ACADIA Pharmaceuticals Inc (ACAD) 2007 Q1 法說會逐字稿

Good day, ladies and gentlemen,, and welcome to Acadia Pharmaceuticals Q1 2007 Financial Results Conference Call. [Operator Instructions] I would now like to turn the presentation over to Ms. Lisa Barthelemy, Director of Investor Relations at Acadia Pharmaceuticals, who will review the Company's forward-looking statements. Please proceed.

Thank you. Good afternoon and welcome to Acadia Pharmaceuticals' first quarter 2007 financial results conference call. This call is being recorded and an archived copy will be available on our website at www.acadia-pharm.com through May 22nd.

Before we proceed, I would first like to remind you that during our call today we will be making a number of forward-looking statements, including statements regarding our anticipated financial results and research and development programs. These forward-looking statements are based on current information and expectations that are inherently subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors and other risks associated with our business can be found in our filings made with the SEC, including our annual report on Form 10-K for the year ended December 31, 2006 and subsequent filings. You are cautioned not to place undue reliance on these forward-looking statements, which are made only as of today's date. Acadia disclaims any obligation to update these forward-looking statements.

It is now my pleasure to turn over the call to Dr. Hacksell, our Chief Executive Officer.

Thank you, Lisa and let me take this opportunity to thank all of you for joining us on today's conference call. Also joining me today from Acadia are Dr. Roger Mills, our Executive Vice President of Development, and Tom Aasen, our Chief Financial Officer.

I will begin today by covering some of our recent highlights and then I will ask Tom to review our financial results for the first quarter. Following these remarks, we'll provide an update on our clinical programs. We will then open the floor to your questions.

We're off to a very strong start to the 2007 year. During the first quarter, we announced exciting top line results from our Phase II trial with pimavanserin as a co-therapy for schizophrenia. The results demonstrated compelling clinical advantages of co-therapy with pimavanserin, including enhanced efficacy and accelerated onset of antipsychotic action and an improved side effect profile. Pimavanserin is the recently approved nonproprietary name for our drug candidate previously referred to as ACP-103.

Meanwhile, we have also made major progress with our final preparations to initiate the first Phase III trial in our program with pimavanserin for Parkinson's Disease (PD) Psychosis (PDP) and our Phase IIb trial in our program with 104 for schizophrenia. I'm pleased to report today that we remain on track to initiate both of these important trials during this quarter.

In addition to our clinical progress, we significantly strengthened our balance sheet through our successful public offering in April 2007. This financing positions us well to further advance our proprietary clinical pipeline. We look to continue this momentum throughout 2007.

I'm also pleased to report that we have made good progress with the full analysis of the data from our pimavanserin Phase II co-therapy trial and we expect to complete the analysis later this quarter. Following this, we will start to explore potential strategic alliances to optimize the commercial opportunity for pimavanserin co-therapy in schizophrenia.

We also have been evaluating potential venues to present the clinical data and we intend to present this at a scientific conference later on this year

Before we review our clinical programs and our upcoming milestones in more detail, I will ask Tom Aasen to discuss our recent financial results.

Thank you, Uli, and good afternoon. I'll provide you with a brief overview of our financial results for the first quarter of 2007, which were reported in our press release and Form 10-Q issued earlier today.

Once again, I'm pleased to report that our financial results for the quarter were in line with our expectations and continue to reflect our plan to invest in our proprietary clinical pipeline. We reported a net loss of $12.6 million, or $0.42 per common share for the first quarter of 2007, compared to a net loss of $9.5 million or $0.39 per common share for the first quarter of 2006.

Our cash and investment securities totaled $69.9 million at March 31, 2007 compared to $83.3 million at December 31, 2006. Following the end of the first quarter, we raised an additional $96.1 million in net proceeds from our public offering in April 2007.

Let's briefly look at some of the components of our first quarter results.

Our revenues totaled $2.0 million for the first quarter and were once again comprised of revenues from our collaborations with Sepracor, Allergan and the Stanley Medical Research Institute. This compared to total revenues of $2.5 million in the first quarter of 2006.

R&D expenses totaled $12.3 million for the first quarter of 2007, including $904,000 in stock-based compensation, compared to $9.7 million for the first quarter of 2006, including $551,000 in stock-based compensation.

The increase in R&D expenses was primarily due to increased costs associated with the our advanced clinical programs, including external development costs, as well as costs related to expansion of our internal development organization.

G&A expenses totaled $3.2 million for the first quarter, including $370,000 in stock-based compensation, compared to $2.7 million for the first quarter of 2006, including $349,000 in stock-based compensation. The increase in G&A expenses was primarily due to increased patent costs and other professional fees, as well as costs associated with expansion of our administrative infrastructure.

Finally, let me update you on our cash position and outlook. As I previously mentioned, we closed the first quarter with a total of $69.9 million in cash and subsequent to year-end, we added $96.1 million in net proceeds from our public offering, which closed in April. With this financing, we have established a solid cash position and significantly extended our cash runway.

We believe that we are well positioned to continue to advance our proprietary clinical pipeline and prepare to explore strategic alliances in our co-therapy program.

As it relates to guidance, we do not anticipate significant changes in our planned cash burn for 2007 and we expect that our cash and investment securities will be greater than $120 million at December 31, 2007. We believe that our existing cash resources, including expected payments from our collaborator, will be sufficient to fund our operations through 2009.

With that, I'll now turn the call back over to Dr. Hacksell.

Thank you, Tom. Let me now review our programs in more detail.

Acadia's pipeline includes five clinical programs. As I mentioned earlier, we reported positive top line results in March from our Phase II trial with pimavanserin, Acadia's novel and selective 5-HT2A inverse agonists, as a co-therapy for schizophrenia.

In our most advanced program, we are entering Phase III development with pimavanserin for the treatment of PDP. We also have two proprietary Phase II stage clinical programs, including ACP-104 for the treatment of schizophrenia and pimavanserin for the treatment of sleep maintenance insomnia (SMI).

We have retained worldwide commercialization rights for all four of these proprietary programs. In addition to this internal pipeline, we have a neuropathic pain program in Phase II clinical trials in collaboration with Allergan.

Let me start by discussing our clinical program where we are developing pimavanserin as a co-therapy to be used together with existing antipsychotic drugs to improve the treatment for schizophrenia. The top line trial results from our Phase II schizophrenia trial announced in March were positive, robust and clearly demonstrate the number of important advantages of pimavanserin co-therapy. Let me briefly review with you the key highlights.

This large, double-blind, placebo-controlled trial included a total of 423 patients and evaluated co-therapy with pimavanserin when used together with risperidone, the commonly prescribed atypical antipsychotic drug, or haloperidol, a generic typical antipsychotic drug.

Both pimavanserin co-therapy arms demonstrated statistically significant antipsychotic efficacy as measured by the reduction in the Positive and Negative Syndrome Scale, known as PANSS, the primary end point of the trial.

In addition to meeting these primary end points, pimavanserin co-therapy, with low-dose risperidone, demonstrated a statistically significant enhancement of antipsychotic efficacy compared to the risperidone low-dose arm. Importantly, pimavanserin co-therapy with low-dose risperidone demonstrated comparable antipsychotic efficacy to the high-dose risperidone arm, along with a number of compelling benefits.

Pimavanserin co-therapy provided a significantly faster onset of antipsychotic action. About 50% more patients in the pimavanserin and risperidone co-therapy arm responded to treatment, which was defined as a 20% reduction in PANSS after only two weeks of therapy, as compared to patients in the high-dose risperidone arm. And I should add that this significant benefit was observed at the time of treatment when patients are typically hospitalized and are undergoing what can be the most critical and expensive aspect of medical care.

Additionally, pimavanserin co-therapy with low-dose risperidone showed 50% less weight gain and significantly lower prolactin levels, as compared to the high-dose risperidone arm. Weight gain and elevated prolactin levels are debilitating side effects of many existing antipsychotic drugs and may adversely impact patient compliance and health.

Following our announcement, we provided the medical community with a first look at the top line data from this trial with a presentation at the International Congress on Schizophrenia Research held at the end of the first quarter. We were very pleased to see the overwhelmingly positive and enthusiastic reaction among the scientists and medical thought leaders who attended the conference. We plan to follow-up this initial presentation with a more detailed presentation of the data at a suitable conference venue later this year.

The completion of the study finalizes our Phase II program for pimavanserin for schizophrenia. Roger and his team have made great progress in conducting the full analysis of the data from this co-therapy trial and we anticipate completing our analysis later this quarter.

We see significant value in our pimavanserin co-therapy and upon completion of the full analysis of the trial, we intend to start exploring potential strategic alliances to optimize the commercial opportunities for pimavanserin co-therapy in schizophrenia. We believe that pimavanserin has the potential to change the way schizophrenia is treated today, by providing a therapy with enhanced antipsychotic efficacy and an improved side effect profile.

Let me now turn to our most advanced program, which is pimavanserin as a treatment for PD or PDP. PDP is a debilitating neuropsychiatric disease that occurs in up to 40% of patients with PD and is the most common factor leading to nursing home placements of these patients. There currently is no drug approved in the U.S. for the treatment of PDP.

I'm pleased to report that our PDP development team is now completing the final preparations to initiate the first of two planned pivotal trials in our Phase III program for PDP. We remain on track to initiate this trial during the second quarter of this year.

Let me take a moment to read you the design and key objectives of this trial. This multicenter, double-blind, placebo-controlled Phase III trial is expected to enroll about 240 patients. Patients will be randomized to three different study arms, including two different doses of pimavanserin and one placebo arm. Patients will receive oral doses of pimavanserin or placebo once daily for six weeks, in addition to stable doses of their existing dopamine replacement therapy.

The primary end point of the trial is antipsychotic efficacy as measured using the Scale for the Assessment of Positive Symptoms (or SAPS). Motoric tolerability will be an important secondary end point in the trial and will be measured using the Unified Parkinson's Disease Rating Scale (or UPDRS). We designed this trial following a productive end of Phase II meeting that we held with the FDA in the fall of last year.

We plan to run the two pivotal trials in a staggered fashion, meaning that we'll dedicate resources to getting the first trial up and running and then plan to initiate the second pivotal trial. In doing so, we can dedicate resources and focus on the first trial to enhance our execution while also seeking to compress the overall development timeframe.

We also plan to conduct open-label extension studies in connection with our efficacy trials in order to help meet our safety requirements and to offer continued options for these patients.

We remain very excited about PDP program and the potential for pimavanserin to be the first effective treatment for this debilitating disease. We believe that pimavanserin will clearly differentiate itself from off-label use in antipsychotics by effectively treating the psychosis in patients with PD, without impairing motor functions or having further side effects.

From a strategic point of view, we see the applications of pimavanserin as a co-therapy for schizophrenia and as a treatment for PDP to be highly complimentary. Our strategy is to retain commercial rights to pimavanserin in North America for PDP, a high value specialty indication, while we seek to complete late-stage development and commence facilitation as a co-therapy in schizophrenia in collaboration with a partner.

Following the positive results from our Phase II co-therapy trial, we have prioritized our opportunities for pimavanserin around our two programs for schizophrenia and PDP to ensure that we take the necessary steps to optimize our commercial opportunities in these areas.

As a result, while we believe that SMI is also a very interesting potential commercial application for pimavanserin, we are currently reviewing the design and timing of additional studies we may pursue to further explore the potential of pimavanserin and other drug candidates from our serotonin program as a treatment for SMI

Let me now turn to our other schizophrenia program, ACP-104, which is a standalone treatment for schizophrenia. We believe that ACP-104 has the potential to be a major step forward in the treatment of schizophrenia. Current treatments are generally not effective in addressing negative symptoms and are also not effective or may, in fact, exacerbate cognitive disturbances associated with schizophrenia.

ACP-104's unique pharmacological profile, combining M1 muscarinic agonists, 5-HT2A inverse agonists and D2 and D3 partial agonists, may provide an atypical antipsychotic efficacy profile with the added advantage of it improving cognitive functions in patients with schizophrenia. As you are aware, we completed three initial studies of ACP-104 in patients with schizophrenia last year, which has provided the foundation for our upcoming Phase IIb clinical trial.

Let me briefly read you the design of our Phase IIb trial. The trial is a multicenter, double-blind, placebo-controlled, six-week study. Patients in this trial will be randomized to three different study arms, which will include two different doses of ACP-104 and one placebo arm.

The primary end point will be antipsychotic efficacy, as measured using the PANSS. We have made major progress and are now finalizing our preparations for this study. We remain on target to commence the trial in the second quarter of this year.

In addition to the significant progress that we have made in our clinical programs, we continue to advance our preclinical and discovery programs. Our broad serotonin platform stands out as an especially valuable asset. In early 2007, we nominated ACP-106, a potent and selective 5-HT2A inverse agonist as a new clinical candidate. We believe ACP-106 and other compounds in this platform may enable Acadia, alone or in collaboration, to address what we believe is a range of exciting commercial opportunities.

In closing, we have had an outstanding start to 2007. We look forward to continuing this momentum throughout the year, as we transition to a Phase III stage Company in our PDP program and advance our Phase IIb trial with ACP-104 in schizophrenia.

Meanwhile, we are well on our way to completing the full analysis of our Phase II pimavanserin co-therapy trial, after which we will start to explore potential strategic alliances for pimavanserin co-therapy in schizophrenia.

I strongly believe that Acadia is uniquely positioned to play a leadership role in providing the next generation therapies for patients who suffer from neuropsychiatric diseases and other synapse disorders.

That completes our update and we will now be happy to entertain any questions that you may have.

Thank you [Operator Instructions] Your first question will come from William Ho of Banc of America Securities. Please proceed.

Hi guys. Congratulations on the quarter. A quick question with respect to 104 in schizophrenia. Can you just review - I think I may have missed it - how long is the dosing period and how long do you expect the trial to take?

So maybe you can take that question, Roger?

Yes. The dosing period will be pretty standard. It will be a six-week study or the dosing period will be six weeks, so it'll be the standard lead and follow-up. How long will it take to run the program? I think we saw, with the 008, the co-therapy study that the enrollment was reasonably quick and we would expect a similar enrollment in the 104 study. So, hopefully, we would complete the enrollment into the study next year.

Okay and then one last question with respect to 103 - sorry, I can't pronounce the new name yet --.

Pimavanserin.

Okay. The new name for 103, the partnership. Do you expect to complete a deal by the end of this year?

We do not comment on partnering discussions or timing, of course. But I can tell you that we are extremely excited about the potential of pimavanserin co-therapy to provide the next generation therapy for patients who suffer from schizophrenia.

As we mentioned earlier, we are well on our way to complete the full analysis of the co-therapy trial and when we are done that we will start to explore potential strategic alliances for pimavanserin co-therapy in schizophrenia. We intend to carefully explore our commercial opportunities and focus on securing the right commercial deal for Acadia. That's what we can say now and I also want to mention that we are very excited about this opportunity.

Great. Thank you.

Michael King, Rodman & Renshaw.

Good afternoon, guys. Thanks for taking my question. On pimavanserin - see, I can say it - I guess a follow on to Will's question about partnering. I wonder in your decision matrix, as you look at it, do you feel that the asset is sufficiently de-risked to induce a partner to come in on terms that are the most favorable to Acadia and its shareholders? Rather than perhaps push it forward a little bit further, maybe in combination with other antipsychotics or such other measures to more fully explore its therapeutic benefit before partnering?

Good question, Mike. So we have all the time seen that we want to complete the Phase II program with pimavanserin and that the completion of that program corresponds to what, from our point of view, is the optimal value state.

And the reason for that is that schizophrenia is a very special kind of a market place. In order to be successful in schizophrenia you need, really, to have a large and powerful marketing effort and you need to ensure that your Phase III development program is consistent with a successful marketing strategy. So, therefore, from a strategic point of view, it's very important to have input from the partner in the full design of the Phase III program to ensure that we really optimize the value of the drug on the market.

We also think that with the co-therapy drug that was just completed we have demonstrated, very convincingly, both safety and efficacy of co-therapy therapy with pimavanserin. And in fact, we saw one unexpected and very interesting thing in the study, which was related to the accelerated onset of co-therapy with pimavanserin. So we are excited about all the data that we have generated on pimavanserin and we think it's sufficient.

Okay and if I just might follow-up -- hang on just a second. I lost my note to myself. Can you talk about -- so you've got pimavanserin also in the clinic or will move it forward in SMI and so I'm wondering how do you differentiate the product for SMI versus co-therapy of schizophrenia?

Another very good question, Mike and this is clearly an area where we want to have detailed decisions with the potential partner in order to find out exactly how to proceed. These are commercial decisions that will need to be made, not only by Acadia but also by our partner.

Are the doses sufficiently different from one another or are they around the same?

That remains to be established. We don't have the final answer of that yet.

Were you contemplating starting the SMI, what doses are you contemplating starting the SMI studies at?

Well, we haven't made any decision yet on what doses to use for a sleep study with pimavanserin. Again, that's one reason why we are carefully evaluating the design of the next studies to be done here. For example, clearly we need to think about not only what doses to use in the sleep study, but also what patient population to use to ensure that its maximally compatible with the other Phase III studies that we have ongoing.

Understood. Okay, thanks very much.

Thanks, Mike.

Ted Tenthoff, Piper Jaffray.

Great, thank you, and I apologize if this question has already been answered or if you discussed it in the opening remarks. There's a little bit of static on the line. But just quickly, how are you guys proceeding through on the analysis of the ACP-103 data and when do you think we'll learn more about the safety benefits that we've seen versus the high dose risperidone group? And also, can you kind of give us any update in your thinking with respect to what may be going on with respect to the early onset of activity?

So maybe you can answer that, Roger?

Yes. So, in terms of how the progress is going, it's going very well indeed. It's going according to plan. I think we expect to be able to complete that analysis this quarter and then pull that together into a report. I can't really share any more of that.

What we would like to do is to -- I think as Uli mentioned during the call earlier, is them put that together into a presentation and submit that to one of the major meetings, which is coming up later this year, where we'll obviously then outline the standard presentation format of the study.

And to answer your question about the accelerated onset of action, I think that's very interesting, because that was an unexpected finding in this study and we saw it in both co-therapy arms. And of course the fact that we had the 50% more responders in the co-therapy arm with low-dose risperidone than in either low-dose risperidone or high-dose risperidone was very, very impressive.

Now one can speculate about why we have this important advantage in the co-therapy arm. We don't have a finalized and proven mechanist for that. But we do expect or we do believe that the pharmacokinetics properties of pimavanserin, which includes a very long duration of action, in fact may contribute to the accelerated onset of action by providing an essentially continuous block of the 5-HT2A receptor throughout the 24 hours of the day. That's something that is quite unusual among antipsychotic [inaudible].

Excellent. Well, thank you so much.

Thanks.

Charles Duncan, JMP Securities.

Good afternoon, guys. Let me add my congratulations on a well-done quarter.

Thanks.

A quick question for you, Uli, on ACP-106. Could you help us understand why you're pursuing that compound? Is it just a backup or does it have some differentiated pharmacologic or otherwise activity?

It's a compound that has relatively similar pharmacodynamic properties as pimavanserin. It's slightly different in terms of its pharmacokinetics, we believe, but we still haven't tried it out in humans, so that remains to be established. We think that it will serve as an excellent drug opportunity for us to more fully explore all the different indication areas where we see opportunities for a drug with this protocol mechanism of action.

Because the 5-HT2A receptor can be blocked, really, without inducing any side effects, we think that this is such an usual feature. And since the prefect can reset disturbed kinds of balances in the brain by blocking this receptor, we think that there are many additional opportunities outside schizophrenia, PDP, and also sleep that are interesting to pursue and explore with 106. And behind 106, we have a broad range of additional potential candidates that we may decide to take forward as well into the [inaudible]. So this is a great asset for Acadia.

And then, Uli, moving onto ACP-104 and its hematological tox -- or not its hematological toxicities, but that of clozapine. Help me understand what you think the minimum number of patients would be required in terms of exposure to start to be able to show a signal or not? When do you start to get comfortable with that and importantly, when would would-be partners start to get comfortable with that profile of ACP-104 versus clozapine?

Yes. So, first of all, we expect to get an initial signal already following our Phase IIb study and that signal will show if we have less leukopenia propensity with 104 than you see with clozapine. That signal, we think, will be quite interesting and valuable. In the end, in order to convince the FDA that we cannot cause agram (agrammatologia) with 104, we will need to complete the whole registration program.

So, specifically, you think that out of the ongoing Phase IIb you might be able to get some clear insights on leukopenia, whether or not --?

Yes, absolutely, then because it's well known, Charles, that clozapine causes leukopenia in about 8.0% of the patients. And so with the kind of size of this trial, which will include 160 patients that are treated with two different doses of 104 for six weeks, we will certainly be able to say whether we are, as we expect and hope, we have less propensity to cause a leukopenia with 104 than what you would have seen with clozapine.

And do you think that that's pretty predictive?

We know that in the -- when patients develop agram, the whole process starts with leukopenia.

Super. That makes sense to me. So we should be able to see that by the end of year, did you say?

I didn't say that. What, in fact, Roger said earlier on is that we expect to have a relatively good recruitment of patients since this is a schizophrenia trial and Roger said that he expected to have completed recruitment some time next year.

And that was just a little bit of challenge you put forward for me there, but I think the results are just in terms of the overall safety that one would require. There is precedence in this area with another structural analog of clozapine, which is olanzapine. So one wouldn't expect to have anything that would be markedly different from that.

That makes sense to me and I was just trying to raise the bar for you, Roger. Thanks.

Thank you.

Thanks.

[Jim Tamboli], Lehman Brothers

Hi guys. In terms of completing the analysis of the pimavanserin Phase II schizophrenia trial later this quarter, is the plan to go direct to scientific conference and if so, what venue should we be looking towards?

Well, the answer is yet. We should complete the analysis fairly soon, obviously this quarter. And then what we'll do is - we are doing, in any case - is looking at which conferences are available later in the year, the specific timing of when we would be required to submit an abstract and then determine which conference we will present at.

But I think one of the conferences within that category would be ACNP. We look at conferences in Europe as well, something which gives us or gives the study the appropriate venue to be presented at.

And then I guess just to follow-up on the top line results, we clearly saw some very strong results in combination with low-dose risperidone. But in terms of going forward, and certainly in speaking with potential partners once you complete the full analysis, what confidence do you have in the dose ranges of ACP-103 and the combination drugs that were pursued thus far? And then how do you see those results being extracted to other commonly used atypicals?

Thanks for a good question, first of all. We think that we have a very good situation here for different reasons, or for various reasons I should say. First of all, the results from the co-therapy trial came out very strongly, so we know that we have a significant enhancement of its efficacy and the number of side effect advantages in addition to the accelerated onset of action when we have ACP-103 -- or pimavanserin on the top of two mgs of risperdal. So that's a good starting point for us.

In fact, we had predicted that kind of results on the basis of preclinical studies in very small dose of pimavanserin co-therapy with all the different antipsychotic drugs that are used on the market. And that means that we can, on the basis of these clinical data and our predictive preclinical studies, make extrapolations to other uses of pimavanserin in co-therapy with antipsychotic drugs like Serequel, Zyprexa, Abilify and not only risperidone.

To account for the doses of pimavanserin on itself, we can rely on Positron Emission Tomography (PET) studies, but where we have demonstrated a very nice dose response for blockade of 5-HT2A receptors with pimavanserin. So all these data together provides us with a foundation to make extrapolations and predictions about what kind of doses we should use in Phase III clinical studies with different kinds of combination of pimavanserin and other antipsychotics.

Thanks for taking the question.

Alan Carr, Needham & Co.

Hi. It's actually, its Alan Carr in for Mark. Good afternoon, everyone.

Hi.

I had a question about the pimavanserin program in sleep maintenance. You mentioned that you were revisiting your timeline. I recall that maybe you guided for a Q2 start there. Can you tell us more about your thinking behind the change there?

Yes. So, first of all, let me say that sleep of course remains a very interesting opportunity for Acadia. But based on the very exciting results from our co-therapy trial, we have prioritized our opportunities with pimavanserin around the schizophrenia and PDP indications and we have done that to ensure that we capture the considerable commercial value of efficacy in these areas.

Therefore, we want to carefully evaluate the design of potential sleep studies and that includes doses, as we talked with Mike about recently, and also patient population, so, really, to ensure that we have a compatibility between the sleep study and the Phase III program for the other indications. And we also think it's important to look at this from the context of looking at sleep with other compounds in our serotonin program and that, of course, includes ACP-106.

Okay. Speaking of some of your other preclinical programs, can we expect some movement from like the 105 or 106 or cannabinoid programs into the clinic in the next year or so?

We haven't provided any guidance regarding specific timing here, but what we can say is that we are moving forward with all these different programs and we think we will provide more guidance when we are ready to file INDs around these compounds.

Okay. Thanks very much.

Thanks.

Jason Napodano, Zacks Investment Research.

Hi. Thanks for taking the question. A question on the Phase II trial that you completed in PDP last year. I believe there were a number of patients that enrolled in an open-label study and I was just wondering if we could have an update on the number of patients that are continued in that study.

Would you like to take that, Roger?

Yes. Sure. That's the Parkinson's study that we're relating to there, so, yes, we had an open-label extension to that study, which has been ongoing. In there, 24 patients have been treated with pimavanserin for at least a year. Eight of them have been treated for over 18 months now.

But can you give us a sense of the percent of patients that elected to continue into that open-label study? I believe there were, what, 52 people in the original trial?

Yes. So if I remember that correctly, I think we have, in fact, over 30 patients who enrolled in the open-label study.

Okay.

It's a rather pretty good uptake and I think that bodes us well for what we're going to see in the Phase III program in Parkinson's where we'll be offering a similar long-term follow-up study.

Got you. Just one further question. Is there an opportunity to, when you go look for a strategic partner for pimavanserin in schizophrenia, is there an opportunity to also out-license, I guess, to the same partner for SMI? Or would you be looking to keep that in-house until you complete at least Phase II trials?

An interesting question. I think probably the most realistic scenario is that the partner will want to have SMI, as well ad it's not unlikely that the partner also may take on the development of pimavanserin for PDP outside North America. But we will look at all these different options in the discussions with partners. We think that we have a very exciting time ahead for us.

Okay, thanks.

Thanks.

Joe Pantginis, Canaccord Adams.

Hi guys, thanks for taking the question, a quick follow-up on the SMI aspect. Is there any reason besides just financial resources and you just deciding on trial designs about pushing it out, per se? Are there any sort of internal scientific questions that you still need to address or mechanistic questions?

Not at all. I think, scientifically, it's quite straightforward and also, you may remember that we had very convincing data from our proof of concept study in older, healthy volunteers.

Okay. Thanks a lot.

Patrick Moriarty, Fortis.

Hi, good afternoon and let me add my congratulations for a productive quarter.

Thanks.

I actually had a similar question on SMI. So you haven't seen any sort of signal in any of the trials that would lead you to move away from there. Is it based on possibly relative pricing between the schizophrenia and SMI markets and therefore would you maybe look at ACP-106 in SMI and kind of move in that direction with a different molecule?

I think when one looks at the -- I think for us the key thing is to make sure that we have that full compatibility with the Phase III program. But clearly we look at all different aspects of pimavanserin and clearly we have ACP-106 as an additional opportunity to have as a follow-on, if you wish. But what we're doing now is we're taking a step back. We're looking at the sleep program in relationship to the other two programs and we want to also -- we would love to have some feedback on this from potential partners as well.

Okay. Thank you.

Thanks.

Michael King, Rodman & Renshaw.

I didn't queue back in.

William Ho, Banc of America Securities.

One more question with respect to the data on pimavanserin. I guess the data, with respect to risperdal, looked very strong, actually fell within historical norms of all the old trials. But the Haldol arm showed high variability, as did some of the older studies that we looked up. Do you have any explanation as to why that occurs?

Yes. I think it's quite straightforward. What we saw with two mgs of haloperidol in the study was say essentially full efficacy. So we have a ceiling effect. You cannot really increase the efficacy as measured by the PANSS more than what we saw with haloperidol alone. S

o we think that in order to observe an efficacy enhancement, one would need to have a study where one used a lower dose of haloperidol, together with pimavanserin. And that's, in fact, again, and coming back to our predictive preclinical models here, that we see that in preclinical models as well that you have a ceiling effect.

And then one other follow-up question on pimavanserin is you achieved equivalence with PANSS to the therapeutic dose of risperdal. Can you, by any chance, give us additional detail on how much of that was a benefit in the negative symptoms scales versus the positive symptoms scale?

Yes, we've not provided breakdown between the two. What I can say very comfortably is that the beneficial effects seen with the co-therapy was manifest in both the positive and the negative symptoms.

Great. Thank you.

Thanks.

There are no further questions. Dr. Hacksell, please proceed to closing remarks.

Well, thanks again to everyone for joining us on today's call and for your continued support. We certainly look forward to the opportunity to update you in the future on our ongoing process. Thank you.

Ladies and gentlemen,, thank you for your participation in today's conference call. This concludes the presentation. You may now disconnect. Good day.