Neurocrine Biosciences Inc.
10/28/2025 | Press release | Distributed by Public on 10/28/2025 14:04
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following Management's Discussion and Analysis of Financial Condition and Results of Operations section contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part II, Item 1A under the caption "Risk Factors." The interim financial statements and this Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the financial statements and notes thereto for the year ended December 31, 2024 and the related Management's Discussion and Analysis of Financial Condition and Results of Operations, which are contained in our Annual Report on Form 10-K for the year ended December 31, 2024 and our Quarterly Report on Form 10-Q for the six months ended June 30, 2025.
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. Food and Drug Administration (FDA) approved treatments for tardive dyskinesia (TD), chorea associated with Huntington's disease, classic congenital adrenal hyperplasia (CAH), and endometriosis and uterine fibroids in collaboration with AbbVie Inc. (AbbVie). 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 therapy.
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.
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. 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. INGREZZA net product sales totaled $1.9 billion and $1.7 billion, respectively, for the first nine months of 2025 and 2024 and accounted for substantially all of our total net product sales during each of these reporting periods. CRENESSITY net product sales totaled $165.8 million for the first nine months of 2025.
Our partner Mitsubishi Tanabe Pharma Corporation (MTPC) launched DYSVAL®(valbenazine) in Japan for the treatment of TD 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.
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. We receive royalties at tiered percentage rates on AbbVie net sales of elagolix.
2025 Business Highlights
•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. 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. During the first nine months of 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.
•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. In addition, we expanded formulary access for INGREZZA, significantly improving coverage to now include approximately 70% of TD and Huntington's disease Medicare beneficiaries to support long-term growth.
•Appointed Sanjay Keswani, M.D., as Chief Medical Officer (CMO) and member of the Company's executive management team effective June 2, 2025.
•Announced planned expansion of the INGREZZA and CRENESSITY sales teams to maximize commercial momentum. Expansion to be completed by the end of the first quarter of 2026.
2025 Pipeline Highlights
•Initiated two Phase 3 clinical studies for direclidine (NBI-1117568), a potential first-in-class, orally active, highly selective investigational M4 agonist, in schizophrenia.
•Initiated a Phase 3 clinical study for osavampator (NBI-1065845), a potential first-in-class alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid (AMPA) positive allosteric modulator (PAM), in major depressive disorder (MDD).
•Initiated a Phase 1 clinical study for NBIP-1435, 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 Nav1.2 and Nav1.6 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 tardive dyskinesia were achieved with once-daily INGREZZA capsules. 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 study of valbenazine for the adjunctive treatment of schizophrenia did not meet the primary endpoint.
Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024
Revenues
Net Product Sales
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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(in millions)
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2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| INGREZZA | $ | 686.6 | $ | 612.9 | $ | 1,856.2 | $ | 1,698.4 | |||||||||||||||
|
CRENESSITY
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98.1 | - | 165.8 | - | |||||||||||||||||||
| Other | 5.2 | 3.7 | 13.6 | 11.0 | |||||||||||||||||||
| Total net product sales | $ | 789.9 | $ | 616.6 | $ | 2,035.6 | $ | 1,709.4 | |||||||||||||||
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected increased net product sales of INGREZZA, driven by total prescriptions on strong patient demand partially offset by lower net price due to new market access investments to support long-term growth, and CRENESSITY, which was launched in the U.S. as a first-in-class FDA-approved treatment of CAH in December 2024.
Collaboration Revenues
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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(in millions)
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2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
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Royalties
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$ | 4.8 | $ | 4.6 | $ | 18.0 | $ | 13.5 | |||||||||||||||
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Other
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0.2 | 0.9 | 1.4 | 4.7 | |||||||||||||||||||
| Total collaboration revenues | $ | 5.0 | $ | 5.5 | $ | 19.4 | $ | 18.2 | |||||||||||||||
Total collaboration revenues for all periods presented primarily reflected royalties earned on AbbVie net sales of elagolix and MTPC net sales of valbenazine.
Operating Expenses
Cost of Revenues
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
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(in millions)
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2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Cost of revenues | $ | 14.0 | $ | 8.0 | $ | 34.5 | $ | 24.7 | |||||||||||||||
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected increased net product sales of INGREZZA and increased royalties payable on net product sales of CRENESSITY.
Research and Development
We support our drug discovery and development efforts through the commitment of significant resources to discovery, research and development programs, and business development opportunities. Costs are reflected in the applicable development stage based upon the program status when incurred. Therefore, the same program could be reflected in different development stages in the same reporting period. For several of our programs, the research and development activities are part of our collaborative arrangements.
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Late stage | $ | 52.2 | $ | 21.6 | $ | 126.3 | $ | 68.9 | |||||||||||||||
| Early stage | 16.1 | 19.2 | 54.5 | 77.6 | |||||||||||||||||||
| Research and discovery | 73.5 | 42.1 | 189.5 | 103.9 | |||||||||||||||||||
| Milestones | 1.0 | 38.8 | 61.5 | 71.4 | |||||||||||||||||||
| Payroll and benefits | 74.6 | 55.4 | 221.8 | 167.9 | |||||||||||||||||||
| Facilities and other | 32.6 | 17.9 | 103.9 | 55.8 | |||||||||||||||||||
| Total research and development | $ | 250.0 | $ | 195.0 | $ | 757.5 | $ | 545.5 | |||||||||||||||
Late Stage. Late stage consists of costs incurred for product candidates in Phase 2 registrational studies and all subsequent activities.
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected increased investment in the Phase 3 programs for osavampator in MDD and direclidine in schizophrenia, partially offset by lower spend related to crinecerfont in CAH.
Early Stage. Early stage consists of costs incurred for product candidates after the approval of an investigational new drug application by the applicable regulatory agency through Phase 2 non-registrational studies.
Compared with the comparable periods last year, the decrease for the third quarter and first nine months of 2025 primarily reflected the successful 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 neuropsychiatry programs, partially offset by increased investment in our early-stage muscarinic portfolio.
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.
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected increased investment in gene therapy and other preclinical development programs.
Milestones. Milestones consists of costs incurred in connection with the achievement of development milestones under collaborative arrangements. The following table presents milestones expense by collaboration partner.
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
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Nxera Pharma UK Limited
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$ | - | $ | 35.0 | $ | 15.0 | $ | 50.0 | |||||||||||||||
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Takeda Pharmaceutical Company Limited
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- | - | 37.5 | 7.5 | |||||||||||||||||||
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Xenon Pharmaceuticals Inc.
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- | - | 7.5 | - | |||||||||||||||||||
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Voyager Therapeutics, Inc.
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- | 3.0 | - | 11.0 | |||||||||||||||||||
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Other
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1.0 | 0.8 | 1.5 | 2.9 | |||||||||||||||||||
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Total milestones
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$ | 1.0 | $ | 38.8 | $ | 61.5 | $ | 71.4 | |||||||||||||||
Refer to Note 2 to the condensed consolidated financial statements for more information on our significant collaboration and license agreements.
Payroll and Benefits. 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.
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected higher headcount and increases of $7.2 million and $19.0 million, respectively, in non-cash stock-based compensation expense.
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.
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected increased facility-based expenses related to our new campus facility.
Selling, General, and Administrative
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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(in millions)
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2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Selling, general, and administrative | $ | 291.6 | $ | 234.3 | $ | 854.4 | $ | 719.4 | |||||||||||||||
Compared with the comparable periods last year, the increase for the third quarter and first nine months of 2025 primarily reflected continued investment in our commercial organization (including the expansion of our psychiatry and long-term care sales team completed in September 2024 and CRENESSITY-related headcount and commercial launch activities) and increases of $5.0 million and $11.2 million, respectively, in non-cash stock-based compensation expense. In addition, the increase for the first nine months of 2025 was partially offset by decreased impairment charges associated with our vacated legacy campus facilities.
Other Income (Expense)
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
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Unrealized gain (loss) on equity investments
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$ | 30.6 | $ | (16.9) | $ | (6.7) | $ | (35.2) | |||||||||||||||
| Charges associated with convertible senior notes | - | - | - | (138.4) | |||||||||||||||||||
| Investment income and other, net | 22.2 | 23.4 | 64.5 | 68.5 | |||||||||||||||||||
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Total other income (expense), net
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$ | 52.8 | $ | 6.5 | $ | 57.8 | $ | (105.1) | |||||||||||||||
Compared with the comparable periods last year, the change for the third quarter and first nine months of 2025 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.
Provision for Income Taxes
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
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Provision for income taxes
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$ | 82.3 | $ | 60.5 | $ | 141.1 | $ | 85.2 | |||||||||||||||
The effective tax rate for the third quarter and first nine months of 2025 and 2024 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, fluctuations in state effective tax rates, and valuation allowances recorded in certain foreign and domestic state jurisdictions for tax benefits that management cannot conclude that it is more likely than not will be realized in the future. In addition, the effective tax rate for the third quarter of 2025 reflects increased tax expense related to foreign operations and the enactment of the One Big Beautiful Bill Act (OBBBA).
Net Income
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net income | $ | 209.5 | $ | 129.8 | $ | 324.9 | $ | 238.2 | |||||||||||||||
Compared with the comparable periods last year, the change for the third quarter and first nine months of 2025 primarily reflected increased INGREZZA and CRENESSITY net product sales, continued investments in our commercial organization (including the expansion of our psychiatry and long-term care sales team completed in September 2024 and CRENESSITY-related headcount and commercial launch activities) and expanded pre-clinical and clinical portfolio, periodic fluctuations in milestones expense associated with the achievement of development milestones under collaborative arrangements, periodic fluctuations in the fair values of our equity investments, and prior year charges associated with the convertible senior notes that matured in May 2024.
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. However, we cannot guarantee that our existing capital resources and anticipated revenues will be sufficient to conduct and complete all of our research and development programs or commercialization activities as planned. We may seek to access the public or private equity markets whenever conditions are favorable or pursue opportunities to obtain debt financing in the future. 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.
Information Regarding Our Financial Condition
| (in millions) |
September 30, 2025 |
December 31, 2024 |
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| Total cash, cash equivalents, and marketable securities | $ | 2,113.3 | $ | 1,815.6 | |||||||
| Working Capital: | |||||||||||
| Total current assets | $ | 2,158.4 | $ | 1,724.7 | |||||||
| Less total current liabilities | 638.0 | 507.7 | |||||||||
| Total working capital | $ | 1,520.4 | $ | 1,217.0 | |||||||
Information Regarding Our Cash Flows
|
Nine Months Ended September 30, |
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| (in millions) | 2025 | 2024 | |||||||||
| Cash flows from operating activities | $ | 394.3 | $ | 352.9 | |||||||
| Cash flows from investing activities | (211.5) | (58.5) | |||||||||
| Cash flows from financing activities | (75.6) | (196.7) | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | - | 0.3 | |||||||||
| Change in cash, cash equivalents, and restricted cash | $ | 107.2 | $ | 98.0 | |||||||
Cash Flows from Operating Activities
Compared with the comparable period last year, the increase primarily reflected increased net product sales of INGREZZA and CRENESSITY, partially offset by continued investments in our commercial organization (including the expansion of our psychiatry and long-term care sales team completed in September 2024 and CRENESSITY-related headcount and commercial launch activities) and expanded pre-clinical and clinical portfolio. The increase in accounts receivable was driven by higher total gross product sales. The increase in accounts payable and accrued liabilities was driven by higher revenue-related reserves for discounts and allowances attributed to higher gross product sales combined with expanded formulary access for INGREZZA. In addition, the increase 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.
Cash Flows from Investing Activities
Periodic fluctuations in cash flows from investing activities primarily reflected timing differences related to our purchases, sales, and maturities of debt security investments and changes in our portfolio-mix.
Cash Flows from Financing Activities
Compared with the comparable period last year, the change reflected $167.7 million in repurchases of our common stock during the first nine months of 2025 under the $500.0 million 2025 Repurchase Program that was authorized by our Board of Directors in February 2025, decreased proceeds from issuances of our common stock, and $308.8 million in cash payments to settle the convertible senior notes in the second quarter of 2024.
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.
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. In particular, our future capital requirements will depend on many factors, including:
•the commercial success of INGREZZA and CRENESSITY;
•continued scientific progress in our research 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 costs 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 commercialization activities and arrangements, including our advertising campaigns; and
•the cost of manufacturing our product candidates.
In addition to the foregoing factors, we have significant future capital requirements, including:
External Business Developments
In addition to our independent efforts to develop and market products, we may enter into collaboration and license agreements or acquire businesses from time-to-time to enhance our drug development and commercial capabilities. With respect to our existing collaboration and license agreements, we may be required to make potential future payments of up to $14.0 billion upon the achievement of certain milestones.
Refer to Note 2 to the condensed consolidated financial statements for more information on our significant collaboration and license agreements.
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. The 2025 Repurchase Program is in addition to the $300.0 million 2024 Repurchase Program that was announced in October 2024 and completed in February 2025. Under the 2025 Repurchase Program, we repurchased 1.5 million shares on the open market for a cost of $167.7 million during the first nine months of 2025. As of September 30, 2025, we had $332.3 million remaining under the 2025 Repurchase Program.
Critical Accounting Policies and Estimates
There were no changes to our critical accounting policies as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Interest Rate Risk
We maintain a diversified investment portfolio consisting of low-risk, investment-grade debt securities with maturities of up to three years, including investments in commercial paper, securities of government-sponsored entities and corporate bonds that are subject to interest rate risk. The 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 September 30, 2025, it would not have had a material effect on the fair value of our investment portfolio as of that date.
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements that involve a number of risks and uncertainties. Although our forward-looking statements reflect the good faith judgment of our management, these statements can only be based on facts and factors currently known by us. Consequently, these forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from results and outcomes discussed in the forward-looking statements.
Forward-looking statements can be identified by the use of forward-looking words such as "believes," "expects," "hopes," "may," "will," "plan," "intends," "estimates," "could," "should," "would," "continue," "seeks," "proforma," or "anticipates," or other similar words (including their use in the negative), or by discussions of future matters such as the development of new products, technology enhancements, possible changes in legislation and other statements that are not historical. These statements include but are not limited to statements under the captions "Risk Factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations" as well as other sections in this report. You should be aware that the occurrence of any of the events discussed under the heading in Part II titled "Item 1A. Risk Factors" and elsewhere in this report could substantially harm our business, results of operations and financial condition and that if any of these events occurs, the trading price of our common stock could decline and you could lose all or a part of the value of your shares of our common stock.
The cautionary statements made in this report are intended to be applicable to all related forward-looking statements wherever they may appear in this report. We urge you not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Except as required by law, we assume no obligation to update our forward-looking statements, even if new information becomes available in the future.
Neurocrine Biosciences Inc. published this content on October 28, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on October 28, 2025 at 20:04 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]