail rate with Kinect and Kinect 2 was virtually identical and as screen failure could be because, they didn’t meet the PD requirement. But it also could be because, they had unstable medical condition, laboratory abnormalities, prohibited uncommon medications et cetera. So the screen fail rate for the two trails was about 50% and of that 50% whose screen failed about half of them were because, they either didn’t have tardive dyskinesia and some other movement disorder or they didn’t have moderate or severe tardive dyskinesia and that was pretty much the same in both trials.

Okay, thank you.

And at this time, I would like to turn the call back over to Mr. Kevin Gorman.

Thank you very much everyone. Thank you for joining us today. We’re going to as you’ve heard particularly in Chris’s group there is a lot of work going on right now to get the Phase III program and PD kicked off in the Phase and then get into the children in Tourette’s syndrome. We’ll keep you apprised at the upcoming meetings on our progress going forward and in our Q2 earnings call, we’ll have a discussion at that point since we should have the FDA minutes from our End-of-Phase II meeting at that point then we can really map out for you what the Phase III program is going to look like. So, thank you once again and I look forward to getting together with you all.

And thank you everyone for joining us today. We do appreciate everyone’s participation. This does conclude today’s conference. You may disconnect at anytime.