Q3 2022 ATAI Life Sciences NV Earnings Presentation
Barton CFO overtime.
Very pleased to have you with us I'm joined by our CEO and co founder Florian brand as well as our CFO and co founder <unk>.
Today, we'll be speaking with two of our long term analysts', Andrew Tsai from Jefferies and Ritu <unk> from Cowen over the next 30 minutes, Andrew <unk>, who will be asking us about recent progress across the pipeline and upcoming catalysts.
And now for the standard reminder, that our discussion today may include forward looking statements about <unk> future results and performance subject to risks and uncertainties that may cause actual results to differ a tie does not undertake any obligation to update such statements, which speak only as of today.
Before kicking off the interview I'll comment on the key financial takeaways included in today's earnings release.
First our Q3 operating use of cash was $28 million and was in line with expectations. So no surprises there.
Next I want to remind everyone of our previously announced debt facility with Hercules, which provides access to up to $175 million.
Back in mid August when we closed the facility, we drew down an initial 15 million we.
We ended Q3 with $304 million in cash.
This cash balance plus the Hercules facility gives us a strong capital position.
We reiterate our cash runway extending into 2025.
Let's start our interviews section I will hand, the mic over to Ritu from Cowen to get Us started ritu.
Thanks, Steven Lauren there's been a lot of news flow around your company is complete before we get to it could you. Please provide a brief high level summary of your most recent progress and milestones for.
Are the ones, who might not be too familiar with it with APAC.
Absolutely return great to have you back program, Andrew It would be true.
On this earnings call and give you a format.
Quickly on the recap of our ultimate goal at a time to achieve.
Medically meaningful sustained vehicle change mattel's patients and as of today, we have eight drug development programs in the clinics and we also have four enabling technologies that we deem to be very complementary with those eight programs and all of those programs targeted several major inpatient psychiatric indications.
In addition to all of these programs have either already achieve proof of concepts in the case of <unk> or have a path to efficacy data over the next two years and we expect that.
These upcoming efficacy datasets.
Are really going to be value inflection points or at times looking at last quarter very briefly in addition to multiple clinical trial initiations, we have announced two very encouraging positive initial phase one results with <unk> 907, our uterine boxing.
Compounds and <unk> 101 are generated by treasury and compounds both of them showed very very intriguing PK PD.
Our results and encouraged us to drive the development of those programs further and then left on the lease of course with <unk> 101 another.
Announced that we've completed our enrollment in this study so that's the phase Iia proof of concept study in <unk> with our <unk> and we are very much looking forward to the data coming out of this trial around the end of this year.
And speaking of <unk> 101 can you share more details about the planned target clinical profile of <unk>.
That drop.
Sure. So our plan with <unk> hundred one our government is really to be differentiated from other depression treatments on the following dimensions or elements, we've targeting unsupervised at home administration.
Rapid onset of effect within 24 hours and we are looking at are anticipating an intermittent dosing regimens.
So looking at approximately.
Times dosing per week and are of course very much focused on developing this compound in treatment resistant depression.
But CRB and.
The profile forces you to choose a PK PD forces you to choose would you aim for a therapy that has stronger efficacy or one that is far more tolerable than current treatment options. How do you see how do you see the biggest unmet need and the biggest opportunity.
The key for this program as relief.
Demonstrating.
Demonstrating data that allowance at home use and Thats why we also like to demonstrate that the association of observation and sedation profile of <unk> hundred one that allows that.
Top insignificant to administer.
Pounds at home without supervision, while in terms of efficacy relocating.
In terms of our internal protocol to be comparable to other approved depression treatments, such as ketamine as kind of a prominent although an answer.
Within ketamine.
Got it and if you do reach that.
The previously disclosed target safety risk ratio.
And transportation industry Association exactly what does that risk ratio to mean practically and what's the math behind that analysis.
Yes, So let me jump in on that point.
Basically the risk ratios the way we're calculating registration is very similar to what was used with provider in their summary basis of approval.
Essentially you can there are normal ranges for both <unk> and you can just basically break the patients and to those that were abnormal than normal in each arm I see now you have a you have.
Percentage now of course that gives you that you can then take those percentages and compare them across arms.
Essentially how you generate a risk ratio right, so 20% abnormal.
The data for example in the drug arm of <unk>, 10, and a placebo arm and obviously, that's a risk ratio too.
On an individual basis, it's more of a population analysis pioneering.
That's exactly right and the agency looked at normal versus abnormal.
They also looked at more severe incidents so severe sedation for example, with some things that they also worked out. So this is the general tax that will be that will be taking and of course. The idea as Brian mentioned is that we are really targeting at home use and the reason that we defined risk ratio with us and to us.
Yes, it's a criteria to say that it's comparable in many ways to placebo.
Essentially the argument so we know that for sedation. There are plenty of drugs out there that are quite today to and in fact.
Sedating, many fold higher than placebo.
Less data around the association per se, but there's certainly data around elucidation that can be quite prominent sofa clones and Fantastic example, thats messed.
Mr. Senator.
Senator does not have its pretty widely used zero percent leased.
<unk> for placebo, 3% originations on the drugs.
Get a sense of how prominent 70 as it moved from a risk ratio perspective, you see our prominence of these side effects can be so we're saying okay fine, let's get a number that's got a ratio that's comparable to placebo markedly better markedly better than provider and.
Putting our best foot forward in that regard and so what's the what's the practical profile of a truck like that that will best address the unmet need that at home.
How far can you push that.
And what's a good comp maybe other than Lunesta sorry, there are other at home profiles that way.
Representing the company for its acceptance.
Yes. So that's an interesting question so the FCA in the approval of Sabra <unk> provider, that's something that I think is a little unusual. So when you talk about the association normally or just talk about any adverse events include sedation et cetera, and normally or thinking about adverse events right. So these are the spontaneous adverse event.
<unk> raised in the cases for volatile there is a focus on two instruments that were specifically designed to measure those particular outcomes sedation in association with sedation or use <unk>.
The association of use cash and that was a point that was the basis of everything there's a certain logic to the adverse event rates can change.
As the doctors as the doctors get trained on some things as associations kind of a tough one to pick up on I mean, what are the main north of the basin report to a doctor one alright, okay.
Associated right.
So you have to map certain terms of the patient using onto a term ah metrics from a preferred term that can get a little bit complicated using <unk> using my wife sidesteps that entire issue. So the reason I bring that up is we don't have an exact analog in that regard it turns out that no drug.
Has the either the cash or the Moab and the label in the United States to the best of them.
We did a fair amount of exploration in that regard.
So we went back to again host nation rates and things of that nature. Certainly <unk> is an interesting one <unk> or <unk> is an interesting analog it's more around multiples. So we know that at multiples that drug is listening creates quite pronounced this nations.
Thats, an interesting kind of product because thats kind of what we're trying to get through here right Association, but we're trying to get to a therapeutic index or trying to get a multiple.
The therapeutic dose the results as association, so very analogous many wise thanks.
Thanks, Andrew.
Sure. Thanks, <unk> so like.
Thank you guys, we touched on safety enough, but I do want to stay on PCM why don't want because it could be a big data read out for you guys. So.
That framework.
Maybe let's shift to efficacy then how did you decide up five points versus placebo at hour 24 to be quote unquote. The bar of what went into your calculus lineup for why not three Wi Fi.
As Lauren mentioned, what we're looking for ultimately in our label based on pivotal studies is on the order of four points.
<unk> changed.
The final endpoint. So it can be in a four week six weeks et cetera, we haven't clearly have knocked out.
We haven't guided on that and we don't have that centralized as yet so that's what we're looking for ultimately so we kind of backtrack from there in essence right. So what sort of look like considering as the phase III trial.
This is a single dose study its a different formulation.
First experiments in this regard that's how we kind of backtrack because thats, how we got to five also you can triangulate on this number. So if you look at other trials of ketamine and S. Ketamine that have similar sized on the order of 30 patients per arm.
<unk> are in the five kind of range five to seven somewhere in that range. So again. These are sort of a two different data points that we use to triangulate on a number.
I see and so you know naturally wall street tends to compare across trials.
And maybe when you report the data they might be tempted to compare what's provider shows at hour 24. So I guess why would that be fair or if not why is it not fair to compare drafts.
It is potentially depending on the study right. So the larger studies that they knew so 2018 and those types of studies are not unreasonable in terms of the size I think where you're headed with that is focusing on that very first phase Iia trial. The J&J conducted with the IV form of Academy.
There are some things theres are some features of that trial that may have exaggerated the magnitude of efficacy there.
First of all it's a small study right. It's only 10 per group in fact.
0.2, and Teekay group by group was only nine subjects. So thats certainly one issue is.
You know that in many fewer sites and when we do we have over 22 sites. They add nine so that's and we don't know how many of those actually actively recruiter of course, so that maybe another factor the most important factor however.
Is that.
S Ketamine was quite and functionally unwinding in that trial right. So if you look at the cabs.
Cash numbers for placebo or very small the cash number for either <unk> or <unk> four in PK, we're really quite high.
So by definition, there was a very pronounced functional unwinding that was occurring in that trial.
Very well is the way the results obviously that is not something that we're anticipating with the doses that we chose in our phase Iia trial.
Makes sense.
This is a single dose study that we will be curious what durability pit shell.
So it seems like patients are followed up by.
By a week or two in this study correct me if I'm wrong.
So what should we expect on durability of efficacy.
Yes, so youre absolutely right. We are looking at the primary of courses Madras changed at 24 hours, but we are looking at seven days post dosing as it was 14 days post dosing.
That's what we're those are obviously secondary endpoints. So we do we have the clinical data here is the previously published third party study of RK Ketamine and they showed a very pronounced effect that 24 hours roughly $20 change non placebo corrected of course.
They did show a durable response that went out to seven days, which is their maximum time point that was the last time point that they actually said they did show a robust efficacy at that point, so that would be wonderful to see to replicate that result of course, and then of course follow that as a 14 times.
Makes sense and said like bigger picture.
What would what would cause you to re SaaS moving forward what is the scenario in which you say.
Maybe we Shouldnt go into phase III V or something like that.
What would you see an efficacy or safety.
On efficacy I think you mentioned before so this is really a single dose study of <unk> 101, while the TPP actually received multiple doses per week as we discussed earlier.
It's important to remember that this very first study is really all about testing with our S. Three dimensions, whether we have a greater therapeutic index compared to other approved treatment options and regarding potential thresholds. So I won't go into any specifics but.
What I can tell you is that of course, the efficacy of a single dose below what is considered to be clinically meaningful would certainly lead to us reassessing. The current clinical development plan in treatment resistant.
Depression, but let me emphasize also that based on all the existing preclinical and clinical data that we have from third parties.
<unk>.
<unk> are kind of in that we remain very confident to achieve the objectives that we.
Guidance on disclosed and discussed in our R&D day in terms of.
Trial objectives for this specific phase III.
Okay, alright, thanks, and retail against our hand, it back to you.
Thanks, Andrew So how did you guys selected two doses for this trial and will you consider bringing two doses with two different profiles again going back to that safety versus efficacy question.
<unk> into phase III.
So the dose selection was based on our phase one wholesale so we conducted that trial two years ago now and we have looked at a range of doses.
Up to a 150 milligram. So 30 60 90 in between.
And we picked doses that were consistent with our hypothesis around therapeutic index and what I mean by that is we paid one dose that was stopped associated essentially or and then the other one and then 30 milligrams of course and the other one that is essentially thresholds associated.
60 milligrams. So this allows us to properly test our hypothesis.
We'll have a therapeutic index pretty much by definition based on the results from our phase one healthy volunteer study now to your second question about whether we go forward with additional doses.
Yes.
Of course, I mean, it depends on the results of this study as well as subsequent trials, but.
There is a rich history of bringing forward multiple doses doctors loved that.
In general to have that flexibility and exactly right. I mean, there may be sort of a different balance of.
Efficacy and Tolerability of the two different doses that may be very important again.
From a physician's perspective vis a via a particular patient that is sitting in front of them.
As you think about your Q bridging study.
What are you trying to replicate from FTE PK PD perspective from the IEEE is at the peak.
We see total exposure I guess.
What feature of that PD do you think is most important to confirm antidepressant antidepressant effect.
<unk> mechanism.
It's a fascinating question in a sense that there is a lot of discussion on this new award is driving the efficacy of Academy and S. Ketamine isn't the AUC is at the C. Max.
There seems to be some coalescence around the concept that it's a <unk> driven effects.
With Hess Academy.
I don't know how strong that data really is but.
Is that seems to where people it seems to be where people have commentary. However, if you think about our ability which is another glutamatergic compound that has an MBA antagonism.
Seems to be more AUC in so far as the half life of Dextromethorphan the contract when coupon Orpheus around is really quite long. So it's just kind of sitting around there you are building up a level over the course of the first five days or so four five days. So in that case, it's probably AUC is probably not being driven by <unk>. So we have these two.
Data points <unk> Gordon.
In the end the most important thing that we really need to get a handle on is the true bioavailability one anticipates the bioavailability from the <unk> perspective should be 100% right. I mean, there's not likely to be any kind of or close 100%, there's not likely to be any local metabolism. For example, but nonetheless, that's the most important thing.
That we really wanted to assess first and then of course, we'll look more closely at <unk> overall duration of effect is another one.
The total time, so all of these factors I mean, all of these things will be looked into and then you basically do the lineup against that the effective doses and you may do depending on what those numbers look like and May do some bracketing.
So you may pick a dose for example, assess a <unk> effect that you may pick a dose that actually.
Replicates the AUC and then another one that might be a little different on AUC, but actually replicates. The C. Max. So this is pretty much what J&J did in their developments. So they weren't as we've discussed from that IV trial to an intranasal, but they did do dose ranging around the intranasal once again.
Got it Andrew.
Great.
At the other day I think it's just a placebo adjusted efficacy of five is ideally what you are seeing on safety something comparable to placebo on sedation disaggregation of August in Asia, something significantly less than what it's providing shifts is that kind of a fair takeaway perfect signs yet.
Alright, very good and so maybe we can shift to contest actually they recently announced their phase III plans and in my notes, it's actually pretty different ones that placebo controlled another one is a repeat dose I believe so there are obviously different two different studies after meeting with the FDA So in euro.
Our view.
As the FDA.
Flexible with them doing either option or is it your view that the FDA wants sponsors as they move to phase III do both types of studies.
I mean, it's an interesting question we've done the short answer is we don't know for sure whether we have the information that compass provider to us, but I can see more broadly. However is that the FDA is comfortable with different sort of sorts of controls depending on the drug and depending on the indication. So there is the ICSC.
10 guidance.
Dose controls OCA and placebo as kind of a dose control of those zero right. So theyre fundamentally okay with that maps is obviously doing placebo controls only.
Why compass settled on one that those controls and governance placebo controlled really not 100% certain on the other and it is interesting.
It's helpful. As we move forward through our own programs.
So.
Obviously, something that we'll take under advisement, we design those next trials.
Okay.
Maybe one more on <unk>.
They are even using integration or.
As well as adding digital support now in phase III.
Just how important to you in your view.
As the use of these tools.
In terms of maximizing the outcome. My guess is there a way to quantify or is this is it your view that these tools serve to augment.
Psychedelic.
Yes go ahead and talk about what you think I guess.
Yes, I mean, certainly this is an area of significant focus for US and you guys have been with us for quite some time. This is something that we've talked about for a long time. The original concept behind introspect really came together in late 2019 and introspect itself was formed in early 2020 as I recall. So this is something thats been really near and Dear to our heart.
The reason for that is that digital therapeutics offer a potential means of allowing for scalability, but also reproduced ability if you will or standardization of therapy. So there is a strong suggestion that.
While certainly prep work is important right and that's something that Compass has also indicated I mean it is.
A very unique experience psychedelic experience is very unique and if youre on initiated that can be that can be very disconcerting.
Telling the patient what to expect setting intention setting expectation all of these things are really critical prior to the psychedelic effect.
There is this concept of course of behavioral plasticity that occurs after the after the administration of these compounds.
Interesting to think about really harnessing that behavioral processes to affect behavioral changes.
That is also a central motif and our strategic vision.
That's a behavioral change it's one thing to just change a symptom of an SSRI for example can do that but it's another thing to actually be able to change behavior to allow for a more durable response rate. So whether that behaviour is improved socialization of our improved exercise or something if you have this period.
Where there may be more flexibility there might be more malleability to change some habits, that's fantastic and one should really kind of.
Take advantage of that and that's what we want to do with our digital therapeutics. So yes, it's really important to us. It was fascinating that there wasn't a factorial design the caveat that all and we've highlighted that in our R&D day. The caveat of course is how is compass viewing these digital.
These therapies right today.
Have been very specific and indicated that we would love to have these are.
Our product developers combination therapies right. It's a combination therapy being a term of art, it's a drug and a device put together.
Inseparable in their label, that's obviously, our vision and Thats something that we are working towards not again compass has not provided guidance on how theyre approaching them.
That makes sense retail I'll turn it back to you on other questions.
Pipeline.
Thanks, Andrew.
So I wanted to 007.
As you look to the next trial the phase <unk>.
Trial for oral <unk> NCI asks how did you choose that primary endpoint the MCC the scale efficacy endpoint for this trial and would it be an approvable.
Endpoints.
And then that secondary endpoint then the RFC.
What does that SaaS.
So the <unk> is in fact or has been in fact supported in the past by the FDA as an approval endpoint for CIA Yes next week the agreement involved or there was.
It wasn't being where it has been developed with the Fda's input.
And while we'll BMS UCB broadly assesses commission diverse cut assesses the impact of change.
Changes in traditional and function by basically stimulating activities of daily living.
So that basically went into that also the decision of course.
Round endpoints for this specific trial.
And how did you choose the 20 milligram and 40 milligram dose at this point in this study. So the doses were essentially selected based on our biomarker study and the patients that we.
We read out the data already published the later earlier this year and the 20 milligram and 40 milligram doses birth Serge.
Clinically meaningful.
Effects Bergen and.
Basically that was also the basis to go forward with those services into the larger phase <unk> study that we anticipate to initiate still this year.
Great Andrew.
Thanks, and maybe one more on that topic, I believe biogen actually sales, but theyre cif's asset. This year does that kind of shake your confidence at all.
Do you know if they had any biomarker changes.
And the initial data sets.
Presumably.
We are following that.
Absent items.
We are following that ASUR, we're certainly following aspects of the path.
Place.
This is obviously a challenging indication there is no doubt about that but of course as part of the appeal of this indication.
Obviously with the.
There is a huge unmet medical need here the costs of these patients to society and of course, the personal cost is very very high.
No.
Even small changes in cognition and as reflected in the broke out for example, and of course ultimately an actual actual actual activities of daily living that is going to be pretty key. So in terms of a biomarker data I will I don't recall seeing anything published on that personally.
So it will be interesting to get a better sense that or even get a more granular read on the results that they have.
Alright already hitting the top of the 30 minutes. Unfortunately.
Thank you so much Andrew Richard for being with US today really grateful that you joined again, thank you and we covered a lot of programs in this session and that I believe personally speaks to the breadth of innovation that we are that is happening at a time.
Looking at the last quarter, we've made meaningful progress in my view across our entire pipeline. We have delivered results that have met the highest centers that we set ourselves for our own programs and looking ahead, we cannot wait to share. The eagerly anticipated top line result of phase II of the phase III of <unk> of course, and we anticipate that for around.
At the end of this year the specific data sets can be potentially as Android also screen you mentioned will be a significant event for tight.
We are targeting an at home therapy for treatment resistant depression, so with our strong balance sheet and runway into 2025, we are in our perspective, very well positioned to achieve additional milestones beyond ark headwinds across all of our other programs.
And that's.
Makes me very excited and we anticipate.
A lot more to come over the next quarters and years, so with that let me. Thank you for listening in today, everyone and have a great week.