Anavex Life Sciences - Earnings Call - Q1 2025

Transcript

Clint Tomlinson (Head of Investor Relations)

Good morning, everyone, and welcome to the Anavex Life Sciences Fiscal 2025 First Quarter Conference Call. My name is Clint Tomlinson, and I will be your host for today's call. At this time, all participants are in a listen-only mode, and later we will conduct a question-and-answer session. During this session, if you would like to ask a question, please use the Q&A box or raise your hand. Note that this conference is being recorded. The call will be available for replay on Anavex's website at www.anavex.com. With us today is Dr. Christopher Missling, President and Chief Executive Officer, and Sandra Boenisch, Principal Financial Officer. Before we begin, please note that this conference call, the company will make some projections and forward-looking statements. These statements are only predictions based on current information and expectations and involve a number of risks and uncertainties.

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. With that, I'd like to turn the call over to Dr. Missling.

Christopher Missling (President and CEO)

Thank you, Clint, and good morning, everyone. Thank you for being with us today to review our most recently reported financial results and to provide our quarterly business update. I would like to point out that we are receiving growing support from stakeholders for the potential to advance a novel precision medicine treatment for early Alzheimer's disease with convenient oral dosing and with potential clinical meaningful benefit. We are excited to be potentially making a difference for individuals suffering from Alzheimer's disease by presenting a scalable treatment alternative alongside the ease of oral administration. Last month, we provided top-line long-term data from the Phase IIb/III ATTENTION-AD open-label extension trial. The data demonstrated that over three years of continuous treatment with blarcamesine significantly reduced clinical decline, showing continued clinical meaningful benefit for early Alzheimer's disease patients.

Also, in January, we announced that the Journal of Prevention of Alzheimer's Disease, JPAD, published a peer-reviewed detailed results from the Phase IIb/III study evaluating oral blarcamesine for the treatment of early Alzheimer's disease. Once daily oral blarcamesine, demonstrating a safety profile with no associated neuroimaging adverse events, significantly slowed clinical progression by 36.3% at 48 weeks with blarcamesine group, as well as the pre-specified Sigma-1 wild-type gene group by 49.8% at 48 weeks on the pre-specified primary cognitive endpoint, ADAS-Cog13, respectively. The peer-reviewed publication of these data underscores the significance of the findings for both the scientific community and those focused on Alzheimer's disease. Alzheimer's disease is a highly complex condition, and this dataset plays a crucial role in advancing our understanding of the Phase IIb/III results. We are grateful for the dedication from participants, their families, and the sites for taking part in this important study.

Finally, at the end of January, we announced that Anavex was issued a new composition of matter U.S. patent expected to remain in force at least until July 2039, entitled A2-73 crystalline polymorph compositions of matter and methods of use thereof from the United States Patent and Trademark Office. This new patent claims crystalline forms of the dihydrogen phosphate salt of ANAVEX 2-73, free base, as well as transdermal patches and enteric coated oral dosage forms, including the same for neuroprotection and treatment of neurodegenerative disorders, including Alzheimer's disease, Parkinson's disease, and other disorders. The issuance of this U.S. patent again showcases our expertise in identifying and pursuing novel therapeutic forms and formulations that are rooted in science.

With respect to ANAVEX 3-71, which will now include more participants at the longer treatment duration within Part B, Anavex expects data from the ongoing Part B of the placebo-controlled Phase II study in schizophrenia in the first half of 2025, and now I would like to direct the call to Sandra Boenisch, Principal Financial Officer of Anavex, for a financial summary of the recently reported quarter.

Sandra Boenisch (Principal Financial Officer)

Thank you, Christopher. Good morning, everyone. I'm pleased to share with you today our first quarter financial results for the 2025 fiscal year. Our cash position at December 31st was $120.8 million, and we had no debt. During the quarter, we utilized cash and cash equivalents of $12.1 million in operating activities after taking into account changes in non-cash working capital accounts. As of quarter end, we anticipate, at the current cash utilization rate and range, a runway of approximately four years. During our most recent quarter, general and administrative expenses were $3.1 million as compared to $2.7 million for the comparable first quarter. Our research and development expenses for the quarter were $10.4 million as compared to $8.7 million for the comparable first quarter. And lastly, we reported a net loss of $12.1 million for the quarter, or $0.14 per share. Thanks, and back to you, Christopher.

Christopher Missling (President and CEO)

Thank you, Sandra. In summary, we are receiving growing support from stakeholders for the potential to advance a novel treatment for early Alzheimer's disease with convenient oral dosing and with potential clinically meaningful benefit. We are very excited to be potentially making a difference for individuals suffering from Alzheimer's disease by presenting a scalable treatment alternative alongside the ease of oral administration using precision medicine. I would now like to turn the call back to Clint for Q&A.

Clint Tomlinson (Head of Investor Relations)

Thank you, Christopher. We will begin the Q&A session now. If you have a question, please raise your hand or enter it in the Q&A box. And it looks like the first question is coming from Tom Bishop. Hold, please. Tom, can you hear us?

Now.

I can hear you now, Tom.

Good. With regards to the next few months, I guess we're hoping for some word from Europe around mid-year, or is that the timeline? I thought I heard six months, but then I heard maybe it could be longer.

Christopher Missling (President and CEO)

So we will expect the review to take 210 days since filing, which was in November last year, and it was accepted in December the following month, less than 30 days after the filing. So we are prepared for this review, and we're looking forward to it.

That would be like July-ish or maybe September?

We expect the feedback for the review to complete it by the end of this year. I don't know more specifics at this time, so that's what we are ready to prepare for.

Okay. Now, was there any discussion about a priority review of any sort or that ship has sailed?

The requirement for that is a prime status, and since we filed without the prime, because we were encouraged to file without the prime because of the unmet need, this is a procedure which is 210 days.

Okay. Also, what are the upcoming events that we can look forward to? I guess we have the 3-71 trial due sometime by mid-year.

That's correct, so we expect the ANAVEX 3-71 schizophrenia readout, as we mentioned, in the first half of this year, then we also are expecting a scientific presentation of detailed data of the open-label extension study, ATTENTION-AD, in April at the AD/PD conference, which we top-lined last month, and the details will be presented at this conference, and further, we will provide updates on the pipeline. We expect updates on the Parkinson's disease program and other subsequent programs as well.

Clint Tomlinson (Head of Investor Relations)

Tom, we don't hear you.

You said you are receiving increasing interest or increasing support. Now, we're just wondering if you could elaborate on that.

Christopher Missling (President and CEO)

We are getting support from stakeholders. That is advocacy groups across the board, and that's very encouraging because of the unmet need and the current limited availability of scalable drugs for this horrible condition, and that includes advocacy groups in Europe and around the globe.

Okay. And how about from other pharmaceutical companies? I mean, if this was approved, you'd need to file. You'd need to start to market it in Europe and produce it and all that. And I guess one thing people point to is that there's been no hint yet of any interest from a pharma company. So just wondering that I think the company's just been quiet about it.

Yeah, that's not accurate because there's ongoing discussions, and we initiated that last month at J.P. Morgan. And also regarding the material for marketing the drug, we have enough supply for launching this drug. The manufacturing has been extremely productive to have marketed product ready for the market entry. Regarding how to move forward in terms of a sales force or a partnership with a pharma company, this is deciding on the terms of those discussions, and the deciding factor, guiding factor, will be creating the most shareholder value for shareholders. So whatever is in the interest of shareholders, that path will be taken. But there's no doubt if there's a drug approved for such an indication, there will be a lot of interest.

Also, what is the status of Rett syndrome?

Rett syndrome, we decided to, and we said it a while ago, we plan to do another study to reconfirm and a larger study given that the last study was short on number of patients and the placebo arm was small, giving some volatility in the endpoints, so we are planning to do another study in Rett syndrome as well, and this is what I refer to: updates will come accordingly throughout this year.

Okay. It's been a while since that last trial ended, so I'm just wondering what's the.

We are allocating resources, and we also like to focus on what is creating most value right now. This is the Alzheimer's program, and the filing of the Alzheimer's indication was the most priority for us last few months.

Okay. And you mentioned the crystalline patent, and I was just wondering how significant is that? It was hard to tell.

It's actually very significant, and I think that should be pointed out. Thanks for asking the question that this crystalline patent API was actually used in all prior clinical studies. So it's not a new patent which has been suddenly identified as a patentable composition of matter, but these trials which we ran in Alzheimer's disease were all utilizing these compositions of matter of the patent which expires at the earliest in July 2038, 2039. And that's very important because that means our composition of matter is protected for the entire spectrum of these indications, including Alzheimer's disease as well as Parkinson's disease for the capsule or the tablets used with the respective API, which will be the case as well in the market.

That is very good news then.

It is.

Also, any update on Parkinson's?

Yeah. As I said, we will update the Parkinson's program. We had interaction with regulatory bodies, and we will provide an update accordingly shortly about how to proceed with the Parkinson's disease program.

Anything on the FDA as far as blarcamesine goes?

For Alzheimer's disease, we are planning to have a meeting, and that is what we did with EMA, with the dialogue, with a very open dialogue in a meeting to request and share the data and asking what is the recommended procedure for us to proceed, and we're looking forward to this interaction.

Okay. Great. And are the OLE patients still on the drug, or?

They are actually, and we mentioned it at the last press release when we mentioned the OLE data that the 74 participants are still on study drug on a compassionate use program, and we will also follow up with them for real-world evidence, and we expect data from that as well going forward, so that's very encouraging that after four years of total intake of the drug in the placebo-controlled part as well as in the open-label part, patients still continue to take the drug and are requesting to be on study drug, and we are able for that reason to use this additional population for real-world evidence potentially, and so far, nobody died from the drug in our study and outside of the study, and that's actually preceded the Phase II/III that includes also the Phase IIA, which started over nine years ago.

Over nine years, there has been no death caused by the drug.

You know, the drug is just amazing in its advantages over these infusion therapy drugs, and it's just, you know, I'm very excited. Well, thank you for answering my questions.

Thank you.

Clint Tomlinson (Head of Investor Relations)

Thank you, Tom. There's another question here. Dr. Missling, if you wanted to expand on that, a brief overview of efficacy compared to the monoclonal antibodies.

Christopher Missling (President and CEO)

So it's important to point out that there's a requirement for clinically meaningfulness, and that's been recently published in a paper 2024, which we also pointed out or cited in one of the last press releases on the efficacy data on the open-label as well as the paper publication on JPAD. And that threshold is a two-point score or more delta of ADAS-Cog13. And we demonstrated in our trials an ADAS-Cog13 of 2.03 for the entire population, all participants. That means we are clearly clinically meaningful because that means that a patient, a participant, can identify these changes himself, herself, but also the caregiver can identify these changes, as well as the physician can identify these changes. And every score less than that would be not identifiable. And to put this in perspective, our ADAS-Cog13 over 48 weeks reached that level of 2 point or more.

In comparison, Kisunla or donanemab from Lilly reached for the ADAS-Cog13 exactly the same score, a score only of 1.35 delta to placebo. That would not meet the clinically meaningful threshold of 2-point or more. It was also reached after a much longer period of time, this 1.35. We are better and earlier in identifying improvement compared to placebo with blarcamesine.

That comes on top of the advantage of an oral once-daily administration, which is mechanistically probably closer to the complexity or origination of the disease, which is ahead or earlier than A-beta and tau aggregation and inflammation and other dysfunctions which are within this disease than other drugs, including the monoclonal antibodies, which are targeting further downstream limited pathways, for example, the A-beta pathway, which has recently gotten in a bit of critique because of the focus on this and the support which was criticized in some media recently as well. There's no doubt that we are happy to consider blarcamesine as potentially complementary to existing treatments that includes the antibodies, but also existing treatments, which is donepezil and memantine, which was demonstrated in our trial to be on the data was on top of blarcamesine, on top of donepezil and memantine.

So our effect is basically on top of standard of care available at the time of the trial. But again, the key thing is that the scalability, the ecosystem of the healthcare would be better suited with an oral once daily. And given its ability not to cause serious deaths like the antibodies are doing. And that's why they have a black box warning. That means you can die from this drug in the case of the antibodies. And you need to have a physician which has to be very courageous to prescribe this drug. And given that it has to monitor the effect on the patient very carefully and requires a mandatory MRI every three weeks. And this requires contrast medium. It's not a trivial task also to find an appointment for an MRI. And MRI centers are not widely spread out in the Midwest. You hardly find any.

And that is probably also the contribution of the slow uptake of the antibodies and the limited ability to expand this into a broader patient population with diverse background and location. And that would be overcome with oral once daily small molecule like blarcamesine, of course.

Clint Tomlinson (Head of Investor Relations)

Thank you for that. Another question, and I think it's the last one here, is assuming an EMA approval, what other countries may follow and open their markets to blarcamesine?

Christopher Missling (President and CEO)

So we are planning to submit to other jurisdictions, among them in the U.K. and others. Canada and Australia have been also participating in this trial. That will probably happen before the end of the year. So we're expanding this. And I mentioned the plan for the U.S. as well, which will be a dialogue with the agency as well. So we're expanding the jurisdictions beyond EMA because of the unmet need.

Clint Tomlinson (Head of Investor Relations)

Excellent. Thank you. I believe that's all the questions at this time, Dr. Missling.

Christopher Missling (President and CEO)

Thank you. So in closing, we'd like to continue to focus on execution and commercial readiness as we advance our therapeutic pipeline to potentially improve patients' lives with these devastating conditions. I'd like to thank you for your attention. Thank you.

Clint Tomlinson (Head of Investor Relations)

Thank you, everyone, for joining the call today. This concludes our conference call. We appreciate your participation. You may now disconnect.