Alkermes plc.
For the period ended Mar 31, 2026. Filed May 5, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 5, 2026
ALKS$45.90+3.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-10-28.
0001193125-25-252524
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-05.
0001193125-26-206534
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 98 previous paragraphs and 116 current paragraphs.
56 unchanged; 25 reworded; 34 added; 17 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 14 previous and 14 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (34)
Current report
On February 12, 2026, we completed the Avadel Acquisition, adding LUMRYZ to our portfolio of proprietary commercial products and a commercial organization with experience in narcolepsy. Pursuant to the Transaction Agreement, we acquired the entire issued and to be issued ordinary share capital of Avadel for consideration of (i) $21.00 per Avadel Share, payable in cash at closing and (ii) a non-transferable CVR entitling holders of Avadel Shares to a potential additional cash payment of $1.50 per Avadel Share, contingent upon achievement of a certain specified milestone. During the three months ended March 31, 2026, we incurred costs of approximately $34.8 million in connection with the Avadel Acquisition.
Current report
LUMRYZ
Current report
LUMRYZ (sodium oxybate) is an extended-release oral suspension product approved by the U.S. Food and Drug Administration (“FDA”) in May 2023 and October 2024 as the first and only once-at-bedtime treatment for cataplexy or excessive daytime sleepiness (“EDS”) in adults with narcolepsy and in pediatric patients seven years of age and older with narcolepsy, respectively. The FDA has granted seven years of orphan drug exclusivity (“ODE”) to LUMRYZ for the adult and pediatric narcolepsy patient populations through May 1, 2030 and October 16, 2031, respectively. We exclusively commercialize LUMRYZ in the U.S. Pursuant to the settlement and license agreement entered into between Jazz Pharmaceuticals entities and Avadel entities in October 2025 (the “Avadel Settlement Agreement”), from October 1, 2025, Jazz receives a royalty of 3.85% (subject to certain adjustments set forth in the Avadel Settlement Agreement) on net sales of LUMRYZ sold for narcolepsy and additional royalties on net sales of LUMRYZ sold for any other non-narcolepsy indications. For more information about the Avadel Settlement Agreement and underlying royalty obligations, see “Patents and Proprietary Rights – LUMRYZ” in “Item 1—Business” in our Annual Report.
Current report
LUMRYZ employs a version of our MICROPUMP technology. LUMRYZ is manufactured by third parties. The FDA has required implementation of a risk evaluation and mitigation strategy (“REMS”) for LUMRYZ to help ensure the benefits of the drug outweigh any risks of serious adverse outcomes that may result from inappropriate prescribing, misuse, abuse or diversion of the product. Under the LUMRYZ REMS, healthcare providers who prescribe the drug must be specially certified, pharmacies that dispense the drug must be specially certified, and the drug must be dispensed only to patients who have enrolled in the LUMRYZ REMS and completed all REMS requirements, including documentation of safe use conditions.
Current report
Key Development Programs
Current report
Alixorexton
Current report
LUMRYZ (sodium oxybate)
Current report
LUMRYZ (sodium oxybate) extended-release oral suspension is currently being evaluated in REVITALYZ, a double-blind, placebo-controlled, randomized withdrawal, multicenter phase 3 study designed to evaluate efficacy and safety in adult patients with IH. Patient enrollment in this study was completed in December 2025.
Current report
“Product sales, net” during the three months ended March 31, 2026 includes LUMRYZ beginning on February 12, 2026. Product sales, net amounts related to LUMRYZ are included within “Product sales, gross”, “Product discounts”, “Medicare Part D” and “Other”.
Current report
The decrease in Medicaid rebates as a percentage of sales was primarily due to gross-to-net favorability, as actual Medicaid rebates related to VIVITROL, ARISTADA/ARISTADA INITIO and LYBALVI were lower than original estimates by approximately $5.4 million, $2.8 million and $0.5 million, respectively, and due to the inclusion of sales of LUMRYZ, which does not participate in a Medicaid rebate program. The increase in Other adjustments is related to the addition of certain gross-to-net deductions related to LUMRYZ.
Current report
The decrease in VUMERITY revenue was due to a decrease of $6.0 million in manufacturing revenue, offset by an increase of $5.5 million in royalty revenue. The decrease in VUMERITY manufacturing revenue was related to the conclusion of our VUMERITY manufacturing subcontracting obligations for Biogen in August 2025. The increase in VUMERITY royalty revenue was due to an increase in end-market net sales of the product.
Current report
In connection with the Avadel Acquisition, we acquired LUMRYZ inventory at its estimated fair value, resulting in a step-up of approximately $121.6 million above its cost. The inventory step-up is recognized in cost of goods manufactured and sold as the underlying inventory is sold. See Note 7, Inventory in the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q for additional information related to purchase accounting adjustments. The increase in the cost of goods manufactured and sold was primarily related to the addition of LUMRYZ and the amortization of such inventory step-up of approximately $12.7 million, and to the cost of goods sold for ARISTADA/ARISTADA INITIO, LYBALVI and VIVITROL due to increases in the number of units sold, as discussed above. These increases were partially offset by a decrease of $8.9 million in the cost of goods manufactured for certain legacy products following the completion of our subcontracting arrangements for the manufacture of such products by the end of 2025.
Current report
The increase in employee-related expenses was primarily due to an increase in share-based compensation expense of approximately $6.5 million related to Avadel Shares that were accelerated and settled by us in connection with the Avadel Acquisition and due to increases in labor and benefits expense related to a 20% increase in R&D-related headcount, primarily in connection with the Avadel Acquisition. See Note 3, Business Combination in the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q for additional information related to purchase accounting adjustments.
Current report
The increase in general and administrative expense was primarily due to increases of $32.8 million, $18.7 million and $5.2 million in expenses related to the Avadel Acquisition, employee-related expenses and professional service fees, respectively. Expenses related to the Avadel Acquisition included stamp duty and transaction-related advisory fees. The increase in employee-related expenses was primarily due to increases of $11.1 million and $5.6 million in labor and benefits expense and share-based compensation expense, respectively. The increase in labor and benefits expense was primarily due to an increase in severance expense of $5.6 million related to the Avadel Acquisition, and a 15% increase in general and administrative-related headcount. The increase in share-based compensation expense was primarily due to the recognition of incremental share-based compensation expense following the modification of certain equity awards and to Avadel Shares that were accelerated and settled by us in connection with the Avadel Acquisition. The increase in professional service fees was primarily due to an increase in legal fees and expenses incurred in connection with the Avadel Acquisition.
Current report
Other (Expense) Income, Net
Current report
Interest income consists of interest earned on our cash and available-for-sale investments. Interest expense consists primarily of $7.7 million of financing costs related to Bridge Credit Agreement through the Closing Date of the Avadel Acquisition and $12.8 million of interest incurred on the Facilities. See Note 12, Long-Term Debtin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q for additional information regarding the Bridge Credit Agreement and the Facilities.
Current report
Cash flows used in investing activities for the three months ended March 31, 2026 were primarily due to the completion of the Avadel Acquisition and the purchase of $4.1 million of property, plant and equipment, partially offset by $12.2 million in net sales of investments. Total cash consideration paid on the Closing Date was $2,199.2 million. We accounted for the Avadel Acquisition as a business combination and recognized $2,085.1 million of assets acquired, net of liabilities assumed and cash transferred as an investing activity during the three months ended March 31, 2026.
Current report
Cash flows provided by investing activities for the three months ended March 31, 2025 were primarily due to $17.5 million in net sales of investments, partially offset by the purchase of $10.1 million of property, plant and equipment.
Current report
Debt
Current report
On February 12, 2026, in connection with the Avadel Acquisition, we entered into the Credit Agreement, which provides for (i) a TLA Facility in an aggregate principal amount of up to $750.0 million and (ii) a TLB Facility in an aggregate principal amount of up to $775.0 million. The TLA Facility matures on February 12, 2031, and the TLB Facility matures on August 12, 2031. On the Closing Date, we borrowed the full $1.525 billion available under the Facilities.
Current report
Also on February 12, 2026, in connection with completion of the Avadel Acquisition and our entry into the Credit Agreement, we terminated the Bridge Credit Agreement originally entered into in order to fund the Avadel Acquisition, as the commitments under the Credit Agreement, together with our cash on hand as of the Closing Date, were sufficient to fund the Avadel Acquisition.
Current report
We record contingent consideration we may owe related to a business combination at fair value on the acquisition date. We estimate the fair value of contingent consideration through valuation models that incorporate a probability-weighted discounted cash flow model related to the achievement of a certain specified milestone. We revalue our contingent consideration each reporting period, with changes in the fair value of contingent consideration recognized within the consolidated statements of operations and comprehensive (loss) income. Changes in the fair value of contingent consideration can result from changes to one or multiple assumptions, including adjustments to the discount rates, changes in the assumed achievement and timing of any such specified milestone and changes in the assumed probability associated with regulatory approval.
Current report
The period over which we discount contingent consideration is based on the current development stage of the product candidate, the specific development plan for such product candidate adjusted for the probability of completing the development step, and the date on which contingent payments may be triggered. In estimating the probability of success, we utilize data regarding similar milestone events from several sources, including industry studies and our own experience. These fair value measurements are based on significant inputs not observable in the market. Significant judgment is employed in determining the appropriateness of these assumptions at the acquisition date and for each subsequent reporting period. Accordingly, changes in assumptions described above could have a material impact on the increase or decrease in the fair value of contingent consideration recorded in any given period.
Current report
At March 31, 2026, our contingent consideration related to the CVR Milestone issued in connection with the Avadel Acquisition. The fair value of the contingent consideration was determined as follows:
Current report
As part of consideration for the Avadel Acquisition, holders of Avadel Shares as of the Closing Date are entitled to receive a potential additional aggregate cash payment of $165.7 million, or $1.50 per Avadel Share, upon achievement of the CVR Milestone.
Current report
The fair value of the contingent consideration was estimated by applying a discount factor, calculated based on the likelihood of achievement of the CVR Milestone, from the expected time the milestone occurs to the end of the reporting period, to the estimated probability of success. We expect the CVR Milestone to occur no later than the end of 2028 and used a discount rate of 5.47%;
Current report
Significant judgment was employed in determining the appropriateness of these assumptions at the Closing Date. Accordingly, changes in assumptions described above could have a material impact on the increase or decrease in the fair value of contingent consideration we record in any given period. In accordance with the accounting standard for fair value measurements, the fair value of the contingent consideration has been classified as a Level 3 liability as its fair value is based on significant inputs not observable in the market.
Current report
Valuation of Intangible Assets
Current report
Our intangible assets consist primarily of IP related to the existing commercial product and IPR&D product candidates that we acquired as part of the Avadel Acquisition. When significant identifiable intangible assets are acquired, we engage an independent third-party valuation firm to assist in determining the fair values of these assets as of the acquisition date. Discounted cash flow models are typically used in these valuations, which require the use of significant estimates and assumptions, including but not limited to:
Current report
estimating the timing of and expected costs to complete the in-process project;
Current report
projecting regulatory approvals;
Current report
estimating future cash flows from product sales resulting from completed products and in-process project; and
Current report
developing appropriate discount rates and probability rates by project.
Current report
We believe the fair values assigned to the intangible assets acquired are based upon reasonable estimates and assumptions given available facts and circumstances as of the acquisition date. If these projects are not successfully developed, the sales and profitability of the Company may be adversely affected in future periods. Additionally, the value of the acquired intangible assets may become impaired. We believe that the foregoing assumptions used in the IPR&D analysis were reasonable as of the acquisition date. No assurance can be given, however, that the underlying assumptions used to estimate expected product sales, development costs or profitability, or the events associated with such products, will transpire as estimated.
Removed paragraphs (17)
Previous report
The decrease in net income from continuing operations of $34.1 million during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was primarily due to a decrease of $36.3 million, in revenues, primarily related to lower manufacturing and royalty revenues, partially offset by an increase in product sales, net. During the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, total expenses increased by $25.8 million and income tax provision decreased by $8.7 million.
Previous report
On October 22, 2025, we announced our entry into the Transaction Agreement, pursuant to which we agreed to acquire the entire issued and to be issued ordinary share capital of Avadel for a total potential consideration of up to $20.00 per Avadel Share, as described above. The completion of the Proposed Acquisition is subject to customary conditions, including, among other things, approval by Avadel’s shareholders, the sanction of the Scheme by the Irish High Court, and the receipt of required antitrust clearances in the United States, and may be terminated by either party under certain circumstances. Subject to the satisfaction or waiver of all applicable closing conditions, we currently expect the Proposed Acquisition to be completed in the first quarter of 2026. We expect to incur costs of approximately $15.0 million to $20.0 million in connection with the Proposed Acquisition during the fourth quarter of 2025.
Previous report
In August 2025, U.S. Patent No. 12,390,474 relating to LYBALVI was granted. This patent has claims to a formulation of a fixed dose of olanzapine and samidorphan and expires in 2041.
Previous report
For a discussion of legal proceedings related to certain of the patents covering INVEGA TRINZA, see Note 16, Commitments and Contingent Liabilities in the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q and for information about risks relating to such legal proceedings, see “Part I, Item 1A—Risk Factors” in our Annual Report and specifically the section entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we or our licensees may face claims against IP rights covering our products and competition from generic drug manufacturers.”
Previous report
Key Development Program
Previous report
Alixorexton (formerly referred to as ALKS 2680)
Previous report
The increase in product sales, gross during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was primarily due to a 19% increase in the number of LYBALVI units sold and the 3% price increase for each of our proprietary products that went into effect on January 1, 2025. These increases were partially offset by 1% decreases in the number of units sold for each of VIVITROL and ARISTADA/ARISTADA INITIO.
Previous report
The decreases in Medicaid rebates, as a percentage of sales, during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were primarily due to gross-to-net favorability as actual Medicaid rebates related to VIVITROL and ARISTADA/ARISTADA INITIO, were lower than original estimates by approximately $7.6 million and $25.3 million for VIVITROL during the three and nine months ended September 30, 2025, respectively, and by approximately $4.9 million and $12.1 million for ARISTADA/ARISTADA INITIO during the three and nine months ended September 30, 2025, respectively.
Previous report
The decreases in royalty revenues related to the long-acting INVEGA products during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were primarily due to the expiration of our royalty on net sales of INVEGA SUSTENNA in the U.S. in August 2024. Accordingly, royalty revenues from net sales of the long-acting INVEGA products have been, and we expect will continue to be, lower in 2025, as the royalty revenues related to U.S. net sales of INVEGA SUSTENNA comprised a significant portion of the overall royalty revenues from the long-acting INVEGA products. In addition, each of INVEGA SUSTENNA and INVEGA TRINZA is currently subject to Paragraph IV litigation in response to companies seeking to market generic versions of such product. Increased competition from new products or generic versions of any one or more of the long-acting INVEGA products may lead to reduced unit sales of the long-acting INVEGA products, including those not yet genericized, and increased pricing pressure. For a discussion of the legal proceedings related to INVEGA TRINZA, see Note 16, Commitments and Contingent Liabilities in the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q, and for information about risks relating to these legal proceedings, see “Part I, Item 1A—Risk Factors” in our Annual Report, and specifically the section entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we or our licensees may face claims against IP rights covering our products and competition from generic drug manufacturers.”
Previous report
The increases in VUMERITY revenue during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were due to increases of $8.3 million and $17.7 million, respectively, in royalty revenue, offset by decreases of $5.3 million and $14.0 million, respectively, in manufacturing revenue. The increases in VUMERITY royalty revenue were primarily due to increases in end-market sales of the product. The decreases in VUMERITY manufacturing revenue were primarily due to reductions in the number of batches manufactured for sale to Biogen.
Previous report
The decreases in the cost of goods manufactured and sold during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were primarily related to decreases of $7.9 million and $28.7 million, respectively, in the cost of goods manufactured for certain legacy products following the sale of the Athlone Facility in May 2024 and decreases in the cost of goods sold for certain of our proprietary products during each period primarily due to decreases in costs related to out-of-specification batches and investigation costs. These decreases were partially offset by increases in the cost of goods sold for LYBALVI, ARISTADA/ARISTADA INITIO and VIVITROL during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, and an increase in the cost of goods sold for LYBALVI during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, due to increases in the number of units sold in each period, as discussed above.
Previous report
The increases in employee-related expenses during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were primarily due to increases in labor and benefits expense related to a 9% increase in R&D-related headcount.
Previous report
The increase in general and administrative expense during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, was primarily due to a $3.4 million increase in employee-related expenses, primarily due to a 7% increase in general and administrative-related headcount, a $2.3 million increase in professional service fees and a $1.5 million increase in branded prescription drug fees. The increase in general and administrative expense during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was primarily due to a $3.3 million increase in employee-related expenses, primarily due to the increase in general and administrative-related headcount, discussed above, and a $1.1 million increase in professional services fees.
Previous report
Other Income, Net
Previous report
On July 4, 2025, the OBBBA was signed into law. This legislation permanently extends, with modifications, several individual, business, and international tax provisions originally enacted under the Tax Cuts and Jobs Act of 2017. As of September 30, 2025, we analyzed the impact of this legislation and determined that the OBBBA did not have a material impact on its effective tax rate for the current year. We expect that the provisions in the OBBBA will result in a material increase in cash flows provided by operating activities and a material decrease in net U.S. deferred tax assets over the next number of years.
Previous report
In connection with the Proposed Acquisition, Alkermes plc, as the TopCo Borrower, together with Alkermes, Inc., as the U.S. Borrower, entered into the Bridge Credit Agreement, which provides for the Bridge Credit Facility in an aggregate principal amount of up to approximately $1.2 billion that is available to finance the payment of Cash Consideration and fees and expenses related to the Proposed Acquisition. In addition, we placed approximately $700.0 million of our cash into an escrow account to finance the remainder of the consideration for the Proposed Acquisition.
Previous report
Cash flows used in investing activities for the nine months ended September 30, 2025 were primarily due to the purchase of $40.4 million of property, plant and equipment, partially offset by $11.8 million in net sales of investments. Cash flows used in investing activities for the nine months ended September 30, 2024 were primarily due to $172.1 million in net purchases of investments and $23.7 million in the purchase of property, plant and equipment, partially offset by proceeds related to the sale of the Athlone Facility of approximately $97.9 million, which included a payment of approximately $91.0 million for the facility and certain related assets.
Reworded paragraphs (25)
Previous wording
Net income from continuing operations was $82.8 million and $192.3 million or $0.50 and $1.17 per ordinary share—basic and $0.49 and $1.14 per ordinary share—diluted, for the three and nine months ended September 30, 2025, respectively, compared to net income from continuing operations of $92.8 million and $226.4 million or $0.57 per and $1.36 ordinary share—basic and $0.56 and $1.33 per ordinary share—diluted, for the three and nine months ended September 30, 2024, respectively.
Current wording
Net loss was $66.5 million or $0.40 per ordinary share—basic and diluted, for the three months ended March 31, 2026, compared to net income of $22.5 million or $0.14 per ordinary share—basic and $0.13 per ordinary share—diluted, for the three months ended March 31, 2025.
Previous wording
The decrease in net income from continuing operations of $10.0 million during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, was primarily due to an increase of $31.7 million in total expenses, primarily due to increases in research and development expenses and selling, general and administrative expenses, partially offset by a decrease in cost of goods manufactured and sold. During the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, total revenues increased by $16.0 million, primarily due to an increase in product sales, net, partially offset by a decrease in manufacturing and royalty revenue.
Current wording
The change in net loss of $88.9 million was primarily due to an increase of $148.5 million in total operating expenses, due to increases in cost of goods manufactured and sold, R&D expenses, selling, general and administrative expenses and amortization of acquired intangible assets, and due to an increase of $20.9 million of interest expense. These increases were primarily related to expenses incurred in connection with the Avadel Acquisition. Total revenues increased by $86.4 million, primarily due to an increase in product sales, net, partially offset by a decrease in manufacturing and royalty revenue.
Previous wording
The key marketed products discussed below have generated, or are expected to generate, significant revenues for us. See the descriptions of the marketed products below and “Part I, Item 1A—Risk Factors” in our Annual Report and “Part II, Item 1A—Risk Factors” in this Form 10-Q for important factors that could adversely affect our marketed products. See the “Patents and Proprietary Rights” section in “Part I, Item 1—Business” in our Annual Report for information with respect to the IP protection for these marketed products.
Current wording
The key marketed products discussed below have generated, or are expected to generate, significant revenues for us. See the descriptions of the marketed products below and “Part I, Item 1A—Risk Factors” in our Annual Report for important factors that could adversely affect our marketed products. See the “Patents and Proprietary Rights” section in “Part I, Item 1—Business” in our Annual Report for information with respect to the IP protection for these marketed products.
Previous wording
We have developed and now commercialize products designed to help address the unmet needs of people living with opioid dependence, alcohol dependence, schizophrenia and bipolar I disorder. See the “Patents and Proprietary Rights” section in “Part I, Item 1—Business” in our Annual Report for information with respect to the IP protection for our proprietary products.
Current wording
We have developed and now commercialize products designed to help address the unmet needs of people living with opioid dependence, alcohol dependence, schizophrenia, bipolar I disorder and narcolepsy. See the “Patents and Proprietary Rights” section in “Part I, Item 1—Business” in our Annual Report for information with respect to the IP protection for our proprietary products.
Previous wording
For a discussion of legal proceedings related to LYBALVI, see Note 16, Commitments and Contingent Liabilitiesin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q, and for information about risks relating to such legal proceedings, see “Part I, Item 1A—Risk Factors” in our Annual Report and specifically the section entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we or our licensees may face claims against IP rights covering our products and competition from generic drug manufacturers.”
Current wording
For a discussion of legal proceedings related to LYBALVI, see Note 18, Commitments and Contingent Liabilitiesin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q, and for information about risks relating to such legal proceedings, see “Part I, Item 1A—Risk Factors” in our Annual Report and specifically the section entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we and our licensees have previously and may in the future face claims against IP rights covering our products and competition from generic drug manufacturers.”
Previous wording
For a discussion of legal proceedings related to VIVITROL, see Note 16, Commitments and Contingent Liabilitiesin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q, and for information about risks relating to such legal proceedings, see “Part I, Item 1A—Risk Factors” in our Annual Report and specifically the sections entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we or our licensees may face claims against IP rights covering our products and competition from generic drug manufacturers” and “Litigation or arbitration filed against Alkermes, including securities litigation, or actions (such as citizens petitions) filed against regulatory agencies in respect of our products, may result in financial losses, harm our reputation, divert management resources, negatively impact the approval of our products, or otherwise negatively impact our business.”
Current wording
For a discussion of legal proceedings related to VIVITROL, see Note 18, Commitments and Contingent Liabilitiesin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q, and for information about risks relating to such legal proceedings, see “Part I, Item 1A—Risk Factors” in our Annual Report and specifically the sections entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we and our licensees have previously and may in the future face claims against IP rights covering our products and competition from generic drug manufacturers” and “Litigation or arbitration filed against Alkermes, including securities litigation, or actions (such as citizens petitions) filed against regulatory agencies in respect of our products, may result in financial losses, harm our reputation, divert management resources, negatively impact the approval of our products, or otherwise negatively impact our business.”
Previous wording
Under our license and collaboration agreement with Biogen, Biogen holds the exclusive, worldwide license to develop and commercialize VUMERITY. For more information about the license and collaboration agreement with Biogen, see the “Collaborative Arrangements—Biogen” section in “Part I, Item 1—Business” in our Annual Report. For a discussion of legal proceedings related to certain of the patents covering VUMERITY, see Note 16, Commitments and Contingent Liabilitiesin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q.
Current wording
Under our license and collaboration agreement with Biogen, Biogen holds the exclusive, worldwide license to develop and commercialize VUMERITY. For more information about the license and collaboration agreement with Biogen, see the “Collaborative Arrangements—Biogen” section in “Part I, Item 1—Business” in our Annual Report.
Previous wording
Our R&D is focused on the development of innovative medicines in the field of neuroscience that are designed to address unmet patient needs. As part of our ongoing R&D efforts, we have devoted, and will continue to devote, significant resources to conducting preclinical work and clinical studies to advance the development of new pharmaceutical products. The discussion below highlights our current key development program. Drug development involves a high degree of risk and investment, and the status, timing and scope of our development programs are subject to change. Important factors that could adversely affect our drug development efforts are discussed in “Part I, Item 1A—Risk Factors” in our Annual Report and “Part II, Item 1A—Risk Factors” in this Form 10-Q. See the “Patents and Proprietary Rights” section in “Part I, Item 1—Business” in our Annual Report for information with respect to the IP protection for our key development program.
Current wording
Our R&D is focused on the development of innovative medicines in the field of neuroscience that are designed to address unmet patient needs. As part of our ongoing R&D efforts, we have devoted, and will continue to devote, significant resources to conducting preclinical work and clinical studies to advance the development of new pharmaceutical products. The discussion below highlights our current key development programs. Drug development involves a high degree of risk and investment, and the status, timing and scope of our development programs are subject to change. Important factors that could adversely affect our drug development efforts are discussed in “Part I, Item 1A—Risk Factors” in our Annual Report. See the “Patents and Proprietary Rights” section in “Part I, Item 1—Business” in our Annual Report for information with respect to the IP protection for our key development programs.
Previous wording
Alixorexton is a novel, investigational, oral, selective orexin 2 receptor agonist in development as a once-daily treatment for narcolepsy type 1 (“NT1”), narcolepsy type 2 (“NT2”) and idiopathic hypersomnia (“IH”). Orexin, a neuropeptide produced in the lateral hypothalamus, is considered to be the master regulator of wakefulness due to its activation of multiple, downstream wake-promoting pathways that project widely throughout the brain. Targeting the orexin system may address excessive daytime sleepiness across hypersomnolence disorders, whether or not deficient orexin signaling is the underlying cause of disease. Once-daily oral administration of alixorexton was previously evaluated in a phase 1 study in healthy volunteers and patients with NT1, NT2 and IH and is currently being evaluated in phase 2 studies, including the recently completed Vibrance-1 study in patients with NT1, and the ongoing Vibrance-2 and Vibrance-3 studies in patients with NT2 and IH, respectively. In September 2025, we announced detailed safety and efficacy results from Vibrance-1 and that we are proceeding with plans for initiation of a phase 3 program in narcolepsy.
Current wording
Alixorexton is a novel, investigational, oral, selective orexin 2 receptor agonist in development for the treatment of narcolepsy type 1 (“NT1”), narcolepsy type 2 (“NT2”) and idiopathic hypersomnia (“IH”). Orexin, a neuropeptide produced in the lateral hypothalamus, is considered to be the master regulator of wakefulness due to its activation of multiple, downstream wake-promoting pathways that project widely throughout the brain. Targeting the orexin system may address excessive daytime sleepiness across hypersomnolence disorders, whether or not deficient orexin signaling is the underlying cause of disease. Once-daily oral administration of alixorexton was previously evaluated in a phase 1 study in healthy volunteers and patients with NT1, NT2 and IH and in Vibrance-1 and Vibrance-2, phase 2 studies in patients with NT1 and NT2, respectively. In April 2026, we announced the initiation of the Brilliance Studies, a phase 3 program evaluating the safety and efficacy of alixorexton compared to placebo in adults with NT1 and NT2. Alixorexton is also currently being evaluated in Vibrance-3, a phase 2 study in patients with IH. Alixorexton has received Breakthrough Therapy designation from the FDA for the treatment of NT1.
Previous wording
Our product sales, net, consist of sales of VIVITROL, ARISTADA and ARISTADA INITIO, and LYBALVI, primarily to wholesalers, specialty distributors and pharmacies. The following table presents the adjustments deducted from product sales, gross to arrive at product sales, net, for sales of VIVITROL, ARISTADA and ARISTADA INITIO, and LYBALVI during the three and nine months ended September 30, 2025 and 2024:
Current wording
Our product sales, net, consist of sales of ARISTADA and ARISTADA INITIO, LYBALVI, VIVITROL, and, following the completion of the Avadel Acquisition on February 12, 2026, LUMRYZ, primarily to wholesalers, specialty distributors and specialty pharmacies. The following table presents the adjustments deducted from product sales, gross to arrive at product sales, net, for sales of ARISTADA and ARISTADA INITIO, LUMRYZ, LYBALVI and VIVITROL during the three months ended March 31, 2026 and 2025:
Previous wording
The increase in product sales, gross during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, was due to increases of 23%, 3% and 2% in the number of units sold for LYBALVI, ARISTADA/ARISTADA INITIO and VIVITROL, respectively, and a 3% price increase for each of these products that went into effect on January 1, 2025.
Current wording
The increase in product sales, gross was due to the addition of LUMRYZ, and increases of 29%, 15% and 5% in the number of units sold for LYBALVI, ARISTADA/ARISTADA INITIO and VIVITROL, respectively, and a 6% price increase for each of LYBALVI, ARISTADA/ARISTADA INITIO and VIVITROL that went into effect on January 1, 2026.
Previous wording
The following table compares product sales, net earned during the three and nine months ended September 30, 2025 and 2024:
Current wording
The following table compares product sales, net earned during the three months ended March 31, 2026 and 2025:
Previous wording
The following table compares manufacturing and royalty revenues earned during the three and nine months ended September 30, 2025 and 2024:
Current wording
The following table compares manufacturing and royalty revenues earned during the three months ended March 31, 2026 and 2025:
Previous wording
The increase in RISPERDAL CONSTA revenue during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was due to an $8.2 million increase in manufacturing revenue, primarily due to an increase in the number of batches made available to Janssen for sale in the U.S., which has a higher selling price than product sold outside of the U.S. The decrease in Other manufacturing and royalty revenue during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, was primarily due to decreases in revenues related to certain of our legacy products. The decrease in Other manufacturing and royalty revenue during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was primarily due to a $13.6 million decrease in revenue from FAMPYRA, as our manufacturing obligations for FAMPYRA concluded on December 31, 2024.
Current wording
The decrease in Other manufacturing and royalty revenue was due to a $5.0 million decrease in RISPERDAL CONSTA manufacturing revenue, primarily due to a decrease in the number of batches made available to Janssen for sale in the U.S., which has a higher selling price than product sold outside of the U.S. and due to a decrease in revenues related to certain of our other legacy products.
Previous wording
The following table sets forth our external R&D expenses for the three and nine months ended September 30, 2025 and 2024 relating to our then-current development programs and our internal R&D expenses, listed by the nature of such expenses:
Current wording
The following table sets forth our external R&D expenses for the three months ended March 31, 2026 and 2025 relating to our then-current development programs and our internal R&D expenses, listed by the nature of such expenses:
Previous wording
The increases in expenses related to alixorexton during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were primarily due to increased spend related to the advancement of the development program for the product, including initiation of our Vibrance-3 phase 2 clinical study and costs related to our long-term extension study for the product. The increases in other external R&D expenses during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, were primarily due to activities associated with our preclinical development programs.
Current wording
The increase in expenses related to alixorexton was primarily due to increased spend related to the advancement of the development program, including initiation of our phase 3 Brilliance Studies of the product in narcolepsy and costs related to our long-term extension study. The increase in expenses related to LUMRYZ was due to the addition of the REVITALYZ program in connection with the Avadel Acquisition. The increase in other external R&D expenses was primarily due to activities associated with our preclinical and clinical development programs.
Previous wording
The increase in selling and marketing expense during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, was primarily due to increases of $11.4 million and $2.2 million in employee-related expenses and marketing expense, respectively. The increase in employee-related expenses was primarily due to a 14% increase in sales and marketing-related headcount. The increase in marketing expense was primarily due to support services related to field expansion during the period. The increase in selling and marketing expense during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was primarily due to an increase of $23.5 million in employee-related expenses, primarily due to the increase in sales and marketing-related headcount, as previously noted, partially offset by a decrease of $11.1 million in marketing spend, primarily related to decreases in media spend for our proprietary products.
Current wording
The increase in selling and marketing expense was primarily due to increases of $28.3 million and $4.3 million in employee-related expenses and marketing expense, respectively. The increase in employee-related expenses was primarily due to the Avadel Acquisition, which resulted in a 15% increase in sales and marketing-related headcount due to the addition of the LUMRYZ commercial organization. In addition, there was an increase in share-based compensation expense of approximately $13.0 million related to Avadel Shares that were accelerated and settled by us in connection with the Avadel Acquisition. See Note 3, Business Combination in the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q for additional information related to purchase accounting adjustments. The increase in marketing expense was primarily due to the addition of $10.5 million in costs, beginning on the Closing Date, related to marketing for LUMRYZ, partially offset by a $4.0 million decrease in media spend for ARISTADA/ARISTADA INITIO, LYBALVI and VIVITROL during the three months ended March 31, 2026.
Previous wording
The income tax provisions in each of the three and nine months ended September 30, 2025, and 2024 were primarily attributable to taxes on income earned in Ireland.
Current wording
The income tax provision during the three months ended March 31, 2026 was primarily attributable to taxes on income earned in the U.S. The income tax provision during the three months ended March 31, 2025 was primarily attributable to taxes on income earned in Ireland.
Previous wording
We generated $350.6 million and $248.7 million of cash from operating activities during the nine months ended September 30, 2025 and 2024, respectively. We expect that our existing cash, cash equivalents and investments will be sufficient to finance our anticipated working capital and other cash requirements, including capital expenditures, for not less than twelve months following the date from which our financial statements were issued. Subject to market conditions, interest rates and other factors, we may pursue opportunities to obtain financing in the future, including debt and equity offerings, corporate collaborations, bank borrowings, arrangements relating to assets or other financing methods or structures.
Current wording
We used $165.7 million and generated $98.8 million of cash from operating activities during the three months ended March 31, 2026 and 2025, respectively. We expect that our existing cash, cash equivalents, restricted cash and investments will be sufficient to finance our anticipated working capital and other cash requirements, including debt services and capital expenditures, for at least the twelve months following the date from which our financial statements were issued. Subject to market conditions, interest rates and other factors, we may pursue opportunities to obtain financing in the future, including debt and equity offerings, corporate collaborations, bank borrowings, arrangements relating to assets or other financing methods or structures.
Previous wording
Information about our cash flows, by category, is presented in the accompanying condensed consolidated statements of cash flows. The discussion of our cash flows that follows does not include the impact of any adjustments to remove discontinued operations and is stated on a total company consolidated basis. The following table summarizes our cash flows for the nine months ended September 30, 2025 and 2024:
Current wording
Information about our cash flows, by category, is presented in the accompanying condensed consolidated statements of cash flows. The following table summarizes our cash flows for the three months ended March 31, 2026 and 2025:
Previous wording
Cash flows provided by operating activities for the nine months ended September 30, 2024 primarily consisted of $220.6 million of net income, adjusted for non-cash items including $75.9 million of share-based compensation, $21.7 million of depreciation and amortization and $32.3 million of deferred income taxes, partially offset by changes in working capital of $105.1 million.
Current wording
Cash flows used in operating activities for the three months ended March 31, 2026 were $165.7 million and primarily consisted of net loss of $66.5 million, adjusted for non-cash items, including share-based compensation of $36.3 million, depreciation and amortization of $19.4 million, amortization of inventory step-up of $12.7 million, deferred income taxes of $8.8 million and changes in working capital of $160.3 million.
Previous wording
Cash flows provided by operating activities for the nine months ended September 30, 2025 primarily consisted of $192.3 million of net income, adjusted for non-cash items, including $72.4 million of share-based compensation, $30.5 million in deferred income taxes, $23.3 million of depreciation and amortization and $27.7 million of changes in working capital.
Current wording
Cash flows provided by operating activities for the three months ended March 31, 2025 were $98.8 million and primarily consisted of net income of $22.5 million, adjusted for non-cash items, including share-based compensation of $22.8 million, depreciation and amortization of $7.4 million, deferred income taxes of $2.5 million and changes in working capital of $43.3 million.
Previous wording
Cash flows provided by financing activities for the nine months ended September 30, 2025 were due to $32.2 million of cash that we received upon exercises of employee stock options, offset by $30.8 million of employee taxes paid related to the net share settlement of equity awards. Cash flows used in financing activities for the nine months ended September 30, 2024 primarily related to $200.0 million (exclusive of any fees, commissions or other related expenses) used to repurchase our ordinary shares under the Repurchase Program and $29.3 million of employee taxes paid related to the net share settlement of equity awards, partially offset by $19.4 million of cash that we received upon exercises of employee stock options.
Current wording
Cash flows provided by financing activities for the three months ended March 31, 2026 were primarily due to $1,511.6 million in net proceeds from borrowings under the Facilities in connection with the Avadel Acquisition and $15.7 million of cash that we received upon exercises of employee stock options, partially offset by $27.7 million (exclusive of any fees, commissions or other related expenses) used to repurchase our ordinary shares under the Repurchase Program and $23.4 million of employee taxes paid related to the net share settlement of equity awards.
Previous wording
Interest income consists of interest earned on our cash and available-for-sale investments. Interest expense consisted of interest incurred on our previously outstanding term loans (the “Former Term Loans”) that were scheduled to become due in 2026 under our former amended and restated credit agreement, which we prepaid in full and terminated in December 2024. See Note 12, Long-Term Debtin the “Notes to Consolidated Financial Statements” accompanying our Annual Report for additional information regarding our Former Term Loans.
Current wording
For additional details regarding our outstanding indebtedness, see Note 12, Long-Term Debtin the “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q.
Previous wording
See the “Critical Accounting Estimates” section in “Part II, Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report for a discussion of our critical accounting estimates.
Current wording
See the “Critical Accounting Estimates” section in “Part II, Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report for a discussion of our critical accounting estimates. See below for a discussion of additions to our critical accounting estimates since December 31, 2025.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Cash flows provided by financing activities for the three months ended March 31, 2025 were primarily due to $29.5 million of cash that we received upon exercises of employee stock options, partially offset by $28.8 million of employee taxes paid related to the net share settlement of equity awards.