Q3 2019 Earnings Call

The conference call.

Operator: Currently, all participants are in a listen-only mode. This call is being webcast live on the Investors and Media section of the SAGE website at sagerx.com. This call is the property of SAGE Therapeutics, and recording, reproduction, or transmission of this call without the express written consent of SAGE Therapeutics is strictly prohibited. I would now like to introduce Matthew Clistry, Director of Investor Relations at SAGE Therapeutics.

Currently all participants are no listen only mode.

This call is being webcast live on investors section of website at stage Rx Dot com.

The property of Sage therapeutics, and recording reproduction or transmission of this call without the expressed written consent of Sage therapeutics is strictly prohibited.

Please note that this call is being recorded.

I would now like synergies Matthew Clay Street Investor Relations at Sage Therapeutics.

Hello, and thanks for joining Sage Therapeutics third quarter 2019 financial results conference call before we begin I encourage everyone to go to investors in media section on our website its age Rx Dot Com, where you can find the press release related to today's call as was the slides nicotine supplemental details.

Matthew Clistry: Hello and thank you for joining SAGE Therapeutics' 3rd Quarter 2019 Financial Results Conference Call. Before we begin, I encourage everyone to go to the Investors & Media section of our website at sagerx.com, where you can find the press release related to today's call as well as the slides that contain supplemental details. I would like to point out that we will be making forward-looking statements, which are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and our actual results may differ materially.

I would like to point out that we will be making forward looking statements, which are based on current expectations and beliefs.

Statements are subject to certain risks and uncertainties actual results may differ materially. Please consult the risk factors discussed in today's press release and in or FCC filings for additional details.

Matthew Clistry: Please consult the risk factors discussed in today's press release and in our SEC filings for additional details. We will begin the call with prepared remarks by Dr. Jeff Jonas, our Chief Executive Officer; Mike Clunan, our Chief Business Officer; and Kimi Iguchi, our Chief Financial Officer. We will also be joined for the Q&A portion of the call by Dr. Steve Kaines, our Chief Medical Officer, Dr. Jim Doherty, our Chief Research Officer, and Dr. Al Robichaud, our Chief Scientific Officer. I will now turn the call over to Jeff.

I'll begin the call with prepared remarks by Dr., Jeff Jones, Our Chief Executive Officer, Mike Cronin, Our Chief Business Officer, Kimi Iguchi, our Chief Financial Officer will also be join for the 20 portion of the call by Dr., Steve <unk>, Our Chief Medical Officer, Dr., Jim Doherty, Our Chief Research Officer, and Darren I'll rubbish odd our Chief Scientific Officer, Oh now.

I'll turn the call over to Jeff.

Dr. Jeff Jonas: Hello, everyone. Thanks for joining us on our first full quarter call as a commercial organization. We have a lot to discuss with you today, including our update on the launch of Zulresa and the continued advancement of multiple compounds in all three of our franchises, depression, neurology, and neuroscience. As you've heard me say before, eight years ago, we stepped into an innovation void in neuroscience drug development. We've taken an approach to drug discovery and development that we think is unique. And by thinking differently about brain disorders, we believe we've made significant progress. With this strategy, we've built a pipeline of differentiated aspects.

Hello, everyone. Thanks for joining us on our first full quarter call has a commercial organization, we have lots of discussion with you today, including our update on the launch upsell, Russia and the continued advancement of multiple compounds in all three of our franchises depression neurology interest.

As you heard me say before eight years ago, we stepped into an innovation weight in neuroscience drug development, we've taken approached a drug discovery and development that we think is unique and my thinking differently about brain disorders. We believe we made significant progress.

With this strategy, we built a pipeline of differentiated assets.

Dr. Jeff Jonas: And with the launch of Zolreso and Postpartum Depression, or PPD, we have taken the first step in accomplishing our long-term goal of making a difference for patients suffering from brain health disorders. We're optimistic about the long-term prospects of our pipeline and the historically difficult neuroscience More importantly, Zolresso, along with SAGE 217, represents a true paradigm shift in how one can think about and treat psychiatric disorders. We believe people deserve new treatment options, options that will allow patients to choose among standard chronic therapeutic interventions and newer, rapidly acting, short-term options that may not require ongoing pharmacotherapy. So, let me first provide a brief update on the launch of Zulresso, and then Mike will take a deeper dive into the launch metrics, and Kimi will follow up with an update on our third quarter financials.

With the launch upsell restaurant, postpartum depression or PPD, we've taken the first step in accomplishing a long term goal of making a difference for patients suffering from brain health disorders, we're optimistic about the long term prospects of our pipeline and historically difficult neuroscience space.

More importantly, so resto glaucoma Sage 207 represents a true paradigm shift in how one can think about and treat psychiatric disorders.

We believe people deserve new treatment options options that will allow patients to choose among standard chronic therapeutic interventions and newer rapidly acting short term auctions that may not require ongoing pharmacotherapy. So let me first provide a brief update on the launch upsell Russia.

And then Mike will take a deeper dive into the launch metrics and Kimi will follow up with an update on our third quarter financials. You know first full quarter of the launch the commercial team has made significant progress in awareness access and reimbursement, although that is not necessarily reflected in their revenue for the quarter, which was 1.5 million as the first treatment ever approved for post.

Dr. Jeff Jonas: In our first full quarter of the launch, the commercial team has made significant progress in awareness, access, and reimbursement, although that is not necessarily reflected in the revenue for the quarter, which was $1.5 million. As the first treatment ever approved for postpartum depression, this is a unique launch, a hospital-based, and of note, it is a healthcare facility-based launch for a disorder that has a devastating impact on women with PPD and their families These are the early days of a launch, but what we are seeing is giving us reason to be optimistic about the long-term prospects for Zylreza, and that is strong patient demand, enthusiasm from healthcare providers about this innovative treatment option, and broad and favorable payer coverage only four months into the launch.

I'm Depression. This is a unique launch a hospital based products.

It is a health care facility based launch for disorder that has devastating impact on women with PBD and their families. These are the early days of a launch but what we're seeing is giving us reason to be optimistic about the long term prospects, Brazil, Russia and that is strong patient demand enthusiasm from health care providers about this innovative treatment option and.

Brought and favorable payer coverage only four months into the launch as Mike will explain later in the call. However, our experiences in the field or also confirming that the majority of health care side, we'll take six to nine months to become treatment ready as we've told you in prior calls Unfortunately that means many women with postpartum depression have not been able to access treatment.

Dr. Jeff Jonas: As Mike will explain later in the call, however, our experiences in the field are also confirming that the majority of healthcare sites will take six to nine months to become treatment-ready, as we've told you in prior calls. Unfortunately, that means many women with postpartum depression will not be able to access treatment with Zylreza during the first few months of the launch.

Also during the first three months of the launch Michael walking through the approach we're taking the helps accelerate to become treatment ready. We believe we made good progress in establishing the foundation for long term growth is already so based on our work in this first full quarter.

Dr. Jeff Jonas: Mike will walk you through the approach we are taking to help sites accelerate to become treatment-ready. We believe we've made good progress in establishing the foundation for long-term growth of Zylreza based on our work in this first full quarter. Later on, Mike will also provide more detail on some key learnings we have three months into the launch, as well as some baseline metrics.

Later on Mike will also provide more detail some key learnings we had three months until launch as well as some baseline metrics now moving to what we believe is one of the most promising neuroscience pipelines in the industry I'd like you have you. Some other milestones in the third quarter, we continue to advance multiple candidates across our three brain health franchise, we've made significant advancements in our depression.

Dr. Jeff Jonas: Now, moving to what we believe is one of the most promising neuroscience pipelines in the industry, I'd like to review some other milestones. In the third quarter, we continued to advance multiple candidates across our three brain health franchises. We've made significant advancements in our depression franchise, specifically our program evaluating SAGE 217 as a rapidly-acting, durable, short-course treatment for major depressive disorder, or MDD. In September, we initiated the Redwood Study, our pivotal study evaluating the efficacy, time-to-first relapse, and long-term safety of fixed-interval SAGE 217 monotherapy maintenance in patients with MDD. Also in September, we completed enrollment in our Mountain Study, our Pivotal Phase III placebo-controlled trial studying a two-week course of treatment with SAGE 2 and 7. We expect to report top-line results from Mountain this quarter.

Franchise, specifically a program evaluating sage 207, as a rapidly acting durable short course treatment for major depressive disorder for MDD in September we initiated the Redwood study our pivotal study evaluated the efficacy tied to first relapse and long term safety, a fixed giftable sage 207 monotherapy maintenance in patients with MD.

I'd.

Also in September we completed enrollment in our mountain state or pivotal phase three placebo controlled trial, starting a two week course of treatment exceeds two et cetera, We expect to report topline results from Mountain study. This quarter. Additionally, we completed enrollment in the shoreline studies are open label real World pivotal trial.

Dr. Jeff Jonas: Additionally, we completed enrollment in the Shoreline Study, our open-label, real-world, pivotal trial evaluating the long-term safety of as-needed treatment with SAGE 2 and 7 and assessing the need for treatment up to one year. We expect to report top-line results from this study in 2020. We are also in the process of evaluating the design and timing of a placebo-controlled study of SAGE 2 and 7 in treatment-resistant depression. Moving now on to Neurology and Neuropsych, For SAGE 324, the lead asset in our neurology franchise, we plan to initiate study-related activities for a Phase II clinical trial of central tremor, or ET, by the end of the year. Our goal to dose the first patient in the first half of 2020 remains on track.

Hi, waiting the long term safety I've asked me to treatment with Sage two in seven and assessing the need for treatment up to one year. We expect to report topline results from this study in 2020. We're also in the process of evaluating the design and timing of a placebo controlled study of Sage 207, you treatment resistant depression, moving now onto our neurology and narrow site franchises.

For stage 324, the lead asset you know neurology franchise, we plan to initiate study related activities for a phase two clinical trial in essential tremor or E. G by the end of year.

Got it does the first patient in the first half of 2020 remains on track given stage 320 fours pharmacologic characteristics, we believe opportunities in epilepsy and Parkinson's disease will also be worth pursuing we're also very excited about our differentiated NMD Pam sage seven when eight the lead acid in under a site franchise say several when he has a unique mechanism of.

Dr. Jeff Jonas: Given SAGE 324's pharmacologic characteristics, we believe opportunities in epilepsy and Parkinson's disease will also be worth pursuing. We're also very excited about our differentiated NMDA-PAM, SAGE 718, the lead asset in our neuropsych franchise. SAGE 718 has a unique mechanism of action and a profile of activity to date that suggests the potential for cognitive enhancement in the domains of executive function in a variety of disorders. We plan to report data from a Phase I clinical study of SAGE 718 in a cohort of patients with early Huntington's disease by the end of the year. I'm also pleased to announce we've expanded our early-stage pipeline with two new additional assets, both of which have recently had INDs cleared for development. SAGE 904 is our second novel NMDA product candidate and is being developed as a potential oral therapy for disorders involving NMDA hypofunction.

Action and a profile of activity to date, they suggest the potential for cognitive enhancement in the domains and executive function in a variety of disorder. We plan to report data from the phase one clinical study of Sage 7.8 in a cohort of patients with early Huntingtons disease by the end of the year I'm also pleased to announce we've expanded our early stage pipeline with two new additional assay.

Both of which have recently had I'd is cleared for development stage nine Ofour is our second novel entered da product candidate and is being developed as a potential oral therapy, but disorders involving an M.D.A. hypofunction.

Dr. Jeff Jonas: We have begun dosing healthy volunteers in a Phase I clinical study in the third quarter. Additionally, I'm pleased to announce that an IND has been cleared for SAGE 689, an intramuscular GABA-PAM, which we plan to move into the clinic as a potential therapy for disorders associated with GABA hypofunction in 2020. I want to remind everybody that our mission remains the same, to create, develop, and deliver medicines that matter. That is particularly important to us while we are executing the Zolresto launch and navigating the initial challenges for the first ever treatment approved for PPD. Now, I'll turn the call over to Mike for additional details about the launch.

We have begun dosing healthy volunteers in a phase one clinical study in the third quarter.

Additionally, I'm pleased to announce and an I'd has been cleared for Sage 689, and intramuscular GABAA, Pam, which we plan to move into the clinic has a potential therapy put disorders associated gas hypofunction in 2020, I want to remind everybody that our mission remains the same to create develop and deliver medicines that matter.

That is particularly important to us while we are executing this all wrestle launch and navigating the initial challenges for the first ever treatment approved for PPD.

Now I'll turn the call over to Mike for additional details about the launch thanks, Jeff and Hello, everyone as Justin to earlier. This is a unique launch in many ways health care facility base launch for the first treatment ever approved for postpartum depression.

Mike Clunan: Thanks Jeff, and hello everyone. As Jeff stated earlier, this is a unique launch in many ways. A healthcare facility-based launch for the first treatment ever approved for postpartum depression, a disorder that has a devastating impact on women with PPD and their families. We remain encouraged by the positive indicators that continue to suggest the long-term potential of Xeresso. For example, we have broad and favorable payer coverage, we believe the underlying demand is strong, and the number of interested sites of care continues to grow.

Disorder that as a devastating impact on women with PPD and their families. We remain encouraged by the positive indicators that continue to suggest the long term potential of the recipe. For example, we have brought in favorable payer coverage. We believe the underlying demand is strong and a number of interested sites of care continues to grow.

I finally feel like myself again, that's the inspiring sentiment we are hearing anecdotally from some of the women who have been treated with serasa for the quarter, we recognize product revenue of 1.5 million with 11 treating sites of care.

Mike Clunan: That's the inspiring sentiment we are hearing anecdotally from some of the women who have been treated with Soreso. For the quarter, we recognized product revenue of $1.5 million with 11 treating sites of care. As we anticipated, it is taking six to nine months or longer for treatment-ready sites to be activated. The treating sites in Q3 were sites that were able to accelerate the activation process.

As we anticipated it is taking six to nine months or longer for activation of treatment ready sites. The treating sites in Q3 were sites that were able to accelerate the activation process.

Mike Clunan: With a limited number of treatment sites in Q3, only a fraction of the women with PPD who wanted Xeresso were able to receive it. We are focused on continuing to accelerate site activation. We also received feedback from several treatment-ready sites about their intention to gain familiarity with the clinical profile of Xeresso and to secure direct experience with reimbursement prior to increasing patient intake. Given initial treatment patterns at sites of care, we believe revenue momentum may lag the expected increase in site-of-care activation. As a result, we believe Xeresso revenue growth will be modest over the next few quarters, and we expect to see a meaningful shift in revenue momentum in the second half of 2020.

With a limited number of treating sites in Q3, only a fraction of the women with PPD, who wanted to rest. So we're able to receive it we are focused on continuing to accelerate site activation.

We also received feedback from several treatment raise sites about their intention to gain familiarity with the clinical profile to wrestle into secure direct experience with reimbursement prior to increasing patient intake given initial treating patterns at sites of care. We believe revenue momentum may lag the expected increase in site of care activation as a result, we believes.

Vessel revenue growth will be modest over the next few quarters, and we expect to see a meaningful shift in revenue momentum in the second half of 2020.

Mike Clunan: One of our goals today is to describe in detail the factors involved in launching this unique product. Let me begin with some key learnings we have gained three months into the launch and some baseline metrics. First, as we previously stated, there are several well-defined actions needed for hospitals and other sites to introduce an innovative therapy like Xoreso into their treatment offering, including establishing site protocols to administer Xoreso, certifying under the Xoreso REMS, attaining formulary access, and securing satisfactory reimbursement from payers. We expected it would take 6-9 months or more for sites to navigate these actions and start treating patients, and that is As mentioned earlier, 11 sites were able to accelerate to treatment readiness status by the end of Q3, and based on these experiences, we have developed and deployed various tools and shared best practices designed to further accelerate, where possible, treatment readiness at sites of care.

One of our goals today is to described in detail. The factors involved in launching this unique product. Let me begin with some key learnings we have three months into the launch and some baseline metrics.

First as we previously stated there are several well defined actions needed for hospitals and other sites to introduce innovative therapy likes the rest, though into their treatment offering including establishing site protocols to administers the recipe.

Certifying under this a wrestle rems attaining formulary access and securing satisfactory reimbursement from payers, we expected it would take six to nine months or more for sites to navigate these actions and start treating patients and that is proving to be the case with the majority of sites. As we mentioned earlier 11 sites were able to accelerate to treatment readiness status by the end of Q.

Three and based on these experiences we have developed and deployed various tools and shared best practices designed to further accelerate where possible treatment readiness at sites of care. We continue to focus on sites, where access to the Russell will have the greatest impact and as of September Thirtyth, there were more than 140 Rems certified sites.

Mike Clunan: We continue to focus on sites where access to Xeressa will have the greatest impact, and as of September 30th, there were more than 140 REM-certified sites of care spread across 66 of the top 140 metropolitan statistical areas, or MSAs, covering more than 54% of potential patients. While REM certification is only one step in the activation process, we believe the level of interest from sites in becoming REM-certified is one of the leading indicators of the long-term growth potential for Xeressa. Second, patient demand has been strong, as has interest from healthcare professionals. In the third quarter, we received more than 200 patient starter forms, and we had referrals from more than 150 healthcare professionals.

Care spread across 66 of the top 140 metropolitan statistical areas or MSC is covering more than 54% of potential patients. While rim certification is only one action in the activation process. We believe the level of interest from sites in becoming Rems certified is one of the leading indicators of the long.

Term growth potential where's the recipe.

Second patient demand has been strong asset interest for me to see piece in the third quarter. We received more than 200 patients start forms and we had referrals from more than 150 HCP.

Mike Clunan: In addition, we have made great strides in one of the key success factors for us, which is payer coverage, with 75% of aggregated lives across commercial and Medicaid having favorable coverage with no or light restrictions as of September 30th. From a coverage and reimbursement perspective, we have made progress across national commercial payers, regional Blues, and several state Medicaid plans, and we are working with several states on appropriate reimbursement outside of the DRG. As more patients are treated, we will continue to gain insights into each state and commercial plan's reimbursement while continuing to support the sites as appropriate. Our early progress on access and reimbursement is on track and, in some cases, exceeding expectations. And third, our patient support program. SAGE Central has enrolled more than 90% of referred patients as of September 30th. This exceeds best-in-class benchmarks.

In addition, we've made great strides in one of the key success factors for US, which is payer coverage with 75% of aggregated lives across commercial and Medicaid, having favorable coverage with no or light restrictions as of September thirtyth.

From a coverage and reimbursement perspective, we've made progress across national commercial payers regional blues and several state Medicaid plans and we are working with several states on appropriate reimbursement outside of the RG.

As more patients are treated we will continue to gain insights into each state and commercial plans reimbursement, but continue to support the sites as appropriate.

Early progress on access and reimbursement is on track and in some cases exceeding expectations.

And third our patient support program siege Central has enrolled more than 90% of referred patients as of September Thirtyth. This exceeds best in class benchmarks save Central is an integral part of our go to market model has proven to be a valued resource for patients sites and HCPCS in closing we have learned a great deal from these early days.

Mike Clunan: SAGE Central is an integral part of our go-to-market model and has proven to be a valued resource for patients, sites, and HCPs. In closing, we have learned a great deal from these early days and are confident in the long-term potential of Xeresso. The indicators of success are present, and we are encouraged by the opportunity ahead for Xeresso as a meaningful therapy for women with PPD. However, as I stated earlier, revenue momentum may lag the site of care activation given the initial treatment patterns of sites of care. Even as more sites become activated, we believe Xeresso revenue growth will be modest over the next few quarters, and we expect to see a meaningful shift in revenue momentum in the second half of 2020. Now, I'll turn the call over to Kimmy to review our financials.

And are confident in the long term potential of the rest of the indicators of success, our president and we are encouraged by the opportunity had for the rest. So has a meaningful therapy for women with PPD as I stated earlier revenue momentum may lag the site of care activation given the initial treating patterns of sites of care, even as more sites become activated we believed.

Vessel revenue growth will be modest over the next few quarters, and we expect to see a meaningful shift in revenue momentum in the second half of 2020 and now I'll turn the call over to kill me to review our financials.

Kimi E. Iguchi: Thanks, Mike. I'll now walk you through the highlights of our financial results and guide. Starting with our balance sheet, we ended the third quarter with $1.1 billion in cash, cash equivalents, restricted cash, and marketable securities, compared with $925.1 million at the beginning of the year. Our cash on hand keeps us in a strong financial position as we work to deliver upcoming milestones across all three of our brain health franchises. Turning now to the rest of our financial results for the third quarter, revenues were $3.6 million in the third quarter, which consisted of $1.5 million of Zoreso net product revenue and $2.1 million in expense reimbursement related to our collaboration with Shianobi. For comparison, there were no revenues in the third quarter of 2018.

Thanks, Mike I'll now walk you through the highlights of our financial results and guidance.

Starting with our balance sheet, we ended the third quarter with 1.1 billion in cash cash equivalents restricted cash and marketable securities compared with 925.1 million at the beginning of the year, our cash on hand keeps us in a strong financial position as we work to deliver upcoming milestones across all three of our brain health franchises.

Turning now to the rest of our financial results for the third quarter revenues were 3.6 million in the third quarter, which consisted of 1.5 million absorbed so net product revenue and a 2.1 million in expense reimbursement related to our collaboration with Shionogi for comparison, there were no revenues in the third quarter 22.

Kimi E. Iguchi: Our portfolio continues to progress and expand. We have what we believe to be one of the most promising neuroscience pipelines. We estimate that the diseases we could pursue with our pipeline impact over 300 million people worldwide. We now have five clinical candidates across three franchises.

Our portfolio continues to progress and expand we have what we believed to be one of the most promising neuroscience pipeline, we estimate that the diseases. We could proceed with our pipeline impact over 300 million people worldwide. We now have five clinical candidates across three franchise as a result.

Kimi E. Iguchi: As a result, our R&D expense increased to $102 million in the third quarter, compared to $75 million for the same period of 2018. We're building a high-impact company with a deliberate and disciplined approach to capital allocation across both drug development and commercialization, resulting in near-, mid-, and long-term drivers of potential growth. Selling, general, and administrative expenses increased to $89 million in the third quarter, compared to $54 million for the same period of 2018. The third quarter expenses in 2019 reflect the full commercial build for the launch of Zorresso and other infrastructure required for the expansion of our pipeline. We reported a net loss in the third quarter of $180 million, compared to a net loss of $123 million for the same period last year.

R&D expense increased to 102 million in the third quarter compared to 75 million for the same period 2018.

We're building a high impact company with a deliberate and disciplined approach to capital allocation across both drug development and commercialization, resulting in near mid and long term drivers for potential growth selling general and administrative expenses increased to 89 million in the third quarter compared to 54 million for this.

Same period of 2018.

The third quarter expenses in 2019 reflect the full commercial build for the launch is already so in other infrastructure required for the expansion of our pipeline we reported a net loss in the third quarter of 180 million compared to a net loss of 123 million for the same period of 20 team. The difference is driven by the increase in expenses.

Kimi E. Iguchi: The difference is driven by the increase in expenses as we transition to a commercial company with an expanding portfolio across three franchises. We continue to maintain a solid financial foundation and anticipate that our cash balance will be at least $950 million at the end of 2019. We expect that our operating expenses will continue to increase year over year to support the ongoing investment in our multi-franchise portfolio and the continued progress in our pipeline development. We've created a lot of value to date with a proven financial playbook. We've made tremendous progress, and we look forward to multiple milestone events over the coming year. With that, I'll turn it over to Jeff for closing remarks.

As we transition to a commercial company with an expanding portfolio across three franchises.

We continue to maintain a solid financial foundation and anticipate that our cash balance of the at least 950 million at the end of 2019.

We expect that our operating expenses will continue to increase year over year to support the ongoing investment in our multi franchise portfolio and the continued progress in our pipeline development. We've created a lot of day to date with a prudent financial playbook, we've made tremendous progress and we look forward to multiple milestone events.

Over the coming here with that I'll turn it over to Jeff for closing remarks.

Dr. Jeff Jonas: Thanks, Kimi. This is Jeff again.

Thanksgiving and this is Jeff again.

Dr. Jeff Jonas: There is a general understanding that we are experiencing a public health crisis as the incidence of brain health disorders increases globally, yet with respect to psychiatric disorders, the treatment model for patients, a model that assumes chronic therapy and a slow onset of action, along with a lack of innovation, have both combined to create a lack of urgency in obtaining new treatment options for people, and we have applied these learnings to our developments. Our mission at SAGE is not only to upend conventional wisdom but to develop medicines that will offer new pathways and new options for medical care that will be distinct from what are currently available. And to build a high-impact company making medicines that matter. As we continue to progress our clinical programs, we hope to create a clear alternative for people needing treatment, not only in terms of currently available therapies but by providing a clear alternative to the chronic therapy approach which predominates today in treating psychiatric disorders.

Here's a general understanding that we are experiencing a public health crisis as incidents of brain health disorders increases globally, yet with respect to psychiatric disorders. The treatment model for patients a model that assumes chronic therapy as slow onset of action along with a lack of innovation have both combine to create a lack of urgency in obtaining new treatment options for people.

Today, we believe that new approaches to research and drug development have led to a growing understanding of the underlying biology of how brain networks work. This understanding is let's say to approach the neurosciences base differently.

We have apply these learnings to our development strategy.

Our mission its age is not only to append conventional wisdom, but to develop medicines that will offer new pathways and new options to medical care that will be distinct from water currently available and to build a high impact company, making medicines that matter as we continue to progress our clinical programs, we hope to create a clear alter.

Turning to for people needed treatment.

Not only in terms of currently available therapies, but by providing a clear alternative to the chronic therapy approach, which predominates today in treating psychiatric disorders.

Dr. Jeff Jonas: This is a big vision, we understand, but as of today, we are pleased with the progress we've made so far in these efforts, and, of course, we have a lot more to do. I'd like to conclude with two thoughts. First, the folks at SAGE embraced this challenge of rethinking how people with psychiatric disorders ought to be treated. And we understand that with that sort of innovation, we need to consider access to our medicines as a high priority. Our progress in obtaining excellent coverage for Xoreso and PPD illustrates our commitment. Secondly, I want to thank the great team of people at SAGE who have done excellent work in developing innovative molecules and launching our first commercial product. With that said, I'd like to open the call for Q&A. Please limit yourself to one question so that all of you have a chance to ask a question. Thank you.

This is a big vision, we understand but as of today. We are pleased with the progress. We've made so far in these efforts and of course, we have a lot more to do.

I'd like to conclude with two thoughts first the folks that stage embraced this challenge of rethinking how people with psychiatric disorders ought to be treated.

And we understand but that's sort of innovation, we need to consider access for our medicines as a high priority our progress in obtaining excellent coverage was arrested PPD illustrates our commitment secondly, I want to thank the great team of people. This age coogan excellent work in developing innovative molecules and launching our first commercial product.

With that I'd like to open the call QNX. Please limit yourself to one question. So that all of you have a chance to ask a question. Thank you.

Thank you.

Operator: Thank you. As a reminder, to ask a question, you will need to press star 1 on your telephone. To withdraw your question, please press the pound key. In the interest of time, we ask that you please limit yourself to one question. Any additional questions, please re-enter the queue. Please stand by while we compile the Q&A roster. Our first question comes from Tazeen Ahmad of Bank of America. Your line is now open. Hi, good morning, guys. Thanks for taking my question. So, Jeff, I'm going to go ahead and ask you the question that everyone's been asking me.

Binder to ask the question you want me to press Star one of your telephone. So it's all your question. Please press the pound key and its trust the timing FC Please limit yourself to one question any additional additional question. Please reenter the queue. Please standby while the compiled the county roster.

Our first question comes from 15 amid a bank of America. Your line is that open.

Hi, Good morning, guys. Thanks for taking my question so Jonathan.

Well I had an asking the question that everyone's asking me so for the mountain study when you do released or topline data beyond the primary endpoint of say 15, do you have expectations of providing any of the secondary endpoints that you have been studying vis-a-vis the ones related to their ability. Thanks I'll get back in Q.

Tazeen Ahmad: For the mountain study, when you do release your top-line data beyond the primary endpoint of day 15, do you have expectations of providing any of the secondary endpoints that you have been studying vis-à-vis the ones related to durability? Thanks. I'll get back in queue.

Dr. Jeff Jonas: Hey, thanks. Good morning, everyone. And thanks for the first call. I'm surprised that it involved Mountain. I'm stunned.

Hey, Thanks, Good morning, everyone and thanks for the first call I'm surprised that it involves mountain.

So I'm stunned.

Dr. Jeff Jonas: Yeah, so obviously, as you said, we expect that the Mountain data will be made available this quarter. We also expect, as has been our practice, to release the data from day 15 and day 42. And that's what will be compiled now. And we will also be releasing some of the key secondary endpoints as part of that.

Yes, so obviously as he said we expect that mountain data will be made available. This quarter. We also expect as it's been our practice to release the data from the fifth day 15, and day 42, and that's what will be compiled now and we will be will be also releasing some of the set key secondary endpoints as part of that.

Dr. Jeff Jonas: Okay, thanks, Jeff. Thank you. And our next question comes from Danielle Brill of Piper Jaffray. Your line is now open.

Hey, Thanks, Jeff.

Thank you and then next question comes from Danielle Frail Piper Jaffray. Your line is open.

Danielle Brill: Hey guys, good morning. Thanks for the question. I'll have a follow-up to Tazeen's on mountains. Jeff, how important is it to show a step...

Hey, good morning, Thanks for the question.

I'll have selected cuisines on mountain, Jeff how important is it shows that takes separation from placebo I'd say 42 and is the trial powered for this bank.

Dr. Jeff Jonas: Is it to show a statistically significant separation from placebo at day 42, and is the trial powered for this? Thanks.

Dr. Jeff Jonas: Thanks again. A couple of points. One is, as you know, the primary end point here is efficacy at day 15 after the course of treatment. And in that respect, although people have often spoken about this in different ways, it's no different than any other conventional antidepressant trial. The only difference being that SAGE 2 and 7, at least in the two studies already completed, work much more rapidly than conventional antidepressants, which require six weeks to achieve the primary endpoint of efficacy. So we have some advantage that the drug so far has worked more rapidly. We're hopeful that we'll see separation at day 42, but our powering assumptions are typically based as most phase three programs are on the primary endpoint of day 15. I'm going to turn it over to Steve for some further color on that.

Thanks again, so a couple of points. One is as you know the primary endpoint here is efficacy at day 15. After the course of treatment and in that respect although people have often.

Spoken about this in different ways, it's no different than any other conventional anti depressant trial, the only difference being that stage 217 at least in the two studies already completed works much more rapidly than conventional antidepressants, which requires six weeks to achieve the primary endpoint of efficacy. So although you know so we have some advantages in the dry.

So far has worked more rapidly we were hopeful that we'll see separation a day 42, but our powering assumptions are typically base as most phase three programs are on on the on the primary endpoint a day 15, I'm going to turn it over to Steve for some further color on that sure what's important Verity Treme member is the real one.

Dr. Steve Kaines: Sure. What's important for everybody to remember is that the 301 Mountain Study is an efficacy study. That's on the primary endpoint. Understanding what happens afterwards, you know, we look at the follow-up data, especially for safety, but understanding the long-term efficacy and how the drug will be used, those are data that will emerge from the longer-term studies, the Shoreline Study, as well as Redwood. So, really important to keep that in mind. We'll be looking for stability of responses, similar to what we've seen in Robin and in the MDD trial that was recently published, but the patterns and how and which patients might have recurrence of symptoms over what period of time will be determined from other studies.

No. One study is an efficacy studies, that's that's on the primary endpoint.

Understanding what happens afterwards, we look at the follow up data, especially for safety, but understanding the long term efficacy and how the drug will be used those are data that will emerge from the longer term studies. The shoreline study as well as redwood So really important to keep that in mind, we'll be looking for stability of response is similar to what.

Seen in Robyn Lindy MDD trial that was recently published but the patterns and how in which patients might have recurrence of symptoms over what period of time those will be determined from other studies.

Thank you.

Dr. Steve Kaines: Thank you. And our next question comes from Corey Kasimov of JP Morgan. Your line is now open.

Question comes from Cory Kasimov of Jpmorgan. Your line is that open.

Corey Kasimov: Hey, good morning guys. Thanks for taking my question, and I guess I might as well go for the trifecta here on Mountain. Piggybacking off these first two, can you remind us how you plan to account for missing data or dropouts during the controlled follow-up period of the Mountain trial? Just wondering if there's any sort of risk that this may under or overestimate the efficacy of any of the three arms at these follow-up time points.

Hey, good morning, guys. Thanks for taking my question I guess I might as well go for the trifecta here on mountain.

Piggybacking off these first two can you remind us how you plan to account for missing date or dropouts during the controlled follow up period of the mountain trial, just wondering if there's any sort of risk because this may under overestimate the efficacy in any of the three arms that follow up time points. Thanks.

Dr. Jeff Jonas: Hey, Corey, Jeff. We haven't made the statistical plan public, but as you can imagine, it's a standard mixed model that we've always employed. It's not a BOCF model, which would be in our favor, as you can imagine. Remember, the other major difference here is that we didn't allow rescue therapy in the program. So we think that that should attenuate any of the risk that even we saw in the original study, where there was an imbalance in the placebo group of more placebo patients on follow-up obtaining SSRI rescue. So as much as one can be comfortable with the data, we think the design should allow us to see the separation moving forward without any adventitious interference with adjuvant pharmacotherapy.

Acreage.

We haven't made the SAP This statistical plan public, but as you can imagine as the standard mixed model that we've always employed it's not be AOCF model, which would be in our favor as you can imagine the remember the other major difference here is that we didn't allow rescue therapy.

In the program. So we think that that should attenuate any of the risk that we even if we saw in the original study where there was an imbalance in the placebo group of more placebo patients on follow up obtaining Sri rescue. So you know we're you know as much in one can be comfortable with the data we think that design should should allow us to.

See that to see the separation moving forward without any adventitious interference with adamant pharmacotherapy.

Dr. Jeff Jonas: Okay, great. Thanks for taking the question and good luck with the data.

Okay, great. Thanks for taking the question good luck with the data.

Thanks.

Dr. Jeff Jonas: Thanks.

Paul Andrew Matteis: Thank you. And our next question comes from Paul Matteis, an STFL. Your line is now open.

Thank you and our next question comes from Palmetto Teva Stifel. Your line is open.

Great Congrats on all the progress and thanks for taking my question.

Dr. Jeff Jonas: Great, congratulations on all the progress, and thanks for taking my question. In the Redwood study, the off-drug treatment hiatus is six weeks, and I believe in Shoreline, per protocol, it's at least... I was wondering, how did you come up with, especially in Shoreline, this six-week hiatus? And when you think about this drug in practice...

Study.

After treatment hiatus for six weeks and I believe and shoreline per protocol. It's at least six weeks I was wondering how did you come up with especially in shoreline six week hiatus.

When you think about this strike in practice.

Dr. Jeff Jonas: If a patient responds and then relapses sooner, is there any reason why they couldn't get SAGE 217 sooner? How did you contemplate that when you designed these trials? Thanks.

Accretion responds and then relapses sooner is there any reason why they couldnt get sage 207 sooner or how did you contemplate that would ximenes trials. Thanks.

Awesome.

Dr. Jeff Jonas: Thanks, Paul. A couple of points I'd make. One is, we obviously were privy to the curves of what patients look like in their response in all the trials we've conducted. But you have to step back and think about our strategy.

Thanks, Paul a couple of points I'd make one is we obviously have were privy to the Kurds of what P. patients looked like in their response and all the trials, we have conducted and when we do.

You have to step back I think about our strategy and that is when we first started with this mechanism will rest, though we saw this durable.

Dr. Jeff Jonas: And that is, when we first started with this mechanism, with Zulresso, we saw this durable onset of action and maintenance of activity. So, we saw that, and we didn't see a lot of, basically, decay in the response curves out to 42 days. So when we did that, we decided, in terms of designing this phase two program, to really put together what we think is one of the most comprehensive depression programs constructed in the last decade. And one of the barriers we have, frankly, is that people are looking at 30 years of SSRI data and expecting us to replicate it in two studies, which we, of course, can't. And as Steve has pointed out, our goal is not only to show acute efficacy but, with 302 and 303, to demonstrate how this drug might be used in a completely different treatment paradigm.

Instead of action and maintenance of activity, so and we saw that and we didn't see allotted basically decay and the response cars out to 42 days. So when we did that we decided in terms of design. This phase three program to really put together. We think is one of the most comprehensive depression programs constructed it really in the last decade and one other one of the.

Carriers, we have frankly is that people are looking at 30 years of Sri data and expecting us to replicated in two studies in which we of course, we can't and as Steve has pointed out our goal is not only to show acute efficacy, but with Rio two and three over three to demonstrate how this drug might be used in a can treat and a completely different treatment paradigm and that is offering patients.

Dr. Jeff Jonas: And that is offering patients a brand new option. So when we looked at the six-week data, we obviously had some level of confidence that this would be a pattern of treatment for physicians who might not want to have the responsibility of monitoring patients, you know, on an as-needed basis, which is the way many pharmacologists treat patients, which is to start them on drugs, stop them after two or three months, and then have them educated to call for a relapse if it occurs. The other point to remember is that this is a completely novel mechanism of action. This is not a monoamine inhibitor. This is not a tricyclic or an SSRI. This is a drug which we hope and believe works completely differently by offering some sort of brain reset of neural circuitry.

Brand new option. So we look at the six six week data, we obviously had some level of confidence that this would be a string a pattern of treatment for physicians, who might not want to have the responsibility of monitoring patients.

On an as needed basis, which is the way many pharmacologist three patients which is start them on drugs stop met the two or three months and then have them educated to call on a relapse. If it occurs the other points from remembers this is a completely novel mechanism of action. This is not a model mean inhibitor. This is not an to try cyclic or in Sri This is a dry.

Which we hope and believe works completely differently by offering some sort of brain reset of neural circuitry and as such you, it's apples and oranges to compare this mechanism and this method of study to what's been done with accessorized. So our approach has been for advanced pharmacologists to do as as needed treatment should the drug should the disease recur.

Dr. Jeff Jonas: And as such, it's apples and oranges to compare this mechanism and this method of study to what's been done with SSRIs. So our approach has been for advanced pharmacologists to do as-needed treatment should the disease recur, or a pattern of treatment in the 302 study or Redwood, which would, we believe, allow patients to remain symptom-free for up to a year. But we believe, in total, that this would be one of the most comprehensive packages not only for acute treatment but also for informing maintenance therapy.

For a pattern of treatment in the three or two study or Redwood, which we believe allow patients to remain symptom free for up to a year, but we believe in toto that this would be one of the most comprehensive packages not only for acute treatment, but also also informing maintenance therapy.

Okay. Thank you.

Paul Andrew Matteis: Okay, thanks, Jeff.

Thank you.

Ritu Subhalaksmi Baral: Thank you, and our next question comes from Ritu Baral of Cowan. Your line is now open. Great, thanks.

From a two for all of Cowen Your line open.

Great, Thanks, and I'm going to complete the.

Ritu Subhalaksmi Baral: And I'm going to complete the trial trifecta by asking about Shoreline and that data and your plans for what sort of data might be released in 2020. It's an open-label study, Jeff. When are you guys going to take the first look at the efficacy and safety data from Shoreline? Will it be after the Mountain Study before going to the FDA? Internally, where could open-label data be useful in moving the whole program forward, and how could that translate to when we on the outside might see that, at least from a safety perspective?

Carl Trifecta of asking about shoreline and that.

And your plans for what sort of data might be released in 2020. It's an open label study Jeff when are you guys going to take the first look.

At the efficacy and safety data.

In short line will it be after the mountain study.

Before going to be Sta internally, where could open label data be useful in moving the whole program forward.

How could that translate to when we on the outside might see that at least from a safety perspective.

Dr. Jeff Jonas: Hi Richie. I'll take that one, and Steve.

Hi, Ritchie I'll take that one and Steve.

Dr. Steve Kaines: So Shoreline, of course, is part of our overall Pivotal Phase 3 program. And, you know, what we're going to be doing is making maximal use of that information. But what's important to understand about them is that these are data that are going to help us understand both safety in retreatment, as well as patterns of retreatment, and, you know, understanding who may or may not be frequent frequent people who have recurrence of symptoms. So it's not the kind of data that one looks at to sort of dig into the specifics.

So shoreline of course is part of our overall pivotal phase three programs and.

What we're going to be doing is making maximal use of that information.

What we what's important to understand about it is that these are.

These are data that are going to help us understand both safety and re treatment as well as patterns of Retreatment and understanding who may or may not be frequent.

Frequent people that have a recurrence of symptoms. So it's not going to do that when we'll look set to sort of dig into the specifics. It really is as Jeff said something that we look at Antonio asked for how we make use of information with regard to regulatory interactions of course those are things that we will comment on it until after we've had.

Dr. Steve Kaines: It really is, as Jeff said, something that we look at in total. As for how we make use of information with regard to regulatory interactions, of course, those are things that we won't comment on until after we've had, you know, after we've had such interactions. But what I can tell you is there's a lot of interest. Of course, we've completed enrollment. The study is going well, and we'll have a lot of very important information as a result of that trial. But what Jeff said during the call is that this is the first and largest naturalistic study in patients with MDD. And, you know, that's going to create important and critical information for understanding patterns of recurrence of symptoms, as well as how best to use 217. That's what we're looking for in that study.

After we've had such a direction will that I can tell you is there's a lot of interest of course, we've completed the enrollment.

The study is going well and we'll have a lot of very important information as a result of that trial, what Jeff said during the call is that this is the first largest naturalistic study in patients with MDD and that's going to create wirtanen critical information for understanding patterns of recurrence of symptoms as well as how best to use to one seven thats all looking.

Thats correct.

Great. Thanks, getting the question.

Thanks, Yeah.

Dr. Steve Kaines: Great, thanks for getting the questions.

Question comes from Angie say of Jefferies. Your line open.

Andrea Tse: Thank you. And our next question comes from Andrea Tse of Jefferies. Your line is now open.

Thanks, Good morning, so when we think about the Approvability of 217 as it relates to the mountain dataset.

Andrea Tse: Thanks, good morning. So, when we think about the approvability of 217 as it relates to the mountain dataset, what do you think is the minimum amount of efficacy delta 217 would need to achieve at day 15?

What do you think is the minimum amount of efficacy delta to oneseven wouldn't need to achieve at the 15.

It should should investors be thinking a two points separation to placebo at the very least 3.4 points of course, you've shown a much larger delta past trial. Thanks.

Dr. Jeff Jonas: Investors may be thinking a two-point separation.

Dr. Jeff Jonas: [inaudible]

Dr. Jeff Jonas: Hi, this is Jeff, and a quick comment on that. I think it's powered for significance, and I think we've never given up more information than that, but we believe the study will be adequately powered to show an adequate delta at day 15. I'm not sure we can comment beyond that. It is correct, and we recently published data doing some comparisons with SSRIs, that the effect size seen with this mechanism is substantially larger. That being said, we believe the study is conservatively powered. I'm going to let Steve layer on this one. Yeah, and an important piece of this is to understand the difference between effect size, which is the difference between a drug from placebo, versus effect, which is how much patients improve after treatment.

Hi, This is Jeff and out a quick comment with that I think.

It's powered for significant and I think I know, we've never given up more information than that but we believe the study will be adequately powered to show up an adequate Delta adds a day 15, I'm not sure I couldn't comment beyond that.

It is correct and we recently published data doing some comparisons with us as arise that the effects I seem with this mechanism is substantially larger.

But that being said we believe this study is considerably powered I'm going to let Steve layer on this one and important piece of this is to understand the difference between effect size, which is the difference of drug from placebo versus effect, which is how much patients improve after treatment and what we've seen with 207 is very large improvements overall remain.

Dr. Steve Kaines: And what we've seen with 217 is very large improvements overall over a matter of days, with greater than 70% of patients responding, meaning greater than 50% improvement, and 50% of patients having remissions over the course of that treatment period. That is qualitatively different from all drugs that are approved right now for antidepressants. So the question around a delta from placebo, that's a technical question that Jeff answered, which is, how large a study do you need to demonstrate statistical significance? We're interested in more than that. Not just statistically significant, but clinically meaningful, and differentiated. Those are all parts of the profile we've been seeing in 217, as well as in Brix analog.

For days with greater than 70% of patients responding, meaning greater than 50% improvement and 50% of patients having remissions over the course of that treatment period that is qualitatively different from all drugs that are approved right now by the presence. So the question around a delta from placebo Thats a technical question that.

To answer which is how the largest study do you need and to demonstrate statistical significance. We're interested in more than that just statistically significant clinically meaningful and differentiated those are all part of the profile we've been seeing into one seven.

As well as in brick sale.

Thank you.

Dr. Steve Kaines: Thank you.

Brian Corey Abrahams: Thank you. And our next question comes from Brian Abrahams of RBC Capital Markets. Your line is now open.

Yes, and then next question comes from Brian Abrahams of RBC capital markets. Your line open.

Brian Corey Abrahams: Hi there. Thanks very much for taking my question. Maybe a question for Mike.

Hi, Thanks, very much for taking my question, maybe a question for Mike Obviously, Celesio has a pretty unique profile, but just curious if there any learnings that all that you can take from your engagement with physicians payers and academic centers that potentially help inform your future commercial strategy for 207 and along those lines anything you can.

Mike Clunan: Obviously, Zorreso has a pretty unique profile, but I'm just curious if there are any learnings at all that you can take from your engagement with physicians, payers, and academic centers that could potentially help inform your future commercial strategy for 217. And along those lines, anything that you're hearing with respect to launch dynamics for a recently approved competitor's acute-use antidepressant that you might be able to use to guide your commercial approach with 217. Thanks.

That you're hearing with respect to launch dynamics for recently improved competitors acute use anti depressant that you might be able to used to guide to commercial approach for two months Evan. Thanks.

Mike Clunan: Hey, Brian, it's Mike. Thanks for the question. Yeah, so I think if you think about a lot of the thesis for Xeresso, we really believe in the long-term potential of Xeresso, don't we? We think this can be a meaningful product for women with PPD, given all the leading indicators we've seen, you know, the stories of the patients, the compelling stories around the treatment of Xeresso. Also, patient demand, the number of sites coming online, and payer coverage.

Hey, Brian It's Mike. Thanks for the question, Yes. So I think if you think about the a lot of the thesis was a restaurant, we really believe in the long term potential upsell wrestle right. We think this can be a meaningful product pulling them with PT PPD given all the leading indicators we've seen the stories for the patients the compelling stories around the treatment of the rest. So also the patient demand the number of sites coming online and the payer cover.

And so lot of the investments, we're making as the rest so as not only about the rest. So it's about the investments that we're making from a franchise perspective to help to on seven which is where your question is going to so we are definitely learnings that we're seeing on so wrestle that we can apply to 207. Some of that is really about helping them understand what it takes to shift the paradigm right. When you think about what it takes for pain.

Mike Clunan: And so a lot of the investments we're making in Xeresso are not only about Xeresso, they're about the investments that we're making from a franchise perspective to help 217, which is where your question is going to. So there are definitely learnings that we're seeing in Xeresso that we can apply to 217. Some of that is really about helping them understand what it takes to shift the paradigm, right? When you think about what it takes for a patient to accept a new treatment like this and the experience that both physicians and patients have to have with a new therapy, that's absolutely a key learning.

And to except the new treatment like this and they experience that both physicians and patients have to have a new therapy. That's absolutely a key learning. What this is about what is the rest. So as we've always said is building championship right. That's a big part of the success for for the rest. So we're going to see that with 207 as well we want to build up campus ship. It helped them understand all the stuff that Jeff and Steve have walked through.

Mike Clunan: What this is about with Xeresso, as we've always said, is building a championship, right? That's a big part of the success for Xeresso. We're going to see that with 217 as well. We want to build up a championship and help them understand all the stuff that Jeff and Steve have walked through with the different trial designs and how 217 will work in the real world. These are learnings we will apply from Xeresso to 217. And probably more specifically on PPD, you asked about MDD, but I've said this before, in that the market that 217 is going to launch into in PPD is going to be different than the launch for Xeresso because of what Xeresso has done. All the work that we're doing, and the foundation that we're setting with Xeresso is going to benefit 217.

True on the different trial designs and how to on several work in the real World. These are learnings, we will apply from zero to one seven and probably more specific on TV you asked about MB MDD, but I've said this before and that the market that 207 is going to launch in two and PPD is going to be different than the launch for so wrestle because what's the wrestle has done all the work that we're doing the foundation.

That we're setting with the rest so is going to benefit to one seven and I think for US you know you asked about other antidepressants and recent launches I mean, the profile is so different up to one seven like we look at analog so we learn from them, but at the end of they we've got to build the best in class go to market approach, which he won seven that fits the profile of this product and ensures it gets to as many patients as possible I'm not trying.

Mike Clunan: And I think for us, you know, you asked about other antidepressants and recent launches. I mean, the profile is so different for 217, like we look at analogs, and we learn from them. But at the end of the day, we've got to build a best-in-class, go-to-market approach with 217 that fits the profile of this product and ensures it gets to as many patients as possible. I'm going to turn to Jeff because he just wanted to follow up on one of these.

Jeff as I just wanted to follow up on on one of this.

Dr. Jeff Jonas: Thanks, Mike. I think there are a couple of points I just want to emphasize. First, I think it's the early days of the launch, and Mike's team has made great progress. One of the major obstacles that people had anticipated was obtaining coverage and lives covered, and they've done substantial good work in achieving that already. I think, you know, we know this is unique. It's a hospital-based psychiatric launch for an indication in women's health that has, and I think Mike's team, we've learned a lot about it, and it does represent a paradigm shift that we think we will be able to leverage as we move forward in 217, which is the idea of an acute therapeutic intervention. Obviously, that would be an outpatient home-based therapy, but overall, I think we're quite encouraged with how the launch has begun, and I think, as we've said, we think it'll take six to nine months for this to really ramp up, and in that respect, you know, I think we feel really good about that we've been on track with our prediction.

Thanks, Mike I think a couple of point doesn't want to emphasize first I think it's early days in a launch and Mike's team has made great progress one of the major obstacles that people had anticipated, which was obtaining coverage and lives covered and they've done substantial good work in achieving that already.

I think we know this is unique it's a hospital base based psychiatry launch for an indication and women's health that has and I think my team we've learned a lot about it and it does represent a paradigm shift that we think we will be able to leverage as we move forward it too much seven which the idea of an acute therapeutic intervention, obviously that would be an.

Patient home based therapy, but overall I think over were quite encouraged with how the launch has begun and I think as we've said it will take we think it will take six to nine months for this to really ramp up and that respect we feel really good about that we've been on track about our predictions.

Dr. Jeff Jonas: Thanks so much.

Thanks, so much.

Laura Kathryn Chico: Thank you. And our next question comes from Laura Chico of Wetbush. Your line is now open.

Yes.

Comes from Laura Chico of Wedbush Your your line open.

Laura Kathryn Chico: Hey, good morning. Thanks for taking the question. I guess I had just one question about Mountain with regard to the 20 mg dose. How should we be thinking about the potential for success there in Mountain but also the implications for the other studies given that the other studies are focusing on 30 mg doses?

Hey, good morning, Thanks for taking the question I guess I had just had one on mountain with regards to the 20, Meg dosing kind of how should we be thinking about the potential for success. There in mountain, but also the implications for the other studies given that its.

Other studies are focusing on 30 make dosing.

Dr. Jeff Jonas: Hey Laura, it's Jeff. Obviously, it's a three-arm study, and the 30 milligrams we believe is what, a positive study in one of the arms is what would be required for moving forward with a complete package. We don't know if the 20 milligram dose will work, and we don't believe it's necessary, frankly. And candidly, I think demonstration of a dose response is not a bad thing in terms of drug development. We're very comfortable about the design of the trial. Obviously, it was adjudicated early with the FDA, and we just thought, in terms of looking at minimal effective dosing, it was prudent to include the 20 milligrams, but we don't believe that's a requirement for registration.

Hey, large Jeff obviously, we don't we it's a three arm study in the 30 milligram. We believe is what would a positive study in one of the arms is what would be required.

For moving forward for complete package.

We don't know up to 20 milligram will work, we don't believe it's necessary frankly, and candidly I think demonstration of a dose response.

Not a bad thing and just in terms of drug development. So we're very comfortable about the design of the trial, obviously was adjudicated early with the FDA and we just thought in terms of looking at minimal effect of dosing of as a prudent do include the 20 milligram, but we don't believe that's a requirement for registration.

Thanks very much.

Dr. Jeff Jonas: Thanks very much.

Salveen Jaswal Richter: Thank you. And our next question comes from Salveen Richard of Goldman Sachs. Your line is now open.

Thanks, Yeah.

Washington from selling Richard of Goldman Sachs. Your line open.

Dr. Steve Kaines: Good morning. Thanks for taking my question. So in Mountain, could you just walk us through why you're using HAM-D at the day 15 measure and then Madras for day 42? Is there some sleep component that may be beneficial here?

Good morning, Thanks for taking my question so in mountain.

As to why you're using Ham D. At the day 15 measure and then Madras for day 42 is there some sleep component that may be beneficial here.

Yes in fact, we're using Madras should be Ham D. As the primary endpoint across all of our trials. Its the is the endpoint that's a regulatory endpoints that weve used reliably across now five placebo controlled trials the entire so Russell program as well as our intent for the.

Dr. Steve Kaines: In fact, we're using HamD as the primary endpoint across all of our trials. It's the regulatory endpoint that we've used reliably across now five placebo-controlled trials, the entire Zillow-Russell program, as well as our intent for the 217 program as well. So, in fact, HamD will be what we report. We typically include both HamD and Modris. It allows for some level of implicit comparison between what we're doing and what others are doing, but the primary endpoint and what our studies are powered for is always HamD.

For the for the 217 program as well so in fact Hamdi will be what we report. We typically include both Ham D and monetarists. It allows for some level of implicit comparison between what we're doing and what others are doing but the primary endpoint and what our studies are powered for as always hamdi.

Salveen Jaswal Richter: Thank you.

Thank you.

Akash Tewari: Thank you. And our next question comes from Akash Tewari of Wolf Research Lens. Now open.

Yes.

<unk> tons from crashed Hillary of Wolfe research lines open.

Akash Tewari: Thanks so much. You made some comments about why the 20 mg dose was kind of included in the Mountain study. Given that we saw an 8 to 9 percent dropout rate in the 30 mg arm in your Phase II MDD trial, could we potentially see a lower dropout rate because of the inclusion of the 20 mg dose for Mountain? And also, can you comment a bit on what were the differences between the Robin study and the Phase II MDD study that led to one trial showing kind of a static durability past 40 days and the other one not showing that? Is there something about MDD versus PPD that's causing this, or maybe rescue treatments? Thank you.

Thanks, So much. So you made some comments about why the 20 make doses kind of included in the mountains study given that we saw an 8% to 9% dropout rate in the 30 make arm and your phase two MDD trial could we potentially see a lower dropout rate because of the inclusion of the 20 make dose for mountain and also can you comment a bit on what were the.

I mean, the Robin study and the phase two MDD study that led to one trial showing kind of a static durability passed 40 days and the other one not showing that is there something about MDD versus PBD, that's causing this or maybe rescue.

Treatments. Thank you.

Dr. Jeff Jonas: Sorry, this is Jeff. I missed the first one, but let me just comment broadly, and I'll turn it over to Steve. With respect to the MDD study, obviously, that was a smaller study, but if you look at the patient curves, they're virtually superimposable. You're really seeing minimal variance over all the 42 days. And as we noted, the rescue therapy was imbalanced in the MDD study with 11 patients in the placebo group receiving rescue therapy versus only three in the treatment group. So the patient response curves, and if you include Zolreso, again, you can argue whether it's appropriate or not, you don't see much decay, and they're virtually superimposable.

Sorry. This is Jeff I didn't I missed the first but let me just comment broadly I will turn it over to Steve.

With respect to the Mbd study, obviously, there was a smaller study, but if you look at the patient curves, they're virtually superimpose Apollo if you're really seeing minimal variance over at the 42 days and as we noted the rescue therapy was a imbalanced in the Mds study.

The 11 patients in the placebo group, receiving rescue therapy, which is only three on the treatment group. So.

The patient response curves and if you include Zilretta. So again you can argue whether it's probably not you don't see much decay and they're virtually superimpose I'm going to turn Steve over dinner over to Steve in the rest of it yes. So so with regard to 20 or 30 milligrams of we included it for the reasons. The Jeff described to mainly to in agreement with the FDA to explore lowered.

Dr. Jeff Jonas: I'm gonna turn it over to Steve with the rest of it.

Dr. Steve Kaines: So with regard to 20 and 30 milligrams, we included it for the reasons that Jeff described, mainly in agreement with the FDA to explore lower doses, no more, no less. Given the low rates of adverse events that we've seen across two studies and the low dropout rate, we really don't anticipate that to be a driver for the different arms. We're really interested in understanding whether or not more than one dose might be useful for patients. With regard to differences in the studies, you know, I think, you know, the MDD trial was, as people may be aware, one week was inpatient, and the second was outpatient. Of course, it was our first placebo-controlled trial. The Robin study was an entirely outpatient study, which is the way we expect 217 to be used more broadly. So as we build the development program, we add elements into each trial that help us understand with greater precision how the drug would best be used in clinical practice. And that's really what all of the elements that we're describing here are for. Great, thanks so much.

I was saying no more or less I don't and given that the low rates of adverse events that we've seen across two studies.

Low dropout rate, we really don't anticipate that to be a driver where the different arms were really interested in understanding whether or not more than one dose might be useful for patients with regard to differences in the studies I.

I think you know the MDD trial was we had as people may be aware one week was in patients. The second was allocation of course. It was our first placebo controlled trial. The Robin study was an entirely outpatient study, which is the way we expect 207 to be used more broadly so as we build the development program we had elements.

To each trial that help us understand with greater precision how the drug would best be used out in clinical practice and that's really what all the elements that were describing here for.

Great. Thanks, so much.

Akash Tewari: Thank you. And our next question comes from Matthew Harrison of Morgan Stanley. Your line is now open.

Thank you I know next question comes from Matthew Harrison of Morgan Stanley . Your line is now open.

Matthew Harrison: Hi, thank you. This is Max Skoron for Matthew. Quick question. For 217, how important do you believe sustained clinical benefit is to physicians and regulators out to day 42? Thank you very much.

Hi, Thank you Mrs. Mac score on from Matthew quick question four to one seven how important do you believe a sustained clinical benefit is to physicians and regulators out today 42. Thank you very much.

This is Jeff the you know if you look at how the study is sustained benefit is part of a maintenance indication and again, what we're should what we've shown is that we can get durable activity with only two weeks of treatment. The idea of a maintenance claim is one that's generic no pun intended to the entire anti depressant space. So we don't.

Dr. Jeff Jonas: This is Jeff. You know, if you look at how the study is structured, sustained benefit is part of a maintenance indication, and again, what we've shown is that we can get durable activity with only two weeks of treatment. The idea of a maintenance claim is one that's generic, no pun intended, to the entire antidepressant space. So we don't believe that's going to be a separate category as part of this package.

So that is not us we don't believe that's going to be a separate.

As part of this package however, as Steve has and I. Both noted just looking at this more broadly we believe that the package, we're putting together will be informative both for acute therapy as well as maintenance therapy, and that's always been our intent to have the 3.13 or two and three or three data as part of the package. So that when this drug if and when.

Dr. Steve Kaines: However, as Steve and I have both noted, just looking at this more broadly, we believe that the package we're putting together will be informative both for acute therapy as well as maintenance therapy, and that's always been our intent, to have the 301, 302, and 303 data as part of the package so that if and when this drug is launched, physicians will have clarity about how to use this drug acutely as well as in maintenance therapy. The other point I'd like to make is that, if you look at our data, the drug has worked very rapidly so far. So we believe it will always have a role in treating patients where rapid resolution of symptoms is desirable. We think this is one of the great options that we might be able to offer the field if this drug is approved, which is rapid onset of action without chronic pharmacotherapy. And it's also been used as an adjuvant in about a third of our patients. So far, we know it works alone and in combination so far, but we have to replicate those data. So we believe this drug will have a place in the arsenal regardless of whether it's being used as monotherapy or as an adjuvant therapy.

This drug is launched the physicians will have clarity about how to use this drug acutely as well as in a maintenance therapy. The other point I'd like to make is that if you look at our data. The drug does so far has worked very rapidly. So we believe it will always have a role in treating patients where rapid resolution of symptoms is desirable. We think this is one of the great.

Options that we might be able to offer the field. If this drug is approved which is rapid onset of action without chronic pharmacotherapy and has also been used as an agile bent and about a third of our patient. So we know it works alone and in combination. So far we have to replicate those data. So we believe this drug will have a place in the armamentarium regardless.

Whether it's being used as a monotherapy or as an adjunct therapy.

Matthew Harrison: With regard to regulatory treatment, we look at how the FDA viewed the data from the Zorreso Development Program. In that case, what was important to the FDA was whether patients got better; did they remain well? It had nothing to do with statistical significance out through a month or more after the treatment. It was, do the patients bounce back with their symptoms as soon as the treatment stops, or do they overall stay well and have continued benefits? That's the important piece of it. That's the pattern that we've seen with 217 in our two prior trials. And what we think, as Jeff has described, represents a true change in paradigm for the treatment of patients.

With regard to sort of regulatory treatment, we looked at as how the FDA review the data from from the rest of development program and in that case, what was important to the FDA was when patients got better did they remain well had nothing to do a statistical significance out through a month or.

Or more after the treatment was to the patients bounced back with their symptoms as soon as the treatment stops were today overall and stay stay well and have continued benefits. That's the important piece of it that's the pattern that we've seen with to 17 in our two prior trials and what we think as Jeff is described represents a true change in.

Aerodyne for for treatment of patients.

Gary Nachman: Thank you very much.

Thank you very much.

Gary Nachman: Thank you, and our next question comes from Gary Nachman of BMO Couple Markets. Your line is now open.

Thank you.

One comes from carrying off.

Your line open.

Gary Nachman: Hi, good morning. For the Shoreline data, given that you're evaluating patients for up to a year, should we assume that data will likely be at the end of 2020? Any sense of the average number of retreatments we might see just from other work that you've done? And then just one quick follow-up with Xelresso. I know it's early, but are it more psychiatricians or OB-GYNs that have been administering it to patients? And where do you expect to see more of the uptake with that product? Thanks.

Hi, good morning for the shoreline data given that you're evaluating patients up to a year or should we assume that data likely will be at the end of 2020 any sense of average number of Retreatments, we might see just from other work that you've done.

And then just one quick follow up with less so I know, it's early but is it more site or Ob Gyn said had been administering it in patients and where do you expect to see more of the uptake with that product. Thanks.

Yes, what we can say right now with satellite as we'll have the data in 2020.

Mike Clunan: What we can say right now with regard to Shoreline is that we'll have the data in 2020, and we can't be more specific than that. With regard to Zorreso Insights, I'll turn it over to Mike.

And we can be more specific than that with regard to wrestle insights I'll turn it over to Mike Yeah, Gary So on on the terrestrial uptake. So we're encouraged by the HCP demand as we said we'd over 150 HCP, referring in the majority of those at this point had been obesity lands as we anticipated right. We built our go to market model to approach both Ob lands end Sykes and what we're seeing is there.

Mike Clunan: Yeah, Gary, so on the Xeresso uptake, we're encouraged by the HCP demand. As we said, we had over 150 HCPs referring in.

Mike Clunan: The majority of those at this point have been OBGYNs, as we anticipated, right? We built our go-to-market model to approach both OBGYNs and psychiatric care providers. And what we're seeing is the majority of referrals are coming from OBs. But in many cases, the treatment at the sites of care can be by a psychiatrist. So it's a combination of both OBs and psychiatrists. We expect to continue to see referrals from both, but right now, it's predominantly OBs.

Majority referrals are coming from movies, but in many cases the treatment in the sites of care can be by psychiatrists. So it's a combination of both obese and sites. We expect to continue to see referrals from both for right now it's been predominately obese.

Okay. Thank you.

Gary Nachman: Okay, thank you.

Sumant Satchidanand Kulkarni: Thank you. And our next question comes from Sumant Kulkarni of Canada Corp. Your line is now open.

Thank you.

Question comes from.

Of Canaccord. Your line is now open.

Fine. Thanks for taking my question, assuming mounted books, what are your latest thoughts on the timing of in India filing for 207, because having shoreline them, but would inherent prior to approval might have important implications from an eventual clinical practice competitive profile and pricing standpoint.

Sumant Satchidanand Kulkarni: Assuming Mountain Works, what are your latest thoughts on the timing of an NDA filing for 217 because having Shoreline and Redwood in hand prior to approval might have important implications from an eventual clinical practice, competitive profile, and pricing standpoint?

Hi, This is Steve and you know what I'd say is that we're moving very very ill walk you know moving along very well with the to 17 program and Redwood in shoreline, we'll certainly add more and greater information.

Dr. Steve Kaines: Hi, this is Steve, and you know, what I'd say is that we're moving very, very, you know, moving along very well with the 217 program, and Redwood and Shoreline will certainly add more and more information. You know, with regard to the timing and the strategy for the NDA, the data themselves will inform the strategy. You know, the next readout, as we're all talking about it today, is our 301 data that we'll have here in the fourth quarter. What we'll do is look at those data, and since 217 is a breakthrough program, we'll bring those data to the FDA and have a discussion about what we think is the most efficient and effective plan for filing. As soon as we have that clarification, we'll share it.

With regard to the timing and the strategy for the end D.A. data themselves will inform the strategy you know the next read out as we're all talking about today is our threea one data that will have here in fourth quarter.

I will do is look at those data and since 217 as a breakthrough program will bring those data to the to the FDA have a discussion about what we think is the is the most efficient and effective plan for filing since we have that clarity will share it it'd be premature to speculate what are the things. It's important about the program is theres lots of ways to unlock.

Dr. Steve Kaines: You know, it would be premature to speculate. One of the things that's important about the program is that there are lots of ways to unlock and articulate the value of 217. Between the acute studies that we've done already, the two positive pivotal trials that we have, the MDD study, as well as the Robin study, the 301, which we'll read out now, as well as the, you know, the long-term studies Shoreline and Redwood, we'll really have a good idea of how best to advise both the agency, patients, and physicians on how to use the medicine. So, until we have all those pieces together, lots of potential pathways to a file, you know, we wouldn't want to speculate about what the specific timing is for that plan.

And articulate the value of 207 between the acute studies that we've done already the two positive pivotal trials that we have MDD study as well as the Robin study the Threea, one which will read out now as well as the the long term study shoreline and Redwood will really have a good idea of how best to advise.

Both the agency patients and physicians on how to use the medicine. So until we have all those pieces together lots of potential pathways to a file.

You know, we wouldn't want to speculate about what the specific timing is for that plan.

Sumant Satchidanand Kulkarni: Thank you.

Thank you.

Yatin Suneja: Thank you, and our next question comes from Yatin Suneja of Guggenheim. Your line is now open.

Thank you.

Question comes from.

That open.

Yatin Suneja: Hey guys, thanks for taking my question. Just another question on the regulatory front. So with regard to the ICS guidelines, would you have an exception that you might not require 300 patients for 6 months or 100 patients for 12 months? Or would you require that? And if you do, what would be the timeline when you'll be able to file? And then quickly, if you can comment on the Huntington readout, what would constitute a successful study that would warrant further development?

Hey, guys. Thanks for taking my question just another question on the regulatory front, so with regard to the I see as guideline would you have an exception that you might not quite clear indication for six months or hundred patient for 12 months.

Or would you required that and if you do like what would be the timeline when you'll be able to file and then quickly. If you couldn't comment on the Huntington read out what would entail a successful study that would warrant.

<unk>.

Yes. So this is Jeff.

Dr. Jeff Jonas: Yes, so this is Jeff. In terms of the numbers, we already have a prearranged agreement with the agency. I think we're not concerned about meeting ICH guidelines if you look at the programs we have under study. So that, we believe, is well covered. With respect to Huntington's, I'm going to turn it over to Jim Doherty.

The numbers, we havent, we already have a pre arranged agreement with the agency I think we're not concerned about meeting I CH guidelines that if you look at our the programs we have under study, but thats. So that we believe are well covered.

With respect to Huntingtons I'm going to turn over to Jim Doherty, Hi, Yes, with respect to Huntingtons, you're referring to the Sage 718 program.

Jim Doherty: Hi, yes, with respect to Huntington's, you're referring to the SAGE 718 program, which is our lead NMDA asset, and as we've talked about previously, that asset has currently been in phase one, and we've looked at early open-label cohorts showing, at least in the acute setting, some beneficial effects in cognition for those healthy volunteers. So the study that's running now is a similar study, but now an open-label cohort looking at the effects of 718 in Huntington's patients. And so, as we've done previously with our more mature programs, we will use those data to help inform the phase two study that's currently planned for the early part of next year.

Which is our lead NMD, a asset and as we've talked about previously that asset has currently been in phase one and Weve looked at early open label cohorts showing at least in acute setting us a beneficial effects and cognition for those healthy volunteers. So the study that's running now is a similar study but down open label.

Cohort looking at the effects of 718 in Huntingtons patients and so as we've done previously with our more mature programs. We will use those data to help inform the phase two study. That's currently in planned for the early part of next year.

Jim Doherty: Thank you. And our next question comes from Jay Olson of Oppenheimer, and your line is now open.

Thank you and our next question comes from Jay Olson of Oppenheimer.

Ben.

Jay Olson: Oh hi, thanks for taking the question. I am curious about the conduct of the Mountain Study. Can you describe any steps you've taken to ensure bedtime dosing, how these steps may differ from previous studies of 217, and how do you expect these dosing instructions to be reflected in a label? Thank you.

Hi, Thanks for taking the question.

I'm curious about the conduct of the mountains study can you describe any steps you've taken to ensure bedtime dose and how these steps may differ from previous studies to 17, and how do you expect we go through construction to be reflected in the label. Thank you.

Dr. Steve Kaines: So, I'll take the last one first, Chris. It's way too early to speculate about how instructions will be reflected in the label. We take a very direct approach to the management of our trials. We give the patients instructions. We tell them it's best to take it at night. And, you know, what we've done in earlier studies, we've looked at PK samples to ensure that, at least based on our modeling, we know that the levels prior to the next dose when they come in, identify that they've been taking the medication and so forth. But, I mean, regardless of what time of day the drug is administered, it's really not about a PK-PD relationship. For something like 217, we're talking about an effect that happens over the course of the entire dosing period. So, you know, I think the most important piece of this is that the approach that we've taken to specifically teaching patients has been effective. We've shown in study after study that patients have been able to manage that relatively brief dosing period. Yeah,

So I'll take the last one first Chris is way too early to speculate about how instructions will be.

To be reflected in label, we take a very direct approach to management of our trials, we give the patients instructions.

We tell them, it's best to take it at night and what we've done earlier studies, we've looked at PK samples to ensure that at least based on our modeling we know the levels with prior to the next dosing when they come in.

Identify that they've been taking the medication and so forth, but I mean, that's not a.

Regardless of where what time of day. The drug is administered it's really not about a PK PD relationship for something like 207, we're talking about an effective happens over the course of the of the entire dosing period. So.

I think.

Most important piece of this is that the approach that we've taken to specifically instructing patients has been effective we've shown in study. After study that patients have been able to manage that relatively brief dosing period and the other point I'd make its a pretty well behaved drug we've seen that and the two prior controlled trials will the open label data and the phase one and Steve first points out.

Yes, the PK does not require dosing in any particular time, but I think the other point, which is maybe more germain is that the drug has so far and extremely well tolerated. So when you look at issues of Noncompliance say for example in Sri trials, usually see that in the context of patients not obtaining benefit wallich, while they are.

Dr. Jeff Jonas: Yeah, the other point I'd make is that it's a pretty well-behaved drug. We've seen that in the two prior control trials, both the open-label data and the Phase I. And as Steve first points out, you know, the PK does not require dosing at any particular time. But I think the other point, which is maybe more germane, is that the drug has so far been extremely well-tolerated. So when you look at issues of noncompliance, say, for example, in SSRI trials, you usually see that in the context of patients not obtaining benefit while they are experiencing side effects, which occur very rapidly. What you have with 217 to date has been sort of the opposite. You see a rapid onset of activity coincident with improved sleep. So compliance with our studies, as you can see from our very low dropout rates, has not been a major tactical issue.

Experiencing the side effects, which occur very rapidly, but you have with it was to my seven to date has been sort of the opposite you see a rapid onset of activity coincident with improved sleep. So so compliance with our studies and you've seen by a very low dropout rates has not been a major tactical issue.

Super helpful. Thank you very much.

Thank you at our next question comes from de Leon of RG, Yes. Your line open.

Hi, Thank you for taking the questions just a quick follow up on that in the phase two Mgd study for stage 207, all the doses were actually delivered under a supervised basis both than the inpatient and outpatient period in the mountains study are the doses also supervised for all.

Dave Zero to 115.

Jay Olson: Super helpful. Thank you very much.

Daily doses as an even though they're outpatient is a clinician going to their house or are they going to connect to receive their daily dose. Thank you.

Doug Thale: Thank you. And our next question comes from Dane Leon of RJS. Your line is now open.

Doug Thale: receive their daily dose? Thank you.

Dr. Steve Kaines: Yeah, no, first, let me clarify. In fact, you know, for the second week of the MDD trial, patients were at home, and they were given their medication to take at home. So, you know, after the patients were discharged, they were, as is standard in an antidepressant trial, given instructions, and they came in for their follow-up appointments. And that's the same approach that we're taking. And no, we're not sending people to supervise administration.

Yes, no first let me clarify in fact for the second week of the MDD trial patients were at home and they are giving their their medications they get home.

So after that patients were discharged stay where as is every it was just standard in anti depressant trial patients were given instructions and they came in for their follow for their follow up appointments with me and that's the same approach that we're taking and no. We're not sending people to supervise administration remember these are the registration programs that will go into labeling.

Dr. Steve Kaines: Remember, these are the registration programs that will go into labeling. And if you have a particular procedure like this, it would then be translated into a label claim, meaning that people would need to be supervised. That's not the way that antidepressants are administered, and it's certainly not the way they work. And it comes down to this issue of effectiveness versus efficacy. When you have a long-term drug, when people are taking it, they get exposure, and then they get the benefit.

And if you have a particular procedure like this.

It was it would then be translated into a label claim meaning that people would need to be supervised that's not the way that anti depressants or are administered they're certainly not the way there where they work and it comes down to this issue of effectiveness versus efficacy effectiveness is when you have a long half life drug when people are taking it to get exposure and then they get the benefit and that's what.

Dr. Steve Kaines: And that's what we've seen, as Jeff said, in study after study. And that's what we anticipate in 301 as well. All right, thank you.

I've seen as Jeff said and study after study that's what we anticipate in three or one as well.

Thank you.

Dr. Steve Kaines: Thank you. And our next question comes from Marc Goodman of SCB Learning. Your line is now open.

Thank you.

Income from Marc Goodman.

Your line open.

Marc Harold Goodman: Morning. Could you talk about the women who've tried Zolreso so far? Just some anecdotal evidence of what you're hearing. Were these women very severe patients? Were they moderate patients? Just curious what type of patients were actually being treated? And then you talked about the sustained benefit and how important that is, obviously, and that's the key to the product. Can you talk about anecdotally what you're hearing? Were these women getting that kind of benefit? Are they on antidepressants? After they go home? Whatever you could tell us, that'd be great. Thanks.

Good morning could you talk about the women who tried full rest. So so far just some anecdotal evidence of what what you're hearing where these women very severe patients where the moderate patients just curious what type of patients actually.

Being treated and then you talked about the sustained benefit and how important that is obviously and thats. The key to product can you talk about anecdotally, what you're hearing with where these women.

Getting back kind of benefit are they on antidepressants after they go home.

Whatever you could tell us that'd be great. Thanks.

Mike Clunan: So, Marc, I think this is Mike. I'll take that one. So in terms of the patients that we're seeing, right, you heard the patient stories. Very encouraging, very compelling. It is consistent with what we've said pre-launch, which is at this point, what we're hearing from physicians is that it's mainly the severe patient population that they're initially going after with SORESO. But what we do expect is that they gain clinical experience, and they gain more trial experience with SORESO. They'll start to use that with more monitor severe patients. I think it's important to remember our payer coverage is covering patients in the monitor severe category. So there's no reason why this can't be moved up earlier in the treatment paradigm.

So mark So I think this is Mike I'll take that one so in terms of the patients that were seeing right. If you heard the patient stories very encouraging very compelling. It is consistent with what we've said pre launch which is at this point what we're hearing from physicians is mainly as physicians are saying, it's the severe patient population that they are initially going after with was still rest so.

But what we do expect it this is big and clinical experience and again more travel experience with so wrestle they'll start to use that with will moderate to severe patients I think it's important to remember our payer coverage is covering patients in the in the moderate to severe category. So there's no reasons why this can't be moved up earlier in the treatment paradigm, we expect that over time as they gain clinical experience I think to your other point about.

Mike Clunan: And we expect that over time as they gain clinical experience. I think about your other point about the trial period that we talked about with some of these sites wanting to get clinical profile evaluation of patients after they've been treated and also get comfort with reimbursement. Every site is sort of developing its own protocol to follow the patient after treatment. But as I said, everything seems to be very consistent with the trials, and we're very confident in what we've seen so far with SORESO. And that's really what you look for when you launch a product like this, real world evidence that replicates the clinical trials. And to date, we've been very encouraged by what we see with SORESO. Thanks.

The trial period that we talked about what some of these sites wanting to get clinical profile evaluation of the patients after they've been treated and also get comfort with reimbursement every cytosorb developing their own protocols all the patient after treatment.

But as I said everything seems to be very consistent with the trials and we're very confident in what we've seen so far with the rest. So thats really what you look for when you launch a product like this is due the real world evidence replicate the clinical trials and to date, we've been very encouraged I will see what's the Russell.

Thanks.

Mike Clunan: Thank you, and our next question comes from Doug Thale, OAC Wainwright. Your line is now open.

Thank you next question comes from Doug sale. They C. Wainwright. Your line is the open.

Doug Thale: Hi, good morning, thanks for taking the questions. So just maybe on the new molecules that you announced today, 904 and 689, if you could provide some perspective on how 904 differs from 718 and 689 from the other GABA modulators and just maybe some thoughts on timing and when you'll sort of disclose the development plans and the

Hi, good morning, Thanks for taking the questions. So just maybe on the new molecules that you announced said nine or for 679, just if you could provide some perspective on how likes and nine afford differs from seven to seven when it and six hitting on from they have their cap of modulators and just maybe some thoughts on timing and when you'll sort of disclosed.

Development plans on the indications that those are going to be target.

Operator: Page PAGE of NUMPAGES www.verbalink.com Page PAGE of NUMPAGES

Yes.

Dr. Jeff Jonas: This is Jeff, and I'm going to turn this over to Jim in a minute, but, you know, one of the opportunities that SAGE presents is a very robust compound library that our discovery folks have developed for us. And as we've moved forward, we've been fortunate in being able to isolate new molecules that we think are pharmaceutical quality. And so these two are examples of the productivity of basically our product engine. And so I think that's a really important feature about SAGE, and thank you for asking this question, because we think SAGE is obviously much broader than Zylresso and even 217, although it tends to throw shade on everything else, as mountains tend to do. Little earnings joke. But anyway, I'm going to turn this over to Jim to give you more detail.

This is Jeff and I'm going to turn this over to Jim in a minute but.

One of the opportunities that say presented a very robust compound library that our discovery folks have developed for us and as we move forward, we've been fortunate to be able to isolate new molecules that we think a pharmaceutical quality and what weve and so these two are examples of the productivity of our but basically our product engine I'm going to it and so I think thats a really important.

Sure about and thank you were asking this question because we think stage is obviously much broader than so rest on even to one seven although mountains tends to throw shade on everything else as mountains tend to do.

But little earnings joke.

But anyway I'm going to turn this is Jim and give you more detail.

Jim Doherty: Hi, yeah, so I would say we're, look, we're really excited about how the pipeline is progressing in general. There are a lot of mid-term opportunities here.

Hi, Yes, so I would say were look we're really excited about the pipeline is progressing in general there a lot of mid term opportunities here to nano for specifically and we talk a lot about following the science and here, we're talking about a novel mechanism of action NMD, a positive Alistair modulators and so with 718, we're about to move into our phase two studies in Huntington.

Jim Doherty: To 904 specifically, you know, we talk a lot about following the science, and here we're talking about a novel mechanism of action, NMDA-positive allosteric modulators. And so with 718, we're about to move into our phase 2 studies in Huntington's disease, but certainly, we see this mechanism of action that could be beneficial for a large number of patient populations. And so, as we have done in the past with our GABA platform, we are taking an opportunity to use the richness of the library to identify molecules that have distinct profiles. And so that's what we think is the case with 904. We think that 904 and 718 both have distinct profiles, so as we move forward into clinical development, we'll be talking about how those differences play out.

Disease, but certainly we see this mechanism of action that could be beneficial for a large number of patient populations and so as we've done in the past with our capital platform. We are taking an opportunity did you use the richness of the library to identify molecules that have distinct profiles and so that's what we think is the case with non.

Before we think that none of 400 718, both have distinct profile as we move forward into clinical development will be talking about how those differences played out.

Add onto the this is kidney.

This is a great example of our investment strategy and how it works. We've always said that we were going to continue to.

Kimi E. Iguchi: Add to that, this is Kimi, so this is a great example of our investment strategy and how it works. We've always said that we were going to continue to invest in the early stage pipeline and research, and we're seeing that bear fruit today.

That's in the early stage pipeline in the research and we're seeing that bear fruit today.

Okay, great. Thank you very much.

Thank you ladies and gentlemen, this does conclude our question answer session I'd now like turn the call back over to Dr., Jeff Jonas for any closing remarks.

Doug Thale: Okay, great. Thank you very much.

Operator: Thank you. And, ladies and gentlemen, this does conclude our question and answer session.

Firstly, thanks, everyone for joining us this morning, and I hope it's apparent everyone that our approach has really led to significant progress both commercially and across the pipeline in the third quarter.

Dr. Jeff Jonas: Firstly, thank you everyone for joining us this morning.

I think you know as you see the early development pipeline has been prolific depression program in two and seven is moving on well, we're looking forward to mountain.

Dr. Jeff Jonas: And I hope it's apparent to everyone that our approach has really led to...

Read out this quarter and importantly, I think there's all wrestle launches is really is is where we said it would be at this time in the launch.

Operator: The Zolreso launch is where we said it would be at this time in the launch. Our major challenge and our major interest is to make sure that women who need this treatment can get it. We have made important strides in terms of getting coverage for this drug, but our work isn't done. We're changing the treatment model. We're changing the approach to treating women with a really devastating disorder and trying to make sure that they have access to care as quickly as they need it. So with that, I'd like to thank everyone for their attention today, and I hope you all have a great day.

Our major challenge and our major interest is to make sure that women, who need is treatment can get it we've made important strides strides in terms of getting coverage for this drug but I'll work isn't done we're changing a treatment model with changing and approach to treating women with a really devastating disorder and trying to make sure that they have access to care as quickly as they need.

Got it.

So with that I'd like to thank everyone for their attention today and hope you'll have a great day.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.

Ladies and gentlemen, this concludes today's conference call. Thank you for parts seating you may now disconnect.