Q1 2020 Earnings Call

Good afternoon my name is.

And I will be a conference operator today welcome to the out of X life Sciences to announce fiscal 2021st quarter Financial results Conference call as a reminder.

This conference call is being recorded I would I like to introduce your host for today's conference quit Thomas said. Please go ahead.

Thank you and good afternoon, everyone.

We appreciate you joining us today for Anavex Life Sciences conference call and webcast.

Our agenda is to review the Companys financial results for its first quarter fiscal 2020.

Providing clinical study update.

Taped replay of this call will.

I'll be available approximately two hours after the call's conclusion and will remain available for one month.

The call will also be available for replay on Anavex is website at www Dot Anavex dotcom.

With us today as Dr., Christopher misleading, President and Chief Executive Officer and.

Sandra Burnish principal financial officer.

Dr misleading and Miss Burnish will make prepared remarks, and then we will take questions from equity analysts.

Before we begin please know that during this conference call. The company will make some projections and forward looking statements regarding future events.

We.

Urge you to review the Companys filings with the FCC.

This includes without limitation, the company's forms 10-K, and 10-Q, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward looking statements.

These.

Factors may include without limitation risks inherent in the development and or commercialization of potential products uncertainty in the results of clinical trials or regulatory approvals need an ability to obtain future capital and maintenance of intellectual property rights.

And.

With that I'd like to turn the call over to Dr. mislead.

Thank you.

I'd like to thank everyone for joining us on today's conference call to review, our first quarter financial results and shared with you some clinical updates bottlenecks to 73 or block comedy.

We were pleased to announce earlier this week that the U.S. food and drug administration FDA has granted fast track designation for the Anavex 273 clinical development program for the treatment of Rett syndrome.

Ft, a fast track is a program designed to.

Facilitate and expedite the development and review, although new truck to address unmet medical need in the treatment of a serious and life threatening condition for which it demonstrates the potential to address unmet medical need for such a disease arc.

Condition.

Part of the program is to get import new therapies for the pot patients.

In order to address the unmet medical need in the treatment of serious and life threatening diseases.

Our clinical Rex syndrome program, our it there was there one and ours zero too.

Avatar are on track with continued enrollment.

We continue to strengthen our patent position as well.

During the quarter, we were granted another U.S. patent to support Anavex, leading drug candidate on the next to 73 for the treatment of Neurodevelopmental disorder.

Putting rett syndrome and multiple sclerosis.

This patent is expected to remain in fourth at least until 2037, not including any patent term extension.

It kind of methods of treatment for neurodevelopmental disorder, including Rett syndrome autism spectrum.

On the load up incremental room, and sort of a policy among others and also treatment for multiple sclerosis, using anavex 273.

Regarding the out of Ics to 73 Parkinson disease dementia study, we were pleased to report that we met our enrollment target for this study.

This study enrollment over 100 patients at 20 sites across Spain, and three sites in Australia.

We expect to announce topline results from this study by mid 2020.

Enrollment for the phase to be slash three on the mix to 73 ultimate disease study.

It's 50% complete recruitment is expected to accelerate given the anticipated international expansion of this study, which will increase the total number of site.

15 to approximately 45 in 2020.

We are reporting.

The advancement of another pipeline compound, we have successfully completed I'd, enabling toxicology studies and drug product manufacturing for out of Ics.

Recently won.

On the next 371 previously received orphan drug designation from the US FDA fall.

Total temporal dementia, FTD and initiation of the first phase one clinical trial of Anavex 271 is expected in 2020.

And now I would like to direct to call to summed up burnish principal financial officer of analytics for a brief financial summary.

Of the recently reported quarter.

Thank you Christopher and good afternoon, everyone.

We reported a net loss of 6.6 million or 12 cents per share during the quarter compared to a net loss of 6.9 million marketing pence per share in the comparable first quarter fiscal 2018.

The decrease in appointed net loss is due to increased research and development incentive income.

Research and development expenses were 6.3 million for the first quarter of 2020 as compared to 5.7 million for the comparable period in 2018.

The increase was driven by increased clinical development.

These related to the advancement of our pipeline.

General and administrative expenses were 1.4 million to the first quarter of 2020 as compared to 1.8 million for the comparable period in 2019.

This decrease was primarily due to lower noncash stock based compensation charges.

During the quarter, our cash position grew to 27.5 million at December 31, 2018 from $22.2 million at our year end September Thirtyth 2019.

Thank you and now I will turn the call back over to Christopher.

'cause for please go ahead.

In summary, thank you sudden drop.

In summary, we continue to make steady progress towards reaching several important milestones and we are poised to an exciting 2020 with multiple data readout.

We look forward to.

I think further updates as advancements continue I.

I would now like to open the call for questions. Operator. Please go ahead.

Thank you at this time, we will be conducting a question and answer session for equity analysts if you'd like to ask a question. Please press star on your telephone keypad.

Confirmation how will indicate your line is in the question Q You May Press Star then one if you like to remove your question from the Q.

Our first question is our Raghuram selvaraju from H.C. Wainwright.

Please go ahead.

Good afternoon. This is Ed remarks on for Rob I. Appreciate you guys taking the questions.

Quickly on the clinical side I'm, just wondering what the gating items are before you're able to initiate the pediatric rett syndrome trial.

They are thank you for the question there are no.

Gating items, we did announce that we were able to get approval for starting to study it is really the.

Customary requirements off.

Site initiation visits site initiation visits and preparing the.

Druck.

To the sites.

And then we can start so I expect us to be.

Although shortly and we will make that announcement public.

Okay good to hear.

You mentioned the recent patent announcement I notice that multiple sclerosis was mentioned multiple times in there Im just wondering if you intend to or.

If other companies have shown interest in rapidly developing blockers mean for multiple sclerosis.

I noticed that you also mentioned autism in cerebral palsy in there that are covered by the pattern.

Are these also planning to be pursued in the future.

So we did actually ahead encouraging data for.

MMS.

From a in vitro study from several investigate US which was also presented at AACR trimas.

Last yield to year end the year before and we have to be we add that mindful that this is a very exciting indication and.

But however still requires.

More preclinical work like an animal study.

Or other forms of validation.

I think the best way to look at this is once we get clarity on the data all for erect syndrome, we would immediately.

Accelerate that.

Program, they often at the same applies for new.

For the Super nuclear policy indication as well.

Got it and then my final question I was just wondering if there's any more detail available regarding the microbial biomarker analysis for Alzheimer's and Parkinson's.

And when do you anticipate releasing some of this data.

So we did.

Debt received a initial positive signal from the phase two a study in ultimate disease that there was a correlation of to gut microbiome changes with drug exposure and we.

Added this.

A measure into our Parkinson disease dementia study extension. So we will all be able to report this.

With deep pockets is dementia study extension outcome.

We will be able to see the.

The level of changes in measures have got back who will be up before drug exposure in Africa as well as for patients on placebo and then on on on Druck active drug. So we will have a very good ability to.

See if we will be able to confirmed the correlation of drug effect with increase of variety of gut microbiome, which is the beneficial.

Effect.

Since healthy volunteers have a high of a variety of gut microbiome.

Then disease patients.

All right. Thank you for all the details.

Youre welcome.

Next question is from young from Janney. Please go ahead.

Hi, Thank you can questions. So the first question is on the status of the two.

Ongoing Rett syndrome study.

I believe I heard you said that the two studies are still enrolling patients and Im wondering did you run into any challenges in recruiting patients. In addition to the.

The fact that just being an orphan indication was a small prevalent.

Sorry.

What was the last part of the question.

Yes, I understand that this is an orphan indication was a small prevalence, but did you run into any additional challenges in recruiting patients into those two studies.

No. We did not we just want to make sure that the patients are.

Recruited in a fashion that the right patients I in the study because that study now becomes relevant given that we received.

Fast track designation and so our goal is not rush the enrollment and make sure we get the right patients into the study, but we did not find.

And the.

And the challenges during this at this point.

Okay, then about the.

Parkinson's disease dimension studies so.

The primary efficacy endpoint and stuff continuity of attention.

So assume that you reported where you see positive.

Adam by mid 2020.

Are you going to approach the FDA shoot discuss about the next step and do you think this same primary endpoint will likely be used in them. The next study.

Yes. So the second question regarding seclusion is a little bit a dialogue with the.

In seed to see if this would be.

Able to become thronged, but the good news is that the measure you. You you mentioned it has been shown to be correlated with a drug which was approved for pockets in the many many years ago. So that is the reason why we picked that measure.

And indeed, it's correct to make that assumption. After the data is available we would sit down with the agency and discuss next steps.

Okay. So then the last question about the new compounds 371.

Right.

What do you expect will be done indication Thats you pursue was.

This compound and how do you plan to position the new compelling as compared to the 273.

To 73, yes.

So we do have them.

Advantage that Arvixe 371 has already received from the FDA orphan drug designation for from Toyota.

Temper dementia, FTD, and we will most likely than advance the phase one into a phase two.

With that indication.

That will be our current strategy.

Okay, but in terms of mechanism of action, but two compounds are.

The same where apart.

Similar is that correct.

So there are differences the molecules are completed differences, but there is a similarity that they both activate the signal one receptor, which the core of our hypothesis.

Thats a anavex 273 has also and.

Nation mechanism of the and one Sigma MUSC organic receptor up which is.

Very strong and did that is slightly different two out of Ics to seven three so there are differences in that regard and though we up that we still believe though.

That for that reason that intriguing to move forward with 371, because we have the ability to demonstrate that the drug has shown very solid reduction in towel and inflammation and a better aggregation in a triple transgenic animal model.

And that basically is the reason why we're very excited about 371 as well.

Okay. Thank you very much.

Youre welcome.

I will once again as a reminder, if you would like to ask a question. Please press Star then one on your telephone keypad.

And we have a question from Tom Bishop from D. I Research. Please go ahead.

Hi.

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If I'm recalling correctly has the FDA given eight to 73.

For Rep.

Orphan drug designation and rare pediatric disease status and now fast track designation is my memory, correct or am I in need of some a two so this is absolutely correct. All three designation have been awarded to another six to 734 Rett syndrome.

That's pretty impressive it sounds like.

The FDA easily.

Doing it's best to speed this along.

It is clear that the FDA is in the loop forget but is is the FDA.

As much in the loop here on the Altzheimer's trials.

So that the companies working closely with the FDA to assure that.

All timers trial results will be to their liking as well as in Australia.

We did and we announced that Ed was by now several years ago that we had interaction with the FDA pre IND meeting and that was a ship the design of the study among them.

So the assumption is correct. We de we do have the interaction with the FDA on the Optima program as well.

On that also I Miss trial, how we're hoping to find its.

Early also members as I understand it and I would just wondering how the company defines that interns terms of and.

He or activities of daily living scores.

So the de designation of early summer is a.

It is a.

Is a.

Developed by the.

Consortium, the ultimate consult soon and it basically.

Discriminates.

Two more advanced out summer and it's basically the area of dysfunction, which is subsequent mild cognitive impairment and the next.

Level is early I'll sum up and the next level is then mild to moderate ultra them up.

And then followed by severe mild summer so it's basically sandwiched between mild cognitive impairment and.

Madrid.

To a mild to moderate of somebody's.

But I was just wondering if there's some cut off for the M M. A C or eight deals scores.

Yeah. That's good that's back the require mentor discourse cut off is 20, MSC and higher so 20 to 28.

To.

Remind again 30 missies cause the is the perfect cognition and discord decreases.

Advancing of cognitive impairment so the inclusion of to trials early altima is in the range of 20 MMC to 28 MMC score.

Okay and I'm just also I wanted to ask about this acceleration in the.

Number of sites.

For the Alzheimer's trials moving it.

I guess offshore.

But also opening sites offshore.

And to increase the number sites like 200%.

Kind of surprised me a little bit seems kind of expensive but is there.

Some reason for the behind the acceleration.

So the it's not going to be actually much more expensive. It's just that we're going to more places to buy so to speak of something so we still need 450 patients we now have.

50% enrolled.

So it would just accelerate the enrollment it's not more expensive it just accelerates it so the what what remains the good what cost money is the number of patients and that's already in the budget, which is 450 patients. So its independent from which sites this would be coming.

But is there some reason for the acceleration I must admit to having read some exciting anecdotal news of patient improvements coming out of Australia.

We are excited.

Oh I'm sorry. So we are excited about this program and we already had a said previously that the faced way out.

A study gave us the confidence to move forward into this phase to be slash, we study and that is the basis of no accelerating this because we are realizing that we want to now we'll make sure that the <unk>. The the study is finishing sooner or later and so we were confident so far.

With the first 50% and now we are moving to this level of acceleration by increasing the number of sites.

Okay, good and and finally that does the company have any thoughts on the shore read data when that might be coming out because there's two ongoing studies. So I don't know her closely or.

Yeah. So these studies ongoing as I mentioned and we will report when each of them involvement is completed and then we will also be able to exactly precisely say when the top line data off these respective to study will be presented.

Okay, great. Thank you.

Thank you.

And we have no further questions at this time I was watching a call on what to tack air missiles are closing remarks.

Thank you also participating in today's conference call I hope that based on the described developing today, you're looking for two 2000 trendy as much as we are.

You do need any additional information or have any questions. Please visit our website at W.W. on of X. dot com or <unk> call or email us as well. This concludes our remarks for today operator.

Main concern that concludes our call for today you may now disconnect.

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