Minerva Neurosciences, Inc.
Q1 2015 Earnings Call Transcript

Published: 7 May 2015

[Operator:]

Welcome to the Minerva Neurosciences First Quarter 2015 Conference Call. [Operator Instructions]. I would now like to turn the call over to Joe Reilly, Chief Operating Officer at Minerva. Please proceed.

[Joe Reilly:]

Good afternoon. A press release with the company’s first quarter 2015 financial results became available at 8 AM Eastern Time today and can be found on the Investors section of our website. Joining me on the call today from Minerva are, Dr. Remy Luthringer, Chief Executive Officer, President, and Mr. Geoff Race, Executive Vice President and Chief Financial 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. Among the factors that could cause actual results to differ materially include the initiation, timing, cost, progress, and success of our research and development, preclinical studies, and clinical trials. Developments relating to our competitors and our industry, including the success of competing therapies that are or may become available, our ability to advance product candidates into and successfully complete clinical trials and other factors identified from time to time in reports filed with the Securities and Exchange Commission. Any forward-looking statements made on this call speak only as of today's date, Thursday, May 7, 2015, and the company does not intend to update any of these forward-looking statements to reflect events or circumstances that occur after today's date. I would now like to turn the call over to Remy Luthringer.

[Remy Luthringer:]

Thank you, and good morning everyone. Thanks for joining us today. This quarter was an important period of continued progress across our pipeline programs bringing us closer to a number of upcoming milestones later this year. We strengthened our balance sheet significantly by successfully closing equity capital and debt financing. Our current financial resources will enable us to move forward with the development of all four of our clinical stage compounds each with transformative potential and key near term milestones which I will now outline in more details. I would like to start with our lead assets, MIN-101, an innovative erotonin 5-HT2A and sigma2 receptor antagonist which we are evaluating in schizophrenia. MIN-101 has shown strong efficacy on negative symptoms and the broader spectrum of schizophrenia symptoms including positive symptoms, cognitive impairment and sleep disorders. This [indiscernible] has a potential to avoid serious side effects of existing therapies including sedation, extrapyramidal symptoms, plasma prolactin increase, metabolic disorders, and weight gain. Today we announced that to-date we have received regulatory approvals in Latvia, Estonia, Romania and Russia and ethical committee approvals have been received in Latvia, Estonia and Romania with respect to our Phase 2b study for MIN-101. This multi-center randomized double-blind parallel wound design study will explore the effect of two doses of MIN-101, 32 milligram and 64 milligram even once daily versus placebo in 234 stable schizophrenic patients with the history of negative symptoms. Enrollment has begun and it's expected to continue through the last three quarters of 2015. We anticipate that top line results for the core part of the study will be available in the second quarter of 2016. I will now turn to MIN-202, our selective orexin-2 receptor antagonist under development in collaboration with Janssen Research and development, one of the Janssen pharmaceutical companies of Johnson & Johnson for the treatment of primary and comorbid insomnia. In March we announced that we expect to initiate two additional studies for MIN-202 this year, a Phase 2a study in primary insomnia and the Phase 1b study in patients with major depressive disorder or MDD with comorbid insomnia. We expect to initiate both trials in mid-2015. These additional trials built upon data reported earlier from a Phase 1 trial of MIN-202 conducted by Janssen which showed the treatment with MIN-202 resulted in statistically significant improvements in sleep onset and sleep duration in patients with comorbid insomnia related to MDD. Additional results from a Phase 1 bioavailability study and the phase 1 multiple ascending dose study in healthy volunteers also suggested that MIN-202 is well tolerated and possess advantages pharmacokinetic, pharmacodynamic features. We believe there is significant potential for MIN-202 in these indications. Importantly we also believe it may be positively differentiated from other treatments by its unique mechanism of action which aims to treat insomnia by controlling the activity of the neurons that promote wakefulness. Turning now to MIN-117, our compound for major depressive disorder. We announced today that we plan to file an amendment with the protocol previously approved by the Latvia regulatory authorities was a double blind placebo control Phase 2a study in patients with MDD. The amendment we request an additional patient arm that would evaluate 2.5 milligram dose of MIN-117. If the amended protocol is approved the study is expected to include a total 80 patients of which 20 would receive open 5 milligram dose of MIN-117, 20 would receive 2.5 milligram dose of MIN-117, 20 would receive the 20 milligram of paroxetine and 20 would receive a placebo. The additional arm would allow us to compare the relative improvement in symptoms between the patients receiving 0.5 milligram and 2.5 milligram doses of MIN-117. We’re on track to begin enrollment for the Phase 2a study in the second quarter of 2015 and expect top line results of the study to be available in the first half of 2016. Finally moving to MIN-301, our investigational neuregulin-1 beta1 compound for the treatment of Parkinson's disease. In January 2015, we announced that treatment with an analog of MIN-301 resulted in improvements in a range of symptoms associated with Parkinson's disease in primates. The analog used in the study differs from MIN-301 by a single amino acid. As a next step we intend to file an IND or IMPD for MIN-301 in 2016 with an expected Phase 1 clinical study to begin following its acceptance. In some we have made significant progress during the quarter across each of our four clinical programs and we’re on track to achieve several upcoming milestones for each later this year, along with key value creating data read outs expected in the first half of 2016. We remain fully committed to our goal of becoming a leader in the development of noble CNS therapeutics which is an area of tremendous unmet medical need for patients around the world. I will now turn the call over to Geoff to cover our financial results.

[Geoff Race:]

Thank you, Remy. Earlier this morning we issued a press release summarizing our operating results for the first quarter of 2015. A more detailed discussion of our results may be found in our quarterly report on Form 10Q also filed earlier today. Let's start with our cash position, in January 2015 we entered into a term loan with Oxford Financing LLC and Silicon Valley Bank for up to $15 million and under which we drew down $10.0 million. In March 2015, we completed a private placement whereby we issued approximately 6.3 million shares of common stock and warrants to purchase an additional approximately 6.3 million shares of common stock resulting in net proceeds of approximately $28.5 million to us net of transaction costs. Cash and cash equivalents as of March 31, 2015 were $52.2 million compared to $18.5 million as of December 31, 2014. We expect our current cash flow to fund our operations through 2016. Research and development expenses were $4 million in the first quarter of 2015, compared to $0.6 million in the same period in 2014. The increase was primarily due to program costs of $1.6 million related to MIN-101, $1.5 million in program costs related to MIN-202 and $0.3 million of employee compensation. General and administrative expenses were $1.9 million in the first quarter of 2015, compared to $2 million in the same period in 2014. The decrease was primarily due to lower consulting and professional fees offset by increases in employee compensation. Net loss was $6.1 million for the first quarter of 2015 or a loss per share of $0.31 basic and diluted, as compared to net loss of $2.9 million or a loss per share of $0.43 basic and diluted for the same period in 2014. We are pleased with our current financial position which enables us to advance our drug development pipeline toward important milestones expected between now and the end of 2016. Now I would like to turn the call over to the operator for any Q&A.

[Operator:]

[Operator Instructions]. Our first question comes from Jason Butler with JMP Securities.

[Jason Butler:]

First one, just on the NKD [ph] program, can you walk us through the rationale for including the higher dose? Is it based on pre-clinical data that you’ve supporting higher dose or do you have any receptor occupancy data that might support [indiscernible].

[Remy Luthringer:]

Yes, so the rationale is definitely related to the pharmacology of the molecule and do some clinical pharmacology data, so not only preclinical data but not clinical pharmacology data. As you remember we have carried out sleep study in volunteers and as we know sleep is a very good biomarker of effects on mood and clearly between 0.5 milligram and a dose which is close to 2.5 milligram which was 3 milligram tested in this [indiscernible] study. We saw some differences indicating that we’re probably engaging more targets with the higher dose so this is the reason why we added this dose.

[Jason Butler:]

And then for treatment of Parkinson's, should we expect any additional preclinical data in 2015 before you move into the clinic next year?

[Remy Luthringer:]

Yes indeed, we’re still awaiting some preclinical data coming out from the monkey [ph] study that we did with the MPTP model and we will soon report on this data when they are completely validated and QC'ed.

[Operator:]

Our next question comes from Brian Skorney with Robert W. Baird.

[Unidentified Analyst:]

This is Meg, on for Brian. I just have a question based on the PK data from the MIN-101 formulations do you expect the dose response between 32 and 64 milligram?

[Remy Luthringer:]

Definitely I mean no we have once a day formulation which was the objective of this trigger size, it seems that clearly have a dose dependent on effect when you’re going to very low doses. We do not expect a huge difference between 32 milligram and 64 milligram so this doses should be having therapeutic effects.

[Operator:]

[Operator Instructions]. And I'm not showing any further questions at this time. I would like to turn the conference back over to our host.

[Joe Reilly:]

Thank you all for your participation in today's call and we really look forward to updating you on the progress in the next coming months. Thank you.

[Operator:]

Ladies and gentlemen, this does conclude today's presentation. You may all disconnect at this time.