Soleno Therapeutics Inc (SLNO) 2025 Q3 法說會逐字稿

Good afternoon and thank you for standing by. Welcome to Soleno Therapeutics Third quarter 2025 Financial and operating results conference call and webcast. [Operator Instructions]

I would now like to introduce Brian Ritchie of LifeSci Advisors. Please go ahead.

Thank you. Good afternoon, everyone, and thank you for joining us to discuss Soleno Therapeutics Third quarter 2025 Financial and Operating Results. Please note, we will be making certain forward-looking statements today.

We refer you to Solano's SEC filings for a discussion of the risks that may cause actual results to differ from the forward-looking statements.

On the call with me today for Soleno are Anish Bhatnagar, Soleno's Chairman and Chief Executive Officer, Meredith Manning, Soleno's Chief Commercial Officer, and Jim Mackaness Soleno's Chief Financial Officer.

With that, I will now turn the call over to Anish.

Thank you, Brian, and thank you everyone for joining us for our third quarter results call this afternoon.

Following my brief opening remarks, Meredith will review the company's commercialization progress to date, and Jim will cover the company's financial statements for the third quarter. We will then open the call for questions.

We had an outstanding third quarter building on the strong launch momentum from our second quarter. Our total net revenue more than doubled from the second quarter to USD66 million and the company achieved profitability with a positive net income of USD26 million for the third quarter.

Our leading indicators, including patients start forms, unique prescribers, and numbers of lives covered, reflect growing awareness of VYKAT XR's potential to improve hyperphagia in those with PWS.

As the first and only FDA approved treatment for patients 4 years and older, for the primary feature of PWS, which is hyperphagia, VYKAT XR is providing a meaningful solution to individuals living with PWS, their caregivers, and physicians.

I would like to take a moment to reiterate the complexity of Prader-Willi syndrome. In addition to the hallmark symptom of hyperphagia, people with PWS suffer from a broad range of potentially serious comorbidities, as well as significant behavioral problems.

And while people with PWS are living longer, some into their 50s and older, the mean age of death unfortunately still stands at around 30 years old.

Patients with PWS experience a very high burden of disease compared to the general population. In particular, comorbidities associated with fluid overload, diabetes, respiratory failure, and congestive heart failure are common.

In a recently published registry of patients with PWS in Sweden, Gaeke and colleagues observed a greater than 20-fold increase in heart failure, a tenfold increase in venous thrombosis, and a five-fold increase in atrial fibrillation and pulmonary embolism.

In a 40 year survey of mortality in patients with PWS, Butler and colleagues reported that respiratory failure and cardiac disease and cardiac failure together accounted for nearly half of all fatalities.

The most common causes of death are respiratory failure, uncontrolled hyperphagia, and hyperphagia-related behaviors, cardiac causes, infection, obesity, and pulmonary embolism, with each accounting for greater than 5% of deaths.

A recent study in 2020 revealed that the mortality rate in people with PWS is substantially higher than the general US population at 2.7%. This translates to over 300 fatalities per year, assuming a population of approximately 12,000 people living with PWS in the US.

The Wear XR clinical program established both substantial evidence of efficacy and a safety profile deemed approvable by the FDA based on a comprehensive phase three clinical program in 127 patients with over 400 patient years of exposure, including patients with nearly six years of continuous treatment.

At the end of Q3, at approximately six months in market, we had 764 active patients. Our real world experience, including efficacy, side effects, and discontinuation rates related to therapy, have been in line with our expectations.

As discussed in VYKAT XR's FDA approved label, the most common adverse events reported in our clinical trials were hypertrichosis, edema, hyperglycemia, and rash.

Most adverse events were self-limiting, with some needing dose adjustments, interruption, or other concomitant treatment. In particular, regarding fluid retention related adverse events post launch.

We see on a percent basis the incidence being lower than what we saw in clinical trials in spite of the post launch patients being more complex and having more comorbidities.

Since approval, the discontinuation rate of VYKAT XR related to AEs was approximately 8% at the end of the third quarter, and the total discontinuation was approximately 10%.

While the discontinuation rate has increased, it remains below our expected long-term rate based on our clinical trial data.

It is worth noting that we did see a disruption in our launch trajectory in the wake of a short seller report that was released in mid-August, mostly in the form of a lower number of start forms and increased discontinuations for non-serious adverse events.

As we have anticipated, we have started to see patients return to therapy, often as withdrawal of VYKAT XR can bring a rapid return of PWS symptoms.

We continue to educate physicians and families in the compelling clinical profile of VYKAT XR and we dedicated significant resources to these activities during the third quarter.

Our team of patient and community educators known as the PACE team is educating families and caregivers on therapy expectations, administration, and monitoring at the time of first dose, and throughout the patient journey.

We're also hosting live community events in collaboration with advocacy organizations, healthcare providers, and caregivers of individuals already on VYKAT XR so they can share their experience with other caregivers contemplating initiating treatment.

We're continuing our HCP education initiatives, including facilitating physician to physician programs, which allows physicians to learn more about VYKAT XR from experts who have experienced treating patients with PWS related hyperphagia.

Selena has received positive feedback on our engagement with the stakeholders in the PWS community, and we believe this will continue to fuel our growth and allow us to establish VYKAT XR as a standard of care for hyperphagia and those living with PWS.

I would now like to provide a brief update on our activities in support of potential approval of DCCR in Europe. As we market DCCR in the US as BAR.

In parallel with our US commercial launch, we have continued to progress along regulatory pathways and other geography, the most prominent of which is the EU. In May we announced the submission and EMA validation of our marketing authorization application.

We received day 120 questions during the past quarter and are preparing our responses at this time. The nature of the questions are generally similar to what we discussed with the US FDA during the approval process.

Gaining approval to market DCCR in the EU would represent a meaningful expansion of our addressable market and remains a priority for us while we continue to progress our US launch.

Based on widely cited prevalence data, it is estimated that there are as many as 9,500 people living with PWS in France, Germany, Italy, Spain, and the UK combined.

Diagnostic rates are high. Patient care is often concentrated around centers of excellence, and as with the US, the PWS community has strong thought leader support. We will continue to keep you apprised of our progress there and in other territories.

I will now turn the call over to Meredith to provide an update on the launch, Meredith.

Thank you, Aneesh, and good afternoon, everyone. As Anish mentioned, since approval, we've made remarkable progress in launching VYKAT XR.

Our success driving broad awareness and adoption reflects discipline execution grounded in effectively introducing VYKAT XR to the prescriber community, individuals with PWS, their caregivers and payers.

We also attribute our launch success to Soleno's steadfast commitment to educating stakeholders, sharing individuals' experience on VYKAT XR therapy, and robust payer access. Soleno field teams are dedicated to ensuring comprehensive educational support on therapeutic expectations.

Appropriate dosing and comprehensive monitoring, all critical factors for successfully integrating VYKAT XR into clinical practice and optimizing patient outcomes.

It is worth noting that many prescribers and academic centers are still in the process of setting up their designated PWS clinics.

As a reminder, VYKAT XR is indicated to treat hyperphasia in adults and children four years of age and older with Prader-Willi syndrome.

And hyperphasia is defined as extreme hunger, constant thoughts about food, and constant urge to eat that cannot be satisfied with food.

Throughout the last several months, we have been hearing from families who are seeing meaningful benefit after completing titration and finding their optimal dose.

While all experiences with VYKAT XR are unique, these experiences continue to reinforce the possibilities and real world impact of VYKAT XR.

And through our responsibility to comprehensive education, we always encourage people to review the full prescribing information and medication guide for important safety information, which can be found on vykatxr.com.

Our commitment to patient services and market access underpins these efforts, ensuring timely access and reimbursement across all payer channels. I will now share the results of our key performance indicators, patient start forms, unique prescribers, and number of covered lives.

Cumulative patient start forms from launch through September 30 totaled 1,043, of which 397 were in the third quarter.

We previously commented that obtaining 646 patient start forms in our first quarter of launch was outstanding and included a bolus. We recognized the rapid uptake was due to strong operational excellence, a large unmet need, and pent up demand that carried into the early part of Q3.

By the end of Q3, 764 individuals were actively treated with ViCA XR. We believe.

That as more and more success stories are shared with the community, they will help create a firm foundation for continued growth.

The second performance indicator is the number of prescribers. We are continuing to make great strides with expanding our prescriber base. In Q3, we added an additional 199 new prescribers, bringing total unique prescribers as of September 30 to 494.

Third quarter performance highlights significant progress within our key accounts. Over 50% of our top 300 providers have submitted start forms, signaling strong adoption.

Importantly, a significant share of SAR forms originated from healthcare providers who are associated with our KOL network. This is underscoring the effectiveness of our ability to educate physicians who play a pivotal role in influencing practice patterns.

We are also seeing strong adoption among community treaters, highlighting our expanded reach and continued growth beyond our core targets.

We have further strengthened our messaging this quarter by spotlighting real patient experiences, launching a new campaign, Make space for what matters that highlights VYKAT XR as a treatment that has the potential to lessen the relentless burden of hyperphasia, creating mental space for individuals living with PWS to focus on what truly matters to them.

Our third performance indicator is payer policies. We have been working diligently to secure broad coverage for VYKAT XR, resulting in policies that cover approximately 132 million lives at the end of the third quarter, including coverage policies with appropriate criteria from the top three national PBMs.

We have achieved broad access coverage across all channels, commercial, Medicaid and Medicare, with a strong uptick in state Medicaid coverage where we had received reimbursed claims from approximately 40 state Medicaid programs through Q3.

As I stated during our last earning earnings call, these positive coverage decisions demonstrate payers recognizing the seriousness of PWS and that that pairers recognize the seriousness of PWS, understand the true unmet need in treating hyperphasia, and appreciate the meaningful value VYKAT XR can deliver.

This is great progress this early in launch because one of the perceived barriers to adoption. Among prescribers is the lack of coverage or the lengthy reimbursement path.

As we move forward, we continue to invest in stakeholder awareness, education, and access resources to ensure every individual being treated with VYKAT XR, their family, and clinician feels supported throughout the treatment journey.

I will now turn the call over to Jim for a review of the company's financial statements for the third quarter.

Thank you, Meredith.

Total net revenue for the third quarter ended September 30, 2025 with USD66.0 million, which was more than doubled from USD32.7 million in the second quarter of 2025, and we achieved profitability with a positive net income of USD26.0 million for the quarter.

In addition, we generated USD43.5 million of cash from operating activities during the three months ended September 30.

At the end of the third quarter, we had USD556.1 million of cash equivalents and marketable securities. This includes the USD230 million of gross proceeds that we raised to an underwritten offering of our common stock in July.

Our strong balance sheet ensures that we are sufficiently capitalized to continue to execute on an effective US launch of VYKAT XR while in parallel progressing towards regulatory approval and commercialization either on a stand-alone basis or with partners in the EU and other geographies.

As a reminder, VYKAT XR was approved in March of this year and therefore the company generated no revenue in the third quarter ended September 30, 2024.

Cost of goods sold was USD1.1 million for the third quarter. Please note that prior to the FDA approval, costs associated with manufacturing VYKAT XR were expensed as research and development expenses.

As such, a portion of the cost of goods sold during the period included inventory at zero cost. Going forward, as we continue to sell VYKAT XR, we will deplete our zero cost inventory and replenish it with at cost inventory, and consequently, cost of goods sold as a percentage of revenue will increase.

Research and development expense for the third quarter was USD8.4 million, which includes USD2.2 million of non-cash stock-based compensation compared to USD30.1 million, which includes USD18.5 million of non-cash stock-based compensation for the same period of 2024.

The cadence of our research and development expenditures fluctuates depending upon the state of our clinical programs, timing of manufacturing, and other projects as we move through submission, approval, and now commercialization.

Selling general and administrative expense for the third quarter ended September 30, 2025 was USD33.8 million, which includes USD7.8 million of non-cash stock-based compensation compared to USD49.2 million, which includes USD38.1 million of non-cash stock-based compensation for the same period of 2024.

The increase in expense after removing stock-based compensation reflects our ongoing investment in additional personnel and new programs to support VYKAT XR commercial launch and in support of our increased business activities.

Total other income net was USD3.9 million for the three months ended September 30, 2025, compared to total other income net of USD3.6 million in the same period of 2024.

Net income was approximately USD26.0 million or USD0.49 per basic and USD0.47 per diluted share for the third quarter ended September 30, 2025 compared to a net loss of USD76.6 million or USD1.83 per basic I diluted share for the same period in 2024.

This concludes the financial overview, and I'll now turn the call back over to Anish for closing remarks. Anish.

Thank you, Jim. In closing, we're very pleased with the trajectory we're on, and we will continue to work tirelessly to make the safe and effective therapy available to as many people living with PWS related hyperphagia as possible.

We had an outstanding Q3 marked by noteworthy advancements in each of our key metrics from start forms to new prescribers to lives covered, all resulting in the doubling of our revenues from Q2 and leading to the company being cash flow positive.

We look forward to continuing to deliver on the successful launch we have seen to date. And with that, we'll now open the call for questions.

[Operator Instructions]

Thank you. Our first question comes from the line of Paul Shoy from Goldman Sachs. Your line is open.

Hi, congrats on the good performance in the quarter, with regard to to to the sales.

My first question for the team is, can you maybe comment on the restart rate with regard to the discontinuations you're seeing any color from the field in terms of how many patients are restarting and sort of the time to restart there would be helpful and then second.

In terms of the number of patients on active drug that you disclosed with the press release, can you maybe comment on just how many of those are still waiting for insurance clearance versus the the patient start forms, any color there helping us connect the dots would be great. Thanks for taking the questions.

Sure. Thanks, Paul. So, on the restart, this is early. So we're just starting to see it now. There's a handful of people who've already started and we've anecdotally heard of others who are planning to start. So this is not a metric we can give meaningful numbers on, but it's early.

Your second question around number of patients on active drug, Meredith, do you want to answer that? Yeah.

So, I think Paul what you're looking at is active versus or paid versus free and that's still a number that we're not reaching steady state and evolving so all of the 764 have claims that are being reimbursed is that the is that exactly what you're asking for?

Maybe just some clarity, any color you can offer on the lag time between the start forms and the patients actually getting getting coverage that would be helpful too just so we can sort of triangulate maybe, how many patients might be backfilled in in the quarter to come.

Yeah, Jim. Go ahead.

Yeah, so, I've been working closely with the specialty pharmacy on this. So, you get your start forms and then obviously there's a discontinuation cancellation that we've spoken to and then we're seeing the fill rate, somewhere around 30 days.

It's plus and minus, obviously depending on where the patient comes from and the amount of time to get through the benefits, but probably we're carrying about 1 month in backlog if you like, of start forms.

Okay great thank you for taking the questions.

Thanks, Paul.

Our next question is from Tyler Van Buren from PD call and your line is open.

Hey guys, congratulations on another strong quarter of sales and achieving profitability. Curious to hear you elaborate on the impact on discontinuations and lower patient start forms due to the short report during the quarter, and I guess how you're confident that it had an impact.

And then, is this impact going away as we enter Q4? What can you tell us about the early launch momentum observed into Q4 here and into year end?

Yeah. Thanks, Tyler. So what we can tell you is that as we look at the quarter, we saw, I would say, a decrease in the August, September time frame.

Now, realize there's complexity of summer as well as the short report around the same time. So, with the slower August, September, we're also seeing no meaningful changes into October.

So we think that there is an effect and we unfortunately think that this is on patients who've had the non-serious adverse events, probably the people who would have benefited tremendously had they stayed on therapy.

So, as Meredith has mentioned, as I also talked to, we're making a lot of efforts in reaching out to these people we're having individuals who are on drugs, talking to other patients who were on drugs.

Yesterday we had a webinar with about 80+ families on that listening to a patient who's been on VYKAT XR and their experiences.

So we think that it's hard to say exactly when the effect would go away, but it's certainly something that we're making serious efforts on.

And and when you say no meaningful impact in October, are you saying that October looks similar to August and September, or that there's no meaningful impact from the report and that you're seeing some of whatever rebound in October?

I'm saying it's looking somewhat similar to what we saw in September.

Okay. Thank you.

Our next question is from Maurice right there from Guggenheim. Your line is open.

Hi, this is Morris on for DevJet. Congrats on a strong quarter. I have two questions. First of all, could you, elaborate a little bit on the average dose, across all patients that are currently on drugs?

And secondly, for your existing prescribers, could you estimate what percent of the PWS patients are currently on VYKAT XR?

What I'm trying to get at is there's still room to grow within those existing prescribers or the future growth need to come from new prescribers?

Thank you.

Yeah, I'll take the second part of it, and Meredith can elaborate on it. There's definitely room to grow. We have about 1,000 start forms right now. That's about 10% of the tap.

So I'd say across the board there is room to grow, and that's particularly the case with our KOL accounts where Meredith mentioned that more than half of them have written scripts, but as we had anticipated.

Their practices are pretty full, and they are, they appear to be prescribing more when they see patients in their regular cadence of one to two times a year.

So we expect that to remain and we expect that over time we'll be getting access to those patients, but Meredith.

Go ahead. Yeah, adding on to what Aneesh said, we're very pleased with the broad prescriber base and we continue to add new prescribers on a daily basis, so we know that there's, significant amount of room for growth and as Anish stated on the numbers with regard to the TAM.

You had asked about the average dosing, so again that's still an evolving number. One thing that we shared last earnings call, which we'll continue to reiterate, is that the majority of our patient population is coming in between four and 26 age.

And we are continuing to make progress in the younger adults, so the 27 to 45, if you will. And we are seeing the average weight coming in a little bit heavier than what we saw in our clinical trial.

Thank you.

Our next question is from Kristen Kuka from Canter. Your line is open.

Yeah, hi, this is Rick Miller on for Kristen. Thanks for taking our questions.

So you mentioned the discontinuations being up after, some of the non-serious AEs after the short report. Can you give us a sense for kind of the kind of the profile of the AEs that were kind of leading to these discontinuations is this strictly sort of the on label safety profile that we're used to or anything else you could talk about there, thank you.

Sure. So, yes, these are on label AEs, typically, low levels of peripheral edema or you can have hyperglycemia. And when I was referring to non-serious adverse events, as you can look at fairs and you can see that a a vast majority of events that are reported are non-serious.

So I think what's happened is a concern that's been created because of the adverse event profile of the drug, which is non-serious, most patients are able To sort of power through and we'll start to see the benefits and we're seeing that in real life.

We've had numerous anecdotes of people who have stayed with low levels of edema, some levels of hyperglycemia, and have done really well from an efficacy perspective. So yes, the adverse events remain sort of on label, and what we are seeing is predominantly non-serious.

If Our next question is from Yasmin Rahimi from Piper Center. Your line is open.

Hi team, congrats on a strong quarter. I guess, team, when you look at, given that August and September was impacted by the short report, like What is this, is the hesitation among patients that are under the care of general endocrinology?

Is there a quantification on who are the type of patients or the type of physicians that need additional outreach and communication? Like, what is that profile look like where you guys are targeting to really have in-depth education for that sort of question one.

And then question two is like, how do you, obviously, I think that Tyler's question that that, October is looking like more like September.

How will you continue to communicate when we're going to When are we going to be out of this, I guess, fear or worry by this report, like any visibility like that, the rest of the quarter could be very much rebounding substantially, and what are your, what would your disclosures be around it.

So we don't expect to do sort of intra-quarter disclosures and as you can imagine, Yasmine that there's a lot of complexity in treating hyperphagia and PWS. We're the first drug and we're learning what the market's like and the prescribers are learning how to use the drug.

So, we realized that last quarter was perhaps a short report, perhaps it was summer, perhaps it was people going to summer camp.

And now this quarter we're going to have Thanksgiving and Christmas, which obviously have meaning for everyone, but for PWS and those with hyperphagia, it has a very different meaning.

So we have to navigate this. We have to see what it looks like and we have to see how prescribers also get accustomed to it, as we said earlier.

There are some hospitals, institutions that are trying to create PWS clinics to sort of, figure out how to best administer VYKAT XR and sort of make sure that they can follow these patients. Meredith, would you like to add something?

Yeah, I think, Yasmine, we're really pleased about the program that actually we launched in August. More of your traditional speakers bureau program, and we've had really strong adoption with that.

So we have recruited some of the national PWS experts to be speakers in the program, which allows for both virtual and in-person as well as an opportunity to do expert on demand, and we've seen really strong interest in that and you asked about the profile of the prescribers who are being educated.

I think what you're leaning towards, and you're correct in thinking that as we're adding these new prescribers on a daily basis who are out in the community who potentially have only one or two PWS patients.

Those are the ones who really need additional education on the disease state in general, as well as how to integrate VYKAT XR into their practice.

So we've received, as Anish said in his prepared comments, really positive feedback on these programs.

And, additionally we're continuing to educate caregivers and families so we've had live patient programs and we'll continue to do that in Q4, as well as webinars all received very well.

Thank you.

Our next question is from Leland Kershaw from Oppenheimer. Your line is open.

Hey, good afternoon, thanks for taking our questions. We just want to maybe understand, with respect to the treating physician population of patients who are on VYKAT XR, you're having close to 500 unique prescribers, at the, end of Q3.

But in your investment materials, you said that about 300 providers are primarily creatures of about 2,100 PWS patients.

So just going back to something we've talked about in the past, is it the case that we should think about these reports of adverse events as more likely to occur amongst patients who are being cared for by those who are less specialized in preability treatment and therefore maybe less.

Astute at at managing some of the side effects wondering if you could share your insights there. Thank you.

Yeah, thanks Leland. I think it's fair to say that just a reminder, the adverse event profile and if you look at edema as an example or food retention related events, in our clinical trials is about, 20%.

What we are seeing now, at least the reported events are actually lower than that. So it's actually a pretty small minority that has these events, and most of the events that are happening are low grade events.

So, these are most often things that may not even need treatment. So, what you're really probably concerned about is significant adverse events or serious adverse events.

And those we do worry that pa physicians who are out there who don't have experience in using VYKAT XR and have one patient on it and choose a patient who had significant comorbidities, etc.

And how would they manage the side effects. So we do, we are concerned about that, and that's something as Meredith mentioned, we have a significant effort in trying to mitigate.

So we have our field teams, our MSLs who go out, have conversations with these physicians about how to manage these things better.

And we have physician to physician programs where there's an expert on demand thing where you can call a physician who has significant experience and that's actually been used very successfully recently.

Great and just wanted to ask you, is, the time to securing reimbursement is that changed from the past is that improved, increased, or is it the is about the same in terms of going from start form to pull through thanks.

There it is. Yeah, so Leland, I think on our last earnings call we mentioned that we were looking at a turnaround time targeting for 30 days.

We're that's still our target that's still optimal, but as you know during the first year of launch it can vary depending on the channel but that's exactly what we're targeting is the 30 days.

Great thanks very much.

Our next question is from Brian Scorny from Beer. Your line is open.

Hey, good afternoon, everyone. Thank you for taking the question. Yeah, I just wanted to try to get a little more clarification on your comments on the disruption that occurred over the summer and how it's specifically manifesting in the numbers.

Was there both a slowdown in start forms that you're saying and an increase in discontinuations and implying that you would otherwise have more than 400 start forms.

And or lower than 8% discontinuation due to AEs otherwise, or is there another figure in terms of missed refills that isn't specifically being called out on on a quantification measure?

So, thanks, Brian. I think where I was trying to go with this is that we saw a decrease in August, September and we realized it's also summer.

So we think it was some combination of summer people in camps as well as the short report that caused the start forms to decrease. Now, we obviously cannot pinpoint that, such and so didn't come in because of they read something or whatever.

But I do think that could, that was likely a factor. We don't have any specific metrics and refills, etc. But what we are thinking through is.

If you have patients who have non-serious adverse events who discontinue and anecdotally call into the specialty pharmacy and say, I read something that I didn't like and I'm concerned and I'm not going to continue on drugs, that's what we are basing the idea on that perhaps it's, these anecdotal things that are out there and misleading that are leading to discontinuation that wouldn't have occurred.

Our next question is from James Conduis from Stavi. Your line is open.

Hey, thanks for taking my question. I wanted to ask one on efficacy. Obviously it takes some time to see it, but we're now approaching six months kind of plus or so.

And just curious what your early kind of learnings are there, what you've heard, how you kind of think that's playing into the current discontinuation rates and what that may do to to discontinuation rates over time as as kind of patients stay on drugs for longer.

Any color there would be appreciated. Thanks.

So, James, thank you for asking about efficacy. We are starting to hear anecdotes across the board on good things that are happening to these patients. There's tons of examples, we got a call the other day about a child who went without food for nine hours.

We talked to a mom about a child who sat in temple at a memorial service for several hours calmly without any tantrums.

We heard from an adult who lives in a group home who will, after, years be able to travel alone to see their family in Florida alone. So it is starting to happen.

We're seeing things happen across the board and we think it will make a difference to these discontinuation rates. And as I was mentioning, we've started a series of patient webinars where those who are on drugs and their families are able to share their experiences with others.

And the first one of those literally had, 100 plus people who signed up for it. So there is a lot of interest, and this is exactly the sort of thing that will turn things around.

Great I appreciate it.

Thanks. Our next question is from Derek Artila from Wells Fargo. Your line is open.

Hey, thanks for taking the questions and congrats on the progress, I guess first I guess. Obviously you're saying what you're seeing in October is kind of resembling, September trends.

I guess is the bolus over or do we think that it resumes as people get more comfortable or the messaging gets better, education gets better.

So that's question number one. And then just quickly on the EU, I know you mentioned about the 120 day questions.

I don't know if you can kind of characterize some of those requests, but do they improve your confidence of an eventual approval in Europe? Thanks.

Sure, so in terms of the bolus, we, this is one of those situations where when you have the first drug for an indication, it's hard to tell what it's supposed to look like.

So we're finding out as we go, but if you remember some of the conversations we had prior to launch, we said we don't know if there will be a bolus, but what we are expecting to see is a slow, steady build up over time with a time of 10,000 patients. There's a lot of them out there and it takes time for physicians to get accustomed to using a drug.

For an indication that has not really had a treatment before, so it's hard for us to comment on, does the bolus come back or not. I think by definition a bolus does not come back, and we're looking for a steady state, that will continue over time and will continue to build a solid base of revenue that we have.

On the EU, I can't really give you any more details on the questions, but I will say that they feel very much similar to the discussions that we had with the FDA.

Mostly around efficacy, the design of the studies, the sequential nature of the studies, the fact that the same patients have been used in in through the multiple studies, etc.

But, I would say that, as we get these responses and as we get responses to these responses from the EU, we'll have a better sense of where it's going.

Our next question is from Gail Chen from Laidlaw. Your line is open.

Thanks for taking the questions and congrats on a very good great quarters. And basically I have two here. The first one is sort of related to the efficacy.

That you guys have talked, you, in the press release, you indicated you have a 100 patients have more than one year treatment and the many of those has a multiple years of treatments.

I just wonder whether you'll be able to do some studies of them to see over such a longer period of treatments, are those patients have been improved and how much those improve, maybe this will be useful. Longer-term historical analysis and have a follow-up.

Yeah, I mean, we have, as been running a long-term open label study. Then there was a randomized withdrawal, and the patients went back on drugs.

So we've had the ability to follow these patients very carefully for a very long period of time and as it's very unusual in a rare disease to have such long-term data.

And we have seen, improvements of many different kinds in these patients, and this is obviously anecdotal and doesn't apply to everyone, but only yesterday we were looking at, we were talking to a patient who is running a triathlon or preparing for a triathlon.

This is a person who's in college. We are aware of a person who's a sous chef. We're aware of numerous people who have graduated from high school.

So, the long-term effects will vary by patient, but we think that taking away the hyperphagia, which is the hallmark symptom of the disease, will over a period of time really alter their lives.

Okay, great. That's very helpful. Maybe one more question here, which is about the patient size that you already have on your a over 1,000 starting from and you suggested maybe 10,000 patients that give and take.

And that, at this stage, do you feel that you need to have additional effort to finding more patients, new patients? Or how would you prescribe your effort in, on that regard, thanks.

Meredith.

Yeah, so I think as we said previously, in our earnings call that we have a claims database where we're confidently able to identify approximately 12,000 claims, and individuals who have PWS and that when we look at that information that brings our TAM down to around 10,000.

So we know where the patients are and where they're being treated. I think one thing that we're very excited about that we're working on is more around machine learning to identify specifically when these patients might be coming into the physician's office to really optimize our effective targeting for the sales team.

But with regard to traditional rare disease patient finding, we have the claims so we know where they're being treated.

Okay, great. Thanks a lot and again, congrats.

Thank you.

Our next question is from Catherine De La Rosso from LifeSci. Your line is open.

Hi, congrats on the quarter and thanks for taking the question. So I was just curious, if you have a sense of the proportion of patients who are able to reach, or be maintained on their on labeled dose versus, those who undergo dose reduction.

And I guess, apologies if I missed this, but for those who discontinue treatment, do you have a sense of how long they're on therapy before they're coming off and kind of expectations for that going forward?

Yeah, I can address the second part of it. So we see the discontinuations happening earlier in treatment. So they're either in titration or just after. So think of it as sort of the first three months.

By the way, of the active patients, we think about 2/3 are, beyond the three-month time frame at this time.

Do you want to address the first question, Meredith? Yeah.

I think it's a little more complicated than that with regard to reducing dose because if you look at our label, really the therapeutic window, if you will, is between, I think like three to five nigs per kg, so. Any dosing around there is is considered on label dosing.

So I think if you are looking at on target dose for a given weight band then I think it's fair to say that there's a very small minority that undergo do reductions in general you would expect people to get to the target doses.

Great, thanks so much.

[Operator Instructions]

Our next question is from Ram Silvera from HC Plainwright. Your line is open.

Hi, this is Jay on for Ram. Thanks for taking our questions and congrats on the profitability this quarter. That actually leads me to my first question.

Do you have some sort of idea when you might be in a position to start providing annualized revenue guidance? And secondly, as I'm sure Rhythm is pursuing an expansion into PWS first at Melatide.

Do you think of that purely as a competitor drug, or do you think there's a possibility for, synergism between between the two drugs there?

I'll answer the second part. Jim can take the first part. In terms of rhythms drug, we still have to see efficacy, as the one study that's been conducted with the drug in PWS, which was a large randomized phase 2 study, was negative for weight loss and hyperphagia.

I believe they are conducting an open label study, so we'll have to see what the data shows. In terms of whether it's competitive or potentially synergistic, it can be potentially synergistic because the two mechanisms are different from each other.

So, for on the competition piece we'll have to see the data and certainly at least theoretically potentially synergistic.

Yeah, and with regards to guidance I'd say it's a bit early at this stage. We're obviously looking for a little bit of maturation in the various components of the business, but we'll continue to investigate that.

Okay, thank you so much.

There are no questions at this time. I would like to have the call back to Anish. Please go ahead.

Thank you all for listening in today. Have a good evening.

This concludes today's conference call. Thank you for participating. You may now disconnect.