Minerva Neurosciences, Inc.
Q4 2020 Earnings Call Transcript

Published: 8 Mar 2021

[Operator:]

Welcome to the Minerva Neurosciences Year End 2020 Conference Call. At this time, all participants are in a listen-only mode. There will be a question-and-answer session, following today's prepared remarks. 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.

[William Boni:]

[Remy Luthringer:]

Thank you, Bill and good morning everyone. Thanks for joining us today. I'm very pleased to present an update on progress and our earnings report for the full year 2020. In May last year we announced top line results from the double-blind portion of the Phase 3 trial with roluperidone in negative symptoms of schizophrenia. Also the study did not meet statistical significance. We remain highly encouraged by the promising signals that emerged. We look forward to sharing data from the Phase 3 nine months open-label extension, which will be available in the first half of this year. Following our Type C meeting with the FDA in November 2020, during which the FDA cautioned us that an NDA submission based on the then current data from the Phase 2b and Phase 3 studies would be highly likely to be filed, we continue our dialogue with the agency.

[Geoff Race:]

Thank you, Remy. Earlier this morning, we issued a press release summarizing our operating results for the fourth quarter and year ended December 31, 2020. A more detailed discussion of our results may be found in our annual report on Form-10K filed with the SEC earlier today. Cash, cash equivalents, and restricted cash as of December 31, 2020 were approximately $25.5 million compared to $46 million as of December 31, 2019. In January 2021, the company received a $60 million cash payment from Royalty Pharma in connection with our acquisition of the company's royalty interest in seltorexant. We presently expect that the company's existing cash and cash equivalents, which include its financial results at the year end 2020 combined with the $60 million payment received in January from Royalty Pharma will be sufficient to meet its anticipated capital requirements for at least the next 12 months from today based on our current operating plan. The assumptions upon which this estimate is based are routinely evaluated and maybe subject to change. Research and development expenses were $3.6 million and $28.5 million for the fourth quarters of 2020 and 2019 respectively. R&D expenses were $22 million and $58.1 million for the years ended December 31, 2020 and 2019 respectively. The decrease in R&D expense for the fourth quarter ended December 31, 2020 was primarily due to a $19 million charge taken in December 2019 for the impairment of the in process research and development related to MIN-117 following the results of the Phase 2b trial in MDD which failed to meet its primary and key secondary endpoints. The decrease in R&D expense for the year ended December 31, 2020 was due also to the approximately $11 million from the completion of the Phase 2b clinical trial of MIN-117 in December 2019 and the completion of the double-blind portion of the Phase 3 clinical trial of roluperidone in May 2020. Non-cash stock compensation expense included in R&D expenses was $3 million and $2.6 million for the years ended December 31, 2020 and 2019 respectively. G&A Expenses were $3.7 million and $3.8 million for the fourth quarters of 2020 and 2019 respectively. G&A expenses were $17.3 million and $17.7 million for the years ended December 31, 2020 and 2019 respectively. The decreases in G&A expenses for the fourth quarter and year ended December 31, 2020 were primarily due to lower pre-commercial expenses in 2020, offset by higher insurance costs. Non-cash stock compensation expense included in G&A expenses was $6.7 million and $6.5 million for the years ended December 31, 2020 and 2019 respectively.

[Operator:]

Thank you. Our first question comes from the line of Tom Shrader with BTIG. Your line is now open.

[Unidentified Analyst:]

Hi, this is Julian on for Tom. Thank you for taking my questions. I'm wondering if there are any data points from the upcoming open-label extension analysis that could may be specifically address some of the pushback you got from the FDA in your recent Type C meeting? And then on the bioequivalence study, is it fair to assume this is the gating step to filing an NDA or will the CMC package share likely be the last detail?

[Remy Luthringer:]

Hi, Remy speaking here. So obviously great questions. I really think, yes indeed you are right, I mean the extension data will be really very encouraging to us because as you know negative symptoms is a chronic part of the disease and you need to re-demonstrate that the effect is sustained over time. So as I mentioned in my presentation, I mean we are really looking forward to check again because we have already efficacious data from the Phase 2b. If you remember we had six months extension of top of the three months or 12 weeks, double-blind Phase. So we could see in this study a continuous improvement of negative symptoms and also we've seen improvement in terms of functioning. So first of all, I mean we will be able to confirm that the negative symptoms continue to improve. Second, that is transformed into a functional improvement and as you know, what is really important is that these patients are able to function again, that they can go back to a job, and then to have a decent family life, so functioning is extremely important. So we will be able to check this, because we are measuring PANSS and PSP all along the extension of the nine months extension, so we will have data of one year. We will also be able to check what is going on in terms of positive symptoms and what we can call relapses to see if we have limited number of relapses as we had in the Phase 2b, so this will be obviously very important.

[Unidentified Analyst:]

Great, thank you.

[Operator:]

Thank you. Our next question comes from the line of Jason Butler with JMP Securities. Your line is now open.

[Jason Butler:]

Hi, thanks for taking the questions. A couple on the open-label extension, can you just give us a sense of how many patients from the placebo arm of the double-blind trial rolled over into the open-label extension? And then secondly, how are you thinking about releasing the data? Will you release the data in conjunction with a medical meeting or could we get it as soon as you finish the analyses that you've outlined in the press release? Thanks.

[Remy Luthringer:]

Good question, Jason. So clearly I mean in terms of placebo patients who went into the extension phase, I think it was quite equivalent between the three treatment arms. So we had more or less the same number of placebo patients who switched to either 32 or 64 mg because it is what happens when they are going into the extension. And I think this data of I think, -- I hopefully I was able to convince everybody, I think this data is extremely important because this will be an additional piece of information about the efficacy of our molecule. I think we will have a specific announcement at a specific event about this release of this data because they are so important. So as soon as we have the data available we will think about the best format to communicate the data.

[Jason Butler:]

Great and then just one more Remy on the mITT analyses, any updated thoughts on or interactions with the FDA or your advisers on the agency's willingness to accept the analyses without -- excluding that single outlier site>

[Remy Luthringer:]

So, you know as already it is a matter of review yes, because the FDA will go into the data more deeply, I mean they will really check all the data we have to really confirm that I mean these 17 patients is from this site, really I mean the assessment of efficacy as well as assessment of some vital signs was not done according to, how it should have been done. So when you're looking to, what has been done in the past particularly by the psychiatry division, I mean, a lot of files, or a lot of NDAs have moved forwards with modified ITT population. So, I mean, so clearly I mean, we are confident that I mean, the 17 patients should not be in the analyses and there are precedents where I mean the FDA, again after having reviewed very carefully the data, were happy with a modified ITT population to be considered. So, and this is what came out basically, from the Type C meeting, they really confirmed based on a matter of review, they are willing to consider ITT and mITT data.

[Jason Butler:]

Okay, great. Thanks for taking the questions.

[Remy Luthringer:]

Thank you, Jason.

[Operator:]

Thank you. Our next question comes from the line of Biren Amin with Jefferies. Your line is now open.

[Jeet Mukherjee:]

Yes. Hey, good morning, guys. This is Jeet on for Biren. Just a couple of questions from me, again on that modified IDC point. Remy, are there any specific examples of agents being approved in the neuroscience space that actually went ahead with that modified ITT analyses that perhaps included or excluded a group of patients? And just in terms of the open-label extension data, are we going to see endpoint data such as PSP or CGI-S to kind of make the point on improvements in patient performance and status? Thanks.

[Remy Luthringer:]

Yes, so definitely, there are precedents. I mean, and as I just mentioned before, as I mean in the space of psychiatry and specifically the psychiatry division as I mean, without going into the details, but I mean you have approvals like SPRAVATO, you have approvals like , where I mean definitely is a modified ITT population has been accepted by the FDA. So again, I think we are not doing something special here. I mean, what is important is that the FDA gets comfortable with this site, that this site did not provide plausible data. So this is what I can say about this. So can you repeat the second question? Sorry, what is the second point you were suggesting ?

[Jeet Mukherjee:]

Yes, the second question was just on the open-label extension data we'll be getting, are we getting PSP and perhaps CGI-S data just to talk about patients' performance?

[Remy Luthringer:]

Sure, for sure. So I mean, as I mentioned before, I mean we continued during the open-label to measure all the efficacy parameters, including PANSS, PSP, CGI-S and so on. And so definitely, yes indeed, we will have this. And I think we will be able to really to re-demonstrate, as we demonstrated already, that the PSP improvement is very linked to the improvement of negative symptoms. If you remember, PSP total score was already significant in the double-blind phase, yes. But indeed, we will have all this data we will have again, the analyses of from wherever the functional improvement is coming, is it related to negative symptoms and more specifically, we will also have abolition there. So all this will happen and will be presented definitely, yes.

[Jeet Mukherjee:]

Great, thank you so much.

[Remy Luthringer:]

You're welcome.

[Operator:]

Thank you. Our next question comes from the line of Joel Beatty with Citi. Your line is now open.

[Joel Beatty:]

Hi, thanks for taking the questions. First one is on bioequivalence. Could you compare the differences in three different formulations for us from Phase 2, Phase 3, and then also what you plan to be in the commercial supply? And then, along with that comparison, could you tell us about what you plan to show in the bioequivalence study to help comfort FDA?

[Remy Luthringer:]

Yes, so again, I mean, as you know, I mean what we are trying to demonstrate is here that the exposure of the drugs or the AUC of the drugs are or the different formulations are the same, because as I mentioned in the past, I mean, the efficacy when you're doing the PK/PD analyses, the efficacy of roluperidone is coming mostly from the parent compound and it is related to exposure so to AUC, and not at all to Cmax. So, this is extremely clear from of our PK/PD analyses, which have been done by some key external people who are really specialists in this space. So what we try to achieve between the Phase 2b and the Phase 3, if you remember, Joel goes to keep this AUC which our preliminary PK study showed, but we wanted to reduce the Cmax of parent compound and one of the metabolites, BFB-520, because we wanted to even further improve the safety margin in terms of event -- effects on QTc prolongation. So this is a difference between Phase 2b and Phase 3 formulation and we were able to do it. Remember, we presented this in one of our webcasts where we could show that I mean, we kept the AUC and we reduced Cmax of again parent and BFB-520 this metabolite. No, is between Phase 3 and the final formulation, nothing major has changed. It is just some percentage of some ingredients and this should not change at all the bioequivalence. So it is ready to confirm once more and we already have the information that I mean this is completely comparable between Phase 3 and as a final formulation, which is currently produced by Catalent. Hello?

[Joel Beatty:]

Got it, thanks. And then may be one other question on the mITT for the 17 patients, is there any way to get kind of like real actual data from those patients or is that something that does not exist?

[Remy Luthringer:]

Here, you have to explain me what you mean by real actual data, so…

[Joel Beatty:]

Yes, I guess, were they, it sounds like the data was so implausible that it doesn't reflect actual readings. So have you been able to confirm, for example, that those patients were dosed and actual readings and assessments were taken?

[Remy Luthringer:]

Sure, sure, sure. No, I understand. So definitely, I think there is no doubt about it that the patients exists. Why it is also clear is that I mean, a lot of the data for efficacy and for, again some vital signs have just been carried forward from the baseline. So, there is no modification of this data over time and which is completely plausible, yes. I mean, so clearly, I mean and I gave some examples in the past. So clearly, I mean the patients exists, but the assessments have not been done in the right way, yes.

[Joel Beatty:]

Thank you.

[Remy Luthringer:]

You are welcome, Joel.

[Operator:]

Thank you. Our next question comes from the line of Myles Minter with William Blair. Your line is now open.

[Myles Minter:]

Thanks for taking my questions and apologies for the background noise. Just a clarification question. I believe for the mITT analyses to be sort of accepted by the FDA that that would be a process of review. But out of the top same, meaning they're actually stating that the NDA in its current format would be unlikely to be filed. So that would mean that it wouldn't get a review. So my question is, is that the correct interpretation? And then was the unwillingness to recommend the filing or acceptance of that filing was that just due to the fact that you didn't have this open-label safety data set on hand and now you're ticking the boxes and you have everything in place or am I completely missing there ? Thanks.

[Remy Luthringer:]

So, I mean, as you know, Minerva is an extremely transparent organization and we gave exactly the terms of what we received in the minutes. So, this is to answer one of your points. It is clear that means the open label data were not available at that time and we are really hoping that this open-label data will be an additional piece of information confirming that the main roluperidone is an efficacious drug. So after, I mean, when we go through the level of preview, I think I mean, if you go according to these guidelines, so this is guidance from end of 2019. If we are able to convince the FDA about our Phase 2b data, this is obviously related to the bioequivalence study, which will make the Phase 2b being one of the two studies you have in your efficacy data package. If this shows bioequivalence, I mean if you can demonstrate bioequivalence, I don't see really a reason why we could not move to the review processes, and this is what our advisors are telling us. And, what the FDA also said is that I mean, if I mean, this goes to review, I mean, this will go to an outcome. So, it's, I think a dynamic process. We, as I mentioned in my presentation we really are having a dialogue open with the FDA. We gave them the information about the psychometric aspects of the different scales. We gave them, how I mean, we managed the calculation of the total score of PSP. So it's a continuous dialogue and I'm extremely confident that I mean, if we're doing a great job in explaining even better our data and the way we have analyzed them, and what is in the data, I think we will have a positive hear from the FDA, and we will be able to move forward with the NDA.

[Myles Minter:]

Yes, understood that's very helpful. And my second question is just on the bioequivalence study, I understand the last time you were talking about that to us, it was around about 36 patients and now it's gone up to 48. Is that just an additional cohort for the commercialization formulation or is the added patients for some other reason in that trial? Thanks very much.

[Remy Luthringer:]

Yes. So Myles when we spoke together I mean, I was speaking about the guideline. No, we have done real power calculation, powering calculation sorry and it ends up with 48 subjects. So we are going to the safe side, basically, I mean, having more subjects or healthy subjects, because we are not dealing with patients here, it is with healthy subjects. So it's -- the powering is indicating that 48 is the number to go, obviously, as you know, because this is a crossover trial, but whereas the subject is his own control. And basically here, you might also have some drop outs, so I mean you never know because healthy body finds a job and he does not want to do period three. So clearly, we are also anticipating or including in our modeling and in our power calculations, and maybe one or two subjects might drop out. So it's really to be on the safe side basically. Sorry to interrupt you, something very important is that we also have submitted our protocol to the FDA. Yes, and we are definitely waiting, if I mean they have any feedback, but I mean, so we -- it's done again in a very open and constructive mindset with the FDA.

[Myles Minter:]

Right, lots of interactions with the FDA and looking for the open-label data, so thanks very much.

[Remy Luthringer:]

Thank you.

[Operator:]

Thank you. Our last question comes from the line of Douglas Tsao with H.C. Wainwright. Your line is now open.

[Douglas Tsao:]

Hi, good morning, and thanks for taking the questions. Just Remy, in terms of the open-label extension we're going to get data for the 64 and 32 mg doses. You've sort of honed in on the 64 mg do you've seen more sort of consistent effect across the studies now. Is there anything that you could see from the 32 mg that would perhaps make you sort of revisit that in terms of the -- you're sort of thoughts for the molecule going forward? Thank you.

[Remy Luthringer:]

Yes, so I mean, definitely I mean, I have not given up on 32 mg because remember I mean in the Phase 2b and it was very clear that 32 mg was really different from placebo. When you're looking to the effect size or the Delta we have in the Phase 3, 32 mg is again showing a nice improvement. Obviously, I mean placebo had also a larger improvement, that the reason why I think we could not show p value at the end of the day. When you're looking for the integrated, when I’m speaking integrated I mean, it is combined Phase 2b and Phase 3 double-blind data means two doses are highly significant with very decent effect sizes. So indeed, I mean, if I mean the extension data are again, pointing towards the fact that 32 mg continues to improve negative symptoms over a period of one year, I think 32 mg is an important dose. I’m not saying that this will be part of the final filing of the NDA, but I mean 32 has still clearly shown that we have a pharmacological effect, which is dose. So let us have the data, let us analyze the data and we will see what we're doing with 32 mg, but always pointing towards the fact that 32 is clearly showing a pharmacological effect of an improvement of the patients.

[Douglas Tsao:]

Okay, great. Thank you. And just as a follow up in terms of your analyses that made you confident that the effect is really AUC not Cmax, which makes sense. I'm just curious, you referenced some PD markers. I'm just curious what PD markers you focused in on? Thank you.

[Remy Luthringer:]

For the PK/PD analyses, I mean it was definitely based on the PANSS negative scores. I mean, so here we are really referring to PANSS negative. So we did exposure versus -- plasma exposures versus negative symptoms coming out from the PANSS. And clearly, when you're looking to what is explaining as improvement of the PANSS negative score, it is AUC and not at all Cmax. So it's, this is from where I'm making this comment. It's a very, very careful analyses. compare I mean in between PANSS parameters and the different pharmacokinetic parameters.

[Douglas Tsao:]

Okay, great. Thank you.

[Remy Luthringer:]

Welcome.

[Operator:]

Thank you. There are no further questions. I will now turn the call back to Remy Luthringer for closing remarks.

[Remy Luthringer:]

Yes, thank you so much. Thank you really, everybody for all these great questions. I wanted also to take this opportunity to thank patients and families and caregivers who have participated to this Phase 3 study. As we have heard, I mean some of these patients went to the end of the 12 weeks, so more than 200 patients. So thank you again for this help, hopefully to develop an extremely innovative drug, which will be one of the first treatments for negative symptoms. So I'm looking forward to update you on the next upcoming milestones, open-label data and bioequivalence data. So thank you again and looking forward to speak with you soon. Bye.

[Operator:]

Ladies and gentlemen, this concludes today's presentation. Thank you once again for your participation. You may now disconnect. Everyone have a great day.