Anavex Life Sciences Q3 2024 Earnings Call Transcript

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August 6, 2024

There are 5 speakers on the call.

Operator

At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. During this session, if you would like to ask a question, please use the Q and A box or raise your hand. Please note this conference is being recorded and the call will be available for replay on Anavex's website at www.anavex.com. With us today is Doctor.

Operator

Christopher Missling, President and Chief Executive Officer and Saundra Bernisch, Principal Financial Officer. 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.

Operator

These factors may include without limitation risks inherent in the development and or 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. And with that, I'd 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 continue to meaningfully advance our differentiated precision medicine clinical program, highlighted by the recent presentation of comprehensive results from the Phase IIbIII clinical trial, blood carmesine, ANAVEX2-seventy 3, which were presented at the Alzheimer's Association International Conference, AAIC, showing that oral once daily blood carmesine significantly slowed clinical decline for early Alzheimer disease, patients with good comparative safety profile and or associated neuroimaging adverse events. Full data from the Blacomysen study in Alzheimer's disease Phase IIbIII placebo controlled clinical trial will be published in an upcoming peer reviewed journal. The initiated process for submitting a marketing authorization application MAA to the European Medicine Agency EMA under the centralized procedure is underway with full regulatory submission of Placamazine expected in Q4 of 2024.

Speaker 1

The marketing authorization would allow direct market access throughout the European Union for oral blood clamsine for the treatment of Alzheimer disease. There are an estimated 7,000,000 people in Europe with Alzheimer disease, a number expected to double by 2,030, according to the European Brain Council. Analysis of RNA sequencing, RNA Seq, which would reveal which genes are actively transcribed or in other words expressed in Alzheimer patients in comparison between placebo and plakamizine of the placebo controlled Phase IIbIII plakamizine trial in early Alzheimer disease is underway. This data might have relevant value since it may provide insight into Alzheimer disease pathology and how cells function in the presence of placebo or in the presence of plaqueminesine respectively. Interim data is expected in the second half of twenty twenty four.

Speaker 1

In June, we completed the last patient last visit in the ATTENTION AD open label extension 96 week trial. Interim data from this trial is expected in the second half of twenty twenty four. The recent AAIC24 meeting resulted in constructive feedback, coupled with enthusiasm around our Alzheimer's disease program, strengthened by the recent addition of an experienced clinical team, which support Anavex future plans. Educational outreach will continue as we work towards MAA submission and beyond. We are also pleased to report that the clinical team continues to beat the planned timelines in the ongoing Phase 2 clinical trial of ANAVEX371 in schizophrenia patients.

Speaker 1

We have completed dosing of the first cohort and are nearing the completion of enrollment of the 2nd cohort of schizophrenia patients in path A of the trial. In Parkinson disease initiation of ANAVEX2-seventy three Phase 2bthree, a over 6 month trial including biomarkers, which we believe may be key for understanding drug effects on Parkinson's disease pathology and account for the recently changing context in the field of Alzheimer's disease is expected in the second half of twenty twenty four. In Rett syndrome an educational presentation was provided at the 2024 IRSF Rett Syndrome Scientific Meeting going from June 18 to June 19, 2024, which demonstrated the commitment of Rett Syndrome to the Rett Syndrome community through direct engagement with patients and families. Positive and supportive feedback was received from families and investigators about the continued ANAVEX Rett Syndrome Program. Regarding Fragile X, new disease specific translatable and objective biomarker data generated with ANAVEX2-seventy three supporting the initiation of the ANAVEX2-seventy three Phase twothreeclinic trial was presented at the 19 NFXF International Fragile X Conference.

Speaker 1

Meeting with the NFXF leadership team strengthened Anavex's relationship with community coupled with an increased awareness of Anavec's Fragile X Syndrome program by engaging with patients and families in attendance. We are also expecting the initiation of ANAVEXXY III Phase twothree clinical trial in a new rare disease in the future. Finally, we are building medical affairs capabilities to expand education and physician support activities to ensure optimal medical impact, including continued clinical publications involving ANAVEX2-seventy three and ANAVEX3-seventy one. And now I would like to direct the call to Sandra Boenisch, Principal Financial Officer of ANAVAX for our 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 Q3 financial results for our 2024 fiscal year. Our cash position at June 30th was $138,800,000 and we have no debt. During the quarter, we utilized cash and cash equivalents of $5,200,000 in operating activities after taking into account changes in non cash working capital accounts. At our current cash utilization rate, we believe we have a cash runway of approximately 4 years.

Speaker 2

During our most recent quarter, general and administrative expenses were $2,900,000 as compared to $2,800,000 for the immediately preceding second quarter. Our research and development expenses for the quarter were $11,900,000 as compared to 9,700,000 for the immediately preceding second quarter. And lastly, we reported a net loss of 12,200,000 for the quarter, which is $0.14 per share. Thank you. And now back to you, Christopher.

Speaker 1

Thank you, Sandra. In summary, we remain dedicated to developing medicines for individuals suffering from brain disorders within neurodegenerative and neurodevelopmental disorders, which could further expand our differentiated precision medicine platform to deliver scalable treatments coupled with convenient oral dosing. I would now like to turn the call back to Clint for Q and A.

Operator

Thank you, Christopher. We'll 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. And the first question comes from Tom Bishop, BI Research. Tom, you should be.

Speaker 3

Okay. I had a couple of questions. What are your plans to meet with the FDA or regulators in Asia, which you also alluded to recently, as you did earlier with EMA? And has the date been set for either? Or is there some sort of hold up or additional data you're waiting for?

Speaker 1

Thank you for the question. There's no hold up. There's only the focus right now on the EMA submission, which takes a lot of resources. We have to submit and put together a package of many modules, which is can be so many pages and documents. So we focus on that.

Speaker 1

But the time will come, we don't know yet when, to also meet regulatory bodies around the world, including the agency in this country as well.

Speaker 3

Okay. With regards to the recent presentation at the AAIC of the Phase IIbIII data, the question comes up with regard to varying number of patients included in different measures that the company presented. And I have assumed that you it's just simply due to the fact that you can't force patients in the trial to come in and take certain tests, especially more invasive ones, and this explains it. But of course, the dark side likes to claim cherry picking. So can you discuss this aspect and put the issue to rest as to whether you do anything with the data that's given?

Speaker 1

May I understand better to talk about the number of patients in each visit, scheduled visits?

Speaker 3

In the different things like Cog13 and whatever that you presented to the AAIC. So the number of patients, some of these.

Speaker 1

This is a time point. Yes. So the so this is a there is no other way to explain it that every patient does not always present at the time point in question. He can skip, He can be impaired because of COVID and this trial was during COVID. It's very normal.

Speaker 1

You just have to then always account for when you have a data point, and that's exactly described in the presentation. And when you look up other papers from Adewhelm, from lecannumab, dunanimab, they are exactly the same. Every number is different at every time point because they are not always the same amount of patients attending the visit. So that's a very common procedure.

Speaker 3

But you use the data exactly as given to you by the biostatistical firm and who was that?

Speaker 1

Yes, of course, there is no other way than to take every available data point. There is no other way to do that other than that.

Speaker 3

Okay. And I wanted to clear up or confirm for myself the so called the $150,000,000 stock offering that the various news headlined, That was just a shelf offering to be used as needed opportunistically in the future, correct?

Speaker 1

So the company has been extremely cautious with financing. We've been very conservative. While other companies spend ton of money, we've been very diligent on being very cautious with our fiscal responsible behavior. So what we did was just to make sure that one day in the future, when we do need more resources for market entry or other reasons that we have that in place. So it's not meant to be used today or tomorrow, but the opportunity will could arise, but it was just to put in place something, so we have it in place for the future.

Speaker 3

Okay. And regarding RED, is there a date to initiate another RED trial or

Operator

well, I'm not sure what was going on there?

Speaker 1

So we have had very good feedback from the conference I mentioned, and there's no date yet, but we proceed as we stated to do a larger study for Rett syndrome as well.

Speaker 3

Okay. And finally, with regards to Fragile ex, was there a phase 1? You mentioned going to a phase 2b3, I think.

Speaker 1

The Phase 1 was done with black carmesine with AUTOBEC2-seventy three already. So we can start into a Phase 2 because of the Phase 1 was already done prior to this because the drug was already tested in human healthy volunteers.

Speaker 3

Okay. And actually, I had one more. With regards to schizophrenia, can you remind us a little more or explain the 1st cohort, the 2nd cohort, Part A? Is there a Part B? I mean, could you just run through that again?

Speaker 1

Sure. So part a is a single ascending doses. So we test the tolerability and, of the patients for the first doses, lower dose and a higher dose subsequently, and the second higher dose is now almost completed enrollment. And the Part B will be a longitudinal study, run about I think it's 28 days or so. So the drug will be given at the dose which will be considered the best tolerated dose and we will then observe patients over a longer period of time.

Speaker 3

So the second dose is the higher dose? The second dose from Part A

Speaker 1

is the higher dose and Part B will be the dose which we choose once it starts. And it will be a longer trial of 28 days or 4 weeks basically.

Speaker 3

All right. Thank you.

Speaker 1

Thank you.

Operator

Thank you, Tom. Our next question comes from Suneet Roy at Jones Research.

Speaker 4

Good morning, everyone, and thank you for taking the question and also congrats on executing on multiple fronts. On the AAIC data, Alzheimer disease, could you give us a little color, make us understand on the dose dependency or the clear lack of dose dependency between 30 milligram and 50 milligram? There was ADAS COG was working a little better for the 50 milligram versus CDRS before the 30 milligram. And the discontinuation rate, are you so what percent of the 50 milligram did you see had to scale back to 30 milligram because of, adverse events in the open label extension?

Speaker 1

So, let me address the first question first. So the two arms are dose groups and we use also the expression for that reason. When you read our description and the presentation, we talk about the dose groups, 30 milligram dose group or 50 milligram group. So since we allow titration to the best tolerated dose for those two arms, as well as placebo by the way, we basically realized that the end of the day the target dose for most patients was relatively close to each other in those two arms. So while in the 50 milligram group, there were some with 50 milligram, there were also some with 30.

Speaker 1

So it was a bit higher than the 30 milligram group, but not by much. So they're pretty much close and that's why also pre specified the two arms together against placebo in a predefined analysis. So that was the background. So we have seen prior to that a dose response curve in our Phase 2a. So there's no doubt about that the dose response is confirmed.

Speaker 1

But what we now notice is that in this trial where we, and that's coming to the second part of the question, where we notice where we force patients to uptake trait to the target dose 50 very quickly within 2 weeks and then to 3 weeks, we noticed that didn't, was very well received. Some patients had some dizziness, and they wouldn't feel comfortable about it, so because they are not impaired patients, they're early Alzheimer, they felt saying, maybe we have COVID, I don't want to continue this. It was during the time of COVID, of course, as well. So that's why we had some dropouts at the higher dose more than in the lower dose group. So what we now realize when we did the open label study where we allowed a more, I would say, lenient and less stringent way of uptetration in also allowing patients to take the drug at nighttime instead of in the morning, which we've basically forced patients to take during the trial early in the morning.

Speaker 1

So we noticed that there was much higher tolerance for either dose, 30 or 50, as long as they were allowed to get used to the drug for a longer period of time. And we noticed that also in the compassionate use program, where there's extremely high tolerance with allowing patients to titrate to a 250 or 30 as long as they have enough time to do that and then taking also nighttime dosing. So we don't see the adverse events we have seen in this trial because we basically forced them to titrate so quickly up to the target dose. We also have to point out that it's actually a clearly manifestation of a manageable and addressable adverse event. It's not like when you look at brain bleeding or brain swelling from the antibodies, which we don't have, that no matter how you take the drug, you always will have 30 or more percentage of patients with that very dangerous side effects of a drug, of an antibody, which we don't have.

Speaker 1

But in our case, the adverse event of dizziness is a manageable one because it just depended on the titration schedule and that can be flexible changed, and that's what we now will, of course, do in the future. So that's the answer to your question. And also, needless to say that we are also acknowledging that, and we've heard that from physicians, that the dizziness sign, again, not all patients had that, we also have to put this in perspective, that it's a sign that shows penetration in the brain and shows that something's happening in the brain. Also, one last point I'd like to make that this dizziness lasted really relatively short for those patients who had it. It was sometimes between 7 to 11 days in the average.

Speaker 1

So it's a very, and a mild form of dizziness. So it's a very easy to address situation, but it shows up in this trial because, again, we forced patients to go to these high doses very quickly. And we learned the lesson that we can avoid that.

Speaker 4

That is really helpful, the color. Last question is, when should we expect the open label 96 week data? Is it CTAD or more towards the end of the year? And should we expect after that data you would approach the FDA with the entire packet submitted to European authority plus this open level or if you can provide any details there?

Speaker 1

Yes. So let us first put together data together. But once we have it, we will make the decision. But all your suggestions could be valid recommendations.

Speaker 4

Thank you and congratulations again on the progress.

Speaker 1

Thank you. Appreciate it.

Operator

That's all the questions for now, Doctor. Masson.

Speaker 1

Thank you. So in closing, we continue to focus on execution and commercial readiness as we advance our therapeutic pipeline to potentially improve patients' lives living with these devastating conditions. Thank you very much.

Operator

Thank you, ladies and gentlemen. This concludes today's conference call. We appreciate your participation and you can now disconnect.

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