10q10k10q10k.net

What changed in NEUROCRINE BIOSCIENCES INC's 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of NEUROCRINE BIOSCIENCES INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+466 added−375 removedSource: 10-K (2026-02-11) vs 10-K (2025-02-10)

Top changes in NEUROCRINE BIOSCIENCES INC's 2025 10-K

466 paragraphs added · 375 removed · 281 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

68 edited+72 added−40 removed89 unchanged
Biggest changeThe U.S. federal Anti-Kickback Statute and equivalent foreign laws makes it illegal for any person or entity to knowingly and willfully, directly or indirectly, solicit, receive, offer, or pay any remuneration that is intended to induce the referral of business, including the purchase, order, lease of any good, facility, item or service for which payment may be made under programs such as a federal healthcare program, such as Medicare or Medicaid in the U.S.
Biggest changeThe U.S. federal Anti-Kickback Statute and equivalent foreign laws makes it illegal for any person or entity to knowingly and willfully, directly or indirectly, solicit, receive, offer, or pay any remuneration that is intended to induce the referral of business, including the purchase, order, lease of any good, facility, item or service for which payment may be made under programs such as a federal healthcare program, such as Medicare or Medicaid in the U.S. 10 Federal and equivalent foreign civil and criminal false claims laws and the federal civil monetary penalties law and equivalent foreign laws, which prohibit among other things, any person or entity from knowingly presenting, or causing to be presented, for payment to, or approval by, federal programs, including Medicare and Medicaid, claims for items or services, including drugs, that are false or fraudulent or not provided as claimed and knowingly making, or causing to be made, a false record or to avoid or decrease an obligation to pay money to the federal government.
It is possible that the actions taken by the PDABs may result in lower prices for certain drug products sold in their states. 15 Proposed Healthcare Reform Measures The U.S. and some foreign jurisdictions are considering a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably.
It is possible that the actions taken by the PDABs may result in lower prices for certain drug products sold in their states. Proposed Healthcare Reform Measures The U.S. and some foreign jurisdictions are considering a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably.
Risk Factors for a discussion of the challenges we may face in obtaining or maintaining patent and/or trade secret protection and Note 15 to the consolidated financial statements f or a description of our legal proceedings related to intellectual property matters. Competition The biotechnology and pharmaceutical industries are subject to rapid and intense technological change.
Risk Factors for a discussion of the challenges we may face in obtaining or maintaining patent and/or trade secret protection and Note 15 to the consolidated financial statements f or a description of our legal proceedings related to intellectual property matters. 9 Competition The biotechnology and pharmaceutical industries are subject to rapid and intense technological change.
In addition to the potential patent term extensions referenced above, the products and product candidates in our pipeline may be subject to additional terms of exclusivity that we may obtain by future patent issuances. 8 Separately, the U.S., the EU, and Japan each provide data and marketing exclusivity for new medicinal compounds.
In addition to the potential patent term extensions referenced above, the products and product candidates in our pipeline may be subject to additional terms of exclusivity that we may obtain by future patent issuances. Separately, the U.S., the EU, and Japan each provide data and marketing exclusivity for new medicinal compounds.
We may need to conduct expensive pharmaco-economic studies in order to demonstrate the medical necessity and cost-effectiveness of our products, in addition to the costs required to obtain the FDA approvals. Nonetheless, our products or product candidates, including INGREZZA, may not be considered medically necessary or cost-effective.
We may need to conduct expensive pharmaco-economic studies in order to demonstrate the medical necessity and cost-effectiveness of our products, in addition to the costs required to obtain the FDA approvals. Nonetheless, our products or product candidates, including INGREZZA and CRENESSITY, may not be considered medically necessary or cost-effective.
An MA may be granted only to an applicant established in the EU. The centralized procedure provides for the grant of a single MA by the European Commission that is valid throughout the European Economic Area (which is comprised of the 27 EU Member States plus Norway, Iceland and Liechtenstein).
An MA may be granted only to an applicant established in the EU. 17 The centralized procedure provides for the grant of a single MA by the European Commission that is valid throughout the European Economic Area (which is comprised of the 27 EU Member States plus Norway, Iceland and Liechtenstein).
The process of obtaining these approvals and the subsequent compliance with appropriate federal and state statutes and regulations require the expenditure of substantial time and financial resources. 9 In addition, federal and state healthcare laws, and equivalent supranational and foreign laws, restrict business practices in the pharmaceutical industry.
The process of obtaining these approvals and the subsequent compliance with appropriate federal and state statutes and regulations require the expenditure of substantial time and financial resources. In addition, federal and state healthcare laws, and equivalent supranational and foreign laws, restrict business practices in the pharmaceutical industry.
Such payors may limit coverage to specific drug products on an approved list, also known as a formulary, which might not include all of the FDA-approved drugs for a particular indication.
Such payors may limit coverage to specific drug products on an approved list, also known as a 14 formulary, which might not include all of the FDA-approved drugs for a particular indication.
Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with Good Clinical Practice (GCP) requirements. 11 After evaluating the NDA and all related information, including the advisory committee recommendation, if any, and inspection reports regarding the manufacturing facilities and clinical trial sites, the FDA may issue an approval letter, or, in some cases, a complete response letter.
Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with Good Clinical Practice (GCP) requirements. 12 After evaluating the NDA and all related information, including the advisory committee recommendation, if any, and inspection reports regarding the manufacturing facilities and clinical trial sites, the FDA may issue an approval letter, or, in some cases, a complete response letter.
Before approving an NDA, the FDA typically will inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.
Before approving an NDA, the FDA typically will inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to ensure consistent production of the product within required specifications.
There also are continuing, annual program user fee requirements for any marketed products, as well as new application fees for supplemental applications with clinical data. 12 The FDA may impose a number of post-approval requirements as a condition of approval of an NDA.
There also are continuing, annual program user fee requirements for any marketed products, as well as new application fees for supplemental applications with clinical data. 13 The FDA may impose a number of post-approval requirements as a condition of approval of an NDA.
The European Commission or the competent authorities of the EU Member States may decide on justified grounds relating to pharmacovigilance, to proceed with one further five-year renewal period for the MA. Once subsequently definitively renewed, the MA shall be valid for an unlimited period.
The European Commission or the competent authorities of the EU Member States may decide on justified grounds relating to pharmacovigilance, to proceed with one further five-year renewal period for the MA. Once renewed, the MA shall be valid for an unlimited period.
Similar laws exist in other countries, such as the United Kingdom (UK) or in EU member states, that restrict improper payments to public and private parties. Many countries have laws prohibiting these types of payments within the respective country.
Similar laws exist in other countries, such as the United Kingdom (UK) or in EU member states, which restrict improper payments to public and private parties. Many countries have laws prohibiting these types of payments within the respective country.
The regulation introduces a streamlined application procedure via a single entry point, the “EU portal”, the Clinical Trials Information System (CTIS); a single set of documents to be prepared and submitted for the application as well as simplified reporting procedures for clinical trial sponsors.
The regulation introduces a streamlined application procedure via a single entry point, the Clinical Trials Information System (CTIS); a single set of documents to be prepared and submitted for the application as well as simplified reporting procedures for clinical trial sponsors.
Such developments by others (including the development of generic equivalents) may render our product candidates or technologies obsolete or noncompetitive. • INGREZZA competes with AUSTEDO ® (deutetrabenazine), marketed by Teva Pharmaceuticals Industries, for the treatment of tardive dyskinesia in adults and chorea associated with Huntington's disease. A once-daily dosing of AUSTEDO (AUSTEDO XR) was introduced in February 2023.
Such developments by others (including the development of generic equivalents) may render our product candidates or technologies obsolete or noncompetitive. • INGREZZA competes with AUSTEDO (deutetrabenazine), marketed by Teva Pharmaceuticals Industries, for the treatment of TD in adults and chorea associated with Huntington's disease. A once-daily dosing of AUSTEDO (AUSTEDO XR) was introduced in February 2023.
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge on our website at www.neurocrine.com , as soon as reasonably practicable after such reports are available on the Securities and Exchange Commission (SEC) website at www.sec.gov .
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge on our website at www.neurocrine.com , as soon as reasonably practicable after such reports are available on the Securities and Exchange Commission (SEC) website at www.sec.gov .
Below is a description of the U.S. and ex-U.S. patents to INGREZZA and CRENESSITY: • INGREZZA, our highly selective VMAT2 inhibitor approved in the U.S. for the treatment of tardive dyskinesia and of chorea associated with Huntington’s disease, is covered by 22 issued, FDA Orange Book-listed U.S. patents which are set to expire between 2027 and 2040.
Below is a description of the U.S. and ex-U.S. patents to INGREZZA and CRENESSITY: • INGREZZA, our highly selective VMAT2 inhibitor approved in the U.S. for the treatment of TD and of chorea associated with Huntington’s disease, is covered by 22 issued, FDA Orange Book-listed U.S. patents which are set to expire between 2027 and 2040.
Phase 3 Larger, multi-center, comparative clinical trials are conducted with patients afflicted with a specific disease in order to determine safety and efficacy as primary support for regulatory approval by the FDA, the European Commission, or equivalent foreign authorities, to market a product candidate for a specific disease.
Phase 3: Larger, multi-center, comparative clinical trials are conducted with patients afflicted with a specific disease in order to determine safety and efficacy as primary support for regulatory approval by the FDA, the European Medicines Agency (EMA) and European Commission, or equivalent foreign authorities, to market a product candidate for a specific disease.
A payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. Further, one payor’s determination to provide coverage for a drug product does not assure that other payors will also provide coverage for the drug product.
A payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. Further, one payor’s determination to provide coverage for a drug product does not ensure that other payors will also provide coverage for the drug product.
In addition, we have a diversified portfolio of multiple compounds in mid- to late-phase development across our core therapeutic areas and an expanding early-phase pipeline that includes a range of modalities including small molecules, peptides, proteins, antibodies, and gene therapy.
In addition, we have a diversified portfolio of multiple compounds in mid- to late-phase development across our core therapeutic areas and an expanding early-phase pipeline that includes a range of modalities including small molecules, peptides, proteins, antibodies, conjugates, and gene therapies.
Additionally, copies of our Annual Report will be made available, free of charge, upon written request. Information found on, or accessible through, our website is not a part of, and is not incorporated into, this Annual Report on Form 10-K.
Additionally, copies of our Annual Report to Security Holders will be made available, free of charge, upon written request. Information found on, or accessible through, our website is not a part of, and is not incorporated into, this Annual Report on Form 10-K.
Continuing adequate supply of such raw materials and API is assured through long-term commercial supply and manufacturing agreements with multiple manufacturers and a continued focus on the expansion and diversification of our third-party manufacturing relationships.
We believe that continuing adequate supply of such raw materials and API is assured through long-term commercial supply and manufacturing agreements with multiple manufacturers and a continued focus on the expansion and diversification of our third-party manufacturing relationships.
Additionally, there are a number of commercially available medicines used to treat tardive dyskinesia off-label, such as XENAZINE ® (tetrabenazine) and generic equivalents, and various antipsychotic medications (e.g., clozapine), anticholinergics, benzodiazepines (off-label), and botulinum toxin.
Additionally, there are a number of commercially available medicines used to treat TD off-label, such as XENAZINE (tetrabenazine) and generic equivalents, and various antipsychotic medications (e.g., clozapine), anticholinergics, benzodiazepines (off-label), and botulinum toxin.
Key elements of our commercial strategy include maximizing the opportunities in INGREZZA and CRENESSITY through consistent and effective commercial execution, continued development of valbenazine as the best-in-class treatment for new patient populations, and to lead the evolving understanding of VMAT2 biology and its role in disease.
Key elements of our commercial strategy include maximizing the opportunities in INGREZZA and CRENESSITY through consistent and effective commercial execution, continued development of valbenazine as the best-in-class treatment for new patient populations, and to lead the evolving understanding of vesicular monoamine transporter 2 (VMAT2) biology and its role in disease.
We launched INGREZZA ® (valbenazine) in the U.S. as the first FDA-approved drug for the treatment of tardive dyskinesia in May 2017 and for the treatment of chorea associated with Huntington's disease in August 2023 and launched CRENESSITY TM (crinecerfont) in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024.
We launched INGREZZA ® (valbenazine) in the U.S. as the first FDA-approved drug for the treatment of TD in May 2017 and for the treatment of chorea associated with Huntington's disease in August 2023 and launched CRENESSITY ® (crinecerfont) in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024.
This period of exclusivity is generally five years in the U.S., six years in Japan and eight years in the EU, with marketing exclusivity lasting an additional two years in the EU, except that for biologics, the period of exclusivity in the U.S. is 12 years under the Biologics Price Competition and Innovation Act.
This period of exclusivity is generally five years in the U.S., six years in Japan and eight years in the EU, with marketing exclusivity lasting an additional two years, plus another optional year, in the EU, except that for biologics, the period of exclusivity in the U.S. is 12 years under the Biologics Price Competition and Innovation Act.
Clinical Trials in the EU In the EU, the Clinical Trials Regulation (EU) No 536/2014 (CTR) entered into application on January 31, 2022 and became effective for all clinical trials on January 31, 2025, repealing and replacing the former Clinical Trials Directive 2001/20 (CTD).
Clinical Trials in the EU In the EU, clinical trials are governed by the Clinical Trials Regulation (EU) No 536/2014 (CTR) which entered into application on January 31, 2022, repealing and replacing the former Clinical Trials Directive 2001/20 (CTD). The CTR became effective for all clinical trials on January 31, 2025.
The period of market exclusivity is extended by two years for orphan medicinal products that have also complied with an agreed PIP.
The period of market exclusivity is extended by two years for orphan medicinal products that have also complied with an agreed Pediatric Investigation Plan (PIP).
Collaboration and License Agreements Refer to Note 2 to the consolidated financial statements for more information on our significant collaboration and license agreements. Government Regulation Our business activities are subject to extensive regulation by the U.S. and other countries.
Collaboration and License Agreements See Note 11 to the consolidated financial statements for more information on our significant collaboration and license agreements. Government Regulation Our business activities are subject to extensive regulation by the U.S. and other countries.
Pursuant to the terms of the respective settlement agreements, such companies have the right to sell generic versions of INGREZZA in the U.S. beginning March 1, 2038, or earlier under certain circumstances. • CRENESSITY, a CRF1 receptor antagonist approved in the U.S. for the treatment of CAH in adults and children, is covered by U.S. patents among other patents set to expire between 2035 and 2041 (not including any potential patent term extensions), and pending patent applications, which, if issued, could expire at least as late as 2045.
Pursuant to the terms of the respective settlement agreements, such companies have the right to sell generic versions of INGREZZA in the U.S. beginning March 1, 2038, or earlier under certain circumstances. • CRENESSITY, a CRF1 receptor antagonist approved in the U.S. for the treatment of CAH in adults and children, is covered by 4 issued, FDA Orange Book-listed U.S. patents which are set to expire between 2035 and 2041 (not including any potential patent term extensions), and pending patent applications, which, if issued, could expire at least as late as 2046.
In April 2024, the Company was notified by CMS that it qualified as a “specified small manufacturer” and will receive the discount phase-in discussed above for INGREZZA.
In April 2024, we were notified by CMS that it qualified as a “specified small manufacturer” and will receive the discount phase-in discussed above for INGREZZA.
In addition, if granted orphan drug designation, certain of our product candidates, including, for example, crinecerfont, may also be eligible for marketing exclusivity in the U.S. for seven years and EU for 10 years. Refer to Part I, Item 1A.
In addition, if granted orphan drug designation, certain of our product candidates may also be eligible for marketing exclusivity in the U.S. for seven years and EU for 10 years. See Part I, Item 1A.
Item 1. Business Overview Neurocrine Biosciences is a neuroscience-focused, biopharmaceutical company with a simple purpose: to relieve suffering for people with great needs, but few options. We are dedicated to discovering and developing life-changing treatments for patients with under-addressed neuropsychiatric, neurological, and neuroendocrine disorders. Our portfolio of products includes U.S.
Item 1. Business Overview Neurocrine Biosciences is a neuroscience-focused, biopharmaceutical company with a simple purpose: to relieve suffering for people with great needs. We are dedicated to discovering, developing, and commercializing life-changing treatments for patients with under-addressed neurological, psychiatric, endocrine, and immunological disorders. Our portfolio of products includes U.S.
Food and Drug Administration (FDA) approved treatments for tardive dyskinesia, chorea associated with Huntington's disease, classic congenital adrenal hyperplasia (CAH), and endometriosis and uterine fibroids in collaboration with AbbVie Inc. (AbbVie).
Food and Drug Administration (FDA) approved treatments for tardive dyskinesia (TD), chorea associated with Huntington's disease, classic congenital adrenal hyperplasia due to 21-hydroxylase deficiency (CAH), and endometriosis and uterine fibroids in collaboration with AbbVie Inc.
The IRA also extends enhanced subsidies for individuals purchasing health insurance coverage in the ACA marketplaces through plan year 2025 and eliminated the “donut hole” under the Medicare Part D program in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost to $2,000 through a newly established manufacturer discount program. These provisions took effect progressively starting in 2023.
The IRA also extends enhanced subsidies for individuals purchasing health insurance coverage in the ACA marketplaces through plan year 2025 and eliminated the "donut hole" under the Medicare Part D program in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost to $2,000 through a newly established manufacturer discount program.
Other states have also submitted SIP proposals that are pending review by the FDA. Any such approved importation plans, when implemented, may result in lower drug prices for products covered by those programs. Further, certain states through legislation have created a state prescription drug affordability board (PDAB) to help control costs of drugs for that state.
Any such approved importation plans, when implemented, may result in lower drug prices for products covered by those programs. Further, certain states through legislation have created a state prescription drug affordability board (PDAB) to help control costs of drugs for that state.
There is no pre-marketing authorization orphan designation for medicinal products in the UK. Instead, the MHRA reviews applications for orphan designation in parallel to the corresponding marketing authorization application. The criteria are essentially the same as those in the EU but have been tailored for the market.
Instead, the MHRA reviews applications for orphan designation in parallel to the corresponding marketing authorization application. The criteria are essentially the same as those in the EU but have been tailored for the market.
Phase 1 Clinical trials are conducted with a small number of subjects to determine the early safety profile, maximum tolerated dose and pharmacokinetic properties of the product in human volunteers or in patients with the target disease.
Typically, clinical evaluation involves a time consuming and costly multi-phase process. 11 Phase 1: Clinical trials are conducted with a small number of subjects to determine the early safety profile, maximum tolerated dose and pharmacokinetic properties of the product in human volunteers or in patients with the target disease.
We estimate that tardive dyskinesia affects approximately 800,000 people in the U.S., that approximately 90% of the 40,000 people in the U.S. affected by Huntington’s disease will develop chorea, and that CAH affects approximately 30,000 people in the U.S.
We estimate that TD affects approximately 800,000 people in the U.S., that approximately 90% of the 40,000 people in the U.S. affected by Huntington’s disease will develop chorea, and that CAH affects at least 20,000 people in the U.S.
In addition, there are a number of different anti-psychotic and anti-depressant medications currently used in these patient populations. • Our investigational treatments for potential use in neurology, neuroendocrinology and neuropsychiatry may in the future compete with numerous approved products and development-stage programs being pursued by several other companies.
In addition, there are a number of different anti-psychotic, including the muscarinic agonist COBENFY, and anti-depressant medications currently used in these patient populations. • Our investigational treatments for potential use in neurology, psychiatry, endocrinology, obesity and related metabolic diseases, and immunology may in the future compete with numerous approved products and development-stage programs being pursued by several other companies.
While the Medicare drug negotiation program targets high-expenditure drugs/biologics that have been on the market for several years without generic or biosimilar competition, we were notified in January 2025 that INGREZZA qualifies for the small biotech exception, which provides an exemption from selection for price negotiation until 2027 (for initial price applicability year 2029, pursuant to which negotiated pricing would go into effect, if selected). 14 Additionally, on January 1, 2025, the Centers for Medicare & Medicaid Services (CMS) implemented those provisions of the IRA establishing a new Medicare Part D manufacturer discount program.
While the Medicare drug negotiation program targets high-expenditure drugs/biologics that have been on the market for several years without generic or biosimilar competition, we were notified in January 2025 that INGREZZA qualifies for the small biotech exception, which provides an exemption from selection for price negotiation until 2027 (for initial price applicability year 2029, pursuant to which negotiated pricing would go into effect, if selected).
Failure to comply with these laws, where applicable, can result in significant penalties, including the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgement, imprisonment, possible exclusion from participation in Medicare, Medicaid and other federal and equivalent foreign healthcare programs, and additional reporting requirements and regulatory oversight, any of which could adversely affect our ability to operate our business and our results of operations. 10 Development and Marketing Approval for Products Preclinical studies generally are conducted in laboratory animals to evaluate the potential safety and efficacy of a product.
Failure to comply with these laws, where applicable, can result in significant penalties, including the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgement, imprisonment, possible exclusion from participation in Medicare, Medicaid and other federal and equivalent foreign healthcare programs, and additional reporting requirements and regulatory oversight, any of which could adversely affect our ability to operate our business and our results of operations.
We believe our outsourced manufacturing strategy enables us to direct our financial resources to the maximization of our opportunity with INGREZZA and CRENESSITY, investment in our internal research and development programs, and expansion of our clinical pipeline through business development opportunities.
We believe our outsourced manufacturing strategy enables us to direct our financial resources to maximize our commercial opportunities with INGREZZA and CRENESSITY, invest in our internal research and development programs, and expand our clinical pipeline through business development opportunities.
In addition to these anti-corruption laws, we are subject to import and export control laws, tariffs, trade barriers, economic sanctions, and regulatory limitations on our ability to operate in certain foreign markets.
In addition to these anti-corruption laws, we are subject to import and export control laws, tariffs, trade barriers, economic sanctions, and regulatory limitations on our ability to operate in certain foreign markets. In August 2025, we received a civil investigative demand from the U.S.
As a result, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our drug products to each payor separately, with no assurance that coverage and adequate reimbursement will be obtained in the first instance or applied consistently. 13 Third-party payors are increasingly challenging the price, examining the medical necessity and reviewing the cost-effectiveness of drug products and medical services, in addition to questioning their safety, efficacy and clinical appropriateness.
As a result, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our drug products to each payor separately, with no assurance that coverage and adequate reimbursement will be obtained in the first instance or applied consistently.
At the state level, legislatures have increasingly passed legislation and implemented regulations designed to examine and/or control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
Congress may introduce and ultimately pass health care related legislation that could impact the drug approval process and make changes to the Medicare Drug Price Negotiation Program created under the IRA. 16 At the state level, legislatures have increasingly passed legislation and implemented regulations designed to examine and/or control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
This legislation includes procedures to prioritize access to new medicines that will benefit patients, including a 150-day assessment route, a rolling review procedure and the International Recognition Procedures (IRP) which entered into application on January 1, 2024. Since January 1, 2024, the MHRA may rely on the IRP when reviewing certain types of marketing authorization applications.
This legislation includes procedures to prioritize access to new medicines that will benefit patients, including a 150-day assessment route, a rolling review procedure and the International Recognition Procedures (IRP) which entered into application on January 1, 2024. There is no pre-marketing authorization orphan designation for medicinal products in the UK.
Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports (PSURs). 17 In the EU, the advertising and promotion of medicinal products are subject to both EU and EU Member States’ laws governing promotion of medicinal products, interactions with physicians and other healthcare professionals, misleading and comparative advertising and unfair commercial practices.
In the EU, the advertising and promotion of medicinal products are subject to both EU and EU Member States’ laws governing promotion of medicinal products, interactions with physicians and other healthcare professionals, misleading and comparative advertising and unfair commercial practices.
We receive royalties at tiered percentage rates on AbbVie net sales of elagolix. 4 Commercial Products Product Indication Major Markets Tardive Dyskinesia U.S., Japan, Select Asian Markets (1) Chorea Associated with Huntington’s Disease Classic Congenital Adrenal Hyperplasia U.S. Endometriosis U.S. (4) Uterine Fibroids U.S.
Commercial Products Product Indication Major Markets Tardive Dyskinesia U.S., Japan, Select Asian Markets (1) Chorea Associated with Huntington’s Disease Classic Congenital Adrenal Hyperplasia U.S. Endometriosis U.S. (2) Uterine Fibroids U.S.
For products with a new active substance indicated for the treatment of other diseases and products that are highly innovative or for which a centralized process is in the interest of patients, authorization through the centralized procedure is optional on related approval. 16 Accelerated assessment may be granted by the EMA’s Committee for Medicinal Products for Human Use (CHMP) in exceptional cases, when a medicinal product targeting an unmet medical need is expected to be of major interest from the point of view of public health and, in particular, from the viewpoint of therapeutic innovation.
Accelerated assessment may be granted by the EMA’s Committee for Medicinal Products for Human Use (CHMP) in exceptional cases, when a medicinal product targeting an unmet medical need is expected to be of major interest from the point of view of public health and, in particular, from the viewpoint of therapeutic innovation.
Our third-party manufacturers, suppliers and service providers may be subject to routine current Good Manufacturing Practice (cGMP) inspections by the FDA or comparable agencies in other jurisdictions.
Our third-party manufacturers, suppliers, and service providers may be subject to routine current Good Manufacturing Practice (cGMP) inspections by the FDA or comparable agencies in other jurisdictions. We depend on our third-party partners and our quality system oversight of them for continued compliance with cGMP requirements and applicable foreign standards.
The holder of an MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that system.
The holder of an MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that system. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports (PSURs).
We also own, or have licensed rights to, patents covering our other products and earlier stage product candidates.
CRENESSITY has been granted seven years of orphan drug exclusivity by the FDA. We also own, or have licensed rights to, patents covering our other products and earlier stage product candidates.
Corporate Information We were originally incorporated in California in January 1992 and reincorporated in Delaware in May 1996. Our principal executive offices are located at 6027 Edgewood Bend Court, San Diego, California 92130. Our telephone number is (858) 617-7600.
Overall, our goal is to reward employees fairly for their contributions and provide benefits that promote their health, safety, and work-life balance. Corporate Information We were originally incorporated in California in January 1992 and reincorporated in Delaware in May 1996. Our principal executive offices are located at 6027 Edgewood Bend Court, San Diego, California 92130.
Healthcare Reform Measures The U.S. and some foreign jurisdictions have enacted a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably.
Even if favorable coverage and reimbursement status is attained for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future. 15 Healthcare Reform Measures The U.S. and some foreign jurisdictions have enacted a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably.
The period of market exclusivity may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria on the basis of which it received orphan medicinal product destination.
The period of market exclusivity may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria on the basis of which it received orphan medicinal product destination. 18 Post-Authorization Obligations in the EU Where an MA is granted in relation to a medicinal product in the EU, the holder of the MA is required to comply with a range of regulatory requirements applicable to the manufacturing, marketing, promotion and sale of medicinal products.
In the U.S., the pharmaceutical industry and the cost of prescription drugs has been a continuous focus of these efforts and has been significantly affected by major legislative initiatives. Most recently, in August 2022, the Inflation Reduction Act of 2022 (IRA) was signed into law, which, among other things, (1) directs the Secretary of the U.S.
In the U.S., the pharmaceutical industry and the cost of prescription drugs has been a continuous focus of these efforts and has been significantly affected by major legislative initiatives.
Drug developers submit the results of preclinical studies to the FDA as a part of an investigational new drug application (IND) and to equivalent foreign authorities before clinical trials can begin in humans. Typically, clinical evaluation involves a time consuming and costly multi-phase process.
Development and Marketing Approval for Products Preclinical studies generally are conducted in laboratory animals to evaluate the potential safety and efficacy of a product. Drug developers submit the results of preclinical studies to the FDA as a part of an investigational new drug application (IND) and to equivalent foreign authorities before clinical trials can begin in humans.
Adequate third-party payor reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development. The marketability of any product or product candidates for which we or our collaborators receive regulatory approval for commercial sale may suffer if third-party payors fail to provide coverage and adequate reimbursement.
The loss or potential loss of these exemptions, including as a result of a third party acquiring us, could have an adverse impact on our business. The marketability of any product or product candidates for which we or our collaborators receive regulatory approval for commercial sale may suffer if third-party payors fail to provide coverage and adequate reimbursement.
We own a portfolio of U.S. and ex-U.S. patents and patent applications, and have also licensed rights to a number of U.S. and ex-U.S. patents and patent applications.
Intellectual Property We actively seek to protect our products, product candidates, and related inventions and improvements that we consider important to our business. We own a portfolio of U.S. and ex-U.S. patents and patent applications and have also licensed rights to a number of U.S. and ex-U.S. patents and patent applications.
Brexit and the Regulatory Framework in the UK The UK’s withdrawal from the EU on January 31, 2020, commonly referred to as Brexit, has changed the regulatory relationship between the UK and the EU. The Medicines and Healthcare products Regulatory Agency (MHRA) is now the UK’s standalone regulator for medicinal products and medical devices.
Regulatory Framework in the UK The Medicines and Healthcare products Regulatory Agency (MHRA) is the UK’s standalone regulator for medicinal products and medical devices.
Traditional treatment approaches for schizophrenia rely on the use of antipsychotic medications that can lead to considerable short- and long-term health impacts. Osavampator (formerly NBI-1065845) Osavampator is a potential first-in-class alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid (AMPA) positive allosteric modulator (PAM) in development for patients with inadequate response to treatment of major depressive disorder.
Osavampator (NBI-1065845) Osavampator is a potential first-in-class alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid (AMPA) receptor potentiator in development for adults with major depressive disorder (MDD) who have inadequate response to oral antidepressant treatment.
INGREZZA net product sales totaled $2.3 billion for 2024, $1.8 billion for 2023, and $1.4 billion for 2022 and accounted for substantially all of our total net product sales during each of these years.
INGREZZA net product sales were $2.51 billion for 2025, $2.31 billion for 2024, and $1.84 billion for 2023 and accounted for a significant portion of our total net product sales during each of these years. CRENESSITY net product sales were $301.2 million for 2025 during its first full-year of launch.
(4) Adrenal Insufficiency U.S., United Kingdom, EU4 (2) (3) Classic Congenital Adrenal Hyperplasia United Kingdom, EU4 (3) (1) INGREZZA is marketed as DYSVAL ® (valbenazine) in Japan and REMLEAS ® (valbenazine) in other select Asian markets, where MTPC retains commercialization rights. (2) ALKINDI is marketed as ALKINDI SPRINKLE ® (hydrocortisone) in the U.S., where Eton Pharmaceuticals, Inc. retains commercialization rights.
(2) _________________________ (1) INGREZZA is marketed as DYSVAL ® (valbenazine) in Japan and REMLEAS ® (valbenazine) in other select Asian markets, where Tanabe Pharma Corporation (formerly Mitsubishi Tanabe Pharma Corporation) retains commercialization rights. (2) AbbVie retains global commercialization rights to elagolix. 4 Commercial Operations We sell INGREZZA exclusively in the U.S. through a limited specialty network.
Certain high-expenditure Part B and Part D drugs/biologics will be selected for negotiation in 2026 (for initial price applicability year 2028) and annually thereafter. AUSTEDO and AUSTEDO XR, marketed by Teva Pharmaceuticals Industries, have been selected for the Medicare drug negotiation program in 2025 (for initial price applicability year 2027).
AUSTEDO and AUSTEDO XR, marketed by Teva Pharmaceuticals Industries, were selected for the Medicare drug negotiation program in 2025 (for initial price applicability year 2027) and CMS has announced a negotiated maximum fair price (MFP) for these products that is lower than their pre-negotiation prices.
We sell INGREZZA in the U.S. principally to a limited network of specialty pharmacy providers, wholesale distributors, and specialty distributors. In addition, we sell CRENESSITY in the U.S. to a specialty pharmacy provider. Manufacturing and Supply We currently rely on, and intend to continue to rely on, third-party manufacturers for the production of INGREZZA, CRENESSITY, and our product candidates.
We believe these investments in commercial capabilities will translate into sustained revenue growth and shareholder value, as we drive current product performance and prepare to bring new therapies to market. Manufacturing and Supply We currently rely on, and intend to continue to rely on, third-party manufacturers for the production of INGREZZA, CRENESSITY, and our product candidates.
Major depressive disorder is one of the leading causes of disability. Approximately 21 million people in the U.S. live with major depressive disorder. It is estimated that roughly one-third of people living with major depressive disorder do not respond to available antidepressants.
Schizophrenia is a severe, disabling disorder affecting approximately 24 million people globally and more than 3 million people in the U.S., and roughly one-third of patients do not respond adequately to current antipsychotics.
In October 2023, the MHRA announced a new Notification Scheme for clinical trials which enables a more streamlined and risk-proportionate approach to initial clinical trial applications for Phase 4 and low-risk Phase 3 clinical trial applications. Marketing authorizations in the UK are governed by the Human Medicines Regulations (SI 2012/1916), as amended.
On April 28, 2026, the Medicines for Human Use (Clinical Trials) (Amendment) Regulations 2024 will enter into application to modernize the UK clinical trials framework and introduce significant changes. Marketing authorizations in the UK are governed by the Human Medicines Regulations (SI 2012/1916), as amended.
Removed
Our partner Mitsubishi Tanabe Pharma Corporation (MTPC) launched DYSVAL ® (valbenazine) in Japan for the treatment of tardive dyskinesia in June 2022 and subsequently in other select Asian markets, where it is marketed as REMLEAS ® (valbenazine). We receive royalties at tiered percentage rates on MTPC net sales of valbenazine.
Added
Our customers include select specialty pharmacy providers, wholesale distributors, and specialty distributors. This focused distribution model allows us to closely manage product supply and support services. In addition, we sell CRENESSITY in the U.S. through a single specialty pharmacy provider, reflecting the product’s rare disease focus and the need for high-touch distribution.
Removed
Our partner AbbVie launched ORILISSA ® (elagolix tablets) in the U.S. for the treatment of endometriosis in August 2018 and ORIAHNN ® (elagolix, estradiol and norethindrone acetate capsules and elagolix capsules) in the U.S. for the treatment of heavy menstrual bleeding due to uterine fibroids in June 2020.
Added
We rely on third-party logistics providers for packaging, warehousing, and shipment of our products, leveraging their expertise to ensure timely delivery and broad patient access. Our commercial reach is powered by a specialized sales force of approximately 600 professionals across the U.S. focused on neurology, psychiatry, long-term care, and rare diseases.
Removed
(3) The EU4 market is made up of the following countries: Germany, France, Italy, and Spain. (4) AbbVie retains global commercialization rights to elagolix. Commercial Operations Our specialty sales force consists of approximately 600 experienced sales professionals located in the U.S. and is divided into four dedicated sales teams focused on psychiatry, neurology, long-term care, and rare diseases.
Added
In October 2025, we announced the planned expansion of the INGREZZA and CRENESSITY sales teams to maximize our commercial momentum.
Removed
We depend on our third-party partners and our quality system oversight of them for continued compliance with cGMP requirements and applicable foreign standards. 5 Clinical Development Programs The following chart summarizes our clinical development programs _________________________ Small Molecule * Initiating Phase 1 clinical study in the first quarter of 2025 Neuropsychiatry Valbenazine Valbenazine is a highly selective VMAT2 inhibitor.
Added
We expect this expansion, which we anticipate completing by the end of the first quarter of 2026, will boost our reach and frequency with prescribers, accelerating INGREZZA’s penetration in both community and institutional settings and supporting the growth trajectory of CRENESSITY in the endocrinology and rare disease community.
Removed
VMAT2 is a protein concentrated in the human brain that is essential for the transmission of nerve impulses between neurons. VMAT2 is primarily responsible for packaging and transporting monoamines (dopamine, norepinephrine, serotonin, and histamine) in neurons. Specifically, dopamine enables neurotransmission among nerve cells that are involved in voluntary and involuntary motor control.
Added
Importantly, a larger sales force and enhanced infrastructure also position us for potential upcoming product launches from our diversified pipeline, which includes late-stage candidates in major depressive disorder (osavampator) and schizophrenia (direclidine).
Removed
We have ongoing the Journey TM study, a Phase 3 randomized, double-blind, placebo-controlled clinical study to evaluate the efficacy, safety, and tolerability of valbenazine when administered orally once daily as adjunctive treatment in adolescents and adults with schizophrenia who have had an inadequate response to antipsychotics. Schizophrenia is a serious and complex syndrome with heterogeneous symptoms.
Added
Clinical Development Programs Our research and development pipeline is robust and diversified across neurology, psychiatry, endocrinology, and immunology. This pipeline is fueled by core expertise in key areas of receptor biology developed over three decades.

… 100 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

154 edited+77 added−17 removed212 unchanged
Biggest changeThe market price of our common stock may fluctuate in response to many factors, including: • sales of INGREZZA and CRENESSITY; • failure of CRENESSITY to achieve commercial success; • the results of our clinical trials; • reports of safety issues related to INGREZZA or CRENESSITY; • any delay in filing an IND, NDA, marketing authorization application (MAA), or other regulatory submission for any of our product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory agency's review of that IND, NDA, MAA, or other regulatory submission; • developments concerning new and existing collaboration agreements; • announcements of technological innovations or new therapeutic products by us or others, including our competitors; • general economic and market conditions, including economic and market conditions affecting the biotechnology industry; • developments in patent or other proprietary rights; • developments related to the FDA, CMS and foreign regulatory agencies; • government regulation, including the Inflation Reduction Act; • future sales of our common stock by us or our stockholders; • any trading activity pursuant to a share repurchase program; • comments by securities analysts; • additions or departures of key personnel; 34 • fluctuations in our operating results; • potential litigation matters; • government and third-party payor coverage and reimbursement; • failure of any of our product candidates to achieve commercial success even if approved; • disruptions caused by man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, or other business interruptions; and • public concern as to the safety of our drugs.
Biggest changeThe market price of our common stock may fluctuate in response to many factors, including: • sales of INGREZZA and CRENESSITY; • failure of CRENESSITY to achieve commercial success; • the results of our clinical trials; • reports of safety issues related to INGREZZA or CRENESSITY; • any delay in filing an IND, NDA, marketing authorization application (MAA), or other regulatory submission for any of our product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory agency's review of that IND, NDA, MAA, or other regulatory submission, including but not limited to the imposition of a temporary or permanent clinical hold by a regulatory agency; • the perceived success of our plan to develop a steady cadence of innovative medicines for years to come; • developments concerning new and existing collaboration agreements; • announcements of technological innovations or new therapeutic products by us or others, including our competitors; 36 • general economic and market conditions, including economic and market conditions affecting the biotechnology industry; • developments in patent or other proprietary rights; • developments related to the FDA, the Centers for Medicare & Medicaid Services (CMS) and foreign regulatory agencies; • government regulation, including the IRA; • future sales of our common stock by us or our stockholders; • any trading activity pursuant to a share repurchase program; • comments by securities analysts; • additions or departures of key personnel; • fluctuations in our operating results; • potential litigation matters; • government and third-party payor coverage and reimbursement; • failure of any of our product candidates to achieve commercial success even if approved; • disruptions caused by geopolitical and macroeconomic developments, man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, tariffs, including protectionist or retaliatory measures taken by the U.S. or other countries, the recent shutdown of the U.S. federal government and the resulting effects on its regulatory agencies, or other business interruptions; and • public concern as to the safety of our drugs.
We may be unable to attract and retain personnel on acceptable terms given the competition among biotechnology, pharmaceutical and healthcare companies, universities and non-profit research institutions for experienced scientists and individuals with experience marketing and selling pharmaceutical products.
We may be unable to attract and retain personnel on acceptable terms given the competition among biotechnology, pharmaceutical and healthcare companies, and universities and non-profit research institutions for experienced scientists and individuals with experience marketing and selling pharmaceutical products.
Use of our approved products or those of our collaborators could be associated with side effects or adverse events. As with most pharmaceutical products, use of our approved products or those of our collaborators could be associated with side effects or adverse events which can vary in severity (from minor adverse reactions to death) and frequency (infrequent or prevalent).
As with most pharmaceutical products, use of our approved products or those of our collaborators could be associated with side effects or adverse events which can vary in severity (from minor adverse reactions to death) and frequency (infrequent or prevalent).
Any delay, interruption, or other issue that arises in the manufacture of our products or product candidates as a result of a failure of a third-party manufacturer to pass regulatory inspections or maintain cGMP compliance could significantly impair our ability to develop, obtain approval for, or successfully commercialize our products.
Any delay, interruption, or other issue that arises in the manufacture of our products or product candidates as a result of a failure of a third-party manufacturer to pass regulatory inspections or maintain cGMP compliance could significantly impair our ability to develop our product candidates or to obtain approval for or successfully commercialize our products.
In particular, risks associated with our business include: • We may not be able to continue to successfully commercialize INGREZZA or any of our product candidates if they are approved in the future. • We may not be able to successfully launch CRENESSITY. • If physicians and patients do not continue to accept INGREZZA or do not accept CRENESSITY, or our sales and marketing efforts are not effective, we may not generate sufficient revenue. • We face intense competition, and if we are unable to compete effectively, the demand for our products may be reduced. • Government and third-party payors may impose sales and pharmaceutical pricing controls on our products, or limit coverage and/or reimbursement for our products or impose policies and/or make decisions regarding the status of our products that could limit our product revenues and delay sustained profitability. • Because the development of our product candidates is subject to a substantial degree of technological uncertainty, we may not succeed in developing any of our product candidates. • Our clinical trials may be delayed for safety or other reasons, or fail to demonstrate the safety and efficacy of our product candidates, which could prevent or significantly delay their regulatory approval. • Enacted healthcare reform, drug pricing measures and other recent legislative initiatives, including the Inflation Reduction Act of 2022, could adversely affect our business. • We have increased the size of our organization and will need to continue to increase the size of our organization.
In particular, risks associated with our business include: • We may not be able to continue to successfully commercialize INGREZZA or any of our product candidates if they are approved in the future. • We may not be able to successfully launch and commercialize CRENESSITY. • If physicians and patients do not continue to accept INGREZZA or do not accept CRENESSITY, or our sales and marketing efforts are not effective, we may not generate sufficient revenue. • We face intense competition, and if we are unable to compete effectively, the demand for our products may be reduced. • Government and third-party payors may impose sales and pharmaceutical pricing controls on our products or limit coverage and/or reimbursement for our products or impose policies and/or make decisions regarding the status of our products that could limit our product revenues and delay sustained profitability. • Because the development of our product candidates is subject to a substantial degree of technological uncertainty, we may not succeed in developing any of our product candidates. • Our clinical trials may be delayed for safety or other reasons, or fail to demonstrate the safety and efficacy of our product candidates, which could prevent or significantly delay their regulatory approval. • Enacted healthcare reform, drug pricing measures and other recent legislative initiatives, including the Inflation Reduction Act of 2022 (IRA), could adversely affect our business. • We have increased the size of our organization and will need to continue to increase the size of our organization.
Such laws include: • the federal Anti-Kickback Statute which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid; • the federal civil and criminal false claims laws, including the federal civil False Claims Act, and Civil Monetary Penalties Laws, which impose criminal and civil penalties against individuals or entities for, among other things, knowingly presenting, or causing to be presented, to the federal government, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; • HIPAA, which imposes criminal and civil liability for, among other things, executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • HIPAA, as amended by HITECH and its implementing regulations, which also imposes obligations, including mandatory contractual terms, on covered entities, including certain healthcare providers, health plans and healthcare clearinghouses, as well as their business associates and their covered subcontractors, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; • the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to CMS information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners) and teaching hospitals, and applicable manufacturers and applicable group purchasing organizations to report annually to CMS ownership and investment interests held by physicians and their immediate family members; and • analogous state, local and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payors, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government; state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures or drug pricing; state laws that require disclosure of price increases above certain identified thresholds as well as of new commercial launches in the state; state laws that create Prescription Drug Price Affordability Boards to review or attempt to cap drug spending; state and local laws that require the registration of pharmaceutical sales representatives; state and local “drug take back” laws and regulations; and state and foreign laws governing the privacy and security of health 39 information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.
Such laws include: • the federal Anti-Kickback Statute which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid; • the federal civil and criminal false claims laws, including the federal civil False Claims Act, and Civil Monetary Penalties Laws, which impose criminal and civil penalties against individuals or entities for, among other things, knowingly presenting, or causing to be presented, to the federal government, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; • HIPAA, which imposes criminal and civil liability for, among other things, executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • HIPAA, as amended by HITECH and its implementing regulations, which also imposes obligations, including mandatory contractual terms, on covered entities, including certain healthcare providers, health plans and healthcare clearinghouses, as well as their business associates and their covered subcontractors, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; 42 • the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to CMS information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners) and teaching hospitals, and applicable manufacturers and applicable group purchasing organizations to report annually to CMS ownership and investment interests held by physicians and their immediate family members; and • analogous state, local and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payors, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government; state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures or drug pricing; state laws that require disclosure of price increases above certain identified thresholds as well as of new commercial launches in the state; state laws that create Prescription Drug Price Affordability Boards to review or attempt to cap drug spending; state and local laws that require the registration of pharmaceutical sales representatives; state and local “drug take back” laws and regulations; and state and foreign laws governing the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.
Our current and future collaborations and licenses could subject us to a number of risks, including: • strategic collaborators may sell, transfer or divest assets or programs related to our partnered product or product candidates; • we may be required to undertake the expenditure of substantial operational, financial and management resources; • we may be required to assume substantial actual or contingent liabilities; • we may not be able to control the amount and timing of resources that our strategic collaborators devote to the development or commercialization of our products or product candidates; • we may not be able to influence our strategic collaborator’s decisions regarding the development and collaboration of our partnered product and product candidates, and as a result, our collaboration partners may not pursue or prioritize the development and commercialization of those partnered products and product candidates in a manner that is in our best interest; • strategic collaborators may select indications or design clinical trials in a way that may be less successful than if we were doing so; • strategic collaborators may not conduct collaborative activities in a timely manner, provide insufficient funding, terminate a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new version of a product candidate for clinical testing; • strategic collaborators may not pursue further development and commercialization of products resulting from the strategic collaboration arrangement or may elect to discontinue research and development programs; • disagreements or disputes may arise between us and our strategic collaborators that result in delays or in costly litigation or arbitration that diverts management’s attention and consumes resources; • strategic collaborators may experience financial difficulties; 29 • strategic collaborators may not properly maintain, enforce or defend our intellectual property rights or may use our proprietary information in a manner that could jeopardize or invalidate our proprietary information or expose us to potential litigation; • we or strategic collaborators could terminate the arrangement (in whole or in part) or allow it to expire, which would delay the development and commercialization, result in disagreements or disputes or may increase the cost of developing and commercializing our products or product candidates; • strategic collaborators could develop, either alone or with others, products or product candidates that may compete with ours; and • our strategic collaborator’s decisions regarding the development and commercialization of a partnered product or product candidate within their territory(ies) could negatively impact us in the territories where we have development and commercialization rights for such product or product candidate.
Our current and future collaborations and licenses could subject us to a number of risks, including: • strategic collaborators may sell, transfer or divest assets or programs related to our partnered product or product candidates; • we may be required to undertake the expenditure of substantial operational, financial and management resources; • we may be required to assume substantial actual or contingent liabilities; • we may not be able to control the amount and timing of resources that our strategic collaborators devote to the development or commercialization of our products or product candidates; • we may not be able to influence our strategic collaborator’s decisions regarding the development and collaboration of our partnered product and product candidates, and as a result, our collaboration partners may not pursue or prioritize the development and commercialization of those partnered products and product candidates in a manner that is in our best interest; • strategic collaborators may select indications or design clinical trials in a way that may be less successful than if we were doing so; • strategic collaborators may not conduct collaborative activities in a timely manner, provide insufficient funding, terminate a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new version of a product candidate for clinical testing; • strategic collaborators may not pursue further development and commercialization of products resulting from the strategic collaboration arrangement or may elect to discontinue research and development programs; • disagreements or disputes may arise between us and our strategic collaborators that result in delays or in costly litigation or arbitration that diverts management’s attention and consumes resources; • strategic collaborators may experience financial difficulties; • strategic collaborators may not properly maintain, enforce or defend our intellectual property rights or may use our proprietary information in a manner that could jeopardize or invalidate our proprietary information or expose us to potential litigation; 30 • we or strategic collaborators could terminate the arrangement (in whole or in part) or allow it to expire, which would delay the development and commercialization, result in disagreements or disputes or may increase the cost of developing and commercializing our products or product candidates; • strategic collaborators could develop, either alone or with others, products or product candidates that may compete with ours; and • our strategic collaborator’s decisions regarding the development and commercialization of a partnered product or product candidate within their territory(ies) could negatively impact us in the territories where we have development and commercialization rights for such product or product candidate.
We may encounter difficulties as we expand and may fail to successfully develop or commercialize our biologic product candidates, which could adversely affect our results of operations. 19 • If we are unable to retain and recruit qualified scientists and other employees or if any of our key senior executives discontinues his or her employment with us, it may delay our development efforts or impact our commercialization of INGREZZA, CRENESSITY, or any product candidate approved by the FDA in the future. • Use of our approved products or those of our collaborators could be associated with side effects or adverse events. • We currently depend on a limited number of third-party suppliers.
We may encounter difficulties as we expand and may fail to successfully develop or commercialize our biologic product candidates, which could adversely affect our results of operations. • If we are unable to retain and recruit qualified scientists and other employees or if any of our key senior executives discontinues his or her employment with us, it may delay our development efforts or impact our commercialization of INGREZZA, CRENESSITY, or any product candidate approved by the FDA in the future. • Use of our approved products or those of our collaborators could be associated with side effects or adverse events. • We currently depend on a limited number of third-party suppliers.
The overall impact on INGREZZA revenues is inherently uncertain and difficult to predict and we are still evaluating the potential impact of this discount program and our designation as a “specified small manufacturer.” 36 Our designation as a “specified small manufacturer” under the new Medicare Part D manufacturer discount program and INGREZZA’s qualification for the small biotech exception for purposes of the Medicare drug price negotiation program are subject to various requirements and there is no assurance that we will continue to qualify for these exemptions in the future.
The overall impact on INGREZZA revenues is inherently uncertain and difficult to predict, and we are still evaluating the potential impact of this discount program and our designation as a “specified small manufacturer.” Our designation as a “specified small manufacturer” under the new Medicare Part D manufacturer discount program and INGREZZA’s qualification for the small biotech exception for purposes of the Medicare drug price negotiation program are subject to various requirements and there is no assurance that we will continue to qualify for these exemptions in the future.
The market acceptance of INGREZZA and CRENESSITY could be affected by a number of factors, including: • the timing of receipt of marketing approvals for additional indications; • the safety and efficacy of the products; • the pricing of these products; • the availability of healthcare payor coverage and adequate reimbursement for the products; • public perception regarding of these products; • the success of existing competitor products addressing our target markets or the emergence of equivalent or superior products; and • the cost-effectiveness of the products.
The market acceptance of INGREZZA and CRENESSITY could be affected by a number of factors, including: • the timing of receipt of marketing approvals for additional indications; • the safety and efficacy of the products; • the pricing of these products; • the availability of healthcare payor coverage and adequate reimbursement for the products; • public perception regarding these products; 22 • the success of existing competitor products addressing our target markets or the emergence of equivalent or superior products; and • the cost-effectiveness of the products.
Furthermore, there can be no assurance that we or our collaborators will resolve any issues related to any product related adverse events to the satisfaction of the FDA or any regulatory agency in a timely manner or ever, which could harm our business, prospects and financial condition. 27 We currently depend on a limited number of third-party suppliers.
Furthermore, there can be no assurance that we or our collaborators will resolve any issues related to any product related adverse events to the satisfaction of the FDA or any regulatory agency in a timely manner or ever, which could harm our business, prospects and financial condition. We currently depend on a limited number of third-party suppliers.
Failure to comply with these ongoing regulatory requirements, or later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, may result in, among other things: • restrictions on the marketing or manufacturing of the product, changes in the product’s label, withdrawal of the product from the market, or voluntary or mandatory product recalls; • fines, warning or untitled letters or holds on clinical trials; • refusal by the FDA or similar foreign regulatory authorities to approve pending applications or supplements to approved applications filed by us, or suspension or revocation of product license approvals; • adverse inspection findings, enforcement actions, or other activities that temporarily delay manufacture and distribution of our products; • product seizure or detention, or refusal to permit the import or export of products; and • product injunctions or the imposition of civil or criminal penalties.
Failure to comply with these ongoing regulatory requirements, or later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, may result in, among other things: • restrictions on the marketing or manufacturing of the product, changes in the product’s label, misbranding allegations, withdrawal of the product from the market, or voluntary or mandatory product recalls; • fines, warning or untitled letters or holds on clinical trials; • refusal by the FDA or similar foreign regulatory authorities to approve pending applications or supplements to approved applications filed by us, or suspension or revocation of product license approvals; • adverse inspection findings, enforcement actions, or other activities that temporarily delay manufacture and distribution of our products; • product seizure or detention, or refusal to permit the import or export of products; and • product injunctions or the imposition of civil or criminal penalties.
If any of the following risks actually occur, our business, operating results, prospects or financial condition could be harmed. Additional risks not presently known to us, or that we currently deem immaterial, may also affect our business operations. Summary Risk Factors We face risks and uncertainties related to our business, many of which are beyond our control.
If any of the following risks actually occur, our business, operating results, prospects or financial condition could be harmed. Additional risks not presently known to us, or that we currently deem immaterial, may also affect our business operations. 20 Summary Risk Factors We face risks and uncertainties related to our business, many of which are beyond our control.
Data Privacy Framework and the UK extension thereto (which allows for transfers for to relevant U.S.-based organizations who self-certify compliance and participate in the Framework), these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the U.S.
Data Privacy Framework and the UK extension thereto (which allows for transfers for to relevant 50 U.S.-based organizations who self-certify compliance and participate in the Framework), these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the U.S.
To that end, we must be able to successfully: • manage our development efforts effectively; • integrate additional management, administrative and manufacturing personnel; • further develop our marketing and sales organization; • compensate our employees on adequate terms in an increasingly competitive, inflationary market; • attract and retain personnel; and • maintain sufficient administrative, accounting and management information systems and controls.
To that end, we must be able to 27 successfully: • manage our development efforts effectively; • integrate additional management, administrative and manufacturing personnel; • further develop our marketing and sales organization; • compensate our employees on adequate terms in an increasingly competitive, inflationary market; • attract and retain personnel; and • maintain sufficient administrative, accounting and management information systems and controls.
If we are unable to obtain or retain third-party manufacturers, we will not be able to develop or commercialize our products, including INGREZZA and CRENESSITY. The manufacture of our products for clinical trials and commercial purposes is subject to specific FDA and equivalent foreign regulations, including current Good Manufacturing Practice regulations.
If we are unable to obtain or retain third-party manufacturers, we will not be able to develop or commercialize our products, including INGREZZA and CRENESSITY. The manufacture of our products for clinical trials and commercial purposes is subject to specific FDA and equivalent foreign regulations, including current good manufacturing practice (cGMP) regulations.
Moreover, these independent investigators and CROs may also have relationships with other commercial entities, some of which may compete with us. If independent investigators and CROs assist our competitors at our expense, it could harm our competitive position. We are subject to ongoing obligations and continued regulatory review for INGREZZA and CRENESSITY.
Moreover, these independent investigators and CROs may also have relationships with other commercial entities, some of which may compete with us. If independent investigators and CROs assist our competitors at our expense, it could harm our competitive position. 33 We are subject to ongoing obligations and continued regulatory review for INGREZZA and CRENESSITY.
If we do not have adequate patent protection for our products, then the relative importance of obtaining regulatory exclusivity is even greater. We may not be successful obtaining orphan drug designations for any indications and, even if we succeed, such product candidates with such orphan drug designations may fail to achieve FDA approval.
If we do not have adequate patent protection for our products, then the relative importance of obtaining regulatory exclusivity is even greater. We may not be successful in obtaining orphan drug designations for any indications and, even if we succeed, such product candidates with such orphan drug designations may fail to achieve FDA approval.
Any action against our employees, independent contractors, principal investigators, consultants, commercial partners or vendors for violations of these laws could result in significant civil, criminal and administrative penalties, fines and imprisonment. 44 We face potential product liability exposure far in excess of our insurance coverage.
Any action against our employees, independent contractors, principal investigators, consultants, commercial partners or vendors for violations of these laws could result in significant civil, criminal and administrative penalties, fines and imprisonment. We face potential product liability exposure far in excess of our insurance coverage.
These developments may further complicate compliance efforts, and may increase legal risk and compliance costs for us and the third parties upon whom we rely. 45 Additionally, HIPAA, as amended by HITECH, imposes specific requirements relating to the privacy, security, and transmission of individually identifiable health information.
These developments may further complicate compliance efforts, and may increase legal risk and compliance costs for us and the third parties upon whom we rely. Additionally, HIPAA, as amended by HITECH, imposes specific requirements relating to the privacy, security, and transmission of individually identifiable health information.
Further, an increasing number of countries use prices for medicinal products established in other countries as “reference prices” to help determine the price of the product in their own territory. Consequently, a downward trend in prices of medicinal products in some countries could contribute to similar downward trends elsewhere, including in the U.S.
Further, an increasing number of countries use prices for medicinal products established in other countries as “reference prices” to help determine the price of 25 the product in their own territory. Consequently, a downward trend in prices of medicinal products in some countries could contribute to similar downward trends elsewhere, including in the U.S.
Furthermore, negative posts or comments about us or our products on social media could seriously damage our reputation, brand image and goodwill. 35 We may be subject to claims that we or our employees have wrongfully used or disclosed alleged trade secrets of their former employers.
Furthermore, negative posts or comments about us or our products on social media could seriously damage our reputation, brand image and goodwill. We may be subject to claims that we or our employees have wrongfully used or disclosed alleged trade secrets of their former employers.
If any of these risks occur and we fail to successfully develop or commercialize our biologic product candidates, we may not realize a return on our investments which could have an adverse effect on our results of operations and financial condition. 26 If we are unable to retain and recruit qualified scientists and other employees or if any of our key senior executives discontinues his or her employment with us, it may delay our development efforts or impact our commercialization of INGREZZA, CRENESSITY, or any product candidate approved by the FDA in the future.
If any of these risks occur and we fail to successfully develop or commercialize our biologic product candidates, we may not realize a return on our investments which could have an adverse effect on our results of operations and financial condition. 28 If we are unable to retain and recruit qualified scientists and other employees or if any of our key senior executives discontinues his or her employment with us, it may delay our development efforts or impact our commercialization of INGREZZA, CRENESSITY, or any product candidate approved by the FDA in the future.
As a result, our contract manufacturers might not be able to meet our clinical schedules or adequately manufacture our products in commercial quantities when required; 28 • switching manufacturers may be difficult because the number of potential manufacturers is limited.
As a result, our contract manufacturers might not be able to meet our clinical schedules or adequately manufacture our products in commercial quantities when required; • switching manufacturers may be difficult because the number of potential manufacturers is limited.
In addition, certain jurisdictions outside of the U.S., including the EU, have instituted price ceilings on specific products and therapies, as described further in the risk factor titled “Government and third-party payors may impose sales and pharmaceutical pricing controls on our products or limit coverage and/or reimbursement for our products or impose policies and/or make decisions regarding the status of our products that could limit our product revenues and delay sustained profitability.” We are currently unable to predict what other additional legislation or regulation, if any, relating to the healthcare industry may be enacted in the future or what effect recently enacted federal or equivalent foreign legislation or any such additional legislation or regulation would have on our business, particularly in light of the recent U.S.
In addition, certain jurisdictions outside of the U.S., including the EU, have instituted price ceilings on specific products and therapies, as described further in the risk factor titled “Government and third-party payors may impose sales and pharmaceutical pricing controls on our products or limit coverage and/or reimbursement for our products or impose policies and/or make decisions regarding the status of our products that could limit our product revenues and delay sustained profitability.” We are currently unable to predict what other additional legislation or regulation, if any, relating to the healthcare industry may be enacted in the future or what effect recently enacted federal or equivalent foreign legislation or any such additional legislation or regulation would have on our business, particularly in light of recent U.S. presidential and congressional elections.
Some of our suppliers and research collaborators are located in China, exposing us to the possibility of supply disruption in the event of changes to the laws, rules, regulations, and policies of the governments of the U.S. or China.
Some of our suppliers and research and development collaborators are located in China, exposing us to the possibility of supply disruption in the event of changes to the laws, rules, regulations, and policies of the governments of the U.S. or China.
We may encounter delays in production and delivery of our biologic product candidates by our third-party manufacturers or other vendors, which would result in corresponding delays to our development and commercialization of such biologic candidates.
We may encounter delays in production and delivery of our biologic product candidates and devices by our third-party manufacturers or other vendors, which would result in corresponding delays to our development and commercialization of such biologic candidates.
Additionally, if our employees, commercial collaborators or consultants use generative artificial intelligence (AI) technologies to develop our proprietary technology and compounds, it may impact our ability to obtain or successfully defend certain intellectual property rights. 37 We also rely upon unpatented trade secrets and improvements, unpatented know-how and continuing technological innovation to develop and maintain our competitive position, which we seek to protect, in part, through confidentiality agreements with our commercial collaborators, employees and consultants.
Additionally, if our employees, commercial collaborators or consultants use generative artificial intelligence (AI) technologies to develop our proprietary technology and compounds, it may impact our ability to obtain or successfully defend certain intellectual property rights. 40 We also rely upon unpatented trade secrets and improvements, unpatented know-how and continuing technological innovation to develop and maintain our competitive position, which we seek to protect, in part, through confidentiality agreements with our commercial collaborators, employees and consultants.
It may be difficult or impossible for us to find a replacement manufacturer quickly on acceptable terms, or at all; • our contract manufacturers may not perform as agreed or may not remain in the contract manufacturing business for the time required to successfully produce, store or distribute our products; and • drug manufacturers are subject to ongoing periodic unannounced inspection by the FDA, the U.S.
It may be difficult or impossible for us to find a replacement manufacturer quickly on acceptable terms, or at all; • our contract manufacturers may not perform as agreed or may not remain in the contract manufacturing business for the time required to successfully produce, store or distribute our products or product candidates; and • drug manufacturers are subject to ongoing periodic unannounced inspection by the FDA, the U.S.
These laws, regulations and standards are subject to varying interpretations in some cases due to their lack of specificity, and as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies, which could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices.
These laws, regulations and standards are subject to varying interpretations in some cases due to their lack of specificity, and as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies, which could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure, policies and governance 37 practices.
We also expect to continue to incur significant operating and capital expenditures as we: • commercialize INGREZZA for tardive dyskinesia and chorea associated with Huntington's disease; • commercially launch CRENESSITY as an adjunctive treatment to glucocorticoid replacement to control androgens in adult and pediatric patients four years of age and older with classic CAH; • seek regulatory approvals for our product candidates or for additional indications for our current products; • develop, formulate, manufacture and commercialize our product candidates; • in-license or acquire new product development opportunities; • implement additional internal systems and infrastructure; and • hire additional clinical, scientific, sales, marketing and administrative personnel.
We also expect to continue to incur significant operating and capital expenditures as we: • commercialize INGREZZA for TD and chorea associated with Huntington's disease; • commercially launch CRENESSITY as an adjunctive treatment to glucocorticoid replacement to control androgens in adult and pediatric patients four years of age and older with classic CAH; • seek regulatory approvals for our product candidates or for additional indications for our current products; • develop, formulate, manufacture and commercialize our product candidates; • in-license or acquire new product development opportunities; • implement additional internal systems and infrastructure; and • hire additional clinical, scientific, sales, marketing and administrative personnel.
For example, we implemented a new company-wide enterprise resource planning (ERP) system in 2024 to streamline certain existing business, operational, and financial processes.
For example, we implemented a company-wide enterprise resource planning (ERP) system in 2024 to streamline certain existing business, operational, and financial processes.
We are transforming our research and development strategies to include the development of biologics, including peptides, antibodies and gene therapies. As a company, we do not have experience successfully developing and commercializing biologics and our current infrastructure may be inadequate to support the expected growth and transformation of processes, personnel, and technologies required for these new programs.
We are transforming our research and development strategies to include the development of biologics, including peptides, proteins, antibodies, conjugates, and gene therapies. As a company, we do not have experience successfully developing and commercializing biologics and our current infrastructure may be inadequate to support the expected growth and transformation of processes, personnel, and technologies required for these new programs.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, our business could be materially harmed. 32 If the market opportunities for our products and product candidates are smaller than we believe they are, our expected revenues may be adversely affected, and our business may suffer.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, our business could be materially harmed. 34 If the market opportunities for our products and product candidates are smaller than we believe they are, our expected revenues may be adversely affected, and our business may suffer.
Litigation or derivation proceedings, including proceedings of a competitor, may also result in a competitor entering the marketplace faster than expected. We cannot assure you that we will be able to prevent misappropriation of our proprietary rights, particularly in countries where the laws may not protect such rights as fully as in the U.S.
Litigation or derivation proceedings, including proceedings of a competitor, may also result in a competitor entering the marketplace faster than expected. We cannot assure you that we will be able to prevent misappropriation of our proprietary rights, particularly in countries where the laws may not protect such rights as fully as in the U.S. Changes in the FDA, the U.S.
Any sales of our product once commercialized outside the U.S. will also likely subject us to foreign equivalents of the healthcare laws mentioned above, among other foreign laws. Additionally, because of our U.S. and international operations, we are also subject to anti-corruption laws and regulations, in the United States and internationally, including but not limited the U.S.
Any sales of our product once commercialized outside the U.S. will also likely subject us to foreign equivalents of the healthcare laws mentioned above, among other foreign laws. Additionally, because of our U.S. and international operations, we are also subject to anti-corruption laws and regulations, in the U.S. and internationally, including but not limited the U.S.
We collaborate with MTPC for the commercialization of DYSVAL in Japan and for the continued development and commercialization of valbenazine for movement disorders in other select Asian markets. Some of our other collaborators include Nxera Pharma UK Limited (formerly Sosei Heptares), Takeda Pharmaceutical Company Limited, Voyager Therapeutics, Inc., and Xenon Pharmaceuticals, Inc.
We collaborate with TPC for the commercialization of DYSVAL in Japan and for the continued development and commercialization of valbenazine for movement disorders in other select Asian markets. Some of our other collaborators include Nxera Pharma UK Limited (formerly Sosei Heptares), Takeda Pharmaceutical Company Limited, Voyager Therapeutics, Inc., and Xenon Pharmaceuticals Inc.
We are committed to maintaining high standards of corporate governance and public disclosure. As a result, our efforts to comply with evolving laws, regulations and standards have resulted in, and are likely to continue to result in, increased selling, general and administrative expenses and management time related to compliance activities.
We are committed to maintaining high standards of corporate governance, workforce initiatives and public disclosure. As a result, our efforts to comply with evolving laws, regulations and standards have resulted in, and are likely to continue to result in, increased selling, general and administrative expenses and management time related to compliance activities.
We launched INGREZZA in the U.S. as the first FDA-approved drug for the treatment of tardive dyskinesia in May 2017 and for the treatment of chorea associated with Huntington's disease in August 2023. Our ability to produce INGREZZA revenues consistent with expectations ultimately depends on our ability to continue to successfully commercialize INGREZZA and secure and maintain adequate third-party reimbursement.
We launched INGREZZA in the U.S. as the first FDA-approved drug for the treatment of TD in May 2017 and for the treatment of chorea associated with Huntington's disease in August 2023. Our ability to produce INGREZZA revenues consistent with expectations ultimately depends on our ability to continue to successfully commercialize INGREZZA and secure and maintain adequate third-party reimbursement.
Moreover, eligibility for coverage and reimbursement does not imply that a drug will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture, sale and distribution.
Moreover, eligibility for coverage and reimbursement does not imply that a drug will be paid for in all cases or at a rate that covers our costs, including research, development, manufacturing, sale and distribution.
Our operations outside the United States could increase the risk of such violations. Our business is also heavily regulated and involves significant interaction with foreign officials. In many countries outside the U.S., independent clinical investigators conducting our clinical trials and prescribers of our products are employed by government entities, and purchasers themselves can be government entities.
Our operations outside the U.S. could increase the risk of such violations. Our business is also heavily regulated and involves significant interaction with foreign 43 officials. In many countries outside the U.S., independent clinical investigators conducting our clinical trials and prescribers of our products are employed by government entities, and purchasers themselves can be government entities.
A once-daily dosing of AUSTEDO (AUSTEDO XR) was introduced in February 2023. Additionally, there are a number of commercially available medicines used to treat tardive dyskinesia off-label, such as XENAZINE ® (tetrabenazine) and generic equivalents, and various antipsychotic medications (e.g., clozapine), anticholinergics, benzodiazepines (off-label), and botulinum toxin.
A once-daily dosing of AUSTEDO (AUSTEDO XR) was introduced in February 2023. Additionally, there are a number of commercially available medicines used to treat TD off-label, such as XENAZINE (tetrabenazine) and generic equivalents, and various antipsychotic medications (e.g., clozapine), anticholinergics, benzodiazepines (off-label), and botulinum toxin.
While our team members and consultants have experience marketing and selling pharmaceutical products, we may face difficulties related to managing the rapid growth of our personnel and infrastructure, and there can be no guarantee that we will be able to maintain the personnel, systems, arrangements and capabilities necessary to continue to successfully commercialize INGREZZA or any product candidate approved by the FDA, or equivalent foreign authorities, in the future. 20 We may not be able to successfully launch CRENESSITY.
While our team members and consultants have experience marketing and selling pharmaceutical products, we may face difficulties related to managing the rapid growth of our personnel and infrastructure, and there can be no guarantee that we will be able to maintain the personnel, systems, arrangements and capabilities necessary to continue to successfully commercialize INGREZZA or any product candidate approved by the FDA, or equivalent foreign authorities, in the future.
If one or more of our competitors’ products or programs are successful (including the development of generic equivalents), the market for our products may be reduced or eliminated. • INGREZZA competes with AUSTEDO ® (deutetrabenazine), marketed by Teva Pharmaceuticals Industries, for the treatment of tardive dyskinesia in adults and chorea associated with Huntington's disease.
If one or more of our competitors’ products or programs are successful (including the development of generic equivalents), the market for our products may be reduced or eliminated. • INGREZZA competes with AUSTEDO (deutetrabenazine), marketed by Teva Pharmaceuticals Industries, for the treatment of TD in adults and chorea associated with Huntington's disease.
For example, the Inflation Reduction Act of 2022, or the IRA, provides for, among other things: (1) the Secretary of the HHS to negotiate the price of certain high-expenditure, single-source drugs and biologics covered under Medicare; (2) the redesign of the Medicare Part D prescription drug benefit to lower patient out-of-pocket costs and increase manufacturer liability; and (3) drug manufacturers to pay rebates on drugs whose prices increase greater than the rate of inflation.
For example, the IRA provides for, among other things: (1) the Secretary of the HHS to negotiate the price of certain high-expenditure, single-source drugs and biologics covered under Medicare; (2) the redesign of the Medicare Part D prescription drug benefit to lower patient out-of-pocket costs and increase manufacturer liability; and (3) drug manufacturers to pay rebates on drugs whose prices increase greater than the rate of inflation.
If our independent investigators fail to devote sufficient time and resources to our drug development programs, or if their performance is substandard, or not in compliance with GCPs, it may delay or prevent the approval of our regulatory applications and our introduction of new treatments.
If our independent investigators fail to devote sufficient time and resources to our drug development programs, or if their performance is substandard, or not in compliance with good clinical practices (GCPs), it may delay or prevent the approval of our regulatory applications and our introduction of new treatments.
If we default on any of our obligations under those licenses, or violate the terms of these licenses, we could lose our rights to those technologies and drug candidates or be forced to pay damages. • If we are unable to protect our intellectual property, our competitors could develop and market products based on our discoveries, which may reduce demand for our products. • Our customers are concentrated and therefore the loss of a significant customer may harm our business. • We may need additional capital in the future.
If we default on any of our obligations under those licenses, or violate the terms of these licenses, we could lose our rights to those technologies, drug leads, products, and product candidates, or be required to pay damages. • If we are unable to protect our intellectual property, our competitors could develop and market products based on our discoveries, which may reduce demand for our products. 21 • Our customers are concentrated and therefore the loss of a significant customer may harm our business. • We may need additional capital in the future.
Compared to us, many of our competitors and potential competitors have substantially greater: • capital resources; • sales and marketing experience; • research and development resources, including personnel and technology; • regulatory experience; • preclinical study and clinical testing experience; • manufacturing, marketing and distribution experience; and • production facilities.
Compared to us, many of our competitors and potential competitors have substantially greater: • capital resources; • sales and marketing experience; • research and development capabilities and capacity, including personnel and technology; • regulatory experience; 23 • preclinical study and clinical testing experience; • manufacturing, marketing and distribution experience; and • production facilities.
The CROs we contract with for execution of our clinical trials play a significant role in the conduct of the trials and the subsequent collection and analysis of data. Failure of the CROs to meet their obligations could adversely affect clinical development of our products.
The CROs we contract with for execution of our clinical trials play a significant role in the conduct of the trials and the subsequent collection and analysis of data. Failure of the CROs to meet their obligations could adversely affect clinical development of our product candidates.
In the EU, orphan exclusivity may be reduced to six years if the drug no longer satisfies the original designation criteria or can be lost altogether if the marketing authorization holder consents to a second orphan drug application or cannot supply enough drug, or when a second applicant demonstrates its drug is “clinically superior” to the original orphan drug.
In the EU, orphan exclusivity may be reduced to six years if the drug no longer satisfies the original designation criteria or can be lost altogether if the marketing authorization holder consents to a second orphan drug application or cannot supply enough drug, or when a second applicant demonstrates its drug is clinically superior to the original orphan drug.
Any deficiencies in the design of the ERP system could adversely affect the effectiveness of our internal control over financial reporting or our ability to accurately maintain our books and 25 records, provide accurate, timely and reliable reports on our financial and operating results, or otherwise operate our business.
Any deficiencies in the design, implementation, or subsequent upgrades of the ERP system could adversely affect the effectiveness of our internal control over financial reporting or our ability to accurately maintain our books and records, provide accurate, timely and reliable reports on our financial and operating results, or otherwise operate our business.
Although the FDA and other regulatory agencies do not regulate a physician’s choice of drug treatment made in the physician’s independent medical judgment, they do restrict promotional communications from companies or their sales force with respect to off-label uses of products for which marketing clearance has not been issued.
Physicians, on the other hand, may prescribe products for off-label uses. Although the FDA and other regulatory agencies do not regulate a physician’s choice of drug treatment made in the physician’s independent medical judgment, they do restrict promotional communications from companies or their sales force with respect to off-label uses of products for which marketing clearance has not been issued.
Under this discount program and subject to certain exceptions, manufacturers must give a 10 percent discount on Part D program drugs in the initial coverage phase, and a 20 percent discount on Part D drugs when the beneficiary enters the catastrophic coverage phase (the phase after the patient incurs costs above the initial phase out-of-pocket threshold, which is $2,000).
Under this discount program and subject to certain exceptions, manufacturers must give a 10 percent discount on Part D program drugs in the initial coverage phase, and a 20 percent discount on Part D drugs when the beneficiary enters the catastrophic coverage phase (the phase after the patient incurs costs above the initial phase out-of-pocket threshold, which is $2,000 in 2025, indexed to inflation thereafter annually).
In addition, the regulatory requirements in the United States and in other countries governing biologics are evolving and the FDA or comparable foreign regulatory authorities may change the requirements, or identify different regulatory pathways, for approval for any of our biologic candidates.
In addition, the regulatory requirements in the U.S. and in other countries governing biologics are evolving and the FDA or comparable foreign regulatory authorities may change the requirements, or identify different regulatory pathways, for approval for any of our biologic candidates.
We have hired employees with expertise in these modalities, but we will need to hire additional qualified personnel and expand our management, administrative, and manufacturing functions to support the research and development organization.
We have hired employees with expertise in these modalities, but we will need to hire additional qualified personnel and expand our management, administrative, and technical staff to support the research and development organization.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action or as a result of legal challenges, either in the United States or abroad.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action or as a result of legal challenges, either in the U.S. or abroad.
Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. Risks Related to Our Industry Enacted healthcare reform, drug pricing measures and other recent legislative initiatives, including the Inflation Reduction Act of 2022, could adversely affect our business.
Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. Risks Related to Our Industry Enacted healthcare reform, drug pricing measures and other recent legislative initiatives, including the IRA, could adversely affect our business.
We currently have no manufacturing capabilities. If third-party manufacturers of INGREZZA, CRENESSITY, or any of our product candidates fail to devote sufficient time and resources to our concerns, or if their performance is substandard, our ability to commercialize existing products, conduct clinical trials and develop new products could be impaired and our costs may rise.
If third-party manufacturers of INGREZZA, CRENESSITY, or any of our product candidates fail to devote sufficient time and resources to our concerns, or if their performance is substandard, our ability to commercialize existing products, conduct clinical trials and develop new products could be impaired and our costs may rise.
We may encounter difficulties with managing our growth, which could adversely affect our results of operations. • We are transforming our research and development strategies to include the development of biologics, which requires substantial investment, including in personnel and facilities.
Such increases may not be sufficient and we may encounter difficulties with managing our growth, which could adversely affect our results of operations. • We are transforming our research and development strategies to include the development of biologics, which requires substantial investment, including in personnel and facilities.
Significant judgment is required in determining our tax liabilities including management’s judgment for uncertain tax positions. The Internal Revenue Service, other domestic taxing authorities, or foreign taxing authorities may disagree with our interpretation of tax laws as applied to our operations.
Significant judgment is required in determining our tax liabilities including management’s judgment for uncertain tax positions. The Internal Revenue Service, other U.S. taxing authorities, or non-U.S. taxing authorities may disagree with our interpretation of tax laws as applied to our operations.
This project has required and may continue to require investment of capital and human resources, the re-engineering of processes of our business, and the attention of many employees who would otherwise be focused on other aspects of our business.
This project has required and may continue to require investment of capital and human resources, the re-engineering of processes of our business, and the attention of many employees who would otherwise be focused on other aspects of our business, including post-implementation optimization and upgrades.
Our success will depend on our ability to, among other things: • obtain patent protection for our products; • preserve our trade secrets; • prevent third parties from infringing upon our proprietary rights; and • operate without infringing upon the proprietary rights of others, both in the U.S. and internationally.
Our success will depend on our ability to, among other things: • obtain patent protection for our products; • preserve our trade secrets; • obtain, maintain, and enforce trademark, trade name, and service mark protection; • prevent third parties from infringing upon our proprietary rights; and • operate without infringing upon the proprietary rights of others, both in the U.S. and internationally.
In April 2024, the Company was notified by CMS that it qualified as a “specified small manufacturer” and will receive the discount phase-in discussed above for INGREZZA.
In April 2024, we were notified by CMS that it qualified as a “specified small manufacturer” and will receive the discount phase-in discussed above for INGREZZA.
INGREZZA is reimbursed under Medicare Part D, and increased discounts could impact INGREZZA revenues, while also having an industry-wide impact on the cost of other Part D program drugs such as AUSTEDO and AUSTEDO XR, marketed by Teva Pharmaceuticals Industries.
INGREZZA is reimbursed under Medicare Part D, and increased discounts could impact INGREZZA revenues, while also having an industry-wide impact on the cost of other Part D program drugs such as AUSTEDO and AUSTEDO XR.
A company that is found to have promoted off-label use of its product may be subject to significant liability, including civil and criminal sanctions. 40 If the FDA or any other governmental agency, including equivalent foreign authorities, initiates an enforcement action against us, or if we are the subject of a qui tam suit brought by a private plaintiff on behalf of the government, and it is determined that we violated prohibitions relating to the promotion of products for unapproved uses, we could be subject to substantial civil or criminal fines or damage awards and other sanctions such as consent decrees and corporate integrity agreements pursuant to which our activities would be subject to ongoing scrutiny and monitoring to ensure compliance with applicable laws and regulations.
If the FDA or any other governmental agency, including equivalent foreign authorities, initiates an enforcement action against us, or if we are the subject of a qui tam suit brought by a private plaintiff on behalf of the government, and it is determined that we violated prohibitions relating to the promotion of products for unapproved uses, we could be subject to substantial civil or criminal fines or damage awards and other sanctions such as consent decrees and corporate integrity agreements pursuant to which our activities would be subject to ongoing scrutiny and monitoring to ensure compliance with applicable laws and regulations.
If we fail to comply with these laws, regulations and standards, our reputation may be harmed and we might be subject to sanctions or investigation by regulatory authorities, such as the SEC. Any such action could adversely affect our financial results and the market price of our common stock.
If we fail, or are perceived to fail, to comply with these laws, regulations and standards, our reputation may be harmed and we might be subject to litigation, sanctions, investigations or other regulatory proceedings by regulatory authorities, such as the SEC. Any such action could adversely affect our financial results and the market price of our common stock.
Our future capital requirements will depend on many factors, including: • the commercial success of INGREZZA and CRENESSITY; • the cost of commercialization activities and arrangements, including advertising campaigns; • continued scientific progress in our R&D and clinical development programs; • the magnitude and complexity of our research and development programs; 30 • progress with preclinical testing and clinical trials; • the time and costs involved in obtaining regulatory approvals; • the cost involved in filing and pursuing patent applications, enforcing patent claims, or engaging in interference proceedings or other patent litigation; • costs associated with securing adequate coverage and reimbursement for our products; • competing technological and market developments; • developments related to any future litigation; • the cost of manufacturing our product candidates; • the impact of pandemics or epidemics on our business; and • the cost of any strategic alliances, collaborations, product in-licensing, or acquisitions.
Our future capital requirements will depend on many factors, including: • the commercial success of INGREZZA and CRENESSITY; • the cost of commercialization activities and arrangements, including advertising campaigns; • continued scientific progress in our research and development and clinical development programs; • the magnitude and complexity of our research and development programs; • progress with preclinical testing and clinical trials; • the time and costs involved in obtaining regulatory approvals; • the cost involved in filing and pursuing patent applications, enforcing patent claims, or engaging in interference proceedings or other patent litigation; • costs associated with securing adequate coverage and reimbursement for our products; • competing technological and market developments; • developments related to any future litigation; • the cost of manufacturing our product candidates; • the impact of pandemics or epidemics on our business; and • the cost of any strategic alliances, collaborations, product in-licensing, or acquisitions. 32 We may seek additional funding through public or private sales of our securities, including equity securities.
For example, the California Consumer Privacy Act, as amended by the California Privacy Rights Act of 2020 (collectively, CCPA), requires businesses to provide specific disclosures in privacy notices, and honor requests of California residents to exercise certain privacy rights. The CCPA allows for fines for noncompliance (up to $7,500 per intentional violation).
For example, the California Consumer Privacy Act, as amended by the California Privacy Rights Act of 2020 (collectively, CCPA), requires businesses to provide specific disclosures in privacy notices, and honor requests of California residents to exercise certain privacy rights. The CCPA allows for fines for noncompliance.
The GDPR impose substantial fines for breaches of data protection requirements.
The GDPR imposes substantial fines for breaches of data protection requirements.
Over the course of the last 12 months, the price of our common stock has ranged from approximately $111 per share to approximately $158 per share.
Over the course of the last 12 months, the price of our common stock has ranged from approximately $84 per share to approximately $160 per share.
In connection with the clinical trials of our product candidates, we face the risks that: • the FDA or similar foreign regulatory authority may not allow an IND or foreign equivalent filings required to initiate human clinical studies for our drug candidates or the FDA or similar foreign regulatory authorities may require additional preclinical studies as a condition of the initiation of Phase 1 clinical studies, or additional clinical studies for progression from Phase 1 to Phase 2, or Phase 2 to Phase 3, or for NDA approval; • the product candidate may not prove to be effective or as effective as other competing product candidates; • we may discover that a product candidate may cause harmful side effects or results of required toxicology or other studies may not be acceptable to the FDA or similar foreign regulatory authorities; 24 • clinical trial results may not replicate the results of previous trials; • we or the FDA or similar foreign regulatory authorities may suspend or vary the trials; • the results may not be statistically significant; • clinical site initiation or patient recruitment and enrollment may be slower or more difficult than expected; • the FDA or similar foreign regulatory authorities may not accept the data from any trial or trial site outside of the U.S.; • a study is compromised due to patients dropping out and not completing the trials; • unforeseen disruptions or delays may occur, caused by man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions or other business interruptions; and • regulatory requirements may change.
In connection with the clinical trials of our product candidates, we face the risks that: • the FDA or similar foreign regulatory authority may not allow an IND or foreign equivalent filings required to initiate human clinical studies for our drug candidates or the FDA or similar foreign regulatory authorities may require additional preclinical studies as a condition of the initiation of Phase 1 clinical studies, or additional clinical studies for progression from Phase 1 to Phase 2, or Phase 2 to Phase 3, or for NDA approval; • the product candidate may not prove to be effective or as effective as other competing product candidates; • we may discover that a product candidate may cause harmful side effects or results of required toxicology or other studies may not be acceptable to the FDA or similar foreign regulatory authorities; • clinical trial results may not replicate or improve upon the results of previous trials; • we or the FDA or similar foreign regulatory authorities may suspend or vary the trials; • the results may not be statistically significant; • clinical site initiation or patient recruitment and enrollment may be slower or more difficult than expected; • the FDA or similar foreign regulatory authorities may not accept the data from any trial or trial site outside of the U.S.; • a study is compromised due to patients dropping out and not completing the trials; • unforeseen disruptions or delays may occur, caused by geopolitical and macroeconomic developments, man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, tariffs, the recent shutdown of the U.S. federal government and the resulting effects on its regulatory agencies, or other business interruptions; and • regulatory requirements may change. 26 These risks and uncertainties impact all of our clinical programs and any of the clinical, regulatory or operational events described above could change our planned clinical and regulatory activities.
These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and, due to subsequent legislative amendments to the statute, including the Infrastructure Investment and Jobs Act and Consolidated Appropriations Act of 2023, will remain in effect until 2032.
These changes include, among others, aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and, due to subsequent legislative amendments, including the Investment and Jobs Act, will remain in effect through 2032.
Manufacturers of pharmaceutical products may encounter difficulties in production, such as difficulties with production costs and yields, process controls and validation, quality control and quality assurance, including testing of stability, impurities and impurity levels and other product specifications by validated test methods, compliance with strictly enforced U.S., state and non-U.S. regulations, and disruptions or delays caused by man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, or other business interruptions.
Manufacturers of pharmaceutical products may encounter difficulties in production, such as difficulties with production costs and yields, process controls and validation, quality control and quality assurance, including testing of stability, impurities and impurity levels and other product specifications by validated test methods, compliance with strictly enforced U.S., state and non-U.S. regulations, and disruptions or delays caused by geopolitical and macroeconomic developments, man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, tariffs, the recent shutdown of the U.S. federal government and the resulting effects on its regulatory agencies, or other business interruptions.
Any changes in tax laws, including any new tax legislation or initiatives, could not only significantly increase our tax provision, cash tax liabilities, and effective tax rate, but could also have a material impact on the value of our deferred tax assets, result in significant one-time charges and ongoing compliance costs, and increase our future tax expense. 33 Our effective tax rate may fluctuate, and we may incur obligations in tax jurisdictions in excess of accrued amounts.
Any changes in tax laws, including any new tax laws or initiatives, could not only significantly increase our tax provision, cash tax liabilities, and effective tax rate, but could also have a material impact on the value of our deferred tax assets, result in significant one-time charges and ongoing compliance costs, and increase our future tax expense.
Our financial results are unpredictable and may fluctuate, for among other reasons, due to seasonality and timing of customer purchases and commercial sales of INGREZZA and CRENESSITY, royalties from out-licensed products, the impact of Medicare Part D coverage, including redesign of the Part D benefit enacted as part of the Inflation Reduction Act, our achievement of product development objectives and milestones, clinical trial enrollment and expenses, research and development expenses and the timing and nature of contract manufacturing, contract research payments, fluctuations in our effective tax rate, disruptions caused by man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, or other business interruptions.
Our financial results are unpredictable and may fluctuate, for among other reasons, due to seasonality and timing of customer purchases and commercial sales of INGREZZA and CRENESSITY, royalties from out-licensed products, the impact of Medicare Part D coverage, including redesign of the Part D benefit enacted as part of the IRA, our achievement of product development objectives and milestones, clinical trial enrollment and expenses, research and development expenses and the timing and nature of contract manufacturing, contract research payments, fluctuations in our effective tax rate, disruptions caused by geopolitical and macroeconomic developments, man-made or natural disasters, public health pandemics or epidemics, armed conflicts, trade restrictions, tariffs, the recent shutdown of the U.S. federal government and the resulting effects on its regulatory agencies, or other business interruptions.
The loss or potential loss of these exemptions, including as a result of a third party acquiring us, could have an adverse impact on our business. Prior to the IRA’s enactment, the most significant recent federal legislation impacting the pharmaceutical industry occurred in March 2010, when the ACA was signed into law.
The loss or potential loss of these exemptions, including as a result of a third party acquiring us, could have an adverse impact on our business. The most significant prior revisions to federal law governing the pharmaceutical industry and prescription drug pricing occurred in March 2010, when the ACA was signed into law.
Additionally, in the past few years, numerous U.S. states—including California, Virginia, Colorado, Connecticut, and Utah—have enacted comprehensive privacy laws that impose certain obligations on covered businesses, including providing specific disclosures in privacy notices and affording residents with certain rights concerning their personal data.
Additionally, numerous U.S. states have enacted comprehensive privacy laws that impose certain obligations on covered businesses, including providing specific disclosures in privacy notices and affording residents with certain rights concerning their personal data.
If we are unable to identify, recruit and integrate additional employees with the requisite skills, or effectively manage our transformation activities, the development of our biologic product candidates may not be successful, or be delayed or paused indefinitely. Additionally, the manufacture of biologics is more complex than the manufacture of small molecule therapies.
If we are unable to identify, recruit and integrate additional employees with the requisite skills, or effectively manage our transformation activities, the development of our biologic product candidates may not be successful, or be delayed or paused indefinitely.
An off-label use is the use of a product for an indication that is not described in the product’s FDA-approved label in the U.S. or for uses in other jurisdictions that differ from those approved by the applicable regulatory agencies. Physicians, on the other hand, may prescribe products for off-label uses.
A company may not promote “off-label” uses for its drug products. An off-label use is the use of a product for an indication that is not described in the product’s FDA-approved label in the U.S. or for uses in other jurisdictions that differ from those approved by the applicable regulatory agencies.
In addition, there are a number of different anti-psychotic and anti-depressant medications currently used in these patient populations. • Our investigational treatments for potential use in neurology, neuroendocrinology and neuropsychiatry may in the future compete with numerous approved products and development-stage programs being pursued by several other companies.
In addition, there are a number of different anti-psychotic, including the muscarinic agonist COBENFY, and anti-depressant medications currently used in these patient populations. • Our investigational treatments for potential use in neurology, psychiatry, endocrinology, obesity and related metabolic diseases, and immunology may in the future compete with numerous approved products and development-stage programs being pursued by several other companies.

… 168 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

14 edited+6 added−1 removed3 unchanged
Biggest changeThe cybersecurity risk management and mitigation measures we implement for certain of our Information Assets include: policies and procedures designed to address cybersecurity threats, including an incident response plan, vulnerability management policy, and disaster recovery/business continuity plans; incident detection and response tools; internal and/or external audits to assess our exposure to cybersecurity threats, environment, compliance with risk mitigation procedures, and effectiveness of relevant controls; documented risk assessments; implementation of security standards/certifications; credit and background checks on our and/or third parties’ personnel; encryption of data; network security controls; threat modeling; data segregation; physical and electronic access controls; physical security; asset management, tracking and disposal; systems monitoring; vendor risk management program; employee security training; penetration testing; red/blue team exercises; cyber insurance; dedicated cybersecurity staff/officer.
Biggest changeThe cybersecurity risk management and mitigation measures we implement for certain of our Information Assets include: • policies and procedures designed to address cybersecurity threats, including an incident response plan, vulnerability management policy, and disaster recovery/business continuity plans, which are evaluated periodically; • incident detection and response tools; • internal and/or external audits to assess our exposure to cybersecurity threats, environment, compliance with risk mitigation procedures, and effectiveness of relevant controls; • documented risk assessments; • implementation of security standards/certifications; • encryption of data; • network security controls; 52 • threat modeling; • data segregation; • physical and electronic access controls; • physical security; • asset management, tracking, and disposal; • systems monitoring; • vendor risk management program; • employee security training, including mandatory annual cybersecurity training for all employees and additional role-based training where appropriate, with contractors who have access to our systems also required to complete cybersecurity training, as well as regular phishing simulations; • penetration testing, including annual third-party penetration testing; • red/blue team exercises; • cyber insurance; and • dedicated cybersecurity staff and officers.
We have certain vendor management processes designed to help to manage cybersecurity risks associated with our use of certain of these providers.
We have certain vendor management processes designed to help manage cybersecurity risks associated with our use of these providers.
To operate our business, we utilize certain third-party service providers to perform a variety of functions, such as outsourced business critical functions, clinical research, professional services, SaaS platforms, managed services, property management, cloud-based infrastructure, data center facilities, content delivery, encryption and authentication technology, corporate productivity services, and other functions.
To operate our business, we utilize certain third-party service providers to perform a variety of functions, such as outsourced business-critical functions, clinical research, professional services, Software as a Service (SaaS) platforms, managed services, property management, cloud-based infrastructure, data-center facilities, content delivery, encryption and authentication technology, corporate productivity services, and other functions.
We rely on a multidisciplinary team (including from our information security function, management, and third party service providers, as described further below) to assess how identified cybersecurity threats could impact our business. These assessments may leverage, among other processes, industry tools and metrics designed to assist in the assessment of risks from such cybersecurity threats.
We rely on a multidisciplinary team (including personnel from management, and third-party service providers, as described further below) to assess how identified cybersecurity threats could impact our business. These assessments may leverage, among other processes, industry tools and metrics designed to assist in the assessment of risks from such cybersecurity threats.
We have implemented and maintain various information security processes designed to identify, assess and manage material risks from cybersecurity threats to critical computer networks, third party hosted services, communications systems, hardware, lab equipment, software, and our critical data includes confidential, personal, proprietary, and sensitive data (collectively “Information Assets”).
We have implemented and maintain various information security processes designed to identify, assess, and manage material risks from cybersecurity threats to critical computer networks, third-party hosted services, communications systems, hardware, lab equipment, software, and our critical data, including confidential, personal, proprietary, and sensitive data (collectively, Information Assets).
Management is also responsible for hiring appropriate personnel, integrating cybersecurity considerations into the company’s overall risk management strategy, and for communicating key priorities to employees, as well as for approving budgets, helping prepare for cybersecurity incidents, approving cybersecurity processes, and reviewing security assessments and other security-related reports.
Management is also responsible for hiring appropriate personnel, integrating cybersecurity considerations into our overall risk management strategy, communicating key priorities to employees, approving budgets, preparing for cybersecurity incidents, approving cybersecurity processes, and reviewing security assessments and other security-related reports.
We work with third parties from time to time that assist us from time to time to identify, assess, and manage cybersecurity risks, including professional services firms, threat intelligence service providers, cybersecurity consultants, cybersecurity software providers, managed cybersecurity service providers, and penetration testing.
We work with third parties from time to time that assist us in identifying, assessing, and managing cybersecurity risks, including professional services firms, threat intelligence service providers, cybersecurity consultants, cybersecurity software providers, managed cybersecurity service providers, and penetration testing firms.
The Company’s general risk management program is designed to manage identified material risks, which would include material cybersecurity risks. 47 We engage in processes designed to identify such threats by, among other things, monitoring the threat environment using manual and automated tools, subscribing to reports and services that identify cybersecurity threats, analyzing reports of threats and actors, conducting scans of the threat environment, evaluating our and our industry’s risk profile, evaluating threats reported to us, coordinating with law enforcement concerning threats, conducting threat assessments for internal and external threats, and conducting vulnerability assessments to identify vulnerabilities.
We engage in processes designed to identify such threats by, among other things, monitoring the threat environment using manual and automated tools, subscribing to reports and services that identify cybersecurity threats, analyzing reports of threats and actors, conducting scans of the threat environment, evaluating our and our industry’s risk profile, evaluating threats reported to us, coordinating with law enforcement concerning threats, conducting threat assessments for internal and external threats, and conducting vulnerability assessments to identify vulnerabilities.
Depending on the nature of the services provided, the sensitivity and quantity of information processed, and the identity of the service provider, our vendor management process may include reviewing the cybersecurity practices of such provider, contractually imposing obligations on the provider related to the services they provide and/or the information they process, conducting security assessments, conducting on-site inspections, requiring their completion of written questionnaires regarding their services and data handling practices, and conducting periodic re-assessments during their engagement.
Depending on the nature of the services provided, the sensitivity and quantity of information processed, and the identity of the service provider, our vendor management process may include reviewing the cybersecurity practices of such provider, contractually imposing obligations on the provider related to the services provided and/or the information processed (including requirements that service providers notify us of certain cybersecurity incidents), conducting security assessments, conducting on-site inspections, requiring completion of written questionnaires regarding the service provider’s services and data-handling practices, and conducting periodic re-assessments of critical or high-risk providers during their engagement.
Management participates in cybersecurity incident response efforts by being a member of the incident response team and helping direct the company’s response to cybersecurity incidents. Our board of directors addresses the Company’s cybersecurity risk management as part of its general oversight function.
Management participates in cybersecurity incident response efforts by being part of the incident response team and helping direct our response to cybersecurity incidents. Our Board of Directors addresses our cybersecurity risk management as part of its general oversight function. The Audit Committee is responsible for overseeing our cybersecurity risk management processes, including oversight and mitigation of risks from cybersecurity threats.
For a description of the risks from cybersecurity threats that may materially affect us and how they may do so, refer to Part I, Item 1A. Risk Factors for additional information about cybersecurity-related risks. Governance Our cybersecurity risk assessment and management processes are implemented and maintained by certain Company management, including a Chief Information Officer, who reports to the CFO.
For a description of the risks from cybersecurity threats that may materially affect us and how they may do so, see Part I, Item 1A. Risk Factors for additional information about cybersecurity-related risks.
In addition, the company’s incident response processes include reporting to the Audit committee of the board of directors for certain cybersecurity incidents. 48 Management is involved with the Company’s efforts to prevent, detect, and mitigate cybersecurity incidents by overseeing preparation of cybersecurity policies and procedures, testing of incident response plans, engagement of vendors to conduct penetration tests.
Management is involved with our efforts to prevent, detect, and mitigate cybersecurity incidents by overseeing preparation of cybersecurity policies and procedures, testing of incident response plans (including annual tabletop exercises), and engagement of vendors to conduct penetration tests.
The board of directors’ audit committee is responsible for overseeing the company’s cybersecurity risk management processes, including oversight and mitigation of risks from cybersecurity threats. The audit committee also has access to various reports, summaries or presentations related to cybersecurity threats, risk, and mitigation.
The Head of Cyber Security briefs the Audit Committee on cybersecurity matters quarterly, and the Audit Committee also has access to various reports, summaries, and/or presentations related to cybersecurity threats, risks, and mitigation.
Our cybersecurity incident response and vulnerability management processes are designed to escalate certain cybersecurity incidents and vulnerabilities to members of management depending on the circumstances, including work with the company’s incident response team to help the company mitigate and remediate cybersecurity incidents of which they are notified.
Our cybersecurity incident response and vulnerability management processes involve management who participates in our disclosure controls and procedures. 53 Our cybersecurity incident response and vulnerability management processes are designed to escalate certain cybersecurity incidents and vulnerabilities to members of management depending on the circumstances, and significant cybersecurity incidents are immediately escalated to executive management.
Removed
Our cybersecurity incident response and vulnerability management processes involve management, who participates in our disclosure controls and procedures.
Added
Our cybersecurity program is informed in part by the National Institute of Standards and Technology (NIST) Cybersecurity Framework, and identified cybersecurity risks are documented and tracked within a formal cybersecurity risk register. Our general risk management program is designed to manage identified material risks, which include material cybersecurity risks.
Added
We also conduct annual third-party penetration testing, maintain external cybersecurity incident response partners who can assist in the event of an incident, and conduct annual incident-response tabletop exercises to evaluate and improve our readiness.
Added
Governance Our cybersecurity risk assessment and management processes are implemented and maintained by certain of our management, including our Chief Information Officer (CIO), who reports to the Chief Financial Officer (CFO), and our Head of Cyber Security, who reports to the CIO and is responsible for day-to-day cybersecurity operations.
Added
Our CIO has 24 years of experience in global information technology leadership focused on digital transformation and artificial intelligence (AI) automation, including establishing responsible AI councils and leading AI governance.
Added
Our Head of Cyber Security has 25 years of experience in cybersecurity, including security operations, incident response, vulnerability management, penetration testing, identity and access management, security architecture, AI security and governance, and third-party risk management, and holds a Master of Science in Cyber Security and a Bachelor of Science in Information Systems, maintains industry certifications including Certified Information Systems Security Professional (CISSP), and is a Digital Directors Network Boardroom Qualified Technology Expert (QTE).
Added
Our incident response team is cross-functional and includes representatives from the CIO’s organization, the Head of Cyber Security, Legal, Finance, Compliance/Privacy, and Communications. This team works together to help mitigate and remediate cybersecurity incidents. In addition, ours incident response processes include reporting to the Audit Committee for certain cybersecurity incidents.

Item 2. Properties

Properties — owned and leased real estate

1 edited+2 added−1 removed1 unchanged
Biggest changeLocation Use Square Feet Expiration Date Pacific Highlands Ranch in San Diego, California Corporate Headquarters, Office and Laboratory 535,000 October 31, 2036 Carmel Valley in San Diego, California Office and Laboratory 229,000 (1) July 31, 2031 Carmel Valley in San Diego, California Office 45,000 (2) April 30, 2029 _________________________ (1) This property is associated with our former corporate headquarters. 73,000 square feet is subleased by multiple companies for general office space through the remaining term of the lease and we are actively marketing an additional 141,000 square feet for sublease.
Biggest changeLocation Use Square Feet Expiration Date San Diego, California Corporate Headquarters, Office and Laboratory 535,000 October 31, 2036 San Diego, California Office and Laboratory 229,000 (1) July 31, 2031 San Diego, California Office 45,000 (2) April 30, 2029 Washington, DC Office 5,300 August 31, 2027 _________________________ (1) This property is associated with our former corporate headquarters.
Removed
(2) This property is associated with our former corporate headquarters. We are actively marketing this property for sublease. Item 3. Legal Proceedings For a description of our legal proceedings, refer to Note 15 to the consolidated financial statements, which is incorporated herein by reference. Item 4. Mine Safety Disclosures None. 49 PART II
Added
Approximately 73,000 square feet are subleased by multiple third parties for general office space through the remaining term of the lease. (2) This property is associated with our former corporate headquarters. We are actively marketing this property for sublease.
Added
Approximately 22,500 square feet are subleased by a third party for general office space through the remaining term of the lease with approximately 22,500 square feet of available space remaining. We believe that our existing facilities are adequate to meet our current needs, and that suitable additional alternative facilities will be available in the future on commercially reasonable terms.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 4. Mine Safety Disclosures 49 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 50 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 52 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 61 Item 8. Financial Statements and Supplementary Data 62
Biggest changeItem 4. Mine Safety Disclosures 54 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 55 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 56 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 64 Item 8. Financial Statements and Supplementary Data 65

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+2 added−3 removed0 unchanged
Biggest changeWe have not paid any cash dividends on our common stock since inception and do not anticipate paying cash dividends in the foreseeable future. Recent Sales of Unregistered Securities There were no unregistered sales of our equity securities during 2024.
Biggest changeThe actual number of stockholders is greater than this number because certain stockholders who are beneficial owners hold our common stock in “street” name with brokers and other nominees. We have not paid any cash dividends on our common stock since inception and do not anticipate paying cash dividends in the foreseeable future. See Part III, Item 12.
The comparisons in the graph below are based upon historical data and are not indicative of, or intended to forecast, future performance of our common stock or Indexes. * The material in this section is not “soliciting material”, is not deemed “filed” with the Securities and Exchange Commission and is not to be incorporated by reference into any of our SEC filings whether made before or after the date hereof and irrespective of any general incorporation language in any such SEC filing except to the extent we specifically incorporate this section by reference. 51
The comparisons in the graph below are based upon historical data and are not indicative of, or intended to forecast, future performance of our common stock or Indexes. * The material in this section is not “soliciting material”, is not deemed “filed” with the Securities and Exchange Commission and is not to be incorporated by reference into any of our SEC filings whether made before or after the date hereof and irrespective of any general incorporation language in any such SEC filing except to the extent we specifically incorporate this section by reference. 55
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the Nasdaq Global Select Market under the symbol “NBIX”. As of February 5, 2025, there were 39 stockholders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the Nasdaq Global Select Market under the symbol “NBIX”. As of February 4, 2026, there were 35 stockholders of record of our common stock.
Refer to Note 6 to the consolidated financial statements. 50 STOCK PERFORMANCE GRAPH AND CUMULATIVE TOTAL RETURN* The following graph presents the cumulative total stockholder return assuming the investment of $100 on December 31, 2019 (and the reinvestment of dividends thereafter) in each of (i) Neurocrine Biosciences, Inc.’s common stock, (ii) the Nasdaq Composite Index and (iii) the Nasdaq Biotechnology Index.
STOCK PERFORMANCE GRAPH AND CUMULATIVE TOTAL RETURN* The following graph presents the cumulative total stockholder return assuming the investment of $100 on December 31, 2020 (and the reinvestment of dividends thereafter) in each of (i) Neurocrine Biosciences, Inc.’s common stock, (ii) the Nasdaq Composite Index and (iii) the Nasdaq Biotechnology Index.
Removed
Issuer Purchases of Equity Securities In October 2024, our Board of Directors authorized a share repurchase program to repurchase up to $300.0 million of the Company’s common stock. Through the end of the fourth quarter of 2024, we have repurchased shares of the Company’s common stock having a value of $240.5 million under this program.
Added
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters for information about our equity compensation plans which is incorporated by reference herein. We did not repurchase any of our equity securities during the three months ended December 31, 2025.
Removed
The number of shares and average price paid per share for shares repurchased in each month of the fourth quarter of 2024 are set forth in the table below: Period Total Number of Shares Repurchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Program (1) Dollar Value of Shares that May Yet Be Purchased Under the Program (1) October 2024 — $ — — $ 300,000,000 November 2024 (1) 1,995,510 $ 120.53 1,995,510 $ 59,481,180 December 2024 — $ — — $ 59,481,180 1,995,510 $ 120.53 1,995,510 _________________________ (1) In November 2024, we paid $300.0 million under an accelerated share repurchase (ASR) transaction and received an initial delivery of 2.0 million shares.
Added
Recent Sales of Unregistered Securities During the year ended December 31, 2025, we did not issue or sell any unregistered securities not previously disclosed in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K.
Removed
The ASR transaction terminated in February 2025, at which time we became contractually entitled to receive an additional 0.3 million shares upon settlement.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

38 edited+26 added−32 removed16 unchanged
Biggest changeFor 2023 compared to 2022, the increase primarily reflected increased investment in our commercial initiatives, including our branded direct-to-consumer INGREZZA advertising campaign and deployment of our expanded salesforce completed in April 2022, and increased payroll and benefits expenses on higher headcount and increased non-cash stock-based compensation expense primarily driven by a charge related to a change in equity grant agreement terms in 2023. 56 Other (Expense) Income, Net Year Ended December 31, (in millions) 2024 2023 2022 Unrealized (loss) gain on equity investments $ (37.1) $ 28.4 $ 30.8 Charges associated with convertible senior notes (138.4) — (70.0) Investment income and other, net 91.0 52.8 4.1 Total other (expense) income, net $ (84.5) $ 81.2 $ (35.1) For 2024 compared to 2023, the increase in total other expense, net, primarily reflected $138.4 million of expense recognized in connection with conversions of the 2024 Notes upon maturity in May 2024 and periodic fluctuations in the fair values of our equity investments, partially offset by increased interest income on our debt security investments.
Biggest changeOther Income (Expense) Year Ended December 31, (in millions) 2025 2024 2023 Unrealized (loss) gain on equity investments $ (4.0) $ (37.1) $ 28.4 Charges associated with convertible senior notes — (138.4) — Investment income and other, net 90.3 91.0 52.8 Total other income (expense), net $ 86.3 $ (84.5) $ 81.2 For 2025 compared to 2024, the change primarily reflected prior year charges associated with the convertible senior notes that matured in May 2024 and periodic fluctuations in the fair values of our equity investments.
The items in our financial statements requiring significant estimates and judgments are as follows: Reserves for Government Rebates We recognize revenues from product sales of INGREZZA net of reserves established for applicable discounts and allowances that are offered within contracts with our customers, payors, and other third parties.
The items in our financial statements requiring significant estimates and judgments are as follows: 63 Reserves for Government Rebates We recognize revenues from product sales of INGREZZA net of reserves established for applicable discounts and allowances that are offered within contracts with our customers, payors, and other third parties.
Payroll and benefits consists of costs incurred for salaries and wages, payroll taxes, benefits and stock-based compensation associated with employees involved in research and development activities. Stock-based compensation may fluctuate from period to period based on factors that are not within our control, such as our stock price on the dates stock-based grants are issued.
Payroll and Benefits. Payroll and benefits consist of costs incurred for salaries and wages, payroll taxes, benefits, and stock-based compensation associated with employees involved in research and development activities. Stock-based compensation may fluctuate from period to period based on factors that are not within our control, such as our stock price on the dates stock-based grants are issued.
We periodically re-assess the need for a valuation allowance against our deferred tax assets based on various factors including our historical earnings experience by taxing jurisdiction, and forecasts of future operating results and utilization of net operating losses and tax credits prior to their expiration.
We periodically reassess the need for a valuation allowance against our deferred tax assets based on various factors including our historical earnings experience by taxing jurisdiction, and forecasts of future operating results and utilization of net operating losses and tax credits prior to their expiration.
In addition, we have a diversified portfolio of multiple compounds in mid- to late-phase development across our core therapeutic areas and an expanding early-phase pipeline that includes a range of modalities including small molecules, peptides, proteins, antibodies, and gene therapy.
In addition, we have a diversified portfolio of multiple compounds in mid- to late-phase development across our core therapeutic areas and an expanding early-phase pipeline that includes a range of modalities including small molecules, peptides, proteins, antibodies, conjugates, and gene therapies.
Key elements of our commercial strategy include maximizing the opportunities in INGREZZA and CRENESSITY through consistent and effective commercial execution, continued development of valbenazine as the best-in-class treatment for new patient populations, and to lead the evolving understanding of VMAT2 biology and its role in disease.
Key elements of our commercial strategy include maximizing the opportunities in INGREZZA and CRENESSITY through consistent and effective commercial execution, continued development of valbenazine as the best-in-class treatment for new patient populations, and to lead the evolving understanding of vesicular monoamine transporter 2 (VMAT2) biology and its role in disease.
We launched INGREZZA ® (valbenazine) in the U.S. as the first FDA-approved drug for the treatment of tardive dyskinesia in May 2017 and for the treatment of chorea associated with Huntington's disease in August 2023 and launched CRENESSITY TM (crinecerfont) in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024.
We launched INGREZZA ® (valbenazine) in the U.S. as the first FDA-approved drug for the treatment of TD in May 2017 and for the treatment of chorea associated with Huntington's disease in August 2023 and launched CRENESSITY ® (crinecerfont) in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024.
Additional Information Refer to Note 1 to the consolidated financial statements for information on accounting pronouncements that have impacted or are expected to materially impact our consolidated financial condition, results of operations, or cash flows. 60
See Note 10 to the consolidated financial statements for information on our income taxes. Additional Information See Note 1 to the consolidated financial statements for information on accounting pronouncements that have impacted or are expected to materially impact our consolidated financial condition, results of operations, or cash flows.
Food and Drug Administration (FDA) approved treatments for tardive dyskinesia, chorea associated with Huntington's disease, classic congenital adrenal hyperplasia (CAH), and endometriosis and uterine fibroids in collaboration with AbbVie Inc. (AbbVie).
Food and Drug Administration (FDA) approved treatments for tardive dyskinesia (TD), chorea associated with Huntington's disease, classic congenital adrenal hyperplasia due to 21-hydroxylase deficiency (CAH), and endometriosis and uterine fibroids in collaboration with AbbVie Inc. (AbbVie).
Overview Neurocrine Biosciences is a neuroscience-focused, biopharmaceutical company with a simple purpose: to relieve suffering for people with great needs, but few options. We are dedicated to discovering and developing life-changing treatments for patients with under-addressed neuropsychiatric, neurological, and neuroendocrine disorders. Our portfolio of products includes U.S.
Overview Neurocrine Biosciences is a neuroscience-focused, biopharmaceutical company with a simple purpose: to relieve suffering for people with great needs. We are dedicated to discovering, developing, and commercializing life-changing treatments for patients with under-addressed neurological, psychiatric, endocrine, and immunological disorders. Our portfolio of products includes U.S.
Provision for Income Taxes Year Ended December 31, (in millions) 2024 2023 2022 Provision for income taxes $ 144.7 $ 82.4 $ 59.4 For 2024 and 2023, the effective tax rate varied from the federal and state statutory rates primarily due to credits generated for research activities, certain nondeductible expenses, excess tax benefits related to stock-based compensation, and losses incurred in foreign jurisdictions for which no tax benefit was recorded as management cannot conclude that it is more likely than not that the tax benefit of such losses will be realized in the future.
For 2024 and 2023, the effective tax rate varied from the federal and state statutory rates primarily due to credits generated for research activities, certain nondeductible expenses, excess tax benefits related to stock-based compensation, and losses incurred in foreign jurisdictions for which no tax benefit was recorded as management cannot conclude that it is more likely than not that the tax benefit of such losses will be realized in the future.
For 2024 compared to 2023, the decrease primarily reflected lower spend on certain early-stage programs in epilepsy and psychiatry, including the successful completions of the Phase 2 programs for osavampator in MDD and NBI-1117568 in schizophrenia, partially offset by increased investments in the Phase 2 program for NBI-1070770 in MDD and certain early-stage muscarinic programs.
For 2024 compared to 2023, the decrease primarily reflected lower spend on certain early-stage epilepsy and psychiatry programs, including the successful completions of the Phase 2 programs for osavampator in MDD and direclidine in schizophrenia, partially offset by increased investments in certain early-stage psychiatry programs and our early-stage muscarinic portfolio. Research and Discovery .
We estimate that tardive dyskinesia affects approximately 800,000 people in the U.S., that approximately 90% of the 40,000 people in the U.S. affected by Huntington’s disease will develop chorea, and that CAH affects approximately 30,000 people in the U.S.
We estimate that TD affects approximately 800,000 people in the U.S., that approximately 90% of the 40,000 people in the U.S. affected by Huntington’s disease will develop chorea, and that CAH affects at least 20,000 people in the U.S.
For 2024 compared to 2023, the decrease primarily reflected the successful completions of the Phase 3 programs for crinecerfont in CAH and Phase 2 program for EFMODY in CAH, partially offset by increased investments in advancing Phase 3 programs for osavampator in MDD and NBI-1117568 in schizophrenia.
For 2024 compared to 2023, the decrease primarily reflected the successful completions of the Phase 3 programs for crinecerfont in CAH, partially offset by increased investments in the Phase 3 programs for osavampator in MDD and direclidine in schizophrenia. Early Stage .
Cash Flows from Investing Activities Periodic fluctuations for all periods presented reflected timing differences related to our purchases, sales, and maturities of debt security investments and changes in our portfolio-mix. For 2023, cash flows from investing activities also reflected a $31.3 million equity investment in Voyager.
Cash Flows from Investing Activities For 2025 compared to 2024 and 2024 compared to 2023, the changes primarily reflected timing differences related to the purchases, sales, and maturities of debt security investments and changes in our portfolio-mix. For 2024 compared to 2023, the change also reflected a $31.3 million equity investment in Voyager in 2023.
For 2023, IPR&D expense reflected the payment of a $143.9 million upfront fee pursuant to the expansion of our collaboration with Voyager.
For 2024 compared to 2023, the decrease primarily reflected the payment of a $143.9 million upfront fee in 2023 pursuant to the expansion of our collaboration with Voyager.
Facilities and other consists of indirect costs incurred for the benefit of multiple programs, including depreciation, information technology, and other facility-based expenses, such as rent expense. For 2024 compared to 2023, the increase primarily reflected increased facility-based expenses related to our new campus facility.
For 2024 compared to 2023, the increase primarily reflected higher headcount. Facilities and Other. Facilities and other consists of indirect costs incurred for the benefit of multiple programs, including facility-based expenses (such as rent expense) and other overhead allocations.
Material Cash Requirements In the pharmaceutical industry, it can take a significant amount of time and capital resources to successfully complete all stages of research and development and commercialize a product candidate, which ultimate length of time and spend required cannot be accurately estimated as it varies substantially according to the type, complexity, novelty and intended use of a product candidate.
Material Cash Requirements In the pharmaceutical industry, it can take a significant amount of time and capital resources to successfully complete all stages of research and development and commercialize a product candidate, which ultimate length of time and spend required cannot be accurately estimated as it varies substantially according to the type, complexity, novelty and intended use of a product candidate. 62 The funding necessary to execute our business strategies is subject to numerous uncertainties and we may be required to make substantial expenditures if unforeseen difficulties arise in certain areas of our business.
For 2023 compared to 2022, the increase primarily reflected increased INGREZZA net product sales, partially offset by increased total payments for upfront fees and development milestones achieved in connection with our collaborations and increased investment in our commercial initiatives and expanded clinical portfolio.
For 2024 compared to 2023, the increase primarily reflected increased total net product sales and decreased total payments for upfront fees and development milestones achieved in connection with our collaborations, partially offset by increased payments for income taxes and continued investments in our commercial organization (including CRENESSITY-related pre-launch activities) and expanded pre-clinical and clinical portfolio.
The liability for such rebates consists of invoices received for claims from prior quarters that remain unpaid, or for which an invoice has not been received, and estimated rebates for the current applicable reporting period.
Such reserves include estimates for government rebates that we are obligated to pay for discounts including under the Medicaid Drug Rebate Program. The liability for such rebates consists of invoices received for claims from prior quarters that remain unpaid, or for which an invoice has not been received, and estimated rebates for the current applicable reporting period.
Selling, General, and Administrative (SG&A) Year Ended December 31, (in millions) 2024 2023 2022 Selling, general, and administrative $ 1,007.2 $ 887.6 $ 752.7 For 2024 compared to 2023, the increase primarily reflected continued investment in our commercial organization, including the recent expansion of our psychiatry and long-term care sales team in September 2024, pre-launch CRENESSITY activities, increased facility expenses related to our new campus facility, and impairment charges of $14.0 million associated with leased office space that has been vacated as we continue to occupy our new campus facility.
Selling, General, and Administrative (SG&A) Year Ended December 31, (dollars in millions) 2025 2024 2023 Selling, general, and administrative $ 1,156.2 $ 1,007.2 $ 887.6 as a % of total revenues 40.4 % 42.8 % 47.0 % For 2025 compared to 2024, the increase primarily reflected continued investment in our commercial organization (including the expansion of our psychiatry and long-term care sales teams completed in September 2024 and CRENESSITY-related headcount and commercial launch activities), partially offset by decreased impairment charges associated with our vacated legacy campus facilities. 60 For 2024 compared to 2023, the increase primarily reflected continued investment in our commercial organization (including the expansion of our psychiatry and long-term care sales teams completed in September 2024 and CRENESSITY-related pre-launch activities), increased facility-based expenses related to our new campus facility, and impairment charges of $14.0 million associated with our vacated legacy campus facilities.
With respect to our existing collaboration and license agreements, we may be required to make potential future payments of up to $17.7 billion upon the achievement of certain milestones.
With respect to our existing collaboration and license agreements, we may be required to make potential future payments of up to $14.87 billion upon the achievement of certain milestones. See Note 11 to the consolidated financial statements for more information on our significant collaboration and license agreements.
For 2024 compared to 2023, the increase reflected increased investments in gene therapy and other preclinical development programs. For 2023 compared to 2022, the increase reflected increased investments in preclinical development programs, including muscarinic agonists, gene therapy, and second generation VMAT2 inhibitors. Milestones. Milestones consists of costs incurred in connection with the achievement of development milestones under our collaborative arrangements.
For 2024 compared to 2023, the increase primarily reflected increased investments in gene therapy and other preclinical development programs. 59 Milestones. Milestones consist of costs incurred in connection with the achievement of development milestones under collaborative arrangements. The following table presents milestones expense by collaboration partner.
Information Regarding Our Financial Condition December 31, (in millions) 2024 2023 Total cash, cash equivalents and marketable securities $ 1,815.6 $ 1,719.1 Working Capital: Total current assets $ 1,724.7 $ 1,607.0 Less total current liabilities 507.7 654.8 Total working capital $ 1,217.0 $ 952.2 Information Regarding Our Cash Flows Year Ended December 31, (in millions) 2024 2023 2022 Cash flows from operating activities $ 595.4 $ 389.9 $ 339.4 Cash flows from investing activities (126.8) (467.1) (177.1) Cash flows from financing activities (486.7) 65.3 (234.3) Effect of exchange rate changes on cash and cash equivalents — 0.3 (1.3) Change in cash, cash equivalents and restricted cash $ (18.1) $ (11.6) $ (73.3) Cash Flows from Operating Activities For 2024 compared to 2023, the increase primarily reflected increased INGREZZA net product sales and decreased total payments for upfront fees and development milestones achieved in connection with our collaborations, partially offset by increased payments for income taxes and continued investments in our commercial organization, including pre-launch CRENESSITY activities, and expanded pre-clinical and clinical portfolios.
However, we cannot provide assurance that adequate funding will be available on terms acceptable to us, if at all. 61 Information Regarding Our Financial Condition December 31, (in millions) 2025 2024 Total cash, cash equivalents and marketable securities $ 2,543.4 $ 1,815.6 Working Capital: Total current assets $ 2,522.7 $ 1,724.7 Less total current liabilities 743.4 507.7 Total working capital $ 1,779.3 $ 1,217.0 Information Regarding Our Cash Flows Year Ended December 31, (in millions) 2025 2024 2023 Cash flows from operating activities $ 782.7 $ 595.4 $ 389.9 Cash flows from investing activities (264.4) (126.8) (467.1) Cash flows from financing activities (38.3) (486.7) 65.3 Effect of exchange rate changes on cash and cash equivalents — — 0.3 Change in cash, cash equivalents and restricted cash $ 480.0 $ (18.1) $ (11.6) Cash Flows from Operating Activities For 2025 compared to 2024, the increase primarily reflected increased total net product sales, partially offset by continued investments in our commercial organization (including the expansion of our psychiatry and long-term care sales teams completed in September 2024 and CRENESSITY-related headcount and commercial launch activities) and expanded pre-clinical and clinical portfolio.
INGREZZA net product sales totaled $2.3 billion for 2024, $1.8 billion for 2023, and $1.4 billion for 2022 and accounted for substantially all of our total net product sales during each of these years.
Net product sales of INGREZZA were $2.51 billion for 2025, $2.31 billion for 2024, and $1.84 billion for 2023 and accounted for a significant portion of our total net product sales during each of these years.
For 2023 compared to 2022, the decrease reflected the achievement of a $20.0 million milestone in 2022 in connection with MTPC's first commercial sale of DYSVAL in Japan. 54 Operating Expenses Cost of Revenues Year Ended December 31, (in millions) 2024 2023 2022 Cost of revenues $ 34.0 $ 39.7 $ 23.2 For 2024 compared to 2023, the decrease primarily reflected the impact of decreased ONGENTYS ® (opicapone) net product sales and lower ONGENTYS inventory reserves in connection with the termination of our license agreement with BIAL, which became effective in December 2023, partially offset by the impact of increased INGREZZA net product sales.
For 2024 compared to 2023, the decrease primarily reflected decreased net product sales of ONGENTYS ® (opicapone) and decreased ONGENTYS inventory reserves in connection with the termination of our license agreement with BIAL, which became effective in December 2023, partially offset by increased net product sales of INGREZZA.
Refer to Note 2 to the consolidated financial statements for more information on our significant collaboration and license agreements. 59 Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations is based upon financial statements that we have prepared in accordance with accounting principles generally accepted in the United States of America (GAAP).
As of December 31, 2025, we had $332.3 million remaining available for additional repurchases under the 2025 Repurchase Program. Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations is based upon financial statements that we have prepared in accordance with accounting principles generally accepted in the United States of America (GAAP).
Year Ended December 31, (in millions) 2024 2023 2022 Late stage $ 101.8 $ 106.1 $ 68.7 Early stage 96.1 107.4 81.1 Research and discovery 145.6 96.5 63.7 Milestones 71.7 0.8 42.7 Payroll and benefits 236.7 206.7 163.8 Facilities and other 79.2 47.5 43.8 Research and development $ 731.1 $ 565.0 $ 463.8 Late Stage.
For several of our programs, the research and development activities are part of our collaborative arrangements. 58 Year Ended December 31, (dollars in millions) 2025 2024 2023 Late stage $ 190.7 $ 101.8 $ 106.1 Early stage 72.4 96.1 107.4 Research and discovery 244.2 145.6 96.5 Milestones 65.4 71.7 0.8 Payroll and benefits 306.4 236.7 206.7 Facilities and other 136.6 79.2 47.5 Total research and development $ 1,015.7 $ 731.1 $ 565.0 as a % of total revenues 35.5 % 31.0 % 29.9 % Late Stage.
For 2023 compared to 2022, the increase primarily reflected increased INGREZZA net product sales, increased interest income on our debt security investments, and decreased debt extinguishment charges in connection with the repurchase of the 2024 Notes in 2022, partially offset by increased total payments for upfront fees and development milestones achieved in connection with our collaborations and increased investments in our commercial initiatives and expanded clinical portfolio. 57 Liquidity and Capital Resources Sources of Liquidity We believe that our existing capital resources, funds generated by anticipated INGREZZA net product sales, and investment income will be sufficient to satisfy our current and projected funding requirements for at least the next 12 months.
Liquidity and Capital Resources Sources of Liquidity We believe that our existing capital resources, funds generated by anticipated INGREZZA and CRENESSITY net product sales, and investment income will be sufficient to satisfy our current and projected funding requirements for at least the next 12 months.
Acquired In-Process Research and Development (IPR&D) Year Ended December 31, (in millions) 2024 2023 2022 Acquired in-process research and development $ 12.5 $ 143.9 $ — For 2024, IPR&D expense primarily reflected the payment of a $6.0 million upfront fee pursuant to our collaboration with Biocytogen Pharmaceuticals (Beijing) Co., Ltd.
Acquired In-Process Research and Development (IPR&D) Year Ended December 31, (dollars in millions) 2025 2024 2023 Acquired in-process research and development $ 17.4 $ 12.5 $ 143.9 as a % of total revenues 0.6 % 0.5 % 7.6 % For 2025 compared to 2024, the increase primarily reflected higher upfront payments under licensing agreements for early-stage development candidates.
For 2024 compared to 2023, cash flows from financing activities also reflected a $300.0 million payment to a third-party financial institution to repurchase shares of the Company’s common stock under a share repurchase program that was authorized by our Board of Directors in October 2024 and the settlement of the 2024 Notes in full for $308.8 million in cash.
For 2024 compared to 2023, the change reflected $300.0 million of share repurchases under the 2024 Repurchase Program, $308.8 million in cash payments to settle the convertible senior notes that matured in May 2024, and increased proceeds from issuances of our common stock.
For 2023 compared to 2022, the increase in total other income, net, primarily reflected increased interest income on our debt security investments and decreased debt extinguishment charges in connection with the repurchase of the 2024 Notes in 2022.
For 2024 compared to 2023, the change primarily reflected $138.4 million of expense associated with the convertible senior notes that matured in May 2024, periodic fluctuations in the fair values of our equity investments, and increased interest income on our debt security investments.
We may also seek additional funding through strategic alliances or other financing mechanisms. However, we cannot provide assurance that adequate funding will be available on terms acceptable to us, if at all.
We may also seek additional funding through strategic alliances or other financing mechanisms.
Late stage consists of costs incurred for product candidates in Phase 2 registrational studies and all subsequent activities.
Late stage consists of costs incurred for product candidates in Phase 2 registrational studies and all subsequent activities. For 2025 compared to 2024, the increase primarily reflected increased investments in the Phase 3 programs for osavampator in MDD and direclidine in schizophrenia, partially offset by lower spend on crinecerfont in CAH.
Additionally, in 2024, we incurred a loss on the extinguishment of debt that was nondeductible for tax purposes. For 2022, the effective tax rate varied from the federal and state statutory rates primarily due to credits generated for research activities and certain nondeductible expenses, including the premium paid on the repurchase of the 2024 Notes in 2022.
Additionally, in 2024, we incurred a loss on the extinguishment of debt that was nondeductible for tax purposes.
Results of Operations Revenues Net Product Sales Year Ended December 31, (in millions) 2024 2023 2022 INGREZZA $ 2,313.5 $ 1,836.0 $ 1,427.8 Other 17.1 24.6 13.1 Total net product sales $ 2,330.6 $ 1,860.6 $ 1,440.9 For 2024 compared to 2023, the increase primarily reflected increased INGREZZA net product sales driven by strong underlying patient demand and improved gross-to-net dynamics.
Operating Expenses Cost of Revenues Year Ended December 31, (dollars in millions) 2025 2024 2023 Cost of revenues $ 52.1 $ 34.0 $ 39.7 as a % of total revenues 1.8 % 1.4 % 2.1 % For 2025 compared to 2024, the increase primarily reflected increased net product sales of INGREZZA and increased royalties payable on net product sales of CRENESSITY.
Business Highlights • INGREZZA net product sales for 2024 increased $477.5 million, or 26.0%, to $2.3 billion, reflecting strong underlying patient demand and improved gross-to-net dynamics. • In December 2024, we received FDA approval for CRENESSITY capsules and oral solution as an adjunctive treatment of CAH and launched CRENESSITY in the U.S. as a first-in-class FDA-approved treatment of CAH.
Net product sales of CRENESSITY were $301.2 million for 2025 during its first full-year of launch. 2025 Business Highlights • Total net product sales for 2025 increased $503.3 million, or 21.6%, to $2.83 billion, reflecting increased net product sales of CRENESSITY, which was launched in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024, and INGREZZA, driven by record total prescriptions on strong patient demand, partially offset by a lower net price due to new market access investments to support long-term growth. • In October 2025, we announced the planned expansion of the INGREZZA and CRENESSITY sales teams to maximize our commercial momentum.
For 2023 compared to 2022, the increase primarily reflected increased investments in certain early-stage programs in psychiatry, partially offset by lower spend on early-stage programs in epilepsy. 55 Research and Discovery . Research and discovery consists of costs incurred prior to the approval of an investigational new drug application by the applicable regulatory agency.
Research and discovery consists of costs incurred prior to the approval of an investigational new drug application by the applicable regulatory agency, including discovery research and preclinical development activities (such as lead optimization, nonclinical studies, preclinical manufacturing, and toxicology).
Removed
Our partner Mitsubishi Tanabe Pharma Corporation (MTPC) launched DYSVAL ® (valbenazine) in Japan for the treatment of tardive dyskinesia in June 2022 and subsequently in other select Asian markets, where it is marketed as REMLEAS ® (valbenazine). We receive royalties at tiered percentage rates on MTPC net sales of valbenazine.
Added
The expansion is expected to be completed by the end of the first quarter of 2026. • Appointed Sanjay Keswani, M.D., as Chief Medical Officer (CMO) and member of our executive management team, effective June 2, 2025. • In February 2025, our Board of Directors authorized a new share repurchase program (the 2025 Repurchase Program) under which we may repurchase up to $500.0 million of our common stock, subject to market conditions.
Removed
Our partner AbbVie launched ORILISSA ® (elagolix tablets) in the U.S. for the treatment of endometriosis in August 2018 and ORIAHNN ® (elagolix, estradiol and norethindrone acetate capsules and elagolix capsules) in the U.S. for the treatment of heavy menstrual bleeding due to uterine fibroids in June 2020.
Added
The 2025 Repurchase Program is in addition to the $300.0 million accelerated repurchase program (the 2024 Repurchase Program) that was announced in October 2024 and completed in February 2025.
Removed
We receive royalties at tiered percentage rates on AbbVie net sales of elagolix.
Added
During 2025, we repurchased 1.5 million shares on the open market under the 2025 Repurchase Program and received an additional 0.3 million shares upon settlement of the 2024 Repurchase Program in February 2025. 56 • In January 2025, we received Centers for Medicare and Medicaid Services (CMS) notification that INGREZZA qualifies for the small biotech exception under the Medicare Drug Price Negotiation Program, which provides exemption from selection until 2027 for initial price applicability in 2029.
Removed
We estimate that CAH affects approximately 30,000 people in the U.S. 52 • Kevin Gorman, Ph.D., retired as Chief Executive Officer (CEO) effective October 11, 2024. Kyle Gano, Ph.D., formerly Neurocrine’s Chief Business Development and Strategy Officer, succeeded Dr. Gorman in the CEO role and also joined the Company’s Board of Directors at that time. Dr.
Added
In addition, we expanded formulary access for INGREZZA, significantly improving coverage to include approximately 70% of TD and Huntington's disease Medicare beneficiaries to support long-term growth. 2025 Pipeline Highlights • Announced the initiation of a Phase 2 clinical study of investigational compound NBI-1065890 in adults with TD.
Removed
Gorman continues to serve on the Company’s Board. • Received notification from the Centers for Medicare and Medicaid Services that INGREZZA qualified for the Specified Small Manufacturer Exception pertaining to the Part D redesign of the Inflation Reduction Act. • Settled the convertible senior notes due May 15, 2024 (the 2024 Notes) in full in cash upon maturity. • Deployed expanded INGREZZA psychiatry and long-term care sales teams to better serve patients by accelerating the number of people who are diagnosed and treated for tardive dyskinesia and chorea associated with Huntington's disease with INGREZZA. • Repurchased and retired an initial delivery of 2.0 million shares of the Company’s common stock pursuant to previously announced $300.0 million accelerated share repurchase (ASR) program.
Added
NBI-1065890 is a next-generation, selective inhibitor of VMAT2. • Initiated a comprehensive Phase 3 clinical program for direclidine (NBI-1117568) in schizophrenia, including studies evaluating efficacy in acutely psychotic hospitalized patients and long-term safety.
Removed
The program was completed in February 2025, at which time we became contractually entitled to receive an additional 0.3 million shares upon settlement.
Added
In addition, we initiated a Phase 2 study evaluating direclidine in bipolar mania in the fourth quarter of 2025. • Initiated a comprehensive Phase 3 clinical program for osavampator (NBI-1065845) in major depressive disorder (MDD), including three acute randomized, double‑blind, placebo‑controlled studies, a randomized‑withdrawal maintenance‑of‑effect study, and a long‑term open‑label safety extension. • Initiated a Phase 1 clinical study for NBIP-01435, an investigational, long-acting corticotropin-releasing factor type 1 (CRF-1) receptor antagonist administered as a subcutaneous injection for the potential treatment of CAH. • Initiated a Phase 1 clinical study for NBI-921355, an investigational, selective inhibitor of voltage-gated sodium channels Na v 1.2 and Na v 1.6 in development for the potential treatment of certain types of epilepsy. • Initiated a Phase 1 clinical study for NBI-1140675, an investigational, oral, selective second-generation small molecule VMAT2 inhibitor in development for the potential treatment of certain neurological and neuropsychiatric conditions. • Announced top-line data from a Phase 4 study, KINECT-PRO™, demonstrating clinically meaningful and sustained effects of INGREZZA capsules on the physical, social, and emotional impacts experienced by patients living with TD, irrespective of TD severity or underlying psychiatric condition. • Presented new data from a post-hoc analysis of the Phase 4 KINECT-PRO open-label study confirming that robust rates of symptomatic remission of TD were achieved with once-daily INGREZZA capsules.
Removed
Pipeline Highlights • Announced the initiation of the Phase 3 program for osavampator (formerly NBI-1065845), a potential first-in-class alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid (AMPA) positive allosteric modulator (PAM) in development for patients with inadequate response to treatment of major depressive disorder (MDD). • Announced amendment to strategic collaboration with Takeda Pharmaceutical Company Limited (Takeda) to develop and commercialize osavampator.
Added
The analysis also showed sustained improvements in patient-reported outcomes among participants who achieved symptomatic remission. • Presented new data from the Phase 2 SAVITRI™ study, which showed statistically significant and clinically meaningful improvement in depression severity at Day 28 and Day 56 with once-daily oral administration of 1 mg osavampator. • Announced the Phase 3 studies of valbenazine in schizophrenia and dyskinesia due to cerebral palsy (DCP) and Phase 2 study of NBI-1070770 in major depressive disorder (MDD) did not meet their primary endpoints.
Removed
Under the amended agreement, we will retain exclusive rights for all indications to develop and commercialize osavampator in all territories worldwide except Japan, where Takeda will have exclusive rights.
Added
Results of Operations Year Ended December 31, (in millions, except per share data) 2025 2024 2023 Revenues $ 2,860.5 $ 2,355.3 $ 1,887.1 Operating expenses 2,241.4 1,784.8 1,636.2 Operating income 619.1 570.5 250.9 Other income (expense) 86.3 (84.5) 81.2 Provision for income taxes 226.8 144.7 82.4 Net income $ 478.6 $ 341.3 $ 249.7 Earnings per share, diluted $ 4.67 $ 3.29 $ 2.47 Weighted average common shares outstanding, diluted 102.5 103.7 101.0 57 Revenues Year Ended December 31, (in millions) 2025 2024 2023 INGREZZA $ 2,513.7 $ 2,313.5 $ 1,836.0 CRENESSITY 301.2 1.7 — Other 19.0 15.4 24.6 Total net product sales 2,833.9 2,330.6 1,860.6 Collaboration revenues 26.6 24.7 26.5 Total revenues $ 2,860.5 $ 2,355.3 $ 1,887.1 Net Product Sales For 2025 compared to 2024, the increase primarily reflected increased net product sales of CRENESSITY, which was launched in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024, and INGREZZA, driven by record total prescriptions on strong patient demand, partially offset by a lower net price due to new market access investments to support long-term growth.
Removed
Under the terms of the updated agreement, each company is responsible for development costs in their respective region, and both companies are eligible to receive royalty payments. • Announced the initiation of the Phase 1 clinical study to evaluate the safety, tolerability, pharmacokinetics, and pharmacodynamics of investigational compound NBI-921355 in healthy adult participants.
Added
For 2024 compared to 2023, the increase primarily reflected increased net product sales of INGREZZA driven by strong underlying patient demand and improved gross-to-net dynamics. Collaboration Revenues Collaboration revenues for all periods presented primarily reflected royalties earned on AbbVie net sales of elagolix and Tanabe Pharma Corporation (formerly Mitsubishi Tanabe Pharma Corporation) net sales of valbenazine.
Removed
NBI-921355 is an investigational, selective inhibitor of voltage-gated sodium channels Nav1.2 and Nav1.6 and in development for the potential treatment of certain types of epilepsy. • Presented subgroup analyses and data from the KINECT ® -HD study showing the impact of INGREZZA capsules on emotional health and psychiatric stability in patients with chorea associated with Huntington's disease.
Added
In addition, cost of revenues for 2025 excluded costs that were charged to R&D expense prior to FDA approval of CRENESSITY. As a result, this lower-cost drug product reduced our cost of revenues and improved related product gross margins for 2025.
Removed
The subgroup analysis showed consistent efficacy in reducing chorea compared to placebo across all identified subgroups, categorized by demographics and baseline assessment scores. A separate data analysis showed improvements in some aspects of emotional health with no worsening of psychiatric symptoms. • Presented data from more than 300 patients diagnosed with tardive dyskinesia and treated with INGREZZA capsules.
Added
In future periods, we expect to incur a higher cost of revenues that includes the cost of CRENESSITY active pharmaceutical ingredients produced following FDA approval.
Removed
These data showed significant improvements in functional, social, emotional, and health-related quality of life measures in Phase 3 and 4 studies and improvements in functional, social, independence, emotional, and physical aspects of patients' lives and antipsychotic adherence in real-world practice. • Announced positive topline data for the Phase 2 study of NBI-1117568, a first-in-class, orally active, highly selective investigational M4 agonist, in development as a potential treatment for schizophrenia.
Added
For 2025 compared to 2024, the decrease primarily reflected the progression of the Phase 2 program for direclidine in schizophrenia to late-stage in the fourth quarter of 2024 and lower spend on certain early-stage psychiatry programs, partially offset by increased investment in our early-stage muscarinic portfolio and the advancements of NBI‑921355, NBI-1140675, and NBIP-01435 into Phase 1 development.
Removed
The successful completion of the Phase 2 study triggered a $35.0 million milestone payment to Nxera Pharma UK Limited (Nxera) in 2024.
Added
For 2025 compared to 2024, the increase primarily reflected increased investments to expand our discovery and preclinical programs across therapeutic areas and modalities, including endocrinology and metabolic disease (including obesity) and immunology, and expanding our capabilities in biologics (including peptides and antibodies) and gene therapy.
Removed
We expect to advance NBI-1117568 into Phase 3 development in the first half of 2025, which would trigger an additional $15.0 million milestone payment to Nxera upon initiation of the Phase 3 study. • Announced positive topline data for the Phase 2 SAVITRI™ study.
Added
Year Ended December 31, (in millions) 2025 2024 2023 Nxera Pharma UK Limited $ 15.0 $ 50.0 $ — Takeda Pharmaceutical Company Limited 37.5 7.5 — Xenon Pharmaceuticals Inc. 7.5 — — Voyager Therapeutics, Inc. 3.0 11.0 — Other 2.4 3.2 0.8 Total milestones $ 65.4 $ 71.7 $ 0.8 See Note 11 to the consolidated financial statements for more information on our significant collaboration and license agreements.
Removed
This randomized, double-blind, placebo-controlled dose-finding study assessed the efficacy and safety of osavampator in adult subjects with MDD. • At the Endocrine Society Annual Meeting (ENDO 2024), presented new Phase 3 clinical study data from the CAHtalyst™ registrational studies of crinecerfont in pediatric and adult patients with CAH.
Added
For 2025 compared to 2024, the increase primarily reflected higher headcount (including an increase of $22.2 million in non-cash stock-based compensation expense) to support our expanded discovery and preclinical programs across therapeutic areas and modalities, including endocrinology and metabolic disease (including obesity) and immunology, and expanding our capabilities in biologics (including peptides and antibodies) and gene therapy.
Removed
In parallel, announced that the primary study results from the CAHtalyst™ registrational studies of crinecerfont in pediatric and adult patients with CAH have been published in The New England Journal of Medicine. • Initiated Phase 2 study of NBI-1070770 in adults with MDD.
Added
For 2025 compared to 2024 and 2024 compared to 2023, the increases primarily reflected increased facility-based expenses related to our new campus facility.
Removed
NBI-1070770 is a novel, selective, and orally active, negative allosteric modulator (NAM) of the NR2B subunit-containing N-methyl-D-aspartate (NMDA NR2B) receptor. 53 • Initiated Phase 1 study of NBI-1117567 in healthy adult participants.
Added
Provision for Income Taxes Year Ended December 31, (dollars in millions) 2025 2024 2023 Provision for income taxes $ 226.8 $ 144.7 $ 82.4 Effective tax rate 32.2 % 29.8 % 24.8 % For 2025, the effective tax rate differed from the federal and state statutory rates primarily due to foreign tax effects, including the impact of global intangible low-taxed income (GILTI), credits generated for research activities, excess tax benefits related to stock-based compensation, certain nondeductible expenses, and state income tax effects including fluctuations in state effective tax rates.
Removed
NBI-1117567 is an investigational, oral, M1/M4 (M1 preferring) selective muscarinic agonist for the potential treatment of neurological and neuropsychiatric conditions. • Initiated Phase 1 study of NBI-1076968 in healthy adult participants.
Added
The increase in accounts receivable was driven by higher total gross product sales. The increase in accounts payable and accrued liabilities was driven primarily by higher revenue-related reserves for discounts and allowances attributed to higher gross product sales combined with expanded formulary access for INGREZZA.
Removed
NBI-1076968 is an investigational, oral, M4 subtype-selective muscarinic antagonist for the potential treatment of movement disorders. • Received approval from the FDA for INGREZZA ® SPRINKLE (valbenazine) capsules, a new oral granules formulation of INGREZZA capsules, and subsequently launched new sprinkle formulation of INGREZZA capsules for the treatment of adults with tardive dyskinesia and chorea associated with Huntington’s disease. • Presented KINECT ® -HD2 interim data at the 2024 MDS International Congress of Parkinson’s Disease and Movement Disorders demonstrating robust and sustained improvements in chorea associated with Huntington’s disease through week 104 irrespective of antipsychotic use. • Announced the ERUDITE™ Phase 2 study of luvadaxistat (NBI-1065844) in cognitive impairment associated with schizophrenia (CIAS) did not meet its primary endpoint.
Added
In addition, the change in income tax assets and liabilities primarily related to timing of foreign tax expense recognition, partially offset by the federal tax benefit on current income taxes payable from the enactment of the OBBBA.
Removed
In addition, we provided Takeda with written notice of termination of the license agreement to develop and commercialize luvadaxistat and NBI-1065846. The termination is anticipated to be effective in April 2025. • Provided Idorsia Pharmaceuticals Ltd. with written notice of termination of the license agreement to develop and commercialize NBI-827104. The termination became effective in January 2025.
Added
Cash Flows from Financing Activities For 2025 compared to 2024, the change primarily reflected decreased share repurchases under the 2025 Repurchase Program compared to the 2024 Repurchase Program and decreased cash payments associated with the convertible senior notes that matured in May 2024.
Removed
For 2023 compared to 2022, the increase primarily reflected increased INGREZZA net product sales on higher prescription demand and increased commercial activities, including continued investment in our branded direct-to-consumer INGREZZA advertising campaign and benefit from the expansion of our sales force completed in April 2022.
Added
Share Repurchase Program In addition to the foregoing future capital requirements, in February 2025, our Board of Directors authorized the 2025 Repurchase Program under which we may repurchase up to $500.0 million of our common stock, subject to market conditions.

… 16 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed1 unchanged
Biggest changeThe primary objective of our investment activities is to preserve principal and maintain liquidity. If a 1% unfavorable change in interest rates were to have occurred on December 31, 2024, it would not have had a material effect on the fair value of our investment portfolio as of that date. 61
Biggest changeThe primary objective of our investment activities is to preserve principal and maintain liquidity. If a 1% unfavorable change in interest rates were to have occurred on December 31, 2025, it would not have had a material effect on the fair value of our investment portfolio as of that date. 64

Other NBIX 10-K year-over-year comparisons