Q3 2023 BioXcel Therapeutics Inc Earnings Call
Good morning, and welcome to the bio <unk> cell Therapeutics conference call, which will cover its alignment with the FDA on its tranquillity program provide an update on our strategic financing and review its financial results for the third quarter of 2023.
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Just to remind everyone certain matters discussed on today's conference call and or answers that may be given to questions asked are forward looking statements that are subject to risks and uncertainties related to future events and or the future financial or business performance of the company.
Actual results could differ materially from those anticipated in these forward looking statements.
Factors that may affect future results are detailed on the company's quarterly report on Form 10-Q for the quarter ended June 30th 2023, which can be found at www dot biotech cell therapeutics dot com or on www dot FCC docked out and which will be updated in its quarterly report.
Form 10-Q for the quarter ended September 32023.
As a reminder, today's conference is being recorded.
On today's call our Doctor of M Almeida, Chief Executive Officer, and Richard Steinhart, Chief Financial Officer.
Joining them for participation in the Q&A session are Matt Wiley Chief Commercial officer, Dr. Rob Risinger, Chief Medical Officer of Neuroscience Doctor, Vince O'neill, Chief R&D officer of Iqos that cell therapeutics and Dr. Frank JAKO Chief Scientific officer.
It is now my pleasure to turn the call over to Dr. Mehta.
Thank you operator, good morning, and thank you everyone joining us today I'll begin with several exciting and highly anticipated update on our recent momentum.
With that I'd like to late stage clinical program for <unk> five or what.
Thank you Rudy and say they maybe three.
In addition, I will call them important news about our financing times, we don't think I've heard other than Germany, and Qatar investment authority. After this.
Briefly an update one on one of your government commercial activity, then uncles that opinion.
Rich will then cover the financial results for the third quarter.
Let me begin with tranquility and see maybe three programs.
I am very pleased to highlight the tremendous progress that we've made with the late stage clinical programs.
Which we believe represents significant value creating catalysts.
In both cases, we completed productive meetings with FDA regarding to pause development path.
We are aligned with the Fda's recommendation regarding your phase III trial in the at home Saturday four thankfully the program as confirmed in the meeting minutes.
Going into that regularly in more detail, we are aligned with the fda's recommendation regarding an additional phase III trial in the at home setting for tranquility as a potential path to an SMB and submission.
This important development false positive.
I'm going to be doing starting to do those in June we completed an independent third party tranquility to trial in October and the receipt of our FDA meeting minutes just this month.
Specifically, we plan to conduct a phase III clinical trial of <unk> in that home setting for the acute treatment of agitation associated with Alzheimer's disease.
This potential market opportunity could include acute treatment of agitation across the full spectrum of as I might have related dementia and severity of agitation.
Ross all care settings.
We believe we are well positioned to bring <unk> 501 to this very large and underserved market, which presents a unique opportunity for which there are no FDA approved drugs.
Why the agency has approved a chronic agitation.
We believe we are breaking new ground for this important unmet medical need.
We are pleased that the result of all that.
Data development plan that anchor at DTE trial is no longer required as part of an as DSM mission.
We expect this will lead us to redeploy resources and focus on the recently agreed at home based on product tankers.
Under the program.
In summary, we believe we are now poised to advance the program I appreciate simply and cost effectively.
Our confidence is further reinforced by the positive findings of an independent third party audit of data integrity at the single Tranquility trial site, we have previously identified.
Are they found no evidence of misconduct all fraud beyond the previously reported in addition, no findings.
That impact data integration.
We look forward to finalizing our study protocol and moving this forward.
Yeah.
Let me now turn to say didn't need three program, which is also making steady progress.
The remainder.
Evaluating the potential at home use of <unk> 501.
Agitation associated with bipolar disorder schizophrenia.
Currently a broad indication for the economy.
Last week, we completed a productive meeting with FDA and expect to receive meeting minutes in the first half of December However, what I can share now that based on preliminary FDA feedback.
To conduct an additional phase III trial evaluating safety of the 120 microgram dose to treat agitation in the home setting and associated with bipolar schizophrenia.
We'll provide more details on this program as we advance.
For now we are pleased that we have multiple opportunities to bring VX 501, who are much larger.
A number of patients in the home setting. This is the expand portion of our land and expand strategy.
In conjunction with the clinical development.
We are focused on enhancing our operational and financial flexibility as we reported today, we have entered into a binding term sheet with the Oaktree capital and Qatar investment authority to amend our existing financing.
Alright agreements.
Two final documentation, we have agreed to revise down that will increase our potential to exit additional tranches of capital and have agreed to revise the revenue covenant to extend a compliance requirement.
And covenant levels to align with our current projections following our business the deeper dive issue.
We believe this is very positive news for the company.
This is an integral part of our overall financing strategy.
We are grateful to our strategic financial partner for their ongoing support.
Briefly turning to economy, we have focused commercial efforts to provide access to regarding me to our current customers.
<unk> direct contracting with hospital systems.
The recent issuance of a J code by CMS is expected to streamline the reimbursement process across commercial and government.
<unk> peers, we hope this will help us continue to establish brand equity in economy and act as a bridge to the larger potential at home market opportunities.
Additionally, <unk> gone <unk> production has been extended to 2043 with two new Orange book listed U S patents.
Okay.
Before wrapping up our life to highlight that we are pleased with the continued progress of <unk>.
<unk> won the title of <unk> 501 for potential treatment of opioid use disorder being conducted by Columbia University.
This may offer an important opportunity to address Brent Daniel combined with <unk>.
And what has been card and emerging threat.
The White House office of National drug control policy.
I am also energized by our emerging neuroscience clinical development program that are the result of our unique use of artificial intelligence platform to drive innovation.
We look forward to sharing more information about our opioid use disorder program.
Im exciting pipeline and an R&D event that we plan to host next month.
In addition, we were pleased with the recent positive survival data reported for <unk> 501 in our open label Phase II trial in patients with metastatic castrate resistant prostate cancer and in patients with small cell neuroendocrine prostate cancer with.
With these data in hand, we are focusing on various strategic options for oncology.
I would like to end by thanking all of our colleagues for their dedication to our mission of bringing transformative medicines to patients.
Ultimately their tireless work that drives our success.
I will now turn the call over to rich, who will review our third quarter financial results rich.
Thank you Nick.
The quarter was indeed, a transfer of a transformative time for the company and I am pleased to review our financial results for the third quarter of 2023.
Net revenue of the economy was approximately $341000 for the quarter.
Research and development expenses were $19 6 million for the third quarter of 2023 compared to $22 1 million for the same period in 2022.
The decreased expenses were primarily attributable to a decrease in costs associated with the <unk> 501, serenity III and the tranquility to clinical trials.
Selling general and administrative expenses were $24 3 million for the third quarter of 2023 compared to $17 1 million for the same quarter in 2022 <unk>.
The increased expenses were primarily attributable to an increase in one time legal and professional fees costs associated with the <unk> potential public offering.
Well as in personnel and related costs to support commercialization at origami in the United States prior to our re prioritization.
<unk> Therapeutics had a net loss of $50 5 million for the third quarter of 2023 compared to a net loss of $41 8 million for the same period in 2022, the company used approximately $37 $6 million in operating cash during the third quarter.
Cash and cash equivalents totaled $90 million as of September 30th 2023.
The company estimates that its current cash and cash equivalents will last through mid 2024. This estimated cash runway does not include potential additional capital that may become available under the amendments to the strategic financing agreement or resulting from any potential financing activities that we may undertake.
Now I'd like to turn the call back to demo.
Thank you rich we would now like to open the call for questions operator.
Thank you we will now be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
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Our first questions come from the line of Greg Harrison with Bank of America. Please proceed with your questions.
Hey, good morning, guys. Thanks for the update and for taking the questions.
With respect to the 100 patient trial.
Can you give us some more color on the <unk> development strategy as Glenn for a broad label. Initially and then what are the criteria for success in this trial and what would a positive trial look like.
Good morning, Greg This is remo.
We were very pleased that we have alignment.
On recommendation from the FDA to conduct their home setting trial.
As you know home setting our most of the patients in Alzheimer's do live in the home setting.
This was a very important development. After we observed in <unk> that number of episodes that are required.
Like in a more chronic in nature. So we don't need to conduct thankfully D. Three anymore. So under those circumstances. This is our best case scenario to move this drug and provide access to this medication to broad as possible patient population.
That's very exciting and in terms of the clinical trial program I will pass it onto Rob to describe what this program will entail.
Just remember we just received the meeting minutes from the FDA and we are in the process of.
Developing the clinical protocol protocol right now Ross.
Sure. So let me just highlight that.
We're really excited that we now agree with the Fda's proposed design this will be a double blind placebo controlled study.
Primarily safety and that includes describing clinical benefit as assessed by family our caregivers will actually working on the protocol and we expect to get back to you with.
Further facts about that protocol.
Got it and.
And can you clarify.
Whether you're able to use all of the data is collected from tranquility to as part of their.
Package.
Company believes after receiving our independent audit and all the information we have that we will be able to use that tranquility to data that we announced in June.
Yeah.
Great. Thanks for taking the questions.
Thanks.
Thank you. Our next question is come from the line of Raj <unk> with H C. Wainwright. Please proceed with your questions.
Hi, Thanks, very much for taking my question I was wondering first of all if you could provide us with some additional context and clarity on what you expect to be the ultimate path forward for 501 in chronic agitation and within what timeline do you expect to pursue this and if we should be thinking about this is <unk>.
Something that you would look to target only once you have an approval the label in Alzheimers associated acute agitation.
That's a great question.
When we had the conversation with the FDA.
<unk> III conceding that so many number of episodes and we did those 501 multiple times two to treat those agitation episode. So there was a discussion that would there be a possibility that fiber one may be useful or country or could be.
And I would love that the chronic treatment.
We have done chronic dosing as you know in the healthy volunteers for wet AMD program.
And we have data, but we have no idea.
Data right now that it can be chronic agitation.
He will work with the agency to develop a Pat our explored that path currently our laser focus is on acute treatment of agitation in a home setting so that we can expand our.
Use of this drug in Alzheimer's related.
Education, so that bad.
This for us and we will have the opportunity to explore but at this point in time as strategy will be to apply all the resources and focus.
In our completion of the tide in the home setting.
Okay, and then secondly, with respect to the opioid use disorder indication.
Do you have any additional information you can provide to us regarding the potential size of this market opportunity.
And maybe give us a sense of how you would expect five or one could potentially be deployed if it were to be approved.
So as you know this program is funded by neither it's a huge huge ligand on national.
Emerging tech and.
The investigators we are working they are widely known.
Investigators in this area and day to day ongoing trial phase II trial.
Upon outcome of that trial, we will know what the path forward will be but in terms of the market opportunity I will pass it on to Matt. If you can provide any color on this.
A woman, who will give us additional data as we get closer to data readout, but we do know that the Sentinel xylazine.
Nominal as an emerging threat it's growing.
So there's not really great epidemiology, yet on and we do know that certain cities like Philadelphia, where the state of Connecticut for instance has significant problems with this emerging threat and it's certainly gotten the attention.
The White house.
No.
And lastly, if you can maybe comment on you know obviously, there's been some recent data that looks pretty positive for <unk>.
Can you give us a sense of you know on a.
Qualitative basis to what extent the availability of this clinical data might make it easier for you to either identify.
Some kind of strategic partnership for 701, or indeed, consummate the spin off <unk> into a separate entity.
Yeah.
With the data in hand, and you saw that data from the two trials.
That's the important thing about the 701 potential.
Vince you want to take that question, yes, good morning, Rob I would just add to that.
The really the complete data package that we have as you said, including survival, but also biomarker what is exactly the data potential partners would really want and need to see to form an assessment. So now that we have that in hand I can tell you we are actively having those conversations.
Thank you.
Thank you. Our next question is come from the line of two months' call Kearney with Canaccord Genuity. Please proceed with your questions.
Good morning, Thanks for taking my questions and all the updates so on your alignment with the FDA did you specifically ask the agency about your ability to find on the basis of the tranquility trial alone.
Asked another way I guess why did the company not choose to go with a more limited NBA initially with the potential to expand the label for that at some time or is that not possible because you still need to establish the safety profile in older patients.
Okay.
Some of them.
With the agency when we met we had all the conversation around the tranquility to program what will allow us to file an NDA in.
In terms of our strategy we adopted this strategy we won.
Have the broadness access to this drug to the patients.
No 80% of the patients live in a home setting which is home and ALR.
We have data in the ALS and to be able to get to the presentation, we needed to demonstrate.
Safety and collect data on efficacy in a home setting and that was the optimal choice.
By the company.
King with agency that this will allow a broader access to their patients and also for decades gave us one of the biggest reasons for these patients who go from a home <unk>.
Our two nothing or is as you know I'm a patient as agitation. So we thought this is the best case scenario that we conduct a starting at home setting and get the best possible label, we can.
In this patient population, where as you know there are no drugs approved then.
To our knowledge no drugs under development also for acute treatment of agitation. So we have a very unique position.
Got it and then is there a specific limit to the number of episodes that you can keep the four week period in this new trial to be considered an acute treatment.
Im confident are you that the new at home trial will not end up in a quality outcome that Adi agitation is not really acute chronic.
Yeah.
We are not aware of any guidelines like migraine, where you have 15 episodes and if the acute and after 15 is considered as chronic does that the path we will be working with the FDA. What is the definition of a acute and episodic.
But as Rob said, we are developing a protocol and he will be providing you the details that what our inclusion criteria will be for <unk>.
Episodic treatment and we will be discussing more on this one but to answer your question. There is not a clear guide.
Guidelines set up or up at about that or there is no theyre trade that information, we'll define that if you have X number of episodes is acute and if you're a wide number of episodes. It's currently.
And then my last question before I jump back into queue is on the <unk> program. You know are allowed to go home with a 120 microgram dose could you just give us some color on what led to that and the discussions with the FDA on that given its higher than what you had contemplated in the past.
Yes, so when we had meeting on the <unk> program we have.
Multiple choices for their doses as you know 120 microgram is already approved dose.
For the economy and now.
Company as teammate that it has been given to at least more than 10000 people, which is one <unk> higher dose is 180.
And there is a lot of data generated which provide the confidence to the company as well as with agency that this could be a dor Richard evaluating their home setting.
You also had a choice to evaluate 80, where you understand and know that we are done PK PD modeling based on our 60 microgram dose.
And we could have chosen the 80 microgram dose those flexibility exists the visa and we are choosing one 'twenty already lot of safety data on one Duane D. Efficacy is already established we need to evaluate as primarily the safety in a home setting and that will allow us to capture.
About $23 million episodes that happened in their home setting and extended beyond the $16 million episode that's in the hospital.
That is synergistic same doors that you gave on <unk>.
Hospitalization if it can go in all the setting and if patients in their homes, adding need any more like you know a medication. They can always get $118 per ton. So it's very very synergistic and as part of the reason we have chosen 124 evaluating in a home setting.
Thank you.
Thank you. Our next question is come from the line of Colin Bristow with UBS. Please proceed with your questions.
Hey, good morning, and thanks for the update.
Maybe just a point of clarification on the path forward in Alzheimer's agitation I think I heard you say the company believes the tranquility to data.
Can be used.
What did the FDA, specifically say about the submit the ability of the data or will there still remain a review issue.
And then on the additional study can you.
So aside from the timelines of properties, we're going to this is looking to be a 2025 readout and then secondly on the cash runway.
On the cash runway you lost in Q2, you said Youll cash will get you to mid 'twenty four you've maintained that language is that simply because the updated agreement isn't finalized just more details will be really helpful. Thanks.
Sure Collin this is remo.
Back to your question about specifically about the tranquility to data.
We have no reason to believe Oh, we have not any discussion, which tells us that tranquility data is not usable.
As you know once you do submission of U S NDA.
FDA does his assessment and that will continue to be the case for any SMB.
In terms of our discussion we have no reason.
I do believe that and as we said company believes these data user base.
Based on our own assessment as well as on the independent audit that was recently concluded.
Your second question was.
What about the additional studies when that readout will be there.
You'll notice that we have about a 100 patient study to conduct its in a home setting.
We are developing the protocol.
Designing how many sites will be required to conduct the study.
Only thing I can mention here is that.
Conducting a trial in homes that thing is going to be a lot more easy than conducting a trial like tranquility to entry. The reason for that is and frankly, two and three you have three helicopter that in Seattle to make that assessment for the efficacy have as we mentioned we are trying to say.
Elliot the safety and will continue to collect can give our assessment of the efficacy. So these styles. We expect are going to be relatively relatively easier in that setting, but we have not done a trial in a home setting. So we are very diligently working with our Seattle.
Finding the protocol getting their alignment on the protocol and very soon we will be able to come back and say when we plan to initiate the trial vendor first patient will be dosed when recruitment will be completed and how long will it take and when their value inflection.
Find value inflection catalysts will be there for the Alzheimer's related agitation program.
Third question is related to the Ah <unk>.
Recently, we are concluding a binding term sheet with <unk> in Qatar investment authority, we are very grateful that they are very.
Supportive.
Uh huh.
<unk> believe in <unk>, Viva and Brad and like US like we believe in it and now having a very clear path for as that must be related agitation and also at bats for expanding the label. What are you guys may know home setting with 73 program.
We bought and based on our recent re prioritization of our commercial efforts.
And in the organization.
Agri men are tons needed to be a mandate. We are very pleased to report today. They have been agreed upon.
The binding term sheet, which will be documented very soon and I will pass it onto Richard So that he can outline of what is the value for the organization and why this wasn't needed or Colin thanks, Richard So we've done a couple of things here collyn that make it.
<unk> to US Yeah, we moved out the revenue covenants that would've started too.
The impact of our cash flow early next year for about a year, so that saves us some significant cash payments that may have been required under the original deal and as Bill said, the new covenants and the new revenue targets really align with our re prioritization and our new budgets. So it gives us a lot more flexibility in turn.
Ziv operation for Us.
And we renegotiated the tranches.
That may allow us to take down additional capital over the next few months.
Very helpful. Thank you.
Thank you our next questions come from the line of Robyn <unk> with the Truest. Please proceed with your questions.
Good morning, and thank you for taking my question.
I guess, starting with the first one so I think before you said that you have to be like you. It doesn't have already gotten them trials, you know what kind of conversations that you've had that using the 16 milligram.
Or 60 microgram for the for the for the asthma setting Christopher Quilty. Second question is you know at home can you update us on the number of potential doses that are in the market or episodes now that you're going for at home and in the hospital setting or.
Assisted living setting like what is now the number that we should thinking about and then I have a follow up.
Okay.
So I'm just trying to.
I understand Robyn. Your first question. Your first question is about the dose being used in the Alzheimer's related agitation 60 micrograms <unk> hi.
I just wanted to make sure that I understood.
Yeah, I mean, I think before you talked about how do you guys see always wants to cut the dose when they go at home.
And that's what you did with or anything it's a little lower.
And what gives me confidence.
Okay.
I guess for.
Your trial that you did in assisted living.
Yeah.
As you know in our assisted living tranquility to program. We tested two doses 40, microgram and 60 Microgram 60 microgram was statistically significant.
And it was valued at a later date and we have a very clear.
Clear safety profile established and in Tranquility. One also we had the data for the 60 microgram. So that's our doors, we wanted to test in a home setting because it's clearly establish the.
Efficacy and the safety profile through two drugs.
I would like to add.
No no no the F D a.
South of 60 microgram had efficacy as demonstrated in tranquility to and therefore, that's the dose to test at home the safety profile.
<unk> was consistent with being able to be dosed at home and so we believe a successful at home trial will be demonstrating safety consistent with what we've shown.
Hum.
In the tranquility to study.
Yeah.
In terms of the number of episodes.
Continue because there is no.
Drug approved AR VR, we believe one of the leaders in the acute treatment of agitation in Alzheimer's.
And then related agitation. So we continue to do a lot of work internally to understand the opportunity I will invite Matt to provide a little color what our understanding is on the number of episodes sure. Good morning, Robyn <unk>.
<unk> said earlier better than 80% of patients with Alzheimers dementia or an at home setting.
This is where the unmet need is potentially the greatest.
Anti psychotics are not typically used in this population due to the side effects and benzodiazepines are not an optimal choice. So typically what's used.
For these patients is some type of soothing technique.
And these are relatively ineffective and so we believe that the opportunity is tremendous what we've seen in our market research.
Is that on average the number of episodes per month for these patients in the at home setting as six.
The opportunity out there is pretty tremendous.
Would you get other patients like.
Patients that are not completely diagnosis a lot of patients are seem to have alternate routes that maybe there are other kinds of dementia would that be.
It's something I read in your press release.
Alzheimer's.
There might be upside to the opportunity and then on the financing question, then I'll, maybe talk a little bit about how you're thinking about priority.
Feature development for Serenity once you get the final minutes back versus tranquility versus say monetizing so having that one like I guess you have to prioritize one given your cash position.
How are you thinking about that.
Yeah.
Regarding the prioritization.
I think good news is that we have full clarity on both program a program and.
From our two recent FDA meeting so we have both options at our disposal to bring this drug into the home setting tranquility conceding a very large opportunity. It makes sense to prioritize tranquility program and that is the meeting we had in October and we are more advanced.
And our protocol development and like taking next steps forward with that Tranquility program coming back are related to your question about the financing.
We believe that we are blessed that we have multiple options for financing in there.
In addition to equity financing.
We do.
Recently.
To revise our tons with our strategic partner to our.
Financial flexibility in addition.
We have opportunity to be able to arc 501 program now we have a full clarity zimmers agitation ex U S that opportunity we have not explored because right now we were waiting for clarity on these two programs and in addition, as you mentioned and wins also mentioned that we are.
Focusing on monetization of ankles exit so depending on the business needs are we can leverage one of these.
Options for us to extend our cash runway and get to the clinical meaningful clinical milestones for the tanker program followed by the three entities.
So Robyn this is Matt I'll just take on your question about the potential label for a presumed Alzheimer's dementia and of course. These are things that we will test in the market to see how the market will react to them, but my initial reaction.
Is that payers, who might otherwise have a prior authorization.
Due to a confirmed diagnosis might not be able to leverage.
A prior authorization in that way that's number one number two is that what we saw in our market research on episodes one of the things we did collect as the number of episodes per months prior to the definitive diagnosis of Alzheimer's dementia and that was three per month. So we do know that agitation exist prior to actually lead to the.
<unk> diagnosis.
Okay, great. Thank you.
Thank you our next questions come from the line of <unk> <unk> with Guggenheim. Please proceed with your questions.
Hi, Good morning, this is Greg on for Jackie.
Thanks for that.
Please go ahead.
Thank you.
Next question is from Polo will conclude with details.
And then.
Thank you Adam.
But it's not right.
For misconduct.
Thank you.
Regarding the long term safety as we have outlined that that is they will continue to be a topic of discussion with the FDA.
Our a drug is acute treatment of agitation is episodic in nature, depending on what is acute episodic and what is chronic those discussions will continue so it's a.
Topic that we based on our frequency of agitation, we will discuss with the agency.
In terms of the site, we are not planning to use that.
That side, which you mentioned and that was specifically designed for E. L F.
And now as we mentioned that we are.
Moving forward with the at home setting so we'll be using the new sites.
That's one.
Thank you ma'am.
Yeah.
Thank you. Our next question is come from the line of Greg <unk> with Mizuho. Please proceed with your questions.
Thanks for taking my questions a couple if I could.
Just with respect to the comments.
Around the long term safety requirements I'm, just wondering are in support of an S. N D E and the 80 agitation setting them. What is your current expectation around what she'll need and I guess the question is beyond the 100 patient four week studies.
Our current thinking that you will need additional long term safety in order to support them.
S N D E and then.
A follow up question, if I could just on the current Opex I think it came in significantly higher than we were expecting and given the current burn I'm just wondering how we should anticipate.
Opex to evolve in the fourth quarter and the first half of next year. Thanks.
So Greg regarding the long term safety as I've mentioned this will be a.
Continued topic of discussion it will happen between now when we are initiating the home setting tile as well as the pre NDA meeting.
There is not a like and no.
There is not a drug that has been approved which is acute treatment for agitation in Alzheimer's.
<unk> in nature, so that package will be reduced because with agency and we will continue to update like where we are on those discussions currently we are focused on the study for their at home setting.
Pivotal trial that we have agreed.
With agency.
In terms of the cash burn rate I will pass it onto Richard to provide color on it what our guidance. It's sure. So good morning, Greg how are you.
The results of the re prioritization will begin to impact the fourth quarter and then certainly into next year.
So we will see our burn rates start to decrease and in addition, there were a couple of one time charges in this quarter that won't be repeated moving forward. So overall, we expect the burn rate to decrease next quarter and then continue into next year.
Okay, great and if I could ask maybe just one follow on on the J code.
How should we expect or how that might impact the trajectory of sales.
Thanks.
Okay.
So so Greg first of all we were very pleased with CMS decision to issue a permanent J code we.
We do believe that this will neutralize any economic concerns.
Hospitals, and clinics might have and putting a gaumy either on formulary or all providing.
Water use within the hospital or clinic.
So we look at this as a positive certainly our corporate account director team has been getting positive feedback from from.
Either key hospitals or systems that they've been in contact with so we feel very good about this development and do think that it alleviates.
Alleviates one of the barriers to increased use.
Thank you.
Okay.
Thank you our next questions come from the line of Corinne Jenkins with Goldman Sachs. Please proceed with your questions.
Great. Thanks, I guess, just a couple from us when do you anticipate that youre going to be able to finalize these protocols and initiate the atom study for tranquility and based on one of your prior answers. All these all be new trials that you need check rollout.
On a on the tranquility platelets you guided I think for 100 patients in that study, but it sounds like you've yet to determine the primary endpoint that you'll be evaluating so how did you come up with that guidance you never infusions required and it could it evolve as you determine the final protocol.
So in terms of the protocol is under development, we had a meeting with the FDA.
Last month, so we were expecting the meeting minutes to confirm our understanding but protocol is in progress.
We are finalizing the protocol once we have input from all of us.
Exports are at Board, then we will submit the protocol to that.
And after protocol has been submitted as you know we will be in a position within a short time after that to be able to initiate that trial. So.
And we will provide guidance on when we think the trial can be initiated and what when first patient will be dosed.
Also we are in the process of.
Finding how many trial sites, we will open and what the recruitment rate will look like coming back to your question about the 100.
<unk> number that was.
As you saw that it is designed for safety and to collect efficacy data.
So FDA analysis ferry that that number will be sufficient to add to our current data set we have.
With 501 in the elderly patient population. So those are the choices and decisions we ended up making what needs to be shown in their homes acting what patient number will be relevant and what the success criteria will be in terms of demonstrating the safety profile.
Rob you'd like to add anything.
Just that the protocol in development is really focused on both feasible and rapid generation.
And I recognize this is a pivotal trial, but the primary aim is described safety.
And only about 100 patients.
And they are being treated as needed with the <unk>.
<unk> microgram dose or placebo.
So it's designed to generate placebo controlled safety data on adverse events for the FDA to review with respect to including these in a potential labeling at hall.
So we're not able to say when the results will be available. However, we will share more facts. Once the protocol is finalized and of course, we expect that we will announce once enrollment begins.
Okay, and then as you think about this.
Great Alright. Thank you I guess, how do you think about.
Taking on additional debt first as he can.
Capital via the equity market.
I think always it's a delicate balance.
Based on the business need.
Current cash position the options you have at your disposal. Good news is that we have both equity as well as potential debt option. In addition to as I mentioned previously.
Partnering which can be outside the U S.
Alzheimer's related agitation because this opportunity.
In U S and I'll say it is a really large.
In addition, as we mentioned that we haven't started now more concerted effort toward down because XL. So we leverage these assets to develop our financing strategy that is create the best value for our shareholders.
Okay.
Thank you. Our next question is come from the line of two months' call Kearney with Canaccord Genuity. Please proceed with your questions.
Well thanks for the follow up I have two so you mentioned, it's easier to conduct a trial at home because of the lack of I think he used the term helicoptering in Seattle, but with the burden of mentioned safety and the patient at home not be data and then it'll go Mumbai monitored setting and how real time feedback to the company be deemed unsafe DDA Vincent in human safety trials.
So <unk> setting as you know.
Nonmedical setting, where we have conducted tranquility went into.
So the only reason you have to look at it in <unk>.
Seattle is to measure the efficacy.
And we will be evaluating now in the home setting so safe.
Safety will be measured as for any other drug like <unk> that is being tested in the home setting.
And then in terms of the Fak is it will be more collecting their efficacy data where there were the agitation the patient for Ya com given more by a caregiver and we are developing the protocol and how we will measure that so but safety is <unk>.
We have now established 60 microgram efficacy.
I love and that that was primarily the reason to come up with the design.
In a home setting to expand patient access to this drug to the patient population.
If we get approved.
And then we understand that the FDA could only opine on the data that you haven't had the tranquility to his microphone.
Review, but did the agency specifically see that only this one additional trial would be required to submit an S. N E.
Oh do you want to acquire more efficacy trials.
I think this is our alignment and this is a recommendation of the FDA that it is 100 patients home setting trial with the efficacy assessment as well as collecting the.
Lefty assessment and collecting that efficacy using a caregiver because that is the best possible design executable in a home setting.
So that's our clear understanding and company believes that there will be one more time that we have outlined today will be required for a potential submission of this NDA.
And last one and I'll squeeze one in this trial is going to have a part one and part two like I said and it easily.
No.
We learned have part one and part two because as you know 60 microgram has efficacy has been established we believe in <unk>, one and then further confirmed in our tranquility to trial.
In Sydney, we were trying to determine a lower dose than the approved dose and trying to see it will be efficacious and safe.
That's part of that he then it was designed as a two part study and tranquility. There was no need to design that is a two part strategy.
Thanks for the clarification.
Thank you we have reached the end of our question and answer session I would now like to turn the floor back over to Dr. <unk> for closing remarks.
Yes.
Thank you everyone for joining us today and for your continued interest in by XL Therapeutics have a great day.
Thank you. This does conclude today's teleconference. We appreciate your participation you may disconnect your lines at this time.
Enjoy the rest of your day.
Okay.
Yeah.
[music].
Yeah.
Okay.