Minerva Neurosciences Inc (NERV) 2015 Q4 法說會逐字稿

Welcome to the Minerva Neurosciences year-end 2015 conference call. (Operator Instructions). This call is being webcast live on the investors section of Minerva's website at ir.minervaneurosciences.com. As a reminder, today's call is being recorded.

I would now like to turn the call over to William Boni, Vice President of Investor Relations and Corporate Communications at Minerva. Please proceed.

Thank you. Good morning. A press release with the Company's fourth-quarter and year-end 2015 financial results became available at 7:30 AM Eastern Time today and can be found on the investors section of our website. Our annual report on Form 10-K was also filed electronically with the SEC this morning and can be found on the SEC's Internet website at www.SEC.gov.

Joining me on the call today from Minerva are Dr. Remy Luthringer, President and Chief Executive Officer; and Mr. Geoff Race, Executive Vice President, Chief Financial Officer, and Chief Business Officer. Following our prepared remarks, we will open the call for Q&A. Before we begin, I would like to remind you that today's discussion will include statements about the Company's future expectations, plans, and prospects that constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

We caution that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated. These forward-looking statements are based on our current expectations and may differ materially from actual results due to a variety of factors, including, without limitation, whether any of our therapeutic products will advance further in the clinical trials process; whether, when, and to what extent results from such trials will be available; and whether and when, if at all, such products will receive final approval from the US Food and Drug Administration or equivalent foreign regulatory agencies, and for which indications; whether any of our therapeutic products will be successfully marketed, if approved; whether any of our therapeutic product discovery and development efforts will be successful; our ability to achieve the results contemplated by our co-development agreements; management's ability to successfully achieve its goals; our ability to raise additional capital to fund our operations on terms acceptable to us; the sufficiency of our cash position to fund our operations; and general economic conditions.

These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed under the caption risk factors in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission on March 14, 2016.

Any forward-looking statements made on this call speak only as of today's date, Monday, March 14, 2016, and the Company disclaims any obligation to update any of these forward-looking statements to reflect events or circumstances that occur after today's call, except as required by law.

I would now like to turn the call over to Remy Luthringer.

Thank you, Bill, and good morning, everyone. Thank you for joining us today. 2015 was a year of successful clinical trial execution for Minerva. I am pleased to report that patient recruitment, screening, and enrollment proceeded on a timely basis in four clinical trials with three compounds during this year. As a result, we are in a position to announce data from these trials in the first half of this year. In fact, we already have obtained positive results with our announcement in January of positive top-line data with MIN-202.

These data relate to our Phase IIa trial in patients suffering from primary insomnia disorder without any associated psychiatric disorder. Today we are pleased to summarize additional positive data with MIN-202 in our trial carried out in patients suffering from a major depressive episode and having the diagnosis of major depressive disorder, or MDD. I will review details from both of these important readouts later in this call.

In addition to the MIN-202 results, we anticipate to readouts in the second quarter of this year from our Phase IIb trial in patients suffering from schizophrenia, and from our Phase IIa trial with MIN-117 in patients affected by MDD. Our goal at Minerva is to address unmet medical needs to help patients suffering from severe CNS disorders. We aim to accomplish this by developing drugs that overcome the limitations of available therapies. Minerva is driven by data generation which will inform our decisions around future development. 2016 will be a key year in this regard.

Let me now address our clinical trials in more detail, beginning with MIN-101. In late 2015, we completed the enrollment of a total of 244 patients in a randomized, placebo-controlled, double-blind, parallel-group design Phase IIb trial of MIN-101 to treat unmet needs in patients suffering from schizophrenia.

The study includes two parts: the core study, which is the double-blind treatment period of the trial, is carried out over a 12-week treatment duration. Following this period, patients have the opportunity to enter into an extension period of six months. During the extension, all patients receive either 32 or 64 milligrams of MIN-101. Patients who receive placebo in the core study are randomized to one of these two doses.

The primary objective of this trial is to evaluate the efficacy of the two doses of MIN-101 -- 32 milligram and 64 milligram, administered in the morning -- compared to placebo in improving negative symptoms. Secondary objectives include the assessments of cognition, sleep, and the overall spectrum of symptoms of the disease. Top-line results from the core study are expected in the second quarter of 2016.

We announced in late December 2015 that the US Food and Drug Administration accepted the Company's investigational new drug, IND, application for MIN-101. FDA acceptance of our IND for MIN-101 is an important step towards the initiation of clinical testing of our compound in the US, following the results of the Phase IIb trial. We will be continuing our dialogue with the FDA as part of our overall planning for late stage clinical development in the US.

During 2015, momentum increased significantly in Minerva's product development program with MIN-202, which is being co-developed by Minerva and Janssen Pharmaceutica NV. To provide some background, Minerva entered into a co-development and license agreement with Janssen in February 2014, covering MIN-202 and other orexin-2 compounds. Let me walk you through the studies carried out in 2015 for which we already have studies readouts.

On January 11 of this year we announced positive top-line results from a Phase IIa clinical trial in patients suffering from insomnia disorders not associated with psychiatric disorder. Since the release of top-line results in early January this year, additional data from this trial have become available. The study was conducted at clinical sites in the US and Europe. In this double-blind, crossover, placebo-controlled trial, 40 milligrams of MIN-202 was tested over treatment duration of five consecutive nights.

That data obtained by means of polysomnographic, PSG, recordings, and objective measure of sleep, indicates that MIN-202 improves significantly sleep induction, restores sleep duration, and preserves key phases of sleep, particularly deep sleep, thus enabling restorative sleep. The primary endpoint of the trial was sleep [efficiency], for which a positive efficacy signal was detected after treatment with MIN-202 versus placebo, with a p value of 0.001. Additional statistically significant p value 0.001 positive efficacy signals were observed for key secondary parameters, including latency to persistent sleep, LPS; wake after sleep onset, WASL; and total sleep time, TST.

Compared to placebo, MIN-202 was observed to significantly improve polysomnographic parameters, p 0.001 on days one and five. On day five, LPS and WASL were reduced by 23.2 and 11 minutes. TST and sleep efficiency increased by 39 minutes and 8.12%, respectively. Subjectively estimated TST, LPS, and WASL also improved versus placebo by 43.1, 38.8, and 14.8 minutes.

Overall, significant correlation was found between objectively and subjectively evaluated sleep parameters. No serious adverse events were observed in this trial, and preliminary data indicates that MIN-202 was well tolerated. We expect additional details of this data to be presented at a peer-reviewed forum.

The second study for which we have readouts was carried out in patients suffering from major depressive disorder. This randomized, multi-center, double-blind, parallel-group, diphenhydramine, and placebo-controlled study evaluated the effect of MIN-202 in MDD outpatients 18 to 65 years of age. 48 patients were enrolled in three groups that received doses of 20 milligrams of MIN-202 daily; 25 milligrams of diphenhydramine daily, used as a positive control to induce sedation; or placebo, over four weeks.

The primary endpoint was safety and tolerability and secondary endpoints included assessments of depressive symptomatology, cognition, and sleep. The trial was conducted in seven clinical sites in Europe. We have reported only top-line results with respect to safety, tolerability, and efficacy on depressive symptomatology. MIN-202 was well tolerated by study participants over a one-month treatment duration, with no new observed emerging safety signals and serious adverse events.

Consistently greater improvements in depressive symptomatology were observed in patients randomized to receive MIN-202 compared to those randomized to receive placebo or diphenhydramine, as measured by clinician administered rating scales, including the Hamilton Depression Rating Scale, HDRS17. Core symptoms of depression, as measured by HAM-D6, were observed to be significantly improved in the MIN-202 arm when compared with placebo. Complete results are planned for peer-reviewed presentations in the future.

The results described above paves the way to initiate a Phase IIb trial in patients suffering from MDD. This improvement supports the potential of MIN-202 to have a direct effect on mood, independent from its effects on sleep.

Data from a third trial with MIN-202 became available earlier in this year, as well. In this Phase I trial, single-dose morning administration of MIN-202 was observed to be well tolerated in healthy Japanese adult male study participants. The observed plasma pharmacokinetic features were compared to those observed in previous studies carried out in healthy non-Asian study participants. These findings are an important step in the planned global development of MIN-202, as they add to the expanding database of study participants treated with this compound worldwide, and support further clinical testing in an important part of the world.

Our third clinical stage compound is MIN-117 in development to treat major depressive disorders, or MDD. We recently completed enrollment of 84 patients with MDD in a Phase IIa randomized, double-blind, parallel-group, placebo and active control clinical trial with MIN-117 in Europe. These patients were enrolled across the four treatment arms of the study, which include 0.5 and 2.5 milligram daily of MIN-117; 20 milligram daily of paroxetine; and placebo.

The primary objective of this trial is to evaluate the efficacy of MIN-117 given at 0.5 milligrams and 2.5 milligrams daily in reducing the symptoms of a major depressive episode, as measured by the change from baseline in the Montgomery-Asberg Depression Rating Scale, MADRS, total score over six weeks of treatment.

Additional objectives include the assessment of onset to response, severity of illness, sexual function, executive function, working memory, and safety and tolerability. Top-line results from this trial are expected in the second quarter of 2016.

Finally, our preclinical stage product candidate is MIN-301 to treat Parkinson's disease. MIN-301 is a recombinant protein with the extra-cellular domain of neuregulin-1 beta 1, primarily activating ErbB4. This regulation of the neuregulin-1 signaling pathway has been linked to neurodevelopmental and neurodegenerative disorders, including and beyond Parkinson's disease. Preclinical data with an analog of MIN-301 were presented in December 2015 at the American College of Neuropsychopharmacology, ACNP.

These data demonstrates the beneficial effects of treatment with MIN-301 on behavioral and motor deficits in animal models. Results also suggest that neuroinflammatory surrogate markers should be explored in future Parkinson's disease trials. The next planned steps in the MIN-301 program are the filing of an IND in the US or an Investigational Medicinal Product Dossier, IMPD, in Europe; and, pending acceptance by regulatory authorities, the initiation of Phase I clinical testing thereafter.

In summary, we have announced positive results from two of four clinical trials scheduled to read out in the first half of 2016. We look forward to the upcoming data from the other two trials in the second quarter of the year.

I will now turn the call over to Geoff to cover our financial results.

Thank you, Remy. Earlier this morning, we issued a press release summarizing our operating results for the fourth quarter and the year ended December 31, 2015. A more detailed discussion of our results may be found in our annual report on Form 10-K, also filed earlier today.

At December 31, 2015, the Company's cash, cash equivalents, and marketable securities were approximately $32.2 million compared to $18.5 million as of December 31, 2014. During the first quarter of 2016, the Company received approximately $17.5 million in proceeds from certain existing shareholders who exercised warrants granted in connection with a private placement in March 2015.

Warrants for a total of approximately 3 million shares of common stock were exercised at an exercise price of $5.77 per share. As a result, Minerva expects that its current cash, cash equivalents, and marketable securities will be sufficient to fund its operations into the second quarter of 2017.

Research and development expenses were $6.3 million in the fourth quarter of 2015 compared to $3 million in the fourth quarter of 2014. R&D expenses were $18.5 million for the year ended December 31, 2015, compared to $42.9 million for the year ended December 31, 2014.

R&D expenses for the year ended December 31, 2014, included a $22 million license fee paid to Janssen pursuant to our co-development agreement for MIN-202. R&D expenses for the years ended December 31, 2015 and 2014, included non-cash stock-based compensation expenses of $0.6 million and $13.1 million, respectively.

Excluding stock-based compensation and the $22 million license fee, total R&D expenses related to drug development programs for the years ended December 31, 2015 and 2014, were $17.9 million and $7.8 million, respectively, an increase of $10.1 million. This increase in R&D expenses primarily reflects increased expenses related to our Phase IIb clinical trial of MIN-101, our Phase IIa clinical trial of MIN-117, and the MIN-202 Phase IIa and Ib clinical trials.

General and administrative expenses were $1.9 million in the fourth quarter of 2015 compared to $4.5 million in the fourth quarter of 2014. G&A expenses were $7.6 million for the year ended December 31, 2015, compared to $12 million for the year ended December 31, 2014. G&A expenses for the years ended December 31, 2015 and 2014, included non-cash stock-based compensation expenses of $1.6 million and $4.9 million, respectively. Excluding stock-based compensation, G&A expenses for the years ended December 31, 2015 and 2014, were $6 million and $7.1 million, respectively.

Net loss was $8.4 million for the fourth quarter of 2015 or a loss per share of $0.34, basic and diluted, compared to a net loss of $7.4 million for the fourth quarter of 2014 or a loss per share of $0.40, basic and diluted. Net loss was $27.1 million for the year ended December 31, 2015, or a loss per share of $1.16, basic and diluted, compared to a net loss of $56.9 million or a loss per share of $4.47, basic and diluted, for the year ended December 31, 2014.

The proceeds generated from the recent warrant exercise strengthened our financial position and extend our runway significantly. Again, we expect our currently available financial resources to enable the advancement of our drug development pipeline into the second quarter of 2017, including the clinical milestones described earlier by Remy.

Now I'd like to turn the call over to the operator for any questions.

(Operator Instructions). Jason Butler, JMP Securities.

First one, just on the Phase II trial for 101 in schizophrenia. Can you just walk us through the pairing assumptions for the primary endpoint? Are you powered for the total PANSS, or just the negative symptom subscale? Thanks.

Good morning, Jason. Remy speaking. So, technically the primary endpoint is negative symptoms. So the study is really powered for positive results on the negative symptoms. All the other parameters -- overall PANSS score, positive symptoms, cognition, sleep -- are definitely secondary endpoints.

Okay, great. And then are there any differences between the negative symptom subscale that you are using for this trial and the typical negative symptoms that we think about from the PANSS? Is it just the negative symptom component of the PANSS?

So, in fact, as you know, we are analyzing the negative symptoms in two ways. They can cause a typical way or the classical way, and the pentagonal way, which is based on a principal component analysis. In our case, the primary endpoint is a pentagonal score for a very simple reason: because our drug is probably having a much broader effect on [all the] negative symptoms, and the pentagonal score seems to represent much better the pathophysiology of the patients.

Great, thanks. And then just a quick question on MIN-202. Can you just help us put into context the data we saw last week in terms of the antidepressant benefit relative to currently available antidepressants? And maybe provide some color on your comments about -- regarding the independent effects on depression that you saw versus just the derivative affect on sleep.

Yes, so this is obviously a very good question, and we are very excited about these results. So, what we have seen is when you are analyzing the Hamilton depression scale, excluding the sleep parameters, the effect on mood is maintained. So this confirms really very well that this effect is a direct effect on mood and not mediated via an effect on sleep.

Great. Thanks for taking the questions.

(Operator Instructions). And I'm not showing any further questions.

I'd like to turn the call back to William Boni for closing remarks.

Thank you, everyone, for participating on the call today. And please don't hesitate to give me a call directly with any questions, or to follow up on the press release issued today or the press release issued on Friday. Thank you very much.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program. You may all disconnect. Everyone have a great day.