Q3 2021 SAGE Therapeutics Inc Earnings Call
Good morning, welcome to Sage Therapeutics third quarter 2021 financial results Conference call.
Currently all participants are in a listen only mode.
This call is being webcast live on the investors and media section of sages website at Sage our Dot Com. This call is the property of Sage Therapeutics and recordings reproduction or transmission of this call without the express written consent of Sage Therapeutics is strictly prohibited.
Please note that this call is being recorded.
I'd now like to introduce Helen Rubinstein Investor Relations at Sage.
Good morning, and thank you for joining Sage Therapeutics third quarter 2021 financial results conference call before we begin I encourage everyone to.
Go to the investors and media section of our website at <unk> Dot Com, where you can find the press release related to today's call as well as the slides that contains supplemental detail I'd.
I'd 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 uncertainty and our actual results may differ materially. Please consult the risk factors discussed in today's press release and in our SEC filings for additional detail.
We will begin the call with prepared remarks by Barry Greene, Our Chief Executive Officer, who will provide an overview of our accomplishments during the quarter and some general context.
We will also be joined by Jim Doherty, Our Chief Development Officer, who will review recent development progress across our programs and Kimi Iguchi, Our Chief Financial Officer, who will review financial results from the quarter with that I'll now turn the call over to Barry.
Thanks, Alan and thank you everyone for joining us this morning.
I'll begin the call by reviewing our recent corporate and clinical progress before turning the call to Jim to provide commentary on our clinical expectations. The remainder of 2021 then.
And then <unk> will provide an update on our financials.
This year and quarter have been marked by significant progress for Sage, We recently announced that following a pre NDA meeting with the FDA.
And Biogen plans to submit an NDA for <unk> alone and mbd in the second half of 2022 with an additional associated submission in PPD and the first half of 2023.
We're pleased that we reached alignment with the agency and believe we have a clear path for this submission.
This brings us one step closer towards our goal of helping patients suffering from mbd in PPD.
Now, let me take a step back to reflect on how we got here.
We met with the agency in early 2020.
Designed three distinct phase III studies, two mbd and one in PPD.
The plan set in motion was for a positive study from any one of the three pads to support an NDA filing and subsequent approval.
Since it will provide the third positive pivotal study.
Based on the positive results from the waterfall study.
We believe that we have the necessary data to submit an NDA for <unk> and we're delighted that our recent pre NDA meeting with the FDA reaffirmed that belief and now in fact, we have four positive studies <unk> Robin waterfall and the <unk> phase III study.
The data we have generated in clinical development to date support our belief in the overall benefit risk of <unk> alone.
The planned NDA will include efficacy data from NPD to OMB waterfall Robyn in the Japanese study.
As well as re treatment data from shoreline data from the ongoing pharmacology studies and coral and safety from the entirety of the program.
Importantly.
The coral study.
Adjunctive study designed to demonstrate the benefits of <unk> alone when co initiated with the standard antidepressant treatment or ADT.
Given the efficacy data, we already have in hand to support the planned NDA filing and to align the cross study primary endpoint with the goal of the study we announced today that the primary endpoint <unk> 17 change from baseline will be measured at day three.
This change is designed to allow us to demonstrate the rapid reduction of depressive symptoms will also assess the impact was around alone during the dosing period as well as its safety profile.
We believe if successful these data may be important to inform potential real world use it's randall and its approved but we do not believe coral efficacy data will be required for the NDA filing pathway.
<unk> data will however, contribute overall safety database, regardless of the outcome of the primary endpoint.
We've had a highly productive and transparent relationship with the agency and look forward to continuing to engage with them.
We begin the rolling submission for us around alone planned to commence in early 2022.
We will work to ensure the totality of the landscape in this programs are appropriately reflected in our planned NDA submission package and the product label if approved.
We recently also presented data from the landscape and Thats programs at both the <unk> and annual site Congress that reinforced the differentiated profiles around we've seen to date in clinical development.
Jim will walk you through the data were presented but I want to take a moment to highlight that we have seen a consistent profile offers around alone across the totality of data.
I would also like to take a moment to congratulate our colleagues at <unk>, who recently presented positive results from a phase II study was around alone conducted in Japan.
These results further demonstrate the promise was around alone for people living with MVD and we look forward to continuing our relationship with them.
As you can see from the totality of data collected across the landscape in this program to date.
Iran alone has consistently demonstrated rapid and sustained reductions in depressive symptoms and a well tolerated safety profile without the adverse events that are often associated with the discontinuation of standard care ADT.
We believe that we are well positioned to be able to provide this important treatment to patients suffering from <unk> and PPD.
<unk>.
To this end we're actively engaging in scientific exchange with Kols and are pleased that many of them recognize both the value demonstrated across brand alone clinical data package as well as the potential for use in specific patient types. They see in clinical practice.
As we look to next year, we anticipate building on this work by.
By remaining steadfast in our commitment to put <unk> and PPD patients first and there is rental and development efforts assembling the right team at the right time to execute on our planned NDA filing and reinvesting our learnings from us around across our pipeline. We believe we are poised to make a difference for people with depression and other brain health disorders.
We look forward to continuing to provide updates underground alone as we pursue the initial NDA filing submission for mbd.
Now turning to our neurology franchise led by Sage 300 to four which is developed in house and as part of our collaboration with Biogen.
Phase III two four is currently being evaluated as a potential treatment for patients suffering from a central tremor and other neurological disorders.
Including Apple.
<unk> disorders, and Parkinson's disease will.
We believe that the pharmacologic characteristics of phase III, two four are well suited to address the significant unmet need in patients suffering from a central tremor and other neurological diseases.
Following the positive results from the kinetics study, we're preparing to initiate a phase two dose ranging study expected to commence later this year.
The goal will be to optimize the dose and frequency with good tolerability profile and the dosing schedule to meet <unk> plasma concentrations that translate into sustained tremor symptom control.
We look forward to providing updates on this study as we are able.
Turning to our neuro franchise, where we are evaluating sage 718, our wholly owned first in class NMDA receptor Pam.
Potential oral therapy for cognitive disorders associated with NMDA receptor dysfunction.
This quarter Sage 718 received fast track designation for.
<unk> as a potential treatment for huntington's disease from the FDA.
As a reminder, we saw promising early data in a phase one study of Sage 718 in people with early Huntington's disease last year.
We're on track with our plan to initiate a randomized placebo controlled phase two study with Sage 718 and <unk>.
Early to moderate Huntington's disease. This year. This study if positive will bring us one step closer to pursuing an initial regulatory indications for sage 718.
I'm also pleased to announce that we plan to initiate a second randomized placebo phase II study.
With Sage 718 in 2022.
This will be in patients with Parkinson's disease cognitive dysfunction.
We believe this study will meaningfully contribute to our understanding of Sage 718 as.
As we seek to provide a safe and efficacious treatment.
For patients suffering from this disorder.
Lastly, Sage 718 is also being evaluated in an ongoing luminary study as a potential treatment for Alzheimer's disease cognitive dysfunction.
Today, we announced the study is fully enrolled and we are on track to announce topline data from this study before the end of this year.
As you can see we realized great progress across our brain health franchises. So far this year.
I'm also pleased to share progress on key corporate updates on today's call.
This quarter we.
We are happy to welcome Christopher <unk>, Chief commercial officer to Sage and announced the Vanessa Procter has been elevated to serve as head of external affairs and joined our executive leadership team.
Additionally.
Jim Doherty on the call with me has assumed the role of Chief Development Officer.
We are also elevated mic work to senior Vice President Discovery and research, where he will continue to build our research capabilities.
As we expand and accelerate our efforts across the organization and with so much to look forward to in the balance of 2021 and next year I am confident that their contributions across our organization will be instrumental to our collective progress toward becoming leaders in Bruno.
Today, we're also announcing the departure of Steve Kings stages, Chief Medical Officer.
It's been Steve's goals since I met him to seek a CEO role and it's fulfilling that today and will become CEO at a private biotech company.
Thrilled for Steve in his new role Steve has made significant contributions to <unk> over the past eight and a half years.
We extend our thanks for his leadership and advancing our brand health programs and wish him success in his future endeavors.
Steve has contributed to establishing sage as a leader in brain health.
Progressing programs across our pipeline.
We're highly confident in the strong team that we have to continue to execute on our priorities.
Invite Steve to say a few words Steve.
Thanks Barry.
As I reflect on my time at Sage I'm proud of all that we've accomplished.
In my eight five years here I've had the opportunity to develop and launch the Russell.
Establish and grow our development organization advanced the pipeline and brings around alone through a robust clinical development program.
It's long been my aspiration to lead the company.
<unk> made the decision that now is the right time to pursue a CEO role.
I couldnt be leaving stage in a better position we've.
We've seen great data with <unk> alone.
<unk>, we have a clear path to filing an NDA.
Very confident in this team's ability to take this program forward.
I appreciate the support and encouragement from Barry and the leadership team and I look forward to watching sages continued success.
I know that I leave stage in great hands with extraordinary shaped with a clear path towards sages second drug to market.
Thanks, Steve and.
In closing I'm highly confident that our accomplishments across our brain health franchises in the third quarter will translate into continued success as we execute on our strategic goals.
And I believe we are primed to enter the next phase of stages journey.
Becoming the leader in brand health.
Now I'd like to turn the call over to Jim to detail, our clinical accomplishments and expectations for the balance of 2021.
Jim.
Thanks, Barry and good morning, everyone. In 2021, we have made important advancements across our three brain health franchises, including our early stage programs.
I am pleased to highlight our next steps across each starting with the three ongoing phase III studies and ours around loan program coral shoreline and Scott.
As a reminder, coral is designed to evaluate the efficacy and safety of surround alone 50 milligrams when co initiated with new open label SSRI in patients with Mds we are.
Also announced today that the primary endpoint in the oral study change from baseline on the <unk> 17 will be measured at day three.
We believe this update is in line with the goal of the study to demonstrate the rapid onset of Israel alone and we will also assess the benefits throughout the treatment period and expect to see a consistent well tolerated safety profile.
Additionally, as we continue to increase our focus on the potential commercial launch of surround alone, we believe that including a trial with a day III primary endpoint may be a useful complement to the broad clinical package for us around alone.
The study is now closed to screening and topline results are expected in early 2022 of note. The enrollment for the Coral study is anticipated to be within the expected range allowed by the study protocol.
Enrollment is 424, and we expect the study to enroll about that number of patients or perhaps slightly higher.
The shoreline study is a naturalistic open label safety and Tolerability study to investigate as needed.
<unk> was around loan over a one year period in patients with <unk>.
We believe this study will provide physicians with important information on houses around loan may be used to treat people with empty if approved.
We are on track with our plan to report top line data cut from the 50 milligram one year cohort in shoreline later this year.
Moving forward enrolment in the study will continue following our prior announcement that we expanded the target enrollment to 500 patients.
And we are offering patients from the coral study the ability to rollover into the shoreline study following the completion of the coral study.
The other ongoing phase III study was around loan the Skylark study in PPD, which we expect to readout in mid 2022.
Our vision for those around loan program is offer a new way of thinking about the treatment of depression, and we recognize that that means providing a robust data package to drive that change.
This is a program with seven major clinical studies and more than 4000 patients treated and MDT is a large market with an estimated 19 million sufferers every year.
The size of both the MD population and our program necessitate a significant filing package.
Such we're planning to assemble a package that meets the requirements of the FDA for a submission of this size and provides information on how is around loan might be used in the real world if approved.
Let me lay out the filing strategy, we plan to begin a rolling submission in early 2022 with the CMC and non clinical modules submitted first.
Our clinical module will likely be the last module submitted for this filing expected to occur in the second half of 2022.
This timing reflects 5% to six months after the last component of the clinical module is anticipated to be completed.
During which time the team will focus on integrating the data package across studies to tell the most complete clinical story for us around alone.
Additionally in October we presented data at the 34th European College of Neuropsychopharmacology or <unk>.
<unk> that further supports the differentiated profile seen to date with surround alone in clinical development.
<unk>, a rapid and sustained reduction in depressive symptoms and a unique and well tolerated safety profile further.
Further in a pooled analysis from the landscape of Neste programs.
<unk> treatment has led to rapid and sustained improvement in quality of life and overall health at day 15.
This improvement continue to increase through day 42 as measured by the SF 36 version to a patient self reported measure of general health, Dr. I need a Clayton chair of psychiatry, and neuro behavioral sciences at the University of Virginia School of Medicine, and principal investigator of the waterfall study recently presented these data.
Ada in an encore presentation is available via the investors section of our website and if you haven't seen our presentation, yet I recommend watching it.
We also presented data at the 34th Congress showing that is around alone demonstrated rapid improvements across <unk> 17, subscales measuring the core symptoms of depression.
As well as symptoms of anxiety in the waterfall study.
These findings are consistent with the totality of data from the landscape and Thats programs.
We also presented analysis, demonstrating that <unk> treatment led to rapid improvements in functional impairment and improvements in depressive symptoms across patient populations such as age.
Gender and body mass index at day 15, regardless of whether patients were receiving is around loan as monotherapy or concomitantly with a standard of care anti depressant.
We're proud of the progress we've made with <unk> throughout 2021 and excited by the profile we've seen across the totality of the development program.
We believes around alone has the potential to offer a different treatment approach that may enable patients to experience reduction in depressive symptoms quickly and maintain longer treatment free intervals without burdens and side effects.
Now I'd like to detail the advancements made in our neurology franchise led by Sage <unk> Q4, and next generation positive allosteric modulator of Gaba a receptors, which we believe hold significant potential and treatment of neurological conditions like essential tremor.
As a reminder, we reported positive data from the kinetics study earlier this year, but you had improvements in upper limb tremor score as measured by the Tetris performance subscale item for upper limb tremor score and importantly demonstrated a statistically significant correlation between tetra scores and activities.
Daily living observed at every time point.
This is an important finding that demonstrates that the reductions in tremor seeing with Sage three Q4, and the study translated to meaningful effects for patients.
Based in part on these results we are on track to initiate a placebo controlled phase II dose ranging study in.
In stage three to $4 four <unk> to optimize the dose and frequency plant to commence in late 2021.
In collaboration with Biogen, we look forward to continuing the development of stage three to four we remain confident that our planned phase III study will generate a dose and frequency for further development to advance our goal of establishing an optimal benefit risk profile.
Moving to the development underway in our neurology franchise, we're excited about the future prospects of Sage 689, a potent product candidate has demonstrated rapid absorption good viability and solid formulation flexibility with potential to treat therapeutic areas that suffer from a lack of treatment options, including.
Acute agitation mania or even migraine we.
We announced last quarter that we dosed the first patient in the phase one program for Sage 689, and remain on track to complete the phase <unk> study in late 2021.
Additionally, I'm also pleased to share that IND, enabling preclinical work is continuing for sage 319, and oral extra synaptic Gaba a receptor preferring Pam <unk>.
The advancements of the Sage 689, and Sage 319 programs represent continued data driven expansion and growth of our sage developed wholly owned neurology pipeline.
Turning to our neuropsychiatric franchise, we are making important strides in developing sage seven eight our NMDA receptor Pam that as a potential oral therapy for disorders, where impairment of cognition is one of the main drivers of visibility.
The fast track designation recently granted to stage 718, as a potential treatment for Huntington's disease accelerates, our developmental efforts to bring this therapy to patients.
In a phase one study of patients with early HD treatment with Sage 701, eight was associated with robust improvements in tests of cognitive performance such as the two back test that began on day eight and were maintained through day 2014, the end of the treatment period.
We are on track with our plan to initiate a double blind placebo controlled phase two study of Sage 718.
Huntington's disease later this year.
We also previously previously reported exciting data in the first part of our open label Phase Iia trial for Sage 708, known as the paradigm study evaluating patients with mild cognitive impairment due to Parkinson's disease.
The data demonstrated that Sage 700, <unk> had a positive impact on multiple domains of cognition, including executive function and learning and memory, while leaving domains altering simple attention or reaction time unaffected.
<unk> has been well tolerated in studies to date as Barry mentioned, we are excited to announce our plans to launch a phase two placebo controlled study in Parkinson's disease, cognitive impairment, which we expect to begin in 2022.
Lastly, the luminary study with Sage 708 in patients with Alzheimer's disease, mild cognitive impairment and mild dementia and <unk>.
Fully enrolled and we look forward to reporting top line data expected later this year.
And further developing our nurse psychiatry franchise, we are making progress evaluating sage 904, and NMDA receptor Pam product candidate as a potential oral therapy for other disorders associated with NMDA Hypofunction we.
We remain on track to complete the Sad study in late 2021, and the Mad study is ongoing.
Additionally, our other earlier stage neuroscience psychiatry program Sage for 'twenty, one and oral NMDA, Pam being evaluated for potential use in neurodevelopmental disorders, and cognitive recovery and rehabilitation is.
<unk> is making good progress and we look forward to providing updates on this program when they become available.
I am excited about the future development opportunities for our earlier stage product candidates and the advancement of our later stage product candidates with the ultimate goal of regulatory approval and commercialization, we are continuing to expand and accelerate potential indications for our wholly owned programs and I believe we have the potential to make a diff.
<unk> for people living with brain health disorders, as well as their families caregivers and communities.
Now I'll turn the call over to Kimi for a review of our financials Jimmy.
Thanks, Jim the third quarter was a critical time for our company's growth and development.
Reflecting on the tremendous progress made throughout 2021 I'm proud of the work our team has accomplished and believe we are well positioned to execute on our clinical and business priority.
Our strong balance sheet gives us the flexibility to continue to invest in our robust pipeline and.
And we are focusing on building the right team to support our expected growth now and into the future.
I'd like to start by highlighting our third quarter financials, and then provide some remarks on our financial guidance.
We recorded $1 4 million in net revenue in the third quarter from the sale of the restaurants.
That compares to $1 6 million of net revenues from the sales of the rationale for the same period in 2020.
We remain committed to Mam, if families and all of those impacted by PPD.
Our targeted commercial efforts, including an integrated approach to engaging key stakeholders are aimed to help moms with PT.
Research and development expenses were $83 5 million in the third quarter.
That was compared to $74 1 million for the same period of 2020.
The increase in R&D expense reflects the planned acceleration of expansion of our wholly owned pipeline include.
Including advancement of Sage 718.
689, and Sage 904, as well as manufacturing related activities or is there a handle on them.
The increase also reflects the recognition of a one time stock based compensation milestone.
These increases are partially offset by a reimbursement from our collaboration with Biogen first of all ran alone and basically 24.
Selling general and administration expenses were $48 7 million inventory quarter compared to $35 1 million for the same period of 2020.
The increase in SG&A expense reflects an increase in hiring of personnel and activities related to launch readiness to support a potential product launch.
Similar to R&D. The increase also reflects recognition of a one time stock based compensation milestone.
And this is partially offset by reimbursements from our collaboration with Biogen for several handler and stage through 'twenty four.
We reported a net loss of $132 million for the third quarter, which included 31 million of noncash stock based compensation.
That was compared to a net loss of $105 7 million, including $20 million of noncash stock based compensation for the comparable period of 2020.
Now I'd like to move to our financial guidance.
Based on our current financial outlook and projections or financial guidance remains unchanged.
We expect to have a cash balance of more than $1 7 billion at the end of 2021.
As a reminder, we do not expect to understand any milestone payments from collaborations.
There are 2021.
We continue to invest thoughtfully and are well positioned to achieve long term success across our organization as we seek to develop meaningful treatments for the patients to inspire artwork.
I'll now turn it over to Helen to handle Q&A with the operator.
Helen.
Thanks, Tony before I turn it over to the operator I'll ask that you limit yourself to one question. If you have an additional question feel free to return to the queue now I'll turn it over to the operator to handle Q&A operator.
As a reminder to ask a question you will need to press star one on your telephone to withdraw your question press the pound key please standby, while we compile the Q&A roster.
Our first question comes from the line of Ritu <unk> from Cowen. Your line is now open.
Hi, guys. Thanks for taking the question I just wanted to ask first about the coral primary endpoint change.
I guess first very quickly with that FTE, driven or sage driven and how does it reflect an anticipated active control change.
At G. III would that Youre anticipating are you are you anticipating that sort of.
Six seven to.
Change that you saw in mountain and waterfall since I characterize really won't kick in.
Hey, Ritu. Thanks for the question that that's a great one so.
As we shared we had a very successful pre NDA meeting that confirmed the NDA filing package with efficacy data from MDT <unk> waterfall Robin and the Japanese phase III study.
As well as re treatment data from shoreline.
Also anticipate the ongoing pharmacology studies and as you mentioned coral as well as safety from the entire program so with that clarity in hand.
We saw overall feedback on the <unk> study statistical analysis plan.
From the agency in after that.
Feedback we selected.
We selected the phase III <unk> endpoint as the key primary endpoint really to get back to the original idea of the Coral study, which is to demonstrate the rapid relief of depressive symptoms early in clinical trials and as you noted current antidepressants don't kick in.
For 48 weeks of ever. So this represents sort of rapid relief for the patient and since we already had the efficacy data in hand for filing it allowed us now to.
Move the primary endpoint to coral two to phase III and just kind of the second part of your question Youre right. We don't expect any efficacy benefits from from the active arm of anti depressants, because we know through millions of patients dose literature over the last 30 years that they take a while to kick in.
Yes.
Yeah.
Great. Thanks for taking my question.
Thank you.
Yes.
Thank you. Our next question comes from the line of Cory <unk> from Jpmorgan. Your line is now open.
Hey, Good morning. This is Thomas on for Cory. Thanks for taking the question I guess, maybe just another one on the coral update here I think the update makes sense and obviously you guys have said that you have all the efficacy data you need to file.
But just curious how important you think it will be for physicians to see a separation from placebo at later time points in this study.
Clearly as we think about the effects of ssris potentially kicking in overtime. Thank you.
Yes, Thanks, Thomas and please send our best to Corey.
I think reflecting youre right. We believe after the pre NDA meeting that we have.
Package to file so it was important for us to have day three reflect that rapid onset and the way I think physicians will think about Saar and alone isn't the totality of data it's not any individual study. It's the 4000 patients in the consistent profile.
As you know we've seen.
Rapid release of depressive symptoms anxiety.
No no no change to sleep better expect potential benefit to sleep patterns. So I really think about the totality of the data across the dosing period and extended period I'll highlight that we saw in the Japanese study in fact, which followed patients out to day 56 that patients continue to improve <unk> six and <unk>.
You saw sort of a kick up in the placebo patients probably reflecting.
Return to baseline, which is what we'd expect in the real world and then we need to reflect the shoreline data, which at 30 milligrams. As you remember showed that 70% of patients only needed one or two too weak.
Treatments in the course of a full year. So when we think about how physicians will think about the data the totality of data and not any individual study.
Got it makes sense. Thanks.
Thanks Thomas.
Thank you. Our next question comes from the line of Paul and the team.
Paul Your line is now open.
Great. Thanks, so much for taking taking my questions I have one really quick one and then one that's a little bit more qualitative just on a quick one can you confirm what the final sample size of coral ended up being and whether or not you over enrolled and then second in your more recent FDA conversations Barry have you talked at all about how these durability time points will be interpreted.
From a regulatory perspective, I know theres see zelle, Resto AD comm precedent, but because postpartum depression is an acute indication in Mds has more chronicity too. It just kind of curious if you've got confirmation that statistical significance that these later time points isn't really a hurdle. Thanks so much.
Hey, Paul Thanks for the questions. Let me, let me start and then turn it over to Jim I'll start with the second part of your question and Jim can talk more about that part as well as oral numbers. So I guess the quick answer is yes.
Significance at the later time point is not required what what the agency and what physicians looked for is consistent and durable impact without a rapid return to baseline and as we've already talked about across 4000 patient subjects dose we've seen.
Rapid benefited day, three with continued benefit out to day 42, and again in shoreline, even even longer term.
So what you worry about and we don't worry about this was around alone but other kinds of medicines is that someone gets better quickly, but after they stopped the drug they quickly returned to baseline and we see nothing like that.
Around alone across any of the trials, Jim you want to add more color and then talk about the coral number still of course, very I would say as Barry mentioned earlier, it's really about the totality of the data and the coral study adds to that story that we're telling for us around loan with 201 be Robin waterfall. The shionogi study the shoreline study and I think that where the.
Coral study ads is in explaining that element of co initiation of the surround loan with a standard antidepressant and really certainly from an efficacy point of view, but I think also perhaps as importantly from a tolerability point of view to understand what do we see from a tolerability perspective with the combination.
To your question around the size for Boral as I said earlier the target for <unk>. As you know is 424 I think we are.
The study is closed for screening and as I said, where we expect to come in around that number with perhaps a little bit enrolled above it since the study ran a little bit longer than originally intended but we expect to be in the range of that for 2014.
Yeah.
Great. Thank you.
Thanks, Paul.
Thank you. Our next question comes from the line of Yasmin Rahimi from Piper Sandler Your line is now open.
Hi team.
Steve you'll be greatly mask.
And thank you for all your entire contribution.
I have a quick question I guess, what im trying to make sense of it.
Dave three placebo responses tend to be significantly lower than <unk> and that <unk> 17 score.
A high probability to hit Stat, Sig and see a separation why not use this data and file problem.
The three.
And to your filing I guess, what I'm trying to figure out is like.
All along.
That data will show a statistical separation.
Why not use this data for filing why do you guys keep saying that we shouldn't we shouldn't we don't need a and b why change it so close to rolling NDA.
That would be helpful. Thank you for taking my questions.
Yes, yes. Thanks. Thanks for the question. So let me, let me sort of take a step back and I commented. This is Mike.
Our prepared remarks on the call, but I'll remind you that in 2020, our teams sat down with the agency are following a number of phase III studies, one recognizing that <unk>.
<unk> was a major unmet need and in fact, a growing unmet need so we and the agency and others appreciated that we needed something addition to the currently approved anti depressants, where we haven't seen a change in benefit risk in a long time.
And designed the landscape at NES programs, two Mbd studies and one <unk> study and we highlighted in this is going back to consistent with our guidance in January that that we needed one more positive study to have the package to file.
Got that and more we had the Japanese positive study as well so we sat down with the agency a pre NDA meeting and confirm that that data package was sufficient for filing and that another phase III was not required.
But there was a dilemma in front of us as we highlight two ongoing phase III study. So we had what I thought was a very good.
Open strategic discussed with the agency would say corals coming up let's file for MVD.
Going to include <unk>, and the filing but the efficacy the efficacy data is not necessarily required to be positive to file now to change. The date III will benefit us if in fact <unk> is positive and we see benefit over the treatment course, those data will be incredibly important to guide.
Our medical Affairs force, our sales force in educating.
Physicians about the appropriate use of surround alone, including the totality of data so.
Another positive study, we will see benefit in terms of educating physicians and I think as you heard in need of Clayton say in our encore presentation with the CMT, who wouldn't want to get better faster. So this will allow us to really lean in on those kind of data.
Thanks Barry.
Thanks Jess.
Thank you. Our next question comes from the line of Amy <unk> from Needham. Your line is now open.
Hi, good morning, Thanks for taking my question.
Wanted to switch gears to <unk> for the phase two study planned.
Are you in a position to talk about.
What type of doses or frequency you may be evaluating in that study.
Tim.
Find kind of a finer tradeoff between efficacy and safety and then just a quick follow up on the spending for the quarter.
The R&D spending this quarter reflective of the run rate that we should expect going forward. Thanks.
Yes, Amit thanks for the question and for broadening the dialogue the rest of our pipeline I'm going to ask Jim to comment on three to four and then can you talk about our financials Jim. Thanks, Brian. So the results from the kinetics study the phase Iia study, we ran a pre Q4 gave us clear evidence for activity of <unk>.
Four in treating a central tremor.
But along the way with some effects on some months. So we knew at the time that that 60 milligram. Once daily dosing was at the top of the range that we wanted to test for essential tremor based on our earlier work open label Phase one as well as the earlier work we've done in the central tremor with both.
The Russell and Zara online and so really that it really helps clarify the strategy for the <unk> study. So it will be a dose ranging study looking at multiple doses with 60 milligrams being the top dose in that study.
And really the goal is to identify an appropriate balance between efficacy and tolerability pretty much a standard activity for a phase <unk> study.
Talked a lot about things like the PK profile of <unk> four as you know the expressed intent for three to four with produce a molecule with a relatively long half life and therefore.
Well similarly compound for chronic dosing and so all of those considerations go into the study design for the Phase <unk> study, which again, we intend to initiate before the end of the year.
The question on the R&D expenses for the quarter.
You did see some increases in the quarter a couple of things that I would like to point out that we did have a one time stock based compensation cost that was reflected in the quarter and that was about $13 million. So some of that was included in the R&D expenses.
But what I will say is that we've always talked about the acceleration and expansion of the pipeline. That's reflected in what you see in the quarter for our operating expenses.
Other thing I'll remind you is of course, we have the cost sharing arrangement with biogen. So they are.
Reimbursing us for 50% of the cost for the development and commercialization for Zohan alone and Sage 324 in the U S. So we do expect to see some additional increases in the in the R&D expenses as we continue to accelerate and expand the pipeline.
Got it can I just ask what is the full 13 million included in R&D or what portion of that was in an R&D. Thanks.
Just a portion of that was in R&D and I'm sorry, the numbers escaping me right now, but I think the.
Think about it hasnt half maybe.
Got it thank you.
Thanks Tommy.
Thank you. Our next question comes from the line of Calvin <unk> Richter from Goldman Sachs. Your line is now open.
Everyone. Thanks for taking the question. This is Andrew on for Celgene and sorry, Barry to go back to is around alone.
But just curious how your cable conversations have evolved over the development of course.
And as your potential launch are you hearing any points of pushback or concern about how the drug would eventually be used in the treatment paradigm.
Thanks Andrea.
No problem going back to Israel, and I know, it's on everybody's mind, so with with.
The totality of data, particularly as presented at <unk> and that really was the first Congress, where an integrated data set including patient reported outcomes. A $15 42 were presented and when treating physicians saw the totality of data and reflected.
Even at day 42, four weeks after patients that stop dosing that they continued to improve and across all domains were statistically significantly better than placebo I think a lot of light bulbs went off this is a new way of treating it.
It's not an SSRI or SNRI not a chronic treatment, it's a short term treatment where patients get better faster and as we've evidenced in shoreline.
Stay better so it's a pretty new approach.
Frankly, what many of them learn to medical school for the last 50 years, which is.
Diagnosed with depression, you treat them for six months at the end of six months. If they are fine slowly remove drug if not keep them drug frankly for the rest of their lives. So at a very different approach.
And I think again light bulbs are going up the other.
The other part of that treating physicians are potential treating physicians are really starting to appreciate is the safety profile one of the things and I think many of you who listened to need or heard this.
And I'm not quoting are exactly but she said something like the two thing she's worried about most sexual dysfunction weight gain for her patients and that's why they stop taking drugs, we don't see that we see a little bit dominance with respect to these patients is helpful, but none of the side effects.
That hurt.
<unk> adherence and of course, the two week course of treatment. So we're making a lot of traction and as we continue the scientific exchange I believe youre going to hear more positivity by potential treating physicians in the future.
Thanks Barry.
Thank you. Our next question comes from the line of Laura Chico from Wedbush. Your line is now open.
Hi, good morning, Thanks for taking the question.
One on coral and I guess, maybe the longer term outlook. So could you speak a little bit to kind of.
The linkage between the days III separation and what is the read through to remission rates. If there is any and then kind of unrelated saran alone but.
<unk> call what are going to be the key data events that we should have in mind for 2022. Thank you.
Hey, Laura let me, let me start and then I can turn it over to Jim for a kind of key.
Date events, so again.
The key here is that we have four positive studies in over 3000 patients and subjects showing the rash.
Rapid release of depressive symptoms anxiety as early as day, three and as evidenced.
Out to day 42, and then when you couple that with shoreline showing that.
Most patients only need one or two week dose in the course of the year, we have we have.
Really impressive data.
For the filing now what's key for Coral on day three is we know that.
People suffering from depression on current standard of care.
It all take weeks to get better so it's clinically meaningful and I think Anita hits us on the call is that you want people to get better quickly.
And who would who wants to suffer for four to six weeks.
I can work through my weight gain worked through my sexual dysfunction.
Depression abate, so <unk> III is incredibly clinically meaningful to patients and to physicians in this coral study data allows us to measure that and potentially even educate on that if the studies are positive in the future. So we're thrilled with the change and looking forward to the core.
Jim you want to talk about.
Of the year.
Yes, absolutely. Thank you very for the rest of the year in 2021 as far as Readouts go.
We would be expecting the 50 milligram.
Shoreline data for us around loan showing up to one year of dosing.
Also for the Sage 708 program.
We are expecting results from the open label Alzheimer's disease patient population before the end of the year.
And then moving into 2022 for those around loan program.
Coral study to read out early in 2022.
Skylark study to readout in mid 2022 and of course, we're expecting to submit our NDA in the second half of 2022, great. Thank you I mean these aren't these aren't data readouts for sale or but we.
We think it's very important that that we'll be initiating the huntington's trial. Later this year and then soon thereafter, the apartments trial for 718 in cognitive dysfunction, not data readout, but but clear progress on moving a program like 718, along and of course as Jim already highlighted the start of the phase II along with Biogen for.
<unk> three to four in essential tremor looking at dose frequency the number of doses as well as longer treatment duration will also be exciting to explain the phase II design in the future.
Thanks, guys.
Thank you. Our next question comes from the line of Jay Olson Oppenheimer. Your line is narrow thing.
Hey, guys. This is Matt on for Jay Thanks for taking the questions. So we were wondering for stage three to four what forms of epilepsy do you believe makes the most sense to study.
And then separately for Sage 718.
What are you hoping to see in the luminary open label data expected soon and.
And how could data from their inform our later stage trial in Alzheimer's I appreciate it. Thank you.
Thanks, Matt let me start with <unk>, So I'll ask Jim to comment on on three to four so what's really exciting about about Sage 718, our first.
Pam.
And NMDA is the biologic hypothesis that started 718 has been consistent now through all preclinical early clinical studies as well as the early Huntington's Parkinson's readout, so while well Alzheimers is much more of a heterogeneous disease.
We hope to see and expect to see the same kind of stabilization or even improvement in cognitive.
In cognition, so that means that.
Net.
And the tests that we perform we want to see the patients arent arent progressing and in fact stabilize or improve and we're really talking about.
Really measuring executive function learning and memory and the reason that's important is that in these neurodegenerative diseases, often the cognition issues they face.
<unk> two <unk>.
<unk> of independents and the hope for Sage 718 is that by stabilizing or in many cases, improving executive function people can carry on activities of daily living that is.
Make a shopping list go to the store by the food I wont put it away to remember where I put it in you can imagine that being able to stay independent for years with these kind of neurodegenerative diseases is very beneficial to patients and their families. So thats the kind of thats the kind of data that we're looking for.
Tim you were talking about three to four absolutely.
Ask the question around the epilepsy types for three to four I think it kind of goes back to the way, we think about our programs overall and sort of trying to follow the science behind what we do and really one of the things that is abundantly clear is that these compounds are quite good at.
Lowering synchronized activity in the brain and what that means is it really gets right at the mechanism that triggers seizures of multiple sites. There are a lot of different kinds of Caesars. What we've found in all of our modeling is that irrespective of which type of seizures, where suddenly studying the compounds have.
Pretty robust anti epileptic effects that gives us a lot of flexibility. So what we will be discussing with our collaboration partners is really which epileptic syndromes that make the most sense for that very broad mechanistic ability to intervene.
Okay got it. Thank you appreciate it.
Thanks, Matt.
Thank you. Our next question comes from the line of Vermont.
Arnie from Canaccord. Your line is now open.
Morning, Thanks for taking my question.
What do you expect to see in terms of potentially dose dependence for the 15 cohort versus 30 makes in the upcoming shoreline data and what would that mean for perhaps keeping things relatively simple in the real world for regulators prescribers and patients by filing only the 50 make those for India.
Thanks, so much thanks for the question so in terms of shoreline.
I'll remind you that in the <unk>.
30 milligram readout in the preliminary readout, we saw but we believe a pretty impressive data. The 30 milligram. We saw 70% response rate and then same number 7% of patients required only one or two or three doses in the course of the year. The 50 milligram preliminary readout, we saw an 80% response rates are slightly better.
And we're hoping that.
I believe at the end of the year, we'll see consistent data with that if you step back and think about it so.
Someone reading only 212 or even three two week course is certainly.
A major step up from a chronic therapy that take everyday with the kind of side effects.
That we're talking about in terms of filing.
It's pretty common with many medicines many.
Antidepressants have multiple doses in the filings so of course, we got to work through the agency, but it's our star believes that in addition to the 50 milligram, we perhaps for the 30 milligram available as well for.
For flexibility and Optionality for those patients or physicians believe their patients.
Mike.
Got it thank you.
Thank you.
Thank you.
Our next question comes from the line of work. The next question comes from the lineup. We are keen to Manhattan from Guggenheim Partners. Your line is now for them.
Hey, guys. Thank you for taking my question.
Maybe just I mean again, it's a question on core ROE and we understand the change that you are making how we actually talked about it in July but trying to get a sense.
If you can talk about what's.
The difference is do you see from commercial standpoint by getting an acute.
By getting this acute onset on the label.
And.
In terms of.
What.
Led you all just trying to get a sense of what led to the realization that the shorter endpoint is needed is it just.
The waterfall study.
Or was there an active engagement from the regulators that led you to decide okay thats changed it.
Yeah. Thanks. Thank you for the question so let.
Let me, let me again sort of remind you and everybody that when.
When we set out the year, we set in motion the landscape.
Programs with two mbd in one PPD study.
What we highlighted is that one of these studies, we needed to be positive for our filing package to the agency at waterfall as you highlight it wasn't back positively we're thrilled with that and during our pre NDA meeting with the agency. We confirmed with the agency had guided before which was that was the study required for a filing path. So.
With the filing package in hand.
<unk>.
In consultation with the agency, we set force too.
<unk> coral for what it's intended to do and it is asking a different question.
The data we have to date shows the rapid and sustained effect is around alone as a monotherapy and on top of the stable antidepressant. So we're doing with coral.
<unk> constantly.
Giving drought alone with an antidepressant.
For the first time, so that's a different question that we're asking and we believe that the rapid relief of Duran alone combined with an antidepressant and that question is.
Important in the wrapper leaf would be new.
Know that current antidepressants takes four to eight weeks if ever to kick in so getting somebody better fast.