Q4 2020 Minerva Neurosciences Inc Earnings Call
Welcome to the Minerva Neurosciences year end 2020 conference call.
At this time all participants are in a listen only mode.
There will be a question and answer session. Following today's prepared remarks.
Call is being webcast live on the investors section of the nervous much light on that Minerva Neurosciences dotcom.
As a reminder, today's call is being reported.
I would now like to turn the call over to William Boni, Vice President of Investor Relations and corporate communications at Minerva. Please proceed.
Good morning, our press release for the company's fourth quarter and year end 2020 financial results and business highlights became available at 730 Eastern time today and can be found on the investors section of our website.
Our annual report on form 10-K was also filed electronically with the Securities and Exchange Commission. This morning, and can be found on the SEC's website at Www Dot FCC Dot Gov.
Joining me on the call today for Minerva are Dr. Remy look singer Executive Chairman and Chief Executive Officer, and Mr. Geoff race, Executive Vice President Chief Financial Officer, and Chief Business Officer.
Following our prepared remarks, we will open the call for Q&A.
Before we begin I would like to remind you that today's discussion will include statements about the company's future expectations plans and prospects that.
Constitute forward looking statements for purposes of the Safe Harbor provisions under the private Securities Litigation Reform Act of 1995.
We caution that these forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated.
These forward looking statements are based on our current expectations and may differ materially from actual results due to a variety of factors that are more fully detailed under the caption risk factors in our filings with Securities and Exchange Commission, including our annual report on form 10-K.
<unk> for the year ended December 31, 2020 filed with the SEC earlier today.
Any forward looking statements made on this call speak only as of today's date Monday March eight 2021, and the company disclaims any obligation to update any of these forward looking statements to reflect events or circumstances that occur after today's call except as required.
By law.
I would now like to turn the call over to Remy Lutheran gear.
Thank you Bill and good morning, everyone. Thanks for joining us today.
I'm very pleased to present, an update on progress and our earnings report for the full year 2020.
It may last year, we announced topline results from the double blind portion of phase three trials is royalty payment on the negative symptoms of schizophrenia.
Also on the study did not meet statistical significance, we remain highly encouraged by is it for.
Rising signals that emerged.
We look forward to sharing data from the phase III nine months open label extension, which will be available until first half for this year.
Following on what type C meeting with the every day in November 2020 day.
During which the FDA caution.
Debt and NDA submission based on the then current data from the phase to be in phase III studies would be highly unlikely to be fine.
We continue our dialogue with urgency.
We are providing information to the FDA on several topics highlighted into meeting minutes per.
The more we will also initiate the pivotal bioequivalence study in approximately 48 healthy volunteers comparing the formulation employed interface to be in phase III trials.
While it has at least one new formulation designed in conjunction with our commercial supply powerful catalysts, Inc.
Possibly take large scale manufacturing, we are working to address the fda's request and comments and we are motivated by the Argentine encouragement to continue the development of probably paradigm for the treatment of negative symptoms of schizophrenia.
Among emerging therapies in development for negative symptoms Ronny paradigm is the most clinically advanced.
We remain committed to bringing royalty paradigm as quickly as possible for patients in need of such a treat.
We're looking forward to 2020 widened with a significantly improved cash position following the recent sale for problem.
Right through the self direction royalty to royalty pharma from which we received $60 million upfront and we've received the first $195 million subject to the achievement of certain milestones.
First I would like to provide a more detailed update on our lead program growth paradigm, a drop which has the potential to treat negative symptoms.
Our primary objective in 2021 is to continue the development path forward to meet the regulatory requirements to submit an NDA for royalty payments.
First for nine months open label extension of the Phase III trial has been completed on schedule on a few weeks ago and day Im happy to report that no patient most discontinued due to COVID-19 eating it.
The total of 300 Kt Street patients around 65 personal growth and growth and the demand months open label extension.
Each of those patients already being treated with royalty per redone remained on treatment on the same dose received into 12 week double blind phase <unk>, two milligram and 64 milligram.
Those patients who received placebo in the 12 week double blind phase of our randomized to Asia, 32, milligram or 64 milligram.
We're very pleased on the total of 202 patients at around 61% completed the open label extension of the study.
Data, we expect it to be available on the first half of 2021.
These data are important because as we observed interface to be six months extension they may demonstrate improvement.
Improvement of negative symptoms, if sustained or increased almost a one year duration.
Improvement on negative symptoms leads to improved functioning well devoted parried on maintained or improved positive symptoms and or agitation.
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Whereas on the safety and Tolerability profile of royalty payment done is maintained over say one year administration period.
I look forward to sharing a detailed presentation of the findings when data become available.
In parallel we continue to move forward with activities necessary to support the submission of a new drug application for Raleigh Paragon.
First we intend to initiate and should value equivalent study I described earlier.
Fortunately, we believe led by showing bio equivalents across formulations, we will address the specific comment made by GM day about the face to be for mortgage.
Second we are in the process of submitting the requested scientific literature in support of the psychometric properties of the primary and key secondary endpoints used in our clinical development as requested by the FDA.
Following the completion of the pivotal Bioequivalence study, we plan to request a pre NDA meeting with the FDA to discuss certain models, including data from the phase III open label extension data from the bio equivalent study and potential NDA submission of revenue paradigm for the treatment.
Negative symptoms of schizophrenia.
I will now move on the recent developments in the scent direction program.
You will remember that in mid 2020, Minerva exercised its right to opt out of a joint development agreement with Janssen for.
For the future development of set direction.
As a result, we are entitled to collect mid single digit royalties on potential future worldwide sales in certain indications with no further financial obligations to contribute development costs for Jensen.
On January 19 of this year, we announced on royalty pharma had a quiet manure bus royalty interest in central action on.
We received an upfront payment of $60 million with a.
Tension to receive up to first on $95 million in additional payments contingent on achieving so continually regulatory on commercialization milestones.
Total restaurant is currently in phase III clinical development by Janssen pharmaceutical.
In the area of Johnson <unk> Johnson for the <unk>.
<unk> treatment of major depressive disorder.
So on your symptoms.
We are delighted to have partnered with royalty pharma as a leader in acquiring pharmaceutical royalties across the life science industry.
It has enabled us to secure significant non dilutive funding, both immediate and potentially over the long term debt, which support our top priority. The continued development of quality for everyone our lead asset.
In summary, we remain committed to developing volume paragon as a potentially transformative treatment in the treatment of negative symptoms of schizophrenia.
I look forward to sharing data from the phase II open label extension with you soon and zone.
Pilot Bioequivalence studies in the coming months as well as continuing to update our investors on the ongoing dialogue with the FDA.
We don't turn it over to Jeff to discuss our financial performance.
Thank you Remy.
Earlier. This morning, we issued a press release summarizing our operating results for the fourth quarter on year ended December 30 for 2020.
A more detailed discussion of our results may be found in our annual report on form 10-K filed with the SEC earlier today.
Cash cash equivalents on restricted cash as of December 31, 2020, we're approximately $25 $5 million.
Compared to $46 million as of December 31st 2019.
In January 2021, the company received a $60 million cash payment from royalty pharma in connection with the acquisition of the Companys royalty interest.
So direction.
We presently expect that the company's existing cash and cash equivalents, which includes its financial resources at year end 2020, combined with the $60 million payment received in January from royalty pharma will be sufficient to meet its anticipated capital requirements for.
Or at least the next 12 months from today based on our current operating plan.
The assumptions upon which this estimate is based are routinely evaluated and may be subject to change.
Research and development expenses were $3 6 million on $28 5 million for the fourth quarters of 2020 on 2019, respectively.
R&D expenses were $22 million and $58 1 million for the years ended December 31, 2020 on 2019, respectively.
The decrease in R&D expense for the fourth quarter ended December 31, 2020 was primarily due to a $19 million charge taken in December 2019 for the impairment of the in process research and development related to Min 117, following the results of the phase.
To be tried and MDT, which failed to meet its primary on key secondary endpoints.
The decrease in R&D expense for the year ended December 31, 2020 was due also to the approximately $11 million from the completion of the phase two b clinical trial of Min 117 in December 2019 on the completion of the double blind portion of the phase III clinical.
Trial of Rowley paradigm in May 2020.
Noncash stock compensation expense included in R&D expenses was $3 million on $2 6 million for the years ended December 31, 2020 on 2019, respectively.
G&A expenses were $3 $7 million on $3 8 million for the fourth quarters of 2020 in 2019, respectively.
G&A expenses were $17 $3 million on $17 $7 million for the years ended December 31, 2020 on 2019, respectively.
The decreases in G&A expenses for the fourth quarter and year ended December 31 2020.
Primarily due to lower pre commercial expenses in 2020 offset by higher insurance costs.
Noncash stock compensation expense included in G&A expenses was $6 7 million on $6 5 million for the years ended December 30, <unk> 2020 on 2019, respectively.
Net loss was $7 3 million for the fourth quarter of 2024 loss per share of.
Of 17 basic and diluted compared to net loss of $29 9 million for the fourth quarter of 2019 for loss per share of 77.
Basic and diluted.
Net income was $1 9 million for the year ended December 31, 2020 or income per share of <unk>.
Basic and diluted compared to a net loss of $72 2 million.
Our loss per share of $1 85.
Basic and diluted for the year ended December 31 2019.
Collaborative revenue was $41 $2 million.
And zero for the years ended December 31, 2020 on 2019, respectively.
The increase in collaborative revenue was the result of the company's exercising its right to opt out of the co development agreement with Janssen during 2020.
As a result of the opt out the company has no further performance obligations on recognized revenue of $41 $2 million, which had previously been included on its balance sheet under deferred revenue.
Now I'd like to turn the call over to the operator for any questions operator.
Thank you.
Ask your question you will need to press Star then one on your telephone to withdraw your question. Please press the pound key.
Our first question comes on the line of Tom Shrader with BT Hygiene. Your line is now open.
Hi, This is Julian on for Tom. Thank you for taking my questions.
I'm wondering if there any data points from the upcoming open label extension analysis that could maybe specifically address some of that pushed back on you got from the FDA on your recent type C meeting and then on the Bioequivalence study is it fair to assume this is the gating step to filing an NDA or would the CMC package share likely be the last detail.
Hi revenue speaking sorry.
Obviously, great questions.
Anything yes.
<unk> extension data will be really value.
Because.
As you know on negative symptoms is a chronic part of the Dcs and zone.
You need to really demonstrate doesn't mean does effect is sustained over time also as I mentioned in my in my presentation. I mean, we are really looking forward to check.
Check again, because we have already on the tissue data from the phase two B remember we had six months extension on top of that street months over 12 weeks of double blind phase. So we could see in this study for <unk>.
Improvement of negative symptoms and on.
<unk> seen an improvement in terms of functioning. So so first of all I mean, we will be able to confirm that on a negative symptoms continues to improve second.
Does he has transformed into a functional improvement in zone.
As you know what is really important is that these patients are able to function of gains that you can go back to hope for.
Job isn't to have a decent family lives are functioning as extremely important.
So we will be able to check this because we are measuring.
On pants on PSP all along.
The extension of the nine months extension. So we will have data for one year, we will also be able to to check what.
What is going on in terms of positive symptoms and.
We can call relapses.
<unk> for maintenance, we have limited number of Synopsys as we head into the phase two b. So this will be obviously very important and last but not least.
As you know I mean, we really.
For this extension in place two confirms.
Cash at data, but also to checks on Bulks about.
12 months exposure on public drug. So we will also be able to check in terms of safety.
Long term safety so.
In my opinion extremely important data and if you remember, yes, indeed, it from a longer placebo control.
It is still blinded for the doses. So we will reveal itself has the possibility to.
Check between 60 for meeting room and.
And so it's a two milligram.
And for your second question about the Bioequivalence study.
Yes, indeed as seen issues <unk>, Inc.
Ports on study.
Housing. This preliminary study we did some time ago demonstrated gain value.
Between the different formulations for <unk> as a driver of moving towards the pre NDA meeting.
Great. Thank you.
Thank you. Our next question comes from the line of Jason Butler with JMP Securities. Your line is now open.
Hi, Thanks for taking the questions a couple on the open label extension can you just give us a sense of how many patients from the placebo arm of the double blind trial rolled over into the open label extension and then secondly.
How are you thinking about releasing the data will you release the data in conjunction with a medical meeting or.
Could we get it as soon as you finish the analysis that you've outlined in the press release. Thanks.
Good question.
Joseph.
So clearly I mean in terms of placebo patients who when the two day extension phase.
For us quite the equivalent between the three treatment arms.
More or less the same.
Same number of placebo patients, who switch to Asia searches for 64 milligrams. Because this is what happens when they are going into the into the extension.
And I think this data is as I think.
Hopefully I was able to convince everybody assumes these data are extremely important because this will be on an additional piece of information about the free cash.
Other molecule.
We will.
A specific announcement with respect to give them for both of you. So this release of these data because they are so important comes out so.
As soon as we have that data available we will think about the best for months communicated the data.
Great and then just one more Randy on the ITT analysis any updated thoughts on our interactions with FDA or your advisors on.
On the agencies willingness to accept the analysis without excluding.
Excluding that single outlier site.
So.
As always it is a matter for the Oes because our.
As the FDA will go into the data more deeply I mean, they will really checked all the data we have to really confirm what that means on this 17 patients from this site.
Iridium in the assessment of efficacy as well as essence estimate, though for some vital science that was not done.
According to how it should have been done so so when you're looking to to what has been done in deposits tactical loudly by site.
<unk> Division.
Total files on.
A lot of NDA has moved forward with modified IGT pop.
Population SME. So so clearly I mean, we are confident that I mean, the 17 patients should not be the analysis and.
Is there a precedence where it means the FDA.
Again after having reviewed very carefully the data.
<unk> modified ITT population to become to debt. So and this is what came out basically from from the type C meeting really confirm that based on that metric for you.
Zero reading to consider ITT and ITT data.
Okay, great. Thanks for taking the questions.
Thank you Jason.
Thank you. Our next question comes on the line of bear on Aman with Jefferies. Your line is now open.
Yeah, Hey, good morning, guys. This is James on for Barron.
Just a couple of questions for me again on that modified ITT point.
Are there any specific examples of agents being approved in the neuroscience space that actually.
Went ahead with that modified ITT analysis.
That perhaps are included or excluded a group of patients and just.
Just in terms of the open label extension data are we going to see.
Endpoint data, such as PSP or see Gis to kind of make the point on improvements in patient performance and status.
Yeah, so definitely taking a precedent for doing that.
And as I just mentioned before is on many in the space.
<unk> and <unk>.
So since you gave me subside, particularly Regionalism, Inc.
Without going into the details of other media.
Provision for Mt tool you have on approvals of line breaks proposal, but I mean definitely the modified ITT population has been has been accepted by EBITDA, yes. So again.
We are not.
Doing something special here.
What is important is debt.
EBITDA gets comfortable with this site.
The site did not provide the plausible data.
So this is what I can say about the can you repeat the second question sorry.
What is the second point.
Yeah.
On the second question was just on the open label extension data will be it will be getting are.
Are we getting the PSP and perhaps see Gis data just to talk about patients' performance.
Sure for sure.
As I mentioned before I mean, we continued during the open label to measure.
All the efficacy parameters, including their pumps for PSP CGI.
And so on the SME, so definitely yes, indeed, we will have losses.
<unk>.
I think we will be able to really to redeem on trade as we demonstrated already that.
PSB improvement this is very linked to the improvement of negative symptoms.
Remember PSP.
This call was already significantly into the double blind phase, but indeed, we will have all these data we will have again.
The analysis of.
Whereas a functional improvement is coming is it related to negative symptoms and more specifically you know.
Obligation there. So all this will happen and will be presented definitely yes.
Great. Thank you so much.
When it comes on.
Thank you.
Our next question comes on the line of Joel Beatty with Citi. Your line is now open.
Hi, Thanks for taking the questions. So first one is on bio equivalents could you compare the differences in the three different formulations for us from phase to Phase III and then also what are you planning to be on the commercial supply.
And then.
Along with that comparison on could you tell us about what you plan to show on the Bioequivalence study to help come for FDA.
Yeah. So so.
Again, I mean, as you know what I mean, what we're trying to demonstrate here.
The exposure of the drug so the AUC of the drugs.
It's a different formulation I'll just say because.
As I mentioned in the past I mean, the efficacy when youre doing the PK PD analogies efficacy.
Rotary paradigm is coming mostly from the parent compound entities related to exposure so to AUC and not at all to see Max. So this is extremely clear from our PK PD analysis, which have been done by some key external.
People, who are really especially since the interest.
This space so what.
What we tried to achieve between the face to be in a phase III. If you remember a jeweler goes to to keep AUC.
Which are preliminary.
PK study showed.
We wanted to reduce the C. Max of parent compound and one on <unk> because we.
We wanted to even further improves the safety margin in terms of for you.
Effect on Q T C for obligations. So this is the difference between the on.
Face to be on phase III formulation, and we weren't able to do it remember we presented this eduardo for webcast.
While we could chose that that means we kept the AUC and we reduced see Microsoft again parent debt.
And on the <unk>.
<unk> metabolite no noise.
Between phase III.
Final formulation nothing nothing major has changed it is just the percentage of some ingredients.
This should not change at <unk>. So it is really to confirm once more as other means.
We already have the informations on demand. This is completely comparable between phase III in terms of trying to formulation, which is currently producing cut on.
Got it thanks and then.
One other question on the ICT.
For the 17 patients is there any way to get it kind of like real actual data from those patients or is that something that does not exist.
Share you have to explain me what you've made on real actual data.
Well I guess.
Yeah, I guess where are they.
It sounds like the debt of us so implausible, but it doesn't reflect actual ratings.
Have you been able to confirm for example for those patients were dosed and actual readings.
On assessments were taken.
Sure sure sure.
So Kevin on that.
So.
I think.
There is no doubt about it the debt as the patients exist.
It is also clear does that mean.
A lot of the data for efficacy.
For <unk>.
Again, some are vital signs.
Just being carried forward from the baseline. So there is no modification of this data overtime on which is <unk>.
Completely plausible for us.
So clearly I mean, and I gave some examples in the past.
So clearly I mean, the patients exist.
Assessments have not been done in <unk>.
The right way yes.
Okay. Thanks.
On a like them John.
Thank you.
Our next question comes from the line of Myles Minter with William Blair. Your line is now open.
Thanks for taking my questions on I apologize for the background noise.
On a clarification question.
I believe for the airline change for your analysis.
B sort of accepted by the STI.
Right.
Price is.
For years, but out of that same aging day actually stating that the Gi in its current format would be likely to be filed so that would mean that debt.
So I'm on my question is is that the correct interpretation and then.
On the willingness.
Willingness to recommend a filing.
Alright acceptance of that filing but is that just the fact.
Have been sharper on LIBOR <unk> guidance that on hand and.
Now you're checking the boxes and you have everything in place.
Or am I completely mentioned sorry for me. Thanks.
So.
As you know been narrow bodies is an extremely.
Transparent organization on do we gave exactly the terms of what we received.
On the minutes.
It is.
To answer one on one of your points you just kols on <unk>.
Open label data well motivated blends on time, and we are really hoping debt lending.
With these open label data will be an additional piece of information confirming that that may not go to paradigm. This is <unk>.
<unk> is a drug is so.
So afterwards.
When we go to the level of review.
I think I mean, if you go according to these guidelines. So this guidance from end of 2019.
If we are able to convince the FDA about our face to be data. This is obviously related to.
Bioequivalence study, which will make the face to be.
Being one of the.
Two studies.
Your efficacy data package. If this shows by excellent maybe if we can demonstrate value excellent I don't see really a reason why we couldnt move because the review processes.
This is whatever advisors are putting us on.
Once the FDA, what's to say does that mean, if this goes to review I mean, this will go to two on us.
So.
It's it's.
I think a dynamic process, we as I've mentioned in my presentation.
Presentation.
We really are.
Having the dialogue open busy every day, we gave we gave them the information about the psychometric aspects of the different scales, we gave zim.
I mean, we managed as a calculation of the total current PSP sales to constant dialogue and on extremely confident that I mean, if we are doing a great job.
Explaining even better.
Data on the way we have analyzed them on what is in the data I think we are going to have.
A positive.
<unk> EBITDA and we will be able to move forward.
Okay.
Yes understood that's very helpful.
And my second question is just on the Bioequivalence study.
On the loss on you were talking about that for <unk>.
Around about 76 patients and now it's gone up to 40.
An additional cohort for that.
<unk> formulation or is that additive.
Added patients fit for some.
On the ratio on that sure thanks very much.
Yes.
When we spoke together I mean.
I was speaking about the guideline no we have done a real power calculation coloring calculation sorry.
It ends up with 48 subjects. So we are we are.
Going to the sales side, basically I mean, having more subjects.
Healthy subjects, but those are on the leading this patient's guarantees healthy subjects.
Operating as a percentage of <unk>.
There's a number to go.
As you know because this is a cross solar trial.
The objectives that he's on control and basically here you might also have some.
Dropouts this net.
Now it becomes.
How simple it defines a job on the it does not want to do <unk>. So clearly we are also anticipating or including in our modeling and in our power calculations had maybe one or two subjects micropump.
To be under safe side basically.
And so on.
So.
Sorry to interrupt you is something very important is that.
We also have submitted.
Protocol to the FDA, yes on debt.
We are definitely waiting.
I mean do you have any feedback, but I mean should we at standard gain.
In a very open and constructive mindset <unk>.
Lots of other interactions on the STI and looking for other clients.
Thanks very much.
Thank you.
Thank you.
Last question will come from the line of Douglas Tsao with H C. Wainwright. Your line is now open.
Hi, good morning, and thanks for taking the questions just.
Let me in terms of the open label extension, we're going to get paid for the $64 32 milligram doses, you've sort of honed in on.
That's the 64 milligrams for <unk> more sort of <unk>.
Consistent effect across the studies now.
Is there anything that you could see from the 32 milligram that would perhaps make you sort of revisit that.
In terms of the your sort of thoughts for the molecule going forward. Thank you.
Yeah, So I mean.
Definitely I mean.
I have not given up on 32 milligram because because.
Remember I mean as opposed to be in that it was very clear that 32 milligram dose really different from Mt.
From from placebo when Youre looking to the effect size of Delta. We have for Eaton is a phase III such at two milligrams again, showing a nice improvement on.
The CMA placebo had also a larger improvement that the reason why we could not show a P value at the end of the day when you're looking to integrate it went on speak integrated I mean, the combined.
On a face to be in phase III double blind data means two doses are highly significant with very decent effect sizes.
So indeed, I mean, if I mean, the extension data on again.
Hunting towards a positive 32 meeting Graham continuously improved negative symptoms over a period of one year I think <unk>.
Two milligram is.
An important those are not saying that this will be part of the of the day.
Finding the filing of the NDA, but I mean, certainly two as the steel.
Clearly show on that is that we have the pharmacologic effect disease. So let us heads of data, let us analyze the data and we will see what youre doing these 32 milligram, but all is pointing towards the fact that the 32 is clearly showing a pharmacological effect of that improvement comes on patients.
Okay, great. Thank you and just as a follow up in terms of your analysis debt made you're confident that the effect is really AUC not C. Max which makes sense I'm. Just curious you referenced some PD markers I'm just curious what PD markers you focused in on thank you.
For the Inc. For the PK PD analysis other than it was debt based on on.
On the pumps negatives for us I mean, so so here, we are really referring to pumps magazine.
So we did the exposure versus plasma exposures versus.
Negative symptoms coming out in terms of tons on the <unk>.
Really when Youre looking at to what is explaining is improvement of the pumps negative coverages AUC and no debt.
So.
This is from where I'm, making just comment its a very very carefully.
Uh huh.
Between the between between pumps.
R&D for us.
For different.
Pharmacokinetic buyer measles.
Okay, great. Thank you.
Youre welcome.
Thank you there are no further questions I will now turn the call back to reminisce linger for closing remarks.
Yes. Thank you so much thank you everybody for.
All day spread question I wanted those sorts would take this opportunity to thank our patients.
And families and caregivers.
Have participated to this phase III study.
You have heard that.
Some of these patients went into towards the end of 12 weeks for more than 200 patients. So thank you again for this.
Help hopefully to develop extremely innovative drug.
It would be.
One of the first treatments for negative symptoms.
I am looking forward to update you on the next.
Up coming milestones.
Open label data and bioequivalence Nathan So thank you again and looking for virtual speakers you some money.
Ladies and gentlemen. This concludes today's presentation. Thank you once again for your participation you may now disconnect.
Everyone have a great day.
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