Q2 2026 Ensysce Biosciences Inc Earnings Call
Speaker #1: Greetings, and welcome to the Ensysce Biosciences, Inc. corporate update call. At this time, all participants are in listen-only mode. If anyone should require operator assistance, please press star zero on your telephone keypad.
Speaker #1: It is now my pleasure to introduce your host, Dr. Lynn Kirkpatrick, Chief Executive Officer. Thank you. You may begin.
Speaker #2: Thank you, operator, and good morning, everyone. Thank you for joining us. We recently issued a press release outlining our acquisition of SciBioPharma and a concurrent private placement financing.
Speaker #2: That release, along with an updated corporate presentation, is available at www.insys.com under the Investor section. Before we begin, I would like to remind everyone that the statements made during this call that are not historical facts, including statements relating to Ensysce's expected future performance, future business prospects and future events or plans, and the anticipated benefits of the transaction, may be forward-looking statements.
Speaker #2: Within the meaning of the Private Securities Litigation Reform Act of 1995, all such forward-looking statements are intended to be subject to the safe harbor protection provided by the Reform Act.
Speaker #2: These statements are based on current expectations and are subject to risks and uncertainties that could cause actual outcomes and results to differ materially from those forecast, due to the impact of many factors beyond the control of Ensysce.
Speaker #2: Insysce undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
Speaker #2: Participants are directed to the risk factors set forth in Ensysce's filings with the Securities and Exchange Commission, including its most recent Form 10-K and Form 10-Q, and in other filings that it makes with the U.S. Securities and Exchange Commission.
Speaker #2: During the call today, I will review the details of our acquisition of SciBioPharma and the concurrent private placement financing. James Morrison, founder and chief executive officer of SciBioPharma, who has joined Ensysce as president, and Professor Richard Langford, SciBioPharma's chief medical officer, will then provide an overview of their lead program, Sci200, for the treatment of complex regional pain syndrome, or CRPS.
Speaker #2: I'd like to start by describing how this transaction developed. Our Board of Directors undertook a thorough evaluation of strategic alternatives with a focus on maximizing value for Insysce's shareholders.
Speaker #2: After a robust process, the Board concluded that this acquisition represented the most significant value-creation opportunity evaluated, including the synergies between the two companies.
Speaker #2: The clinical data supporting Sci200 and SciBioPharma's approach to treating the devastating condition of CRPS reinforced our conviction in this program. In addition to the acquisition, we also announced financings of up to $77 million that included a private placement of $21.5 million through the sale of Series C non-voting convertible preferred stock to a group of institutional investors, $17.1 million of SciBioPharma's cash and cash equivalents from a pre-acquisition convertible note financing, and up to another $38.6 million upon achievement of a clinical trial milestone.
Speaker #2: The financing was led by Alibridge Group and included participation from Perceptive Advisors, Dolora Investments, Ikerian Capital, and Adage Capital Partners LP. The proceeds from these financings are intended to be used primarily to advance SCI-200 through key clinical milestones, including top-line data from a randomized phase 2 trial assessing efficacy, safety, and tolerability in participants with CRPS type 1, and to prepare the program for registrational development.
Speaker #2: Sci200 is a botanical psilocybin extract designed to provide a neuro reset for CRPS. It has already received U.S. FDA orphan drug designation for the treatment of CRPS, which we believe provides important regulatory and commercial advantages as we advance the program.
Speaker #2: I want to emphasize that the private placement was intentionally sized to support the immediate strategic objectives of executing the Phase 2 trial of SCI-200 while maintaining financial discipline.
Speaker #2: And importantly, this transaction is not expected to come at the expense of our existing pipeline. We will continue to progress PF614 and PF614-MPAR, which we believe represents a fundamentally new approach to opioid safety.
Speaker #2: It's now my pleasure to introduce James Morrison, founder and Chief Executive Officer of SciBioPharma, who joins Ensysce as President and has also joined our Board of Directors.
Speaker #2: James led SciBioPharma since its founding, building the company's clinical strategy for Sci200 from early discovery through orphan drug designation and into Phase 2 development.
Speaker #2: James over to you.
Speaker #3: Thank you, Lynn, and good morning, everyone. I would like to echo Lynn's thanks to those joining us this morning and to the investors supporting the recent financings.
Speaker #3: We at SciBioPharma are excited to join Ensysce with the opportunity to deploy this capital toward developing serotonin receptor agonist therapeutics beyond mood disorders, starting with a much-needed, meaningful treatment for patients suffering from an orphan condition, complex regional pain syndrome.
Speaker #3: Professor Richard Langford, our CMO, and I will take a few minutes to walk through why we believe CRPS represents such a significant unmet need, and why our lead candidate, SCI-200, is well positioned to address this.
Speaker #3: Richard.
Speaker #4: Thank you, James, and good morning, everyone. CRPS is widely regarded as one of the most severe chronic pain conditions that exists today. Patients often describe pain that is disproportionate to any known injury, and the condition frequently presents with swelling, changes in skin temperature and color, and progressive loss of function in the affected limb.
Speaker #4: Because there is no single diagnostic test and no FDA-approved therapy specifically indicated for the condition, patients often cycle through pain management strategies, including opioids, nerve blocks, and physical therapy, with inconsistent and often short-lived relief.
Speaker #4: Or invasive, high-cost measures such as implanted neurostimulation devices. The physical, psychological, and socioeconomic burden on these patients is substantial. CRPS may even develop in adolescence and early adulthood, meaning that they can face decades living with the condition.
Speaker #4: Our approach with Sci200 is different from standard symptom management. Rather than simply blunting pain signaling, Sci200 is designed as a neuroplasticogenic therapy, meaning it is intended to act on the underlying neurobiology thought to drive and sustain CRPS.
Speaker #4: With the goal of producing greater and more durable benefit rather than transient or inadequate symptom relief, with Sci-200 we're aiming to improve both pain and functioning.
Speaker #4: We believe that the orphan drug designation SCI-200 has already received from the FDA reflects both the seriousness of this condition and the potential of our approach.
Speaker #4: We expect to provide considerable regulatory and commercial advantages as we move through development, including opportunities for closer engagement with the FDA. And if Sci200 is ultimately approved, there will be a period of market exclusivity in the United States.
Speaker #4: I will now turn it over to James to describe our development strategy.
Speaker #3: Thank you, Richard. Our development strategy combines rigorous clinical science with an efficient regulatory pathway intended to accelerate delivery of this therapy to patients. The next milestone for this program is top-line data from our randomized Phase 2 trial evaluating the efficacy, safety, and tolerability of SCI200 in participants with CRPS Type 1, which the proceeds from the financings are intended to support.
Speaker #3: This transaction gives our science the capital, the public market platform, and the strategic flexibility to help execute on our mission. We believe we are entering the public markets at the right point, where clinical execution—not financing—can be our primary near-term focus, and we are looking forward to an exciting second half of the year.
Speaker #3: I'm honored to join the Ensysce team as president and to join the board of directors of the combined company. With that, I'll turn the call back to Lynn to cover the structure of the transaction.
Speaker #2: Thank you, James, and welcome to the team. Now, let me walk through a few additional details on the structure of the transaction. The acquisition of SciBioPharma was completed as previously described in our August 6 press release.
Speaker #2: Concurrent with the closing, we entered into a definitive agreement for the sale of Series 3 non-broadening convertible preferred stock in a private placement, which resulted in gross proceeds to Ensysce of approximately $38.6 million before deducting transaction expenses.
Speaker #2: Following completion of the transaction and financing, we expect to have pro forma cash on hand sufficient to fund operations into late 2027, supporting the company through anticipated catalysts including top-line Phase 2 data for SCI-200, which may trigger a second investment of up to $38.6 million to carry activities through 2028.
Speaker #2: On the advisory side Troutman Pepper Lock served as legal counsel to Insysce and Auric Harrington and Sutcliffe served as legal counsel to SciBioPharma. Wedbush Securities served as the exclusive financial advisor to SciBioPharma Tungsten Advisors and H.C.
Speaker #2: Wainwright served as financial advisors to Ensysce, and UBS served as placement agents for the private placement financing. Details on our combined strategy and pipeline are available in an updated corporate presentation, now posted to the investor section of our website at www.ensysce.com.
Speaker #2: We will not be taking any questions for today's call, but we look forward to engaging with our investors and analysts as we move through integration and towards our next clinical milestones.
Speaker #2: We appreciate your time this morning and your continued interest in Ensysce. We are energized by this transaction and by the opportunity ahead of us with SCI-200 and the broader pipeline.
Speaker #2: Thank you, and have a great day.
