Anavex Life Sciences Q1 2024 Earnings Call Transcript

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February 7, 2024

There are 5 speakers on the call.

Operator

Good morning. Welcome to the Anavex Life Sciences Fiscal 20 24 First Quarter Conference Call. My name is Clint Tomlinson, and I will be your host for today's call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session.

Operator

And during this session, if you would like to ask a question, please use the Q and A box or raise your hand. Please note during this conference this conference is being recorded. The call will be available for replay on Anavex's website at www.anavex.com. With us today is Doctor. Christopher Missling, President and Chief Executive Officer and Saundra Boenisch, Principal Financial Officer.

Operator

Before we begin, please note that during this conference call, the company will make some projections and forward looking statements. These statements are only predictions based on current information and expectations and involve a number of risks and uncertainties. We encourage you to review the company's filings with the SEC. This includes, without limitation, the company's forms 10 ks and 10 Q, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward looking statements. These factors may include, without limitation, risks inherent in the development and our commercialization of potential products, uncertainty in the results of clinical trials or regulatory approvals, need and ability to obtain future capital, and maintenance of intellectual property rights.

Operator

And with that, I would like to turn the call over to Doctor. Missling.

Speaker 1

Thank you, Clint, and good morning, everyone. Thank you for being with us today to review our most recently reported financial results And to provide our quarterly business update. We are poised for a very exciting year for Anavex. In December, the Committee for Medicinal Products for Human Use within the European Medicines Agency Agreed to the oral dakamezine for Alzheimer disease is eligible for submission of an application for a union authorization in the AU under the European Medicines Agency centralized procedure. The market authorization would allow direct market access throughout the European Union for oral Blacomazine for the treatment of Alzheimer disease.

Speaker 1

We are actively engaged on this process and aiming to submit the market authorization application as early as possible in 2024. Full data from the Blaucomazine in Alzheimer's disease Phase twothree randomized clinical trial is forthcoming and will be published in an upcoming peer reviewed journal. Also, we'd like to mention that open label extension 96 week trial, attention AD is ongoing. Top line data from ANAVEX 273 RA03 Phase twothree excellence pediatric clinical trial was announced last month. We intend to further assess the results and discuss with the regulatory authorities next steps.

Speaker 1

A high enrollment rate into the OLE Open label extension of over 91% as well as the high level of requests for the compassionate use program of 93% Provide solid numerical evidence for the positive real world evidence reported by patients and their caregivers with Rett syndrome under compassionate use Authorization. Previously, we announced the first entire clinical gene pathway data from the ANAVEX2-seventy three RS-two AVATAR Rett Syndrome trial. We believe that this is the first time a home genome exome analysis Comparing drug and placebo in patients with Rett syndrome was performed. And we believe the results confirm That Rett syndrome is indeed a neurodevelopmental disorder with a key metabolic component, which can be addressed with therapeutic intervention And it's likely relevant for other neurodevelopmental diseases as well. Related to ANAVEX-three Senduran, Our second clinical small molecule, we were pleased to announce the initiation of the U.

Speaker 1

S. FDA cleared placebo controlled Phase II trial of ANAVEX-three seventy one for the treatment of schizophrenia, which is expected to begin in the Q2 of calendar 2024. Regarding the Parkinson disease program, we are in preparation to initiate the ANAVEX-two seventy three imaging focused trial and ANAVEX2-seventy three Phase 2bthree 6 months trial. For Fragile X, We believe new disease specific translatable and objective biomarker data generated recently with ANAMX-two seventy three should be strengthening the support for the initiation of the potentially pivotal ANAVEX2-seventy three Phase twothree clinical trial in Fragile X. Related to a new rare disease, we are also in preparation to initiate a potentially pivotal ANAVEX 2CIM3 Phase twothree clinical trial.

Speaker 1

We're also expecting further peer reviewed clinical publications involving ANAVEX2-seventy three and ANAVEX3-seventy one. Last month, We announced a new peer reviewed publication in clinical pharmacology and drug development, findings from ANAVEX371, first in human study, which are key achieved its safety objectives. The publication is entitled population based characterization of the pharmacokinetics and food effect of ANAVEX371, a novel sigma-one receptor and allosteric M1 musculinic receptor agonist in development for treatment for frontal deple dementia, schizophrenia and Alzheimer disease. The publication reports pharmacokinetic dose proportionality of ANAVEX371 in humans and food had no effect on the PK of ANAVEX This is very good news. And this data also expands the safety objectives met in this first in human study of ANAVEX371, further supporting its drug development program.

Speaker 1

And lastly, also last month, we announced the expansion and strengthening of our patent portfolio with the United States Patent and Trademark Office, rented a new U. S. Patent entitled Neurodevelopmental disorder therapy from the United States Patent and Trademark Office. ANAVEX newest patent expands coverage of ANNREX2CYM3 therapy to ameliorate various conditions associated with loss of function mutations of the gene encoding And now I would like to direct the call to Sandra Boenisch, Principal Financial Officer of Anavex for a financial summary of the recently reported quarter.

Speaker 2

Thank you, Christopher, and good morning to everyone. I'm pleased to share with you today our Q1 financial results for our 2024 fiscal year. Our cash position at December 31 was 143,800,000 During the quarter, we utilized cash and cash equivalents of $7,300,000 to fund operations. At our current cash utilization rate, we believe we continue to have sufficient cash runway to fund operations and clinical programs beyond the next 4 years. During our most recent quarter, general and administrative expenses were $2,600,000 Which is consistent with the immediately preceding Q4 of fiscal 2023.

Speaker 2

Our research and development expenses for the quarter were $8,700,000 as compared to $10,000,000 for the most recent Q4 of fiscal 2023. And lastly, we reported a net loss of $8,600,000 for the quarter or 0 point 11 dollars per share. Overall, we plan to continue to be fiscally responsible, And we believe we continue to have sufficient cash runway to fund operations and clinical programs beyond the next 4 years. Thank you. Back to you, Christopher.

Speaker 1

Thank you, Sandra. Not only have we demonstrated to continue to be fiscally responsible, but this is also an exciting time for the company And we're very excited to be entering a new phase of the company's history with our biomarker driven precision medicine programs. I would now like to turn the call back to Clint for Q and A.

Operator

Thank you, Christopher. We will now begin the Q and A session. If you have a question, please raise your hand or enter it into the Q and A box. Our first question is coming from Jones Research, and I'm assuming this will be Sumit Roy.

Speaker 3

Hi, Clint. Hi, everyone. Thank you for taking my question. A few on the timeline point of view for the Alzheimer program. What is the expected time for submission of the publication for the Alzheimer's data?

Speaker 3

And When are you thinking to get the submission for the European filing done this year?

Speaker 1

Both are in progress, and we cannot provide timelines because the papers Review process is not in our hands, the timelines. There are different average times for these. So it's hard for us to assess it, but I think we are in the right path here. Regarding the EMA submission, we said that We like to do this as soon as possible in 2024 and that's exactly what we're doing. So we are really very Active on preparing every module and to submit it.

Speaker 3

Should we expect these to be first segment,

Speaker 1

I would rather say we try to do our best. I would we will provide an update once it is submitted, But it's really not easy for us to commit to something and we like to do that as soon as possible and we will update Everybody wants it submitted. Good news and also this happens in a dialogue, so it's not just in a vacuum. So the submission is in a dialogue with the agency and that's kind of like also is important.

Speaker 3

Understood. A similar question on the timeline for The OLE data or any other update we're going to get from the AZAMR trial?

Speaker 1

So the OLE data is The OLE is ongoing. So there's always a possibility for doing an interim analysis because it's open label extension study, But the OLE study is ongoing, it's just needed to provide additional safety data. So it's really like the focus is on that.

Speaker 3

Algo, switching to the RET program, two questions. 1 is, If you can provide us some kind of detail on what's the difference between your trial and ACADIA's trial, The reduction in the given the placebo arm or the treatment was much pronounced in your trial, does that mean the baseline characteristic was very Different in the enrolled patient? And the second is, you saw a quick early 4 week, Possibly a clinical benefit, but then it kind of waned away at the 12 week time point. You see as a pharmacokinetics or a dosing issue?

Speaker 1

No, I think if I can start with the last part, there's not such a thing. Actually, the trial was really showing a Extremely nice improvement score in the active arm with over minus 12.9 In our analysis, which is extremely strong and trofinetide showed only an improvement in the active arm of minus 5.1. So we showed a stronger signal in the active arm. What happened was in our Trial, the placebo also improved. And in the trofinetide, the placebo did not improve.

Speaker 1

So that is basically really the difference. So the standard error, so the variability of the scores was much higher in our trial Then in the trofinetide trial, and we laid out several factors why that is possible. And we now understand exactly what happened and we can factor that in the explanation very, very, very nicely. It's really like the variability of the trial, the noise, if you like, was much higher in our trial. Let's not forget, we had a smaller study.

Speaker 1

We also had a Phase twothree, it was not a pivotal study, Phase 3. And also we had just A 2 to 1 randomization with 60 patients or 62 in the active arm and 30 in the placebo arm. In these 30 patients, if a few of them are just basically very noisy, that could derail and increase the noise in the trial and increase the standard error, which we saw in our trial.

Speaker 3

So should we expect that rates still being Kind of one of the primary focuses for the company and maybe one path forward would be to start a fresh Pivotal trial with 180 patient, 1 to 1 randomized kind of the Acadia size trial?

Speaker 1

That is a very good point and it's exactly A possibility. And again, we would not do that, however, without further get regulatory input because We might get some feedback, which could be very favorable. But indeed, that is something which could be done very easily. It's a 12 week study. It's not too long.

Speaker 1

And we have again a strong interest from the community given the strong interest in to continue to stay on study drug And patients in Rett Syndrome from our program have been now on this drug for over 4 years, up to 4 years. That really shows very High, sticky interest to keep our drug and not to switch to anything else in the meantime. Understood.

Speaker 3

Thank you again for taking the questions and congratulations on all the comments.

Speaker 1

Thank you.

Operator

Looks like our next call comes from Tom Bishop with BI Research. Go ahead Tom. Hi.

Speaker 4

Can you hear me?

Operator

Yes. Go ahead.

Speaker 4

Good. Where do you stand with the FDA As far as Alzheimer's goes, I was really pleased with the news about the EMA. But what about the FDA?

Speaker 1

Yes. It's a great question. We actually have noticed that last night, we saw the release from Eisai And the pickup of the antibodies of lecannubab was relatively, I would say, muted. So we saw that in the last quarter, they were not able to reach their target numbers of patients On drug in the market and they basically stated that they I have reached a very limited amount of number of patients on the drug. That tells us that the antibodies indeed seem to be Not easy, well received in the community or the procedures are very cumbersome or the pet Centers are not able to accommodate patients or the MRI centers are not able to schedule at a time.

Speaker 1

So it's a combination of factors, which I cannot really talk about, but seems to be really not an easy task. And this gives us actually probably an interesting position from a Timing perspective to prepare now a dialogue with the agency to share our data With a small molecule, which has the advantage of being easy administrable, does not have any Challenging procedures, you don't need a PEP study upfront, you don't need an MRI study upfront or during the treatment. And you can just go to the physician and be assessed and have Alzheimer disease. And the physician will say, take this Capsules or pills then come back in a few weeks or months again. And so this is really a big advantage From our procedure, there's also no requirement to have a demonstrated level of abeta in the brain, Because in our study, it was not required.

Speaker 1

We measured A beta in the brain, but it was not an entry criteria. So the entire population of the Alzheimer Population in the world, including every region would be basically The entire population would be something ANAVEX2-three, black carmesan could be considered as a target population, while the antibodies Only can target patients with MCI in a certain level or threshold of a bet on the brain. And it turns out not all patients with Alzheimer have that threshold, that high threshold of a bet on the brain. So they would not be eligible for a antibody treatment. So that basically means that the available Population Alzheimer disease is much larger for Blakarmesin to penetrate than for the antibodies.

Speaker 1

So this is a long winding answer. So we are proceeding with this dialogue.

Speaker 4

So would do you Plan perhaps to speak to the FDA soon or are you scheduled to or have you already to make

Operator

your case?

Speaker 4

You are playing that. You are playing that.

Speaker 1

What I've just said and the timing could not be better.

Speaker 4

Okay, great. And as far as Rett goes, what I sort of heard you say was Given that the data for A273 was even better than the drug that recently got approved, Except for how the placebo went, is it possible that the FDA might just go ahead and encourage you to file for approval Based on this data?

Speaker 1

We don't know and everything is possible. That's why we said we want to reserve and analyze the data completely and then discuss this with the agency and then we take the next step from there. So but we cannot promise anything. But again, as I mentioned before, there's a very easy way to address this as a backup plan to have just another study, a 12 week study And putting in place all the features, which would not allow for a placebo response as we have seen Larger study, similar size to trofinetide and also other features which can be included.

Speaker 4

How big was the study again?

Speaker 1

Pardon me? 12 week?

Speaker 4

How big was it, Dilo?

Speaker 1

180 patients? 180 patients, I think, About 180 patients in total. So randomization, 90, 90 active arm placebo equally randomized.

Speaker 4

Okay. Our prior Phase

Speaker 1

II study was Phase IIIII study was half of this size with a caveat that we had only 30 patients in And these measures are very noisy, as we have noticed. And so unless you get unblinded, maybe They are noisy, and they're just not measures which are perfect. That's what we noticed. But there are ways to address it to avoid this noisiness. And now we can implement that.

Speaker 4

Okay. Well, Godspeed. Thank you.

Speaker 1

Thank you.

Operator

So I don't see any other questions at this time. Doctor. Myssen?

Speaker 1

Thank you. Again, this is exciting progress in the field relating to treating neurodegenerative diseases, highlights the significant potential for our broad therapeutic portfolio and differentiated precision medicine platform To deliver easy access and scalable treatment options demonstrated by the initiated process of marketing authorization application to the European Medicine Agency, EMA, for Blartamezine related to the treatment of Alzheimer disease. We continue to focus on execution and commercial readiness as we advance our therapeutic pipeline to potentially improve patients' lives living with neurodegenerative, neurodevelopmental disorders And schizophrenia. Thank you.

Operator

Thank you all for participating today. This concludes our conference. You may now disconnect.

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