What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-02-16 compared with 2022-02-16 · 121 added, 115 removed, 621 unchanged (28% of the section changed)

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Alkermes plc is a fully-integrated, global biopharmaceutical company that applies its scientific expertise and proprietary technologies to research, develop and commercialize, both with partners and on its own, pharmaceutical products that are designed to address unmet medical needs of patients in major therapeutic areas.

Alkermes has a portfolio of proprietary commercial products focused on alcohol dependence, opioid dependence, schizophrenia and bipolar I disorder, and a pipeline of product candidates in development for neurodegenerative disorders and cancer.

Headquartered in Dublin, Ireland, Alkermes has a research and development (“R&D”) center in Waltham, Massachusetts;

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Schizophrenia

Schizophrenia and

Schizophrenia;

Bipolar I disorder

dependence and

Alcohol dependence;

Opioid dependence

The following provides summary information regarding our key licensed products, and certain key third-party products using our proprietary technologies under license, that are commercialized by our licensees:

The following provides summary information regarding our key licensed product, and certain key third-party products using our proprietary technologies under license, that are commercialized by our licensees:

Key Third-Party Products Using Our Proprietary Technologies

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Schizophrenia;

and Bipolar I

Pharmaceutica Inc.

(“Janssen, Inc.”) and

Pharmaceutica

International, a

division of Cilag

International AG (“Janssen

International”)

Janssen Pharmaceuticals, Inc.

(“Janssen, Inc.”) and Janssen Pharmaceutica International, a division of Cilag International AG (“Janssen International”)

INVEGA SUSTENNA* / XEPLION

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Schizophrenia;

and Schizoaffective

Schizoaffective disorder

Schizophrenia

Pharmaceutica N.V.

(together with

Janssen, Inc., Janssen

International and

their affiliates

Janssen Pharmaceutica N.V.

(together with Janssen, Inc., Janssen International and their affiliates “Janssen”)

INVEGA TRINZA* / TREVICTA

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Schizophrenia

* Janssen partially terminated its license agreement related to these products, effective February 2022.

See the section entitled “Products Using Our Proprietary Technologies” below and Note 17, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report for more information with respect to this partial termination and the arbitration proceedings related to this partial termination and other matters in respect of these products.

Our Key Licensed Product

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ARISTADA is packaged in a ready-to-use, pre-filled syringe product format.

We developed ARISTADA and exclusively manufacture and commercialize it in the U.S.

We exclusively manufacture and commercialize ARISTADA in the U.S.

ARISTADA INITIO

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The first ARISTADA dose may be administered on the same day as the ARISTADA INITIO regimen or up to 10 days thereafter.

We developed ARISTADA INITIO and exclusively manufacture and commercialize it in the U.S.

We exclusively manufacture and commercialize ARISTADA INITIO in the U.S.

In December 2022, U.S.

11,518,745 relating to ARISTADA and ARISTADA INITIO was granted.

The patent has claims to the synthesis of aripiprazole lauroxil and expires in 2030.

What is schizophrenia?

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LYBALVI was launched commercially in October 2021 and is available in fixed dosage strengths composed of 10 mg of samidorphan and 5 mg, 10 mg, 15 mg or 20 mg of olanzapine.

We developed LYBALVI and exclusively manufacture and commercialize it in the U.S.

We exclusively manufacture and commercialize LYBALVI in the U.S.

What is bipolar I disorder?

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Bipolar I disorder is characterized by the occurrence of at least one manic episode, with or without the occurrence of a major depressive episode, and affects approximately 1% of the American adult population in any given year.

VIVITROL (naltrexone for extended-release injectable suspension) is a once-monthly, non-narcotic, injectable medication approved in the U.S., Russia and certain countries of the Commonwealth of Independent States for the treatment of alcohol dependence and for the prevention of relapse to opioid dependence, following opioid detoxification.

VIVITROL (naltrexone for extended-release injectable suspension) is a once-monthly, non-narcotic, injectable medication approved in the U.S.

for the treatment of alcohol dependence in patients able to abstain from alcohol in an outpatient setting prior to initiation of treatment with VIVITROL and for the prevention of relapse to opioid dependence, following opioid detoxification.

VIVITROL uses our polymer-based microsphere injectable extended-release technology to deliver and maintain therapeutic medication levels in the body through one intramuscular injection every four weeks.

We developed and exclusively manufacture VIVITROL and we commercialize it in the U.S.

For a discussion of legal proceedings related to VIVITROL, see Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report , and for information about risks relating to such legal proceedings, see “Item 1A—Risk Factors” in this Annual Report and specifically the sections entitled “Patent and other IP protection for our products is key to our business and our competitive position but is uncertain,” “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation, which is inherently costly and unpredictable, could significantly delay or prevent approval or negatively impact commercialization of our products, and could adversely affect our business” 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 .”

We exclusively manufacture and commercialize VIVITROL in the U.S.

For a discussion of legal proceedings related to VIVITROL, see Note 17, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report , and for information about risks relating to such legal proceedings, see “Item 1A—Risk Factors” in this Annual Report and specifically the sections entitled “Patent and other IP protection for our products is key to our business and our competitive position but is uncertain,” “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation, which is inherently costly and unpredictable, could significantly delay or prevent approval or negatively impact commercialization of our products, and could adversely affect our business” 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 .”

What are opioid dependence and alcohol dependence?

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National Survey on Drug Use and Health, an estimated 2.6 million people aged 18 or older in the U.S.

had an opioid use disorder in the past year.

had an opioid use disorder in the prior year.

Alcohol dependence is a serious and chronic brain disease characterized by cravings for alcohol, loss of control over drinking, withdrawal symptoms and an increased tolerance for alcohol.

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National Survey on Drug Use and Health, an estimated 27.8 million people aged 18 or older in the U.S.

had an alcohol use disorder in the past year.

had an alcohol use disorder in the prior year.

Adherence to medication is particularly challenging with these patient populations.

In 2013, with the publication of the Diagnostic Statistical Manual (“DSM”) 5, the DSM IV diagnoses of substance use disorders as either dependence or abuse (i.e., opioid dependence or alcohol dependence), which reflects the approved indications of VIVITROL, were subsumed under a new diagnostic category of “substance use disorders” (i.e., opioid use disorder or alcohol use disorder) with three categories of disorder severity—mild, moderate or severe.

In determining the applicability of treatments for DSM-IV conditions to persons diagnosed according to DSM-5, one study found agreement between the DSM-IV diagnoses of alcohol dependence and opioid dependence and moderate to severe alcohol use disorder and opioid use disorder, respectively, under DSM-5.

Licensed Products and Products Using Our Proprietary Technologies

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INVEGA SUSTENNA/XEPLION, INVEGA TRINZA/TREVICTA and INVEGA HAFYERA/BYANNLI

In November 2021 we received notice of partial termination in the U.S.

of our license agreement with Janssen related to INVEGA SUSTENNA, INVEGA TRINZA, and INVEGA HAFYERA.

This partial termination became effective in February 2022.

The basis for this termination is Janssen’s assertion that it does not utilize our NanoCrystal technology licensed under the license agreement.

We strongly disagree with Janssen’s position and are prepared to pursue all options at our disposal to enforce our contractual rights and address any unauthorized use of our intellectual property.

For information about risks relating to this notice of partial termination and our collaborative arrangements more broadly, see “Item 1A—Risk Factors” in this Annual Report and specifically that section entitled “We rely heavily on our licensees in the commercialization and continued development of products from which we receive revenue and, if our licensees are not effective, or if disputes arise in respect of our contractual arrangements, our revenues could be materially adversely affected”.

In November 2021, we received notice of partial termination of an exclusive license agreement with Janssen.

Under this license agreement, we provided Janssen with rights to, and know-how, training and technical assistance in respect of, our small particle pharmaceutical compound technology, known as NanoCrystal technology, which was used to develop INVEGA SUSTENNA/XEPLION, INVEGA TRINZA/TREVICTA, and INVEGA HAFYERA/BYANNLI.

When the partial termination became effective in February 2022, Janssen ceased paying royalties related to sales of INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA in the U.S.

In April 2022, we commenced binding arbitration proceedings related to, among other things, Janssen’s partial termination of this license agreement and Janssen’s royalty and other obligations under the agreement.

On December 21, 2022, we received an interim award (the “Interim Award”) in these proceedings from the arbitral tribunal (the “Tribunal”), in which the Tribunal agreed with our position that, while Janssen may terminate the agreement, it may not continue to sell Products (as defined in the agreement) developed during the term of the agreement without paying royalties pursuant to the terms of the agreement.

This award is not yet final.

We will engage with Janssen and the Tribunal in additional proceedings prior to the Tribunal’s issuance of a final award.

For additional information about these proceedings, see Note 17, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report and for information about risks relating to this notice of partial termination and our collaborative arrangements more broadly, see “Item 1A—Risk Factors” in this Annual Report and specifically that section entitled “We rely heavily on our licensees in the commercialization and continued development of products from which we receive revenue and, if our licensees are not effective, or if disputes arise in respect of our contractual arrangements, our revenues could be materially adversely affected”.

INVEGA SUSTENNA/XEPLION (paliperidone palmitate), INVEGA TRINZA/TREVICTA (paliperidone palmitate) and INVEGA HAFYERA/BYANNLI (paliperidone palmitate) (collectively, the “long-acting INVEGA products”) are long-acting atypical antipsychotics owned and commercialized worldwide by Janssen.

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INVEGA HAFYERA is approved in the U.S.

for the treatment of schizophrenia in patients who have been adequately treated with INVEGA SUSTENNA for at least four months or INVEGA TRINZA for at least three months.

for the treatment of schizophrenia in patients who have been adequately treated with INVEGA SUSTENNA for at least four months or INVEGA TRINZA for at least three month s .

BYANNLI is approved in the EU for the maintenance treatment of schizophrenia in adult patients who are clinically stable on XEPLION or TREVICTA .

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RISPERDAL CONSTA microspheres are exclusively manufactured by us.

For a discussion of legal proceedings related to certain of the patents covering RISPERDAL CONSTA, see Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report and for information about risks relating to such legal proceedings, see “Item 1A—Risk Factors” in this Annual Report and specifically the section entitled “We or our licensees may face claims against IP rights covering our products and competition from generic drug manufacturers.”

Licensed Product

VUMERITY (diroximel fumarate) is a novel, oral fumarate with a distinct chemical structure that is approved in the U.S., the European Union and certain European countries for the treatment of relapsing forms of multiple sclerosis in adults, including clinically isolated syndrome, relapsing-remitting disease and active secondary progressive disease.

VUMERITY (diroximel fumarate) is a novel, oral fumarate with a distinct chemical structure that is approved in the U.S., the EU and several other countries for the treatment of relapsing forms of multiple sclerosis in adults, including clinically isolated syndrome, relapsing-remitting disease and active secondary progressive disease.

Under our license and collaboration agreement with Biogen, Biogen holds the exclusive, worldwide license to develop and commercialize VUMERITY.

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See the “Patents and Proprietary Rights” section in “Item 1—Business” in this Annual Report for information with respect to the IP protection for our key development program.

nemvaleukin alfa

the activation of immunosuppressive cells by selectively binding to the intermediate-affinity IL-2 receptor complex.

n emvaleukin alfa

Nemvaleukin alfa (“nemvaleukin”) is an investigational, novel, engineered fusion protein comprised of modified interleukin-2 (“IL-2”) and the high affinity IL-2 alpha receptor chain, designed to preferentially expand tumor-killing immune cells while avoiding the activation of immunosuppressive cells by selectively binding to the intermediate-affinity IL-2 receptor complex.

The selectivity of nemvaleukin is designed to leverage the proven anti-tumor effects of existing IL-2 therapy while mitigating certain limitations.

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The ARTISTRY program is comprised of multiple clinical trials evaluating intravenous (“IV”) and subcutaneous (“SC”) dosing of nemvaleukin, both as a monotherapy and in combination with the anti-PD-1 therapy KEYTRUDA (pembrolizumab) in patients with advanced solid tumors.

ARTISTRY-1 (evaluating IV nemvaleukin) and ARTISTRY-2 (evaluating SC nemvaleukin) are ongoing phase 1/2 studies evaluating the safety, tolerability, efficacy and pharmacokinetic and pharmacodynamic effects of nemvaleukin in patients with refractory advanced solid tumors, in both monotherapy and combination settings.

ARTISTRY-3 is an ongoing phase 2 study evaluating the efficacy, safety and tolerability of less frequent dosing of IV nemvaleukin and pharmacokinetic and pharmacodynamic effects of IV nemvaleukin in the tumor microenvironment as a monotherapy and in combination with pembrolizumab in a variety of advanced solid tumors.

ARTISTRY-6 is an ongoing phase 2 study evaluating the anti-tumor activity, safety and tolerability of IV nemvaleukin monotherapy in patients with mucosal melanoma and SC nemvaleukin monotherapy in patients with advanced cutaneous melanoma.

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In March 2021 and August 2021, we announced that the FDA granted Orphan Drug Designation and Fast Track designation, respectively, to nemvaleukin for the treatment of mucosal melanoma.

In October 2021, the FDA granted Fast Track designation to nemvaleukin in combination with pembrolizumab for the treatment of platinum-resistant ovarian cancer.

In October 2021, we announced that the FDA granted Fast Track designation to nemvaleukin in combination with pembrolizumab for the treatment of platinum-resistant ovarian cancer.

In January 2023, we announced that the Medicines and Healthcare products Regulatory Agency (MHRA), the regulatory body of the United Kingdom (UK), granted nemvaleukin an Innovation Passport for the treatment of mucosal melanoma under the Innovative Licensing and Access Pathway (ILAP).

Collaborative Arrangements

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INVEGA SUSTENNA/XEPLION, INVEGA TRINZA/TREVICTA and INVEGA HAFYERA/BYANNLI

In November 2021, we received notice of partial termination in the U.S.

of our license agreement with Janssen related to INVEGA SUSTENNA, INVEGA TRINZA, and INVEGA HAFYERA.

The basis for this termination is Janssen’s assertion that it does not utilize our NanoCrystal technology licensed under the license agreement.

We strongly disagree with Janssen’s position and are prepared to pursue all options at our disposal to enforce our contractual rights and address any unauthorized use of our intellectual property.

For information about risks relating to this notice of partial termination and our collaborative arrangements more broadly, see “Item 1A—Risk Factors” in this Annual Report and specifically those sections entitled “We rely heavily on our licensees in the commercialization and continued development of products from which we receive revenue and, if our licensees are not effective, or if disputes arise in respect of our contractual arrangements, our revenues could be materially adversely affected.”

Under our license agreement with Janssen Pharmaceutica N.V., we granted Janssen a worldwide exclusive license under our NanoCrystal technology to develop, commercialize and manufacture injectable pharmaceutical products containing paliperidone palmitate, which include the long-acting INVEGA products.

Under this license agreement, we received milestone payments from Janssen upon the achievement of certain development goals;

In November 2021, we received notice of partial termination of an exclusive license agreement with Janssen.

When the partial termination became effective in February 2022, Janssen ceased paying royalties related to sales of INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA in the U.S.

and we stopped recognizing royalty revenue related to net sales of these products.

On December 21, 2022, we received the Interim Award in these proceedings from the Tribunal, in which the Tribunal agreed with our position that, while Janssen may terminate the agreement, it may not continue to sell Products (as defined in the agreement) developed during the term of the agreement without paying royalties pursuant to the terms of the agreement.

This award is not yet final.

We will engage with Janssen and the Tribunal in additional proceedings prior to the Tribunal’s issuance of a final award.

For additional information about these proceedings, see Note 17, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report and for information about risks relating to this notice of partial termination and our collaborative arrangements more broadly, see “Item 1A—Risk Factors” in this Annual Report and specifically those sections entitled “We rely heavily on our licensees in the commercialization and continued development of products from which we receive revenue and, if our licensees are not effective, or if disputes arise in respect of our contractual arrangements, our revenues could be materially adversely affected.”

Under this license agreement, we granted Janssen a worldwide exclusive license under our NanoCrystal technology to develop, commercialize and manufacture injectable pharmaceutical products containing paliperidone palmitate, which include the long-acting INVEGA products, and we received milestone payments from Janssen upon the achievement of certain development goals;

there are no further milestones to be earned under this agreement.

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The know how royalty is a tiered royalty of 3.5% on calendar year net sales up to $250 million, 5.5% on calendar year net sales of between $250 million and $500 million and 7.5% on calendar year net sales exceeding $500 million.

The know‑how royalty rate resets to 3.5% at the beginning of each calendar year and is payable until 15 years from the first commercial sale of a product in each individual country.

The know how royalty rate resets to 3.5% at the beginning of each calendar year and is payable until 15 years from the first commercial sale of a product in each individual country, subject to expiry of the agreement.

These royalty payments may be reduced in any country based on patent litigation or on competing products achieving certain minimum sales thresholds.

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Revenues from our collaborative arrangements with Janssen accounted for approximately 15%, 30% and 33% of our consolidated revenues for the years ended December 31, 2022, 2021 and 2020, respectively.

Under a license and collaboration agreement with Biogen, which we entered into in November 2017 and amended in October 2018, January 2019 and October 2019, we granted Biogen a worldwide, exclusive, sublicensable license to develop, manufacture and commercialize VUMERITY and other products covered by patents licensed to Biogen under that agreement.

Under this license and collaboration agreement, we received an upfront cash payment and milestone payments upon the achievement of certain milestones, including FDA approval of the NDA for VUMERITY in October 2019, and amendment of the license and collaboration agreement in October 2019.

Under a license and collaboration agreement with Biogen, we granted Biogen a worldwide, exclusive, sublicensable license to develop, manufacture and commercialize VUMERITY and other products covered by patents licensed to Biogen under that agreement.

Under this license and collaboration agreement, we received an upfront cash payment and milestone payments related to the achievement of certain milestones, including FDA approval of the NDA for VUMERITY and amendment of the license and collaboration agreement.

We are also eligible to receive additional payments upon achievement of certain milestones, including milestones relating to the first two products other than VUMERITY covered by patents licensed to Biogen under the license and collaboration agreement.

In addition, we receive a 15% royalty on worldwide net sales of VUMERITY, subject to, under certain circumstances, minimum annual payments for the first five years following FDA approval of VUMERITY.

In addition, we receive a 15% royalty on worldwide net sales of VUMERITY, subject to increases for VUMERITY manufactured and/or packaged by Biogen or its designees, and subject to, under certain circumstances, minimum annual payments for the first five years following FDA approval of VUMERITY.

We are also entitled to receive royalties on net sales of products other than VUMERITY covered by patents licensed to Biogen under the license and collaboration agreement, at tiered royalty rates calculated as percentages of net sales ranging from high-single digits to sub-teen double digits.

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Following FDA approval of VUMERITY and except for the manufacturing responsibilities discussed below, Biogen is now responsible for all development and commercialization activities for VUMERITY and all other products covered by the patents that we licensed to Biogen.

Under the license and collaboration agreement, Biogen appointed us as the toll manufacturer of clinical and commercial supplies of VUMERITY, subject to Biogen’s right to manufacture or have manufactured commercial supplies as a back-up manufacturer and

subject to good faith agreement by the parties on the terms of such manufacturing arrangements.

Biogen has elected to initiate a technology transfer and, following a transition period, assume responsibility for the manufacture (itself or through a designee) of clinical supplies of VUMERITY and up to 100% of commercial supplies of VUMERITY in exchange for an increase in the royalty rate to be paid by Biogen to us on net sales of that portion of product that is manufactured by Biogen or its designee .

In October 2019, we entered into a commercial supply agreement with Biogen for the commercial supply of VUMERITY, an amendment to such commercial supply agreement and an amendment to the license and collaboration agreement with Biogen , pursuant to which Biogen has elected to conduct a technology transfer and, subject to agreement in respect of a manufacturing transition period, assume responsibility for the manufacture (itself or through a designee) of clinical supplies of VUMERITY and up to 100% of commercial supplies of VUMERITY in exchange for an increase in the royalty rate to be paid by Biogen to us on net sales of that portion of product that is manufactured by Biogen or its designee .

Unless earlier terminated, the license and collaboration agreement will remain in effect until the expiry of all royalty obligations.

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Our manufacturing and development capabilities include formulation through process development, scale‑up and full‑scale commercial manufacturing and specialized capabilities for the development and manufacturing of controlled substances.

Although some materials and related services for our products are currently only available from a single source or a limited number of qualified sources, we attempt to acquire an adequate inventory of such materials, establish alternative sources for such

materials and related services and/or negotiate long ‑term supply arrangements.

However, we cannot be certain that we will continue to be able to obtain long‑term supplies of our manufacturing materials or long-term provision of related services.

Our supply chain is growing with an expanding external network of third‑party service providers involved in the manufacture of our products who are subject to inspection by the FDA or comparable agencies in other jurisdictions.

Our supply chain includes an external network of third‑party service providers involved in the manufacture of our products who are subject to inspection by the FDA or comparable agencies in other jurisdictions.

Any delay, interruption or other issues that arise in the acquisition of API, raw materials, or components, or in the manufacture, fill‑finish, packaging, or storage of our marketed or development products, including as a result of a failure of our facilities or the facilities or operations of third parties to pass any regulatory agency inspection, could significantly impair our ability to sell our products or advance our development efforts, as the case may be.

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Our Wilmington, Ohio facility has been inspected by U.S., European (including the UK Medicines and Healthcare products Regulatory Agency), Chinese, Japanese, Brazilian, Turkish, Russian and Saudi Arabian regulatory authorities for compliance with required cGMP standards for continued commercial manufacturing.

We manufacture several products in our Athlone, Ireland facility that are marketed by third parties, including AMPYRA, FAMPYRA and VUMERITY.

This facility has been inspected by U.S., Irish, Brazilian, Turkish, Saudi Arabian, Korean, Belarusian, Russian and Chinese regulatory authorities for compliance with required cGMP standards for continued commercial manufacturing.

We manufacture several products in our Athlone, Ireland facility that are marketed by third parties, including FAMPYRA and VUMERITY.

This facility has been inspected by U.S., Irish, Brazilian, Turkish, Gulf Health States, including Saudi Arabia, Korean, Belarusian, Russian and Chinese regulatory authorities for compliance with required cGMP standards for continued commercial manufacturing.

For more information about our manufacturing facilities, see “Item 2—Properties” in this Annual Report.

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IMP074) and Certificates of Good Manufacturing Practice Compliance of a Manufacturer (Ref.

2014/7828/IMP074 and 2014/7828/M1067) from the Health Products Regulatory Authority in Ireland (“HPRA”) in respect of our Athlone, Ireland facility, and a number of Controlled Substance Licenses granted by HPRA.

2014/7828/IMP074 and 2014/7828/M1067) from the Health Products Regulatory Authority in Ireland (“HPRA”) in respect of our

Athlone, Ireland facility, and a number of Controlled Substance Licenses granted by HPRA.

Due to certain U.S.

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product acceptance by, and preferences of, physicians, other healthcare providers and patients;

our ability to comply with applicable laws, regulations and regulatory requirements with respect to the commercialization of our products, including any changes or increases to regulatory restrictions;

our ability to comply with applicable laws, regulations and regulatory requirements with respect to the commercialization of our products, including any changes or increases to regulatory

restrictions;

protection of our proprietary rights relating to our products;

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and our ability to recruit, retain and develop skilled employees .

With respect to our proprietary injectable product platform, we are aware that there are other companies developing extended-release delivery systems for pharmaceutical products, including but not limited to, Teva Pharmaceuticals Industries Ltd.’s development of a risperidone extended-release injectable suspension for subcutaneous use and a once every two weeks injectable microsphere formulation, each for the treatment of schizophrenia, and Teva Pharmaceuticals USA, Inc.’s Abbreviated New Drug Application (“ANDA”) seeking approval to commercialize a generic version of VIVITROL (naltrexone for extended-release injectable suspension).

With respect to our proprietary injectable product platform, we are aware that there are other companies developing extended-release delivery systems for pharmaceutical products, including but not limited to, technology from MedinCell S.A., which underpins Teva Pharmaceuticals Industries Ltd.’s development of a risperidone extended-release injectable suspension for subcutaneous use, technology from Pharmathen S.A., which underpins aripiprazole formulations in development, and technology underpinning Teva Pharmaceuticals Industries Ltd.’s once every two weeks injectable microsphere formulation, each for the treatment of schizophrenia, and Teva Pharmaceuticals USA, Inc.’s Abbreviated New Drug Application (“ANDA”) seeking approval to commercialize a generic version of VIVITROL (naltrexone for extended-release injectable suspension).

In the treatment of schizophrenia, ARISTADA, the long-acting INVEGA products and RISPERDAL CONSTA compete with each other and a number of other injectable products, including ZYPREXA RELPREVV ((olanzapine) For Extended Release Injectable Suspension), which is marketed and sold by Lilly;

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PERSERIS (risperidone for extended release injectable suspension), a once-monthly formulation of risperidone marketed by Indivior plc;

and generic versions of branded injectable products .

generic versions of branded injectable products;

and, once it launches in the U.S., RYKINDO (risperidone), a once-every-two-weeks injectable formulation of risperidone developed by Luye Pharma Group.

In the treatment of schizophrenia, LYBALVI competes with other oral antipsychotic products, including CAPLYTA (lumateperone) developed and marketed by Intra-Cellular Therapies, Inc.;

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ZEPOSIA from Bristol-Myers Squibb Company;

and PONVORY from Janssen.

PONVORY from Janssen;

and, once it launches in the U.S., BRIUMVI TM (ublituximab-xiiy) from TG Therapeutics, Inc.

With respect to our NanoCrystal technology, we are aware that other technology approaches similarly address poorly water‑soluble drugs.

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ARISTADA INITIO

VIVITROL and RISPERDAL CONSTA

We have a number of patents and pending patent applications covering our microsphere technology throughout the world, which, to some extent, cover VIVITROL and RISPERDAL CONSTA.

The latest to expire of our patents covering RISPERDAL CONSTA expire in the U.S.

in 2023 and expired in the EU in 2021.

The latest to expire of our patents covering RISPERDAL CONSTA expired in the U.S.

in January 2023 and expired in the EU in 2021.

We own one unexpired Orange-Book listed U.S.

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Under the terms of a settlement and license agreement entered into in July 2019 with Amneal Pharmaceuticals LLC (“Amneal”), we granted Amneal a non-exclusive license under certain patents covering VIVITROL, including the remaining patent covering VIVITROL in the U.S., to market and sell a generic formulation of VIVITROL in the U.S.

beginning sometime in 2028 or

earlier under certain circumstances.

beginning sometime in 2028 or earlier under certain circumstances.

For a discussion of legal proceedings related to the U.S.

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and in countries outside of the U.S.

The latest of the patents subject to our license agreement expires in 2030 in the U.S.

and certain other countries and in 2022 in the EU.

The latest to expire of the patents subject to our license agreement expires in 2030 in the U.S., the EU and certain other countries.

In addition, Janssen has other patents not subject to our license agreement, including one that covers INVEGA SUSTENNA in the U.S.

and expires in 2031 and one that covers INVEGA TRINZA in the U.S.

and expires in 2036.

For a discussion of legal proceedings related to one of the patents covering INVEGA SUSTENNA, see Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report.

and expires in 2031, one that covers INVEGA TRINZA in the U.S.

and expires in 2036 and two that cover INVEGA HAFYERA in the U.S.

and expire in 2041.

For a discussion of legal proceedings related to patents covering INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA, see Note 17, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report.

patents and patent applications, and a number of corresponding non-U.S.

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The manufacture, use, offer for sale, sale or import of some of our products might be found to infringe on the claims of these patents.

A third party might file an infringement

action against us.

A third party might file an infringement action against us.

The cost of defending such an action is likely to be high, and we might not receive a favorable ruling.

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Patent and Trademark Office and the patent or trademark offices of other countries.

Our licensed products and products using our proprietary technologies also use trademarks that are owned by our licensees, such as the trademarks for INVEGA SUSTENNA/XEPLION, INVEGA TRINZA/TREVICTA, INVEGA HAFYERA/BYANNLI and RISPERDAL CONSTA, which are registered trademarks of Johnson & Johnson Corporation, VUMERITY, which is a registered trademark of Biogen (and used by Alkermes under license) and AMPYRA and FAMPYRA, which are registered trademarks of Acorda.

Our licensed products and products using our proprietary technologies also use trademarks that are owned by our licensees, such as the trademarks for INVEGA SUSTENNA/XEPLION, INVEGA TRINZA/TREVICTA, INVEGA HAFYERA/BYANNLI and RISPERDAL CONSTA, which are registered trademarks of Johnson & Johnson or its affiliated companies, VUMERITY, which is a registered trademark of Biogen (and used by us under license) and FAMPYRA, which is a registered trademark of Acorda.

Trademark protection varies in accordance with local law and continues in some countries as long as the trademark is used and in other countries as long as the trademark is registered.

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In the case of adding a new indication, we would be required to demonstrate with additional clinical data that the product is safe and effective for the new intended use.

Such regulatory reviews can result in denial or modification of the

planned changes, or requirements to conduct additional tests or evaluations that can substantially delay or increase the cost of the planned changes .

Such regulatory reviews can result in denial or modification of the planned changes, or requirements to conduct additional tests or evaluations that can substantially delay or increase the cost of the planned changes.

In addition, the FDA regulates all advertising and promotional activities for products under its jurisdiction.

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Regardless of the approval process employed, various parties share responsibilities for the monitoring, detection and evaluation of adverse events post‑approval, including national authorities, the EMA, the EC, other relevant regulatory authorities and the marketing authorization holder.

Good Manufacturing Processes

Good Manufacturing Practices

The FDA, the EMA, the competent authorities of the EU member states and other regulatory agencies regulate and inspect equipment, facilities and processes used in the manufacturing of pharmaceutical and biologic products prior to approving a product.

In 2020 and 2021, the COVID-19 pandemic has in some instances impacted the FDA’s and other regulatory agencies’ ability to conduct on-site inspections and has resulted in such agencies either delaying planned inspections or collecting the requisite information through review of written records in lieu of an on-site inspection, which in some instances has negatively impacted timelines for potential product approvals.

Since 2020 and 2021, the COVID-19 pandemic has in some instances impacted the FDA’s and other regulatory agencies’ ability to conduct on-site inspections and has resulted in such agencies either delaying planned inspections or collecting the requisite information through review of written records in lieu of an on-site inspection.

Once approval from a regulatory agency is obtained, if a company makes a material change in manufacturing equipment, location or process, additional regulatory review and approval may be required.

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The rebate amount is required to be recomputed each quarter based on our report of current AMP and best price for each of our products to the Centers for Medicare & Medicaid Services (“CMS”).

The terms of our participation in the rebate program imposes a requirement on us to report revisions to AMP or best price within a period not to exceed 12 quarters from the quarter in which the data was originally due.

The terms of our participation in the rebate program impose a requirement on us to report revisions to AMP or best price within a period not to exceed 12 quarters from the quarter in which the data was originally due.

Any such revisions could have the impact of increasing or decreasing our rebate liability for prior quarters, depending on the direction of the revision.

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Except for dual eligible Medicare Part D beneficiaries who qualify for low - income subsidies, manufacturers, including us, are required to provide a seventy percent ( 7 0%) discount on our brand name prescription drugs utilized by Medicare Part D beneficiaries when those beneficiaries reach the coverage gap in their drug benefits.

The availability of federal funds to pay for our products under the Medicaid Drug Rebate Program and Medicare Part B requires that we extend discounts to certain purchasers under the Public Health Services (including the Indian Health Services, “PHS”) pharmaceutical pricing program.

Purchasers eligible for discounts include a variety of community health clinics, other entities that receive health services grants from PHS, and hospitals that serve a disproportionate share of financially needy patients.

Federal law also requires that any company that participates in the Medicaid Drug Rebate Program also participate in the Public Health Services’ (including the Indian Health Services, “PHS”) pharmaceutical pricing program (the “340B program”), in order for federal funds to be available for the manufacturer’s drugs under Medicaid and Medicare Part B.

The 340B program, which is administered by the Health Resources and Services Administration (“HRSA”) requires participating manufacturers to agree to charge statutorily defined covered entities no more than the 340B “ceiling price” for the manufacturer’s covered drugs used in an outpatient setting.

These 340B covered entities include certain qualifying community health clinics, a variety of entities that receive health services grants from the Public Health Service, and multiple categories of hospitals, including children’s hospitals, critical access hospitals, free standing cancer hospitals and hospitals that serve a disproportionate share of low-income patients.

The 340B ceiling price is calculated using a statutory formula, which is based on the average manufacturer price and rebate amount for the covered outpatient drug as calculated under the Medicaid Drug Rebate Program.

A regulation regarding the calculation of the 340B ceiling price and the imposition of civil monetary penalties on manufacturers that knowingly and intentionally overcharge covered entities became effective on January 1, 2019.

The scope and implementation of the 340B program continue to be the subject of legislative and regulatory interest and ongoing litigation, the outcomes of which are difficult to predict.

We also make our products available for purchase by authorized users of the Federal Supply Schedule (“FSS”) of the General Services Administration pursuant to our FSS contract with the Department of Veterans Affairs.

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FSS pricing is intended not to exceed the price that we charge our most‑favored non‑federal customer for a product.

In addition, prices for drugs purchased by the Department of Veterans Affairs, Department of Defense (including drugs purchased by military personnel and dependents through the TriCare retail pharmacy program), Coast Guard and PHS are subject to a cap on pricing equal to 76% of the non‑federal average manufacturer price (“non‑FAMP”).

In addition, prices for drugs purchased by the Department of Veterans Affairs, Department of Defense (including drugs purchased by military personnel and dependents through the Tricare Retail Pharmacy (“Tricare”) program), Coast Guard and PHS are subject to a cap on pricing equal to 76% of the non‑federal average manufacturer price (“non‑FAMP”).

An additional discount applies if non‑FAMP increases more than inflation (measured by the Consumer Price Index—Urban).

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Such reforms may include price controls, value-based pricing and changes to the coverage and reimbursement of our products, which may have a significant impact on our business.

For example, in November 2021, the U.S.

House of Representatives passed H.R.

5376, the Build Back Better Act (the “BBBA”).

The BBBA includes several provisions that may impact our business, including provisions that create an out-of-pocket cap for seniors, implement a new manufacturer liability (including in Medicare Part D), allow the U.S.

government to negotiate prices for some drugs covered under Medicare Part B and Part D, require inflation rebates to limit annual increases in drug prices in Medicare and private insurance, and repeal the rebate rule that would require pass through of pharmacy benefit manager rebates to beneficiaries.

In August 2022, the Inflation Reduction Act of 2022 (the “Inflation Reduction Act”) was signed into law.

The Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including those that impose new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, allow the U.S.

government to negotiate prices for some drugs covered under Medicare Part D beginning in 2026 and Medicare Part B beginning in 2028, and require companies to pay rebates to Medicare beginning in 2023 for drug prices that increase faster than inflation.

In addition, emphasis on managed care in the U.S.

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As a global biopharmaceutical company focused on developing innovative medicines in the fields of neuroscience and oncology, we have built, and continue to devote significant resources to further develop and enhance, a comprehensive cross-functional infrastructure designed to support product development from discovery through commercialization and lifecycle management.

We seek to attract, hire, develop, recognize and retain qualified and highly skilled personnel with experience in areas

such as R&D, including early discovery, translational medicine, formulation and clinical development capabilities;

We seek to attract, hire, develop, recognize and retain qualified and highly skilled employees with experience in areas such as R&D, including early discovery, translational medicine, formulation and clinical development;

intellectual property prosecution, enforcement and defense;

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Competition for such personnel in our industry and the geographic regions in which we operate is intense, with numerous companies also developing, launching or marketing products, including products against which our products directly compete.

Supporting our employees’ well-being in a transparent, diverse, inclusive, and collaborative culture and providing them with the training, support and resources they need to succeed professionally, while appropriately balancing their professional and personal lives, helps keep our employees connected and engaged and is critical to our success.

We are committed to supporting our employees’ well-being in a transparent, diverse, inclusive, and collaborative culture and to providing them with access to training, support and resources intended to help them succeed professionally, while appropriately balancing their professional and personal lives.

As of February 10, 2023, we had approximately 2,280 full time employees, of which approximately 1,860 were based in the U.S.

and 420 were based in Ireland.

Our 2021 global voluntary attrition rate was below industry benchmarks.

Our 2022 global voluntary attrition rate of 9.5% was below industry benchmarks.

None of our employees are covered by a collective bargaining agreement, and we consider our relations with our employees to be good.

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We have established our compensation programs based on market and benchmark data and strive to pay all employees equitably, taking into consideration factors such as their role, skills, abilities and relevant experience.

We also offer healthcare and retirement savings plan benefits, paid time off, tuition reimbursement and other benefits designed to support healthy lifestyle choices, financial wellness and work-life balance.

Across all of our sites, we cultivate a work environment that reflects our values of collaboration at our core, respect for each voice and unwavering commitment.

Over the past several years, we have continued to focus on fostering an environment that respects and celebrates Diversity, Inclusion & Belonging (“DIB”) in our workplaces and our communities and have actively evolved our DIB strategy to cater to the changing needs of our employees and respond to important external social and cultural events.

In support of this strategy, in 2019, we created a global cross-functional DIB Steering Committee, comprised of representatives from all of our locations, including field-based employees, to create connections, foster conversations, help ensure our efforts are aligned with the diverse range of perspectives within our organization and develop and advance practices, tools and resources that can be used to strengthen the sense of belonging among our employee base.

Since 2020, we have established five Employee Resource Groups (ERGs):

Limitless, a network for individuals with disabilities and caregivers;

We routinely monitor our pay programs in order to respond to market trends and maintain equity within our workforce.

We offer healthcare and retirement savings plan benefits, paid time off, tuition reimbursement and other benefits designed to support healthy lifestyle choices, financial well-being and work-life balance.

Across our sites, we seek to cultivate a work environment that reflects our values of collaboration at our core, respect for each voice and unwavering commitment.

Over the past several years, we have continued to focus on fostering an environment that respects and celebrates Diversity, Inclusion & Belonging (“DIB”) in our workplaces and our communities and have actively evolved our DIB strategy to reflect the needs of our employees and our business.

We have a robust DIB governance structure, consisting of our DIB Steering Committee, Employee Resource Groups (“ERGs”), and a DIB Executive Committee.

Our global cross-functional DIB Steering Committee, comprised of representatives from all of our locations, including field-based employees, is focused on creating connections, fostering conversations, helping ensure our efforts are aligned with the diverse range of perspectives within our organization and developing and advancing practices, tools and resources that can be used to strengthen the sense of belonging among our employees.

Our five ERGs include:

Limitless, a network to support people impacted by disability or illness;

Mosaic, a multicultural network;

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These ERGs share a common purpose of supporting and enhancing the inclusiveness of our company culture and providing opportunities for professional development, networking and building deeper connections within Alkermes.

In 2021, we established a DIB Executive Committee, which includes our Chief Executive Officer and other senior leaders, to continue to refine our DIB strategy and champion its implementation and impact across the business.

Our DIB Executive Committee, which includes our Chief Executive Officer and other senior leaders, is tasked with continuing to refine our DIB strategy and championing its implementation and impact across the business.

These groups work together to set goals, establish and execute strategic initiatives, measure our progress and promote a culture of understanding and inclusion throughout our organization.

Additionally, as part of our increased focus on social and racial justice, diversity and inclusion, and in response to global events throughout 2020 and 2021, we held company-wide town hall conversations, sponsored recognition events and enhanced our Company’s diversity education and training.

We strive to foster a strong culture of active employee engagement to ensure that employees feel part of our mission and that they have a voice in the Alkermes community.

Since 2017, we have conducted annual employee engagement surveys to understand employee sentiment regarding, and satisfaction with, their work and experience at Alkermes.

In 2021, over 70% of our employees participated in our employee engagement survey and we have used the data collected to help inform and evolve our human capital management strategy and initiatives.

In 2022, through the collaboration of these groups, we introduced an annual performance goal focused on DIB for all senior leaders (Vice President level and above) at Alkermes with an emphasis on talent management, including recruiting and development.

Additionally, as part of our increased focus on social and racial justice, diversity and inclusion, we have held company-wide town hall conversations, sponsored recognition events and have enhanced our Company’s diversity education and awareness training.

We remain focused on achieving greater representation of diverse talent through targeted recruitment and development efforts.

In 2022, we achieved a notable increase in the percentage of our Vice Presidents/Senior Vice Presidents who are female (from 29.0% to 38.8%).

We also established a Women’s Mentoring Circle to provide internal resources for the continued development of our female talent pool.

Additionally, we have continued to focus on increasing the representation of people of color (“POC”) across our workforce and have partnered with outside organizations such as The Partnership and Connexion to support continued leadership development of POC within our organization.

We encourage active employee engagement to help ensure that employees feel part of our mission and that they have a voice in the Alkermes community.

Since 2017, we have conducted periodic employee engagement surveys to understand employee sentiment regarding, and satisfaction with, their work and experience at Alkermes and have used the data collected to help inform and evolve our human capital management strategy and initiatives.

In 2022, we conducted approximately 30 focus groups with more than 225 employees and managers across the organization as part of our efforts to enhance key company processes related to “employee listening” and performance management.

Also in 2022, we implemented function- and site-specific mentoring programs, conducted open forums with leaders, and hosted various company events to foster connections and visibility between leadership and employees and build strong peer-to-peer connections.

We are committed to the professional growth and development of our employees.

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We encourage and support our employees in their adoption of Individual Development Plans designed to identify professional development and growth opportunities to help support their career aspirations.

We frequently organize company-hosted trainings that cover topics including performance management, collaboration, leadership development, diversity, communication, and mentorship, and more specialized skills-based programs.

In 2021, we launched a new LinkedIn Learning platform to provide on-demand learning opportunities to our employees.

Since we made this platform available, our employees have, in the aggregate, viewed over 14,000 courses on a wide variety of topics.

We frequently offer company-hosted trainings that cover topics including performance management, problem-solving, leadership development, diversity, communication and mentorship, and as appropriate, more specialized skills-based programs.

We also provide all employees access to our LinkedIn Learning platform, which provides on-demand learning opportunities.

Our culture is one of collaboration and trust.

We ask our employees to help us promote and provide workplace environments that are safe and protective of the health and well-being of our people and in compliance with applicable laws, rules and regulations.

We maintain extensive environmental, health safety and security policies, adhere to all health and safety standards set by regulators in the locations in which we operate and routinely train employees and monitor our sites to reduce the risk of workplace accidents.

We ask our employees to help us promote and sustain workplace environments that are safe and protective of the health and well-being of our people and in compliance with applicable laws, rules and regulations.

We maintain extensive environmental, health, safety and security policies, adhere to all health and safety standards set by regulators in the locations in which we operate and routinely assess workplace risks, conduct employee trainings and monitor our sites to reduce the risk of workplace accidents.

In 2022, employee health, safety and wellness continued to be of particular focus and importance for the Company.

Following the emergence of the COVID-19 pandemic, we adopted a series of precautionary measures to protect and support our employees, including those performing essential tasks in our laboratories and manufacturing facilities who could not perform their work remotely.

In 2021, we adjusted our communication strategies to keep employees connected and informed, including increased communications from leadership and frequent online surveys to measure employee experiences and the effectiveness of our communications.

Since the emergence of the COVID-19 pandemic, we have adjusted and enhanced our remote work policies and opportunities, and our communication strategies for keeping employees connected and informed.

We also enhanced employee resources, including wellness and stress-reduction resources, guidance on how to effectively engage and work remotely, and increased childcare benefits.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business