Anavex Life Sciences Corp (AVXL) 2018 Q4 法說會逐字稿

Good afternoon. My name is Darrel, and I will be your conference call operator today. Welcome to the Anavex Life Sciences 2018 Fiscal Year-End Financial Results Conference Call. As a reminder, this call is being recorded.

I will now like to introduce your host for today's conference, Scott Gordon. Please go ahead.

Thank you, Darrel, and good afternoon, everyone. We appreciate you joining us today for Anavex Life Sciences' conference call and webcast. Our agenda is to review the company's financial results for 2018 fiscal year-end, provide a clinical study update and highlight recent corporate developments. The taped replay of this call will be available approximately 2 hours after the call's conclusion and will remain available for 1 month. The call will also be available for replay on Anavex' website at www.anavex.com.

With us today is Dr. Christopher U. Missling, President and Chief Executive Officer; Sandra Boenisch, Principal Financial Officer. Dr. Missling and Ms. Boenisch will make prepared remarks and then we will take questions from equity analysts.

Before we begin, please note that during this conference call, the company will make some projections and forward-looking statements regarding future events. We encourage you to review the company's filings with the SEC. This includes, without limitation, the company's Forms 10-K 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/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 would now like to turn the call over to Dr. Missling.

Thank you. I'd like to thank everyone for joining us on today's conference call to review our full year 2018 financial results and share with you our clinical updates for ANAVEX 2-73.

First, we were pleased to report that we have successfully activated 100% of all planned clinical study sites representing 20 clinical trial sites for the Phase II ANAVEX 2-73 Parkinson's disease dementia study. Enrollment and dosing of patients is currently proceeding as planned. The company has also successfully activated 75% of all planned clinical study sites representing 9 clinical trial sites for the Phase IIb/III ANAVEX 2-73 Alzheimer's disease study. Enrollment and dosing of patients is currently proceeding as planned.

Regarding the Rett syndrome first study in humans, we successfully initiated the first clinical trial site for the study and expect to add further planned study sites and to enroll the first patient within a short period of time.

Last month, Anavex announced the appointment of Dag Aarsland, MD, PhD to its Scientific Advisory Board. Dr. Aarsland is a distinguished researcher for clinical treatment of Parkinson's disease dementia. Anavex had recently announced that it has enrolled the first patient in its Phase II double-blind, randomized, placebo-controlled, 14-week safety and efficacy trial of ANAVEX 2-73 for the treatment of Parkinson's disease dementia. The Phase II study will enroll approximately 120 patients, randomized 1:1:1 to 2 different ANAVEX 2-73 doses or placebo.

Previously, Anavex announced that it had enrolled its first patient in its Phase IIb/III double-blind, randomized, placebo-controlled, 48-week safety and efficacy trial of ANAVEX 2-73 for the treatment of early Alzheimer's disease. The Phase IIb/III trial will enroll approximately 450 patients, randomized 1:1:1 to 2 different ANAVEX 2-73 doses or placebo.

In October, Anavex presented new clinical data for ANAVEX 2-73 in a presentation at the 2018 Clinical Trials on Alzheimer's Disease (CTAD) Meeting. At 148 weeks into the 5-year extended Phase IIa clinical study of ANAVEX 2-73, data confirmed a significant association between ANAVEX 2-73 concentration in both exploratory functional and cognitive endpoint as measured by the ADCS-ADL, Activities of Daily Living evaluation and the Mini Mental State Examination, MMSE, respectively.

The genetic biomarker signal, identified previously at week 57 of the study, was also confirmed at week 148. The data identified genetic variants within the SIGMAR1 and COMT gene with a significant impact on response of patients exposed to ANAVEX 2-73, specifically the genomic biomarker sigma-1 and the direct -- which is the direct target of ANAVEX 2-73 as well as COMT, a gene involved in memory function, on the drug response level was identified, leading to ANAVEX 2-73 specific biomarker.

The impact on the drug response levels of both the SIGMAR1 and COMT genomic biomarker were significant with p-value smaller than 0.008 and p-value smaller than 0.0014, respectively. All forthcoming ANAVEX 2-73 clinical study designs will incorporate the inclusion of these genomic precision medicine biomarkers identified in the ANAVEX 2-73 Phase IIa study. We are very excited as we embark on this next phase clinical trials as it could be a unique differentiating factor for Anavex in that we are incorporating a precision medicine paradigm approach.

Additionally, we continue to add staff members to our team so we can execute on our strategic objectives and meet our planned milestones.

And now I would like to direct you -- the call to Sandra Boenisch, Principal Financial Officer of Anavex, for a brief financial update.

Thank you, Christopher, and good afternoon, everyone. Our cash resources at September 30, 2018, were $22.9 million. We believe we are sufficiently capitalized to fund our objectives for the next 2 years given the support we receive from the Australian government and third parties.

During 2018, we used $12.6 million in cash for operations.

Operating expenses for the year were $19.3 million, which included $5.5 million in noncash charges compared to $15.7 million for 2017, inclusive of $4.1 million in noncash charges. The increase in operating expenses is primarily attributable to an increase in research and development expenses of $2.7 million due to an increase in expenses incurred in connection with our recently commenced clinical trials, including manufacturing costs and preparatory activities as well as additions to our scientific team.

The net loss for 2018 was $17.5 million or $0.39 per share compared to a net loss of $13.5 million or $0.33 per share in 2017.

Thank you. And now I'll turn it back to Christopher.

Thank you, Sandra. In summary, we believe that 2019 will be a year of execution, and we continue to maintain a strong balance sheet which will allow us to execute the current clinical studies for ANAVEX 2-73. We anticipate several key milestones and accomplishments in 2019 related to the 3 clinical studies utilizing a precision medicine approach. And we will provide enrollment information of the respective clinical studies in the near future. We look forward to updating you as advancements are made.

I would now like to open the call for questions. Operator, please go ahead.

(Operator Instructions) And we do have a question from Ram Selvaraju.

Can you hear me?

Yes.

Just a couple of quick ones. Regarding the Parkinson's disease positioning for 2-73, I was wondering if you could maybe frame for us a little bit more the specific opportunity as you see it and how you view 2-73 fitting into the overall treatment continuum, specifically within Parkinson's disease? And also just a housekeeping item, could you update us on the current status of the ATM facility and whether or not you plan to utilize that at any point in the near term?

I appreciate the call and the questions. So the first question related to Parkinson's disease dementia. So Parkinson's disease is a disease of loss of dopaminergic cells in the brain and they cause the motor impairment of the patient. And that is getting worse with age. What has been now very relatively successfully accomplished, a steady state of dopa, L-dopa administration to patients which basically replaces the produced dopaminergic cells. And so outside L-dopa will cause the patient to not have too much of the movement impairment or delay that onset. It's not a disease-modifying approach, but it's a temporary approach of addressing this disease. However, that also means that these patients will live longer and now it has been identified that the Parkinson's disease patients will also eventually become cognitive impaired as they age. And that is now a significant unmet need in the Parkinson's community because there's no treatment available for those patients. And we have currently 1 million patients in the U.S. alone with Parkinson's disease, and that number is obviously much larger around the world. So this is the -- addressing the first question. The -- I'd like also to add to that, that ANAVEX 2-73 has demonstrated, in an animal model of Parkinsonian disease modification model, which was a 6-OHDA model, which is a very difficult model to have improvement in, where the animals are getting eradicated their dopaminergic region with a chemical, and then hence are impaired with motor impairment, with significant motor impairment. ANAVEX 2-73 treatment in these animals was able to a certain extent restore or ameliorate the movement impairment. So we are now also looking in our study for the signal on motor impairment as a secondary endpoint. So we try to basically address the cognitive decline feature which is reaching almost 80% of all Parkinsonian patients. And also in parallel to that, however, also the motor impairment. So that is important to appreciate in this study. The second question regarding to the ATM. So the ATM stands for at-the-market facility. We have a at-the-market facility set up which we have not yet used to date. And we will not yet -- we have no plans yet to use it. And it's really a facility for emergency or if the opportunity arises that we might utilize it. But right now, we have no plans to utilizing it as we speak since we have sufficient cash available right now in our -- on our balance sheet.

Okay. And then just a very quick follow-up on the Rett syndrome program. There were 2 items that I wanted to query you about regarding the therapeutic signature of 2-73. And in particular, I was curious to know your opinion on whether you would anticipate there being an impact of 2-73 on apnea in Rett syndrome patients? And secondarily, if again within the treatment continuum, you would envisage potentially there being the possibility of 2-73 being employed, either as a standalone or as part of polypharmacy, for example, being combined with either of the experimental drugs that are also in late-stage testing for Rett syndrome, namely trofinetide and/or sarizotan?

Regarding the question on the apnea or the therapeutic signature, the ANAVEX 2-73 has demonstrated the following phenotype improvements which are relevant for Rett syndrome, and there's really no, I would say, sequence of priority here. But one of the key features is of the movement impairment and cognitive impairment as well as seizures and anxiety, to a certain extent also apnea. And the preclinical animal studies, which were in 2 different animal models, showed that we have seen an improvement in motor impairment, an improvement also in apnea. And in other animal models, we saw an improvement in seizures and cognitive impairment and anxiety. So in a way, our compound has shown an independent pathological model the ability to restore function in what causes the entire, I would say, Rett syndrome pathology dysfunction or phenotype. The second question about standalone or polypharmacy. Obviously, this is something which we have not yet decided to test it because also it doesn't -- it's not dependent on us, ourselves only because those drugs you mentioned still have to be concluded successfully in clinical studies. So that's one requirement. However, we do know from polypharmacy that we have a relatively good sense about ability of being able to join existing treatment regimens, and that's been demonstrated in the Alzheimer's study, where Alzheimer's patients on average have a lot of treatment regimens for other pathologies or insufficiencies, like cardiovascular disease insufficiencies and other age-related insufficiencies. And we had not seen any problems with the administration of Anavex with patients receiving additional other medications.

And we have no more questions at this time. Wait, we do have a question from Caroline Palomeque.

Just wondering if you -- and I apologize if this was asked before, but any updates on the genomic data and will you be having any other readouts come out either while the trials are ongoing? And then another question is, can you update us on anything -- any more enrollment numbers on the ongoing trials?

To the first question about the genomic data. So all studies which we are now undergoing, the Alzheimer's disease study, the Parkinson's disease dementia study and the Rett syndrome studies, they all require all the patients to get the entire genomic readout analyzed. And this will be done throughout all the studies with all patients. We have not yet decided when to announce data. But before we do that, we will have to analyze that data. I suspect that this analysis of this gene data will be done in parallel with the analysis of the endpoints of the top line data readout. So I would expect that there might be relevant information coming along the same time frame. Regarding the enrollment rate, we are very happy with the pickup on the sites on the enrollment, and we will be able to share more specifics and quantitative enrollment levels in the foreseeable future.

And it doesn't look like we have any more questions. At this time, I'm going to go ahead and turn it back to Dr. Missling.

Yes. So thank you all for participating in today's conference call. I hope you are as excited as we are about the recent progress and the prospects for the year ahead. Should you need any additional information or have any question, please visit our website at www.anavex.com or call or e-mail us. This concludes our remarks for today. Operator, please?

And thank you. Ladies and gentlemen, this concludes today's conference. Thank you for participating. You may now disconnect.