Mind Medicine (MindMed) - Earnings Call - Q4 2024
March 6, 2025
Executive Summary
- Q4 2024 focused on funding and Phase 3 execution: cash and cash equivalents were $273.7M, with runway “into 2027” and at least 12 months beyond the first Phase 3 GAD topline, enabling three pivotal trials (Voyage, Panorama, Emerge) to progress without near-term financing risk.
- Clinical catalysts unchanged: Voyage topline (Part A) expected 1H 2026; Panorama 2H 2026; Emerge (MDD) 2H 2026. First patients dosed in Voyage in Q4 and Panorama in Q1; Emerge initiation guided for 1H 2025.
- Operating spend ramped as expected: Q4 R&D rose to $21.8M (from $11.5M YoY) driven by Phase 3 MM120 ODT starts; G&A flat YoY at $10.7M. Net loss was $(34.7)M (vs $(23.9)M YoY); basic/diluted EPS $(0.41).
- Potential stock catalysts: enrollment progress updates, blinded sample-size re-estimation mid-trial, regulatory design clarity (functional unblinding mitigation, 8-hour monitoring), and continued HEOR/payer groundwork ahead of 2026 readouts.
What Went Well and What Went Wrong
- What Went Well
- Phase 3 execution milestones: first patients dosed in Voyage (Q4) and Panorama (Q1), with strong site/patient enthusiasm; Emerge on track to initiate 1H 2025.
- Balance sheet strengthened: ~$250M raised in 2024; YE cash $273.7M; runway into 2027 and ≥12 months beyond first Phase 3 GAD topline.
- Regulatory/market positioning: FDA Breakthrough Therapy (GAD); UK ILAP Innovation Passport; added to Nasdaq Biotechnology Index, supporting visibility and potential access.
- What Went Wrong
- Elevated operating losses with scale-up: Q4 net loss $(34.7)M vs $(23.9)M YoY as R&D stepped up with Phase 3 starts.
- Non-cash volatility: larger negative fair value mark on 2022 USD warrants in Q4 ($(4.9)M) pressured other income/expense line.
- Estimates benchmarking unavailable: S&P Global quarterly consensus for Q4 (revenue/EPS) was not retrievable at this time, limiting beat/miss assessment (will update when accessible). Values from S&P Global were unavailable due to request limits.
Transcript
Operator (participant)
Good morning and welcome to the Mind Medicine fourth quarter and year-end 2024 financial results corporate update conference call. Currently, all participants are on listen-only mode. This call is being webcast live on the investors and media section of MindMed's website at mindmed.co, and a recording will be available after the call. I would like to introduce Stephanie Fagan, Chief Corporate Affairs Officer of Mind Medicine. Please go ahead.
Stephanie Fagan (Chief Corporate Affairs Officer)
Thank you, Operator, and good morning, everyone. Thank you for joining us for a discussion of MindMed's fourth quarter and year-end 2024 business highlights and financial results. Leading the call today will be Rob Barrow, our Chief Executive Officer, and he will be joined by Dr. Dan Karlin, our Chief Medical Officer. After our prepared remarks, we will open the call for Q&A. An audio recording and webcast replay for today's conference call will also be available online as detailed in the press release announcement for this call. During today's call, we will be making certain forward-looking statements, including without limitation statements about the potential safety, efficacy, and regulatory and clinical progress of our product candidates, our anticipated cash runway, and our future expectations, plans, partnerships, and prospects.
These statements are subject to various risks, such as changes in market conditions and difficulties associated with research and development and regulatory approval processes. These and other risk factors are described in the filings made with the SEC and the applicable Canadian securities regulators, including our annual report on Form 10-K filed today. Forward-looking statements are based on the assumptions, opinions, and estimates of management at the date the statements are made, including the non-occurrence of the risks and uncertainties that are described in the filings made with the SEC and the applicable Canadian securities regulators or other significant events occurring outside of MindMed's normal course of business. You are cautioned not to place undue reliance on these forward-looking statements, which are made as of today, March 6, 2025. MindMed disclaims any obligation to update such statements, even if management sees change except as required by law.
With that, let me turn the call over to Rob.
Rob Barrow (CEO)
Thank you, Stephanie, and everyone for joining our call today. 2024 marked a year of unparalleled progress for MindMed, underscoring our leadership in advancing new treatments for brain health. We successfully achieved key milestones positioning us to potentially deliver multiple clinical readouts from our MM-120 phase III program in 2026. A year ago, we announced positive results from our phase II-`B study of MM-120 in Generalized Anxiety Disorder, or GAD, which showed statistically significant and durable improvements in mean Hamilton Anxiety Rating Scale, or HAMA, and Clinical Global Impression Severity, or CGIS, scores for 12 weeks after a single dose of MM-120. We also announced the results of a pharmacokinetic bridging study of our orally disintegrating tablet formulation of MM-120, our intended commercial formulation, which we are also using in our phase III studies.
Additionally, in 2024, we secured a new formulation patent on MM-120 ODT, extending our intellectual property protection through at least 2041. Based on the strength of our data and the seriousness of GAD, FDA granted our MM-120 GAD program Breakthrough Therapy designation, indicating its potential to represent a substantial improvement over currently available therapies. Our development approach prioritizes designing clean studies that yield clear results and are efficient to operationalize. This is exemplified by our bold decision early in development to study MM-120 as a standalone treatment and our streamlined phase III clinical trial designs, which aim to replicate the rapid, durable response observed in our phase IIB study. Our pivotal program in GAD includes two phase III studies, Voyage and Panorama.
As we previously announced, we are very excited to have already successfully dosed patients in both studies, and we have seen strong enthusiasm from clinical sites and patients as recruitment has continued to ramp up. These sites include some of the highest-performing enrollers from our phase IIB study, and we are very encouraged by early enrollment trends. We are also on track to dose participants in Emerge, our first phase III study for the treatment of major depressive disorder, or MDD, in the first half of this year. This phase III program closely aligns with our GAD program with a protocol that allows for streamlined and efficient patient enrollment. These two indications, GAD and MDD, affect approximately 51 million adults in the U.S. and represent two of the most significant unmet medical needs in psychiatry.
We believe MM-120 could offer a differentiated and compelling option in both GAD and MDD, potentially positioning it as a best-in-class and first-in-class treatment option. We aspire to deliver a truly transformative treatment that has the potential to change the trajectory of the ongoing brain health epidemic. In fact, in our research with providers, they have shared their belief that the availability of psychedelics will radically transform treatment for GAD and MDD. Over the past year, we have been dedicated to broadening the awareness and understanding of these disorders and sharing our findings at a number of key medical meetings, such as the American Psychiatric Association's annual meeting, the International Society for Health Economics and Outcomes Research annual meeting, and the American College of Neuropsychopharmacology's annual meeting.
We continue to generate evidence that underscores the significant economic and social burden of GAD in the United States, including higher healthcare utilization and costs, as well as reduced work productivity. These findings highlight the substantial impact of GAD, which has largely been underappreciated. I couldn't be more thrilled with the progress we've made this past year. As we look forward, 2025 will be a year of execution focused on our phase III programs in GAD and MDD and preparing for our three pivotal trial readouts in 2026. We have a strong, dedicated team in place and continue to build a leading organization with best-in-class execution. Over the past year, we have also strengthened our financial position, having raised approximately $250 million in gross proceeds and gained the support of a number of top institutional investors.
We expect our current cash and cash equivalents to provide sufficient funding into 2027 with a cash runway that extends at least 12 months beyond the first phase III top-line data readout for MM-120 and GAD. Now, let me turn the call over to our Chief Medical Officer, Dr. Dan Karlin, to discuss our clinical development programs in more detail. Dan?
Dan Karlin (CMO)
Thanks, Rob. As Rob just mentioned, we have already dosed participants in both of our pivotal phase III clinical studies for GAD, Voyage, and Panorama. We are highly encouraged by the early enrollment trends and continue to expect top-line readouts from Voyage in the first half of 2026 and Panorama in the second half of 2026. Each study consists of two parts. Part A, a 12-week randomized double-blind placebo-controlled parallel group study assessing the efficacy and safety of MM-120 versus placebo, and Part B, a 40-week extension period with opportunities for open-label treatment designed to provide important long-term data on the durability and response patterns with MM-120.
In Voyage, we expect to enroll approximately 200 participants who will be randomized one-to-one to receive MM-120 100 micrograms or placebo, while in Panorama, we expect to enroll approximately 250 participants who will be randomized two-to-one-to-two to receive MM-120 100 micrograms, 50 micrograms, or placebo. As Rob mentioned, we have taken an intentional and thoughtful approach to our development strategy, which has been informed by our team's deep experience in developing novel psychiatric therapies and through close collaboration with FDA. Our protocols are designed with operational input from sites and participants and specific attention to enabling enrollment so that we are able to rapidly recruit a representative sample of participants. Our phase III studies in GAD closely resemble the design and execution used in our phase II-B study.
In both Voyage and Panorama, the primary endpoint is the change from baseline to week 12 in the HAMA, which was the outcome measure used for the approval of the currently available GAD therapies. These trials incorporate important methods such as the use of central raters who are blinded to both treatment assignment and visit number, questionnaires to assess potential expectancy bias, and in the case of Panorama, multiple control arms, including a lower dose control that is perceivable and was previously tested. This approach builds on our phase II-B data, where we demonstrated that despite functional unblinding of participants at all tested doses, the lower doses, including 50 micrograms, did not demonstrate a meaningful clinical response. We believe this evidence strongly supports our view that the anxiolytic effect of MM-120 cannot be attributable to functional unblinding, and thus the measured effect reliably represents a true drug effect.
These trials were designed to have 90% power to detect a five-point improvement over placebo based on certain statistical assumptions, where in the phase II-B trial, we observed an almost eight-point improvement for MM-120 over placebo at week 12. We are using an adaptive design in our phase III studies that includes an interim blinded sample size re-estimation, which allows for increased enrollment of up to 50% in each trial. This approach helps to adjust for any unexpected variability in nuisance parameters, specifically dropout rates and pooled variance of HAMA response, maintaining statistical power and enhancing the interpretability of our results if needed. Key elements such as inclusion and exclusion criteria will largely mirror our successful phase II-B study of MM-120 and GAD, incorporating exclusion criteria around the recency or total use of psychedelics to ensure a representative sample is recruited.
We also conduct comprehensive safety assessments and labs before and after the administration of MM-120 and ensure the collection of all adverse events. Turning to our MDD program with MM-120, we remain on track to dose our first participant in the first half of 2025 with data expected in the second half of 2026. Just like in our GAD program, we anticipate that our MDD program will consist of two pivotal clinical studies. Our first study, Emerge, will be comprised of two parts. Part A, a 12-week randomized double-blind placebo-controlled parallel group study assessing the efficacy and safety of a single dose of MM-120 versus placebo, and Part B, a 40-week extension period during which participants will be eligible for open-label treatment with MM-120, subject to meeting eligibility requirements.
In Emerge, we plan to enroll at least 140 participants with a primary diagnosis of MDD randomized one-to-one to receive MM-120 100 micrograms or placebo. The primary endpoint in Emerge is the change from baseline in Montgomery-Asberg Depression Rating Scale score, or MADRS, at week 6 between MM-120 100 micrograms and placebo. The design and timing of a second MDD trial will be informed by the progress from Emerge and additional regulatory discussions. With that, I'll turn the call back over to Rob to discuss our fourth quarter and year-end financial results. Rob?
Rob Barrow (CEO)
Thanks, Dan. Turning to our financial results for the year ended December 31st, 2024, we ended the year with cash and cash equivalents totaling $273.7 million, compared to $99.7 million as of December 31st, 2023. Overall, we believe that our cash and cash equivalents as of December 31st, 2024, will be sufficient to fund our operations into 2027 and at least 12 months beyond the top-line data readout for our first phase III trial of MM-120 in GAD. Research and development expenses were $21.8 million for the three months ended December 31st, 2024, compared to $11.5 million for the three months ended December 31st, 2023, an increase of $10.3 million. R&D expenses were $65.3 million for the year ended December 31st, 2024, compared to $52.1 million for the year ended December 31st, 2023, an increase of $13.2 million.
The increase was primarily due to expenses related to our pivotal MM-120 programs, phase I MM-402 program, and an increase of internal personnel costs, partially offset by a decrease in expenses related to preclinical activities. We anticipate R&D expenses to ramp up in 2025 due to the costs associated with running three pivotal phase III studies. General and administrative expenses were $10.7 million for the three months ended December 31st, 2024, and were the same for the three months ended December 31st, 2023. G&A expenses were $38.6 million for the year ended December 31st, 2024, compared to $41.7 million for the year ended December 31st, 2023, a decrease of $3.1 million. The decrease was primarily attributable to reduced professional services fees and expenses, partially offset by increased stock-based compensation expense and costs associated with pre-commercial activities.
The company's net loss for the three months ended December 31st, 2024, was $34.7 million, compared to $23.8 million for the same period in 2023, an increase of $10.9 million. The company's net loss for the year ended December 31st, 2024, was $108.6 million, compared to $95.7 million for the same period in 2023, an increase of $12.9 million. The increase was primarily attributed to research and development expenses associated with our MM-120 and MM-402 programs. In closing, I'm incredibly proud of the progress we have made over the past year at Mind Medicine. We believe MM-120 is uniquely positioned to potentially offer a novel and highly differentiated treatment option for people living with brain health disorders. None of our progress would have been possible without the dedication of our exceptional team. I want to thank them for their continued efforts and commitment to our mission.
With that, I'd like to thank you all again for joining us today, and the team and I are happy to take your questions.
Operator (participant)
Thank you. If you'd like to ask a question, please press star 11. If your question hasn't been answered and you'd like to remove yourself from the queue, press star 11 again. Our first question comes from Mark Goodman with Lyric. Your line is open.
Hi, this is Madhu on the line for Mark. I think some people we speak with are trying to get a better understanding of which GAD patients would be likely to want to use MM-120 over other available options once it could be eventually approved. I am just curious, would this be for patients who strictly do not respond to other available therapies or patients past a certain severity level? If you could share any insights that you have on that, maybe from market research or just in terms of the patients that are looking to enroll in these studies, that would be great. Thank you.
Rob Barrow (CEO)
Yeah, thanks so much, Madhu, and I'll turn it over to Dan in just a second. I think at a very high level, certainly the indication we're pursuing, which is a broad label for all generalized anxiety disorder patients, would enable access much more broadly than if we had a severely restricted criteria on the label. Certainly, there are payer dynamics that come into play, and we've had really encouraging signs in that research just based on the relative lack of treatments for GAD and the long time since any new treatments have been introduced and the overall severity of that population. Maybe, Dan, if you want to add some clarity there as well.
Dan Karlin (CMO)
Yeah, absolutely. I think that there's a really interesting point there, which is that the sorts of patients who would be interested in accessing the drug is a really broad swath of the population. For folks with diagnosed GAD, tolerability and efficacy of existing drugs like SRIs is pretty unsatisfactory. SRIs have never been particularly effective against anxiety cluster symptoms, either in GAD or MDD. What we see both in market research, but also in who presents to enroll in our studies, is that there are people with severe GAD, there are people with moderate GAD, there are people who have had prior treatments, including SRIs or psychotherapy. There are people who haven't had those treatments before, either because they didn't want them or because their GAD wasn't recognized.
We see there being both broad appeal and, of course, based on the efficacy we've seen in phase IIb, the ability to really help a broad swath of patients. The realistic nature of a payer-supported commercial market is that there are likely to be step therapy requirements. What you see often with new treatments in the class, even new treatments that have a mechanism that's similar to existing treatments or the same as existing treatments, is a requirement to have been failed by one or more existing treatments. Given the efficacy that we're seeing, given the appeal of having a single treatment with no lingering adverse events, we think that the demand side will be quite high.
Thank you.
Operator (participant)
Thank you. Our next question comes from Gavin Clark Gartner with Evercore ISI. Your line is open.
Gavin Clark-Gartner (Managing Director)
Hey, guys. Congrats on the progress, and thanks for taking the questions. First, I just wanted to ask, are you planning to give more granular enrollment updates for both of the GAD trials over the course of this year, or is the next update that we should expect enrollment completion?
Rob Barrow (CEO)
Yeah, thanks so much, Gavin. We haven't yet provided exact guidance. I think we would expect to follow a similar pattern as industry standards and as we did in our phase II study, where as we approached the end of enrollment, we were able to announce that. Certainly, as we have any material updates, we would be disclosing those.
Gavin Clark-Gartner (Managing Director)
Got it. That makes sense. Separately, just on the sample size re-estimation analysis, I wanted to confirm that there's no alpha used, no futility criteria, and also ask what you think the likelihood of the trial being upsized a little bit is and when this analysis roughly may occur.
Rob Barrow (CEO)
Yeah, great question. The way the sample size re-estimation is designed is a no alpha spin blinded re-estimation. As Dan mentioned, it's only based on the nuisance parameters, the dropout rate, and the pooled variance of the standard or the pooled variance of MA outcomes. We can't provide exact timing for when that would occur other than upon the completion of about half the patients, about 100 patients. We make it through week 12 is when we anticipate to run that analysis. Certainly, no futility, no spend of alpha. It's really just to ensure that power is maintained if any of those nuisance parameters are outside of our estimates. Now, the estimates we have, we feel quite confident in based on a long history of historical norms in this population and also analyzing the data from our phase II clinical trial.
We feel quite confident in the assumptions we've made at baseline, but it just adds an additional layer of protection in the event there is some kind of surprise on either the variance or on the dropout rate.
Gavin Clark-Gartner (Managing Director)
Very helpful. Thank you.
Rob Barrow (CEO)
Thanks, Gavin.
Operator (participant)
Thank you. Our next question comes from Brian Abrahams with RBC Capital Markets. Your line is open.
Hi, everyone. This is Nevin on for Brian. Thank you for taking our questions. With the Voyage and Panorama studies underway, I was wondering if you could provide any more color on what you're seeing in the early rates of enrollment. Are they tracking in line with or better or worse than the prior phase II trial? I guess, among those who, just given that recent more enthusiasm for psychedelic clinical trials in general, are you seeing similar types of patients enrolling in the GAD trial in the pivotal trials as you did in the phase II? I'm wondering if perhaps the increased awareness of psychedelics among the patient population could change or potentially impact the expectancy bias among that group.
Rob Barrow (CEO)
Yeah, thanks so much, Nevin. While we can't provide specific numbers of enrollment, as Dan mentioned, we've been really highly encouraged by the enthusiasm from providers, from patients, from the early enrollment trends, and are quite confident as a result in the progress we're making in both of the studies. To your latter question, again, we wouldn't provide specifics on demographics, but the inclusion/exclusion criteria and the population we're pursuing are very, very close to identical, almost to the phase II-B trial. Certainly, the expectation and all of the extensive screening that we do to ensure that we get the right patients in these studies, we feel quite confident that we're getting a similar population and a representative one.
On the final point, while we certainly have seen growing interest, I don't know that we could say that that has had a direct impact in any measurable way on expectancy. I mean, I think population-level or group-level trends certainly are one thing, but I think we have to remember for an individual person, for a patient who's been suffering for GAD for, in many cases, years or decades, people enroll in late-stage trials with inevitable expectancy, regardless of the treatment that is being studied, simply for the reason that most of those patients either are unsatisfied or not getting the level of response from currently available therapies, and therefore come into clinical trials with the hope that something new will potentially help them.
While they may be randomized to get placebo or an inactive dose of drug in these studies, we certainly expect, like with any clinical trial, there's going to be a degree of expectancy just by the nature of it being an experimental drug that we're studying.
Okay, thank you. A quick follow-up as well. I know you had mentioned that the inclusion/exclusion criteria were similar across both Panorama and Voyage. Looking at the clinical trials listing for both of them, I see that the exclusion criteria for Voyage specifically mentions bipolar disorder, but Panorama does not. Is there any particular reason for that?
No, the inclusion criteria could not be consistent across both studies in that respect.
Okay, thank you.
Operator (participant)
Thank you. Our next question comes from Charles Duncan with Cantor. Your line is open.
Charles Duncan (Managing Director)
Hey, morning, Rob and Dan. Congrats on the design and operationalizing these phase IIIs. Thanks for taking the question. I had another question about enrollment criteria. I think Dan mentioned that he expected a broad swath of patients to be interested in the study. I guess I'm wondering, are you seeing any types of severity or treatment experience that are presenting? With regard to experience with LSD or psychedelics in the past, what is happening in terms of the enrollment for the patients in Voyage and Panorama? Thanks.
Rob Barrow (CEO)
Thanks, Charles. I'll turn it over to Dan to answer both those.
Dan Karlin (CMO)
Yeah, consistent with what we believe to be a representative sample of people who seek treatment for GAD in general, what we're seeing, again, while we can't really comment on live enrollment in phase III, what we were able to see in the phase II study, again, like what Rob said, nearly identical inclusion/exclusion, was about two-thirds of patients with treatment experience who'd been failed by prior treatments, about one-third who hadn't been treated, 10-15% with a fairly recent diagnosis of GAD. We know in the population that there are almost twice as many people walking around with symptoms of moderate to severe GAD who have never been diagnosed with it on a population level. When new treatments become available or new studies are launched, additional attention is paid to a diagnosis. Obviously, that diagnosis gets made.
Folks who have had the disease for some time, you'll recall in phase II, we saw a mean MA of 30, just about 30. That puts people well into the severe category. There's no reason to think that we would end up particularly different in this study. When we think about that, the breadth of the appeal of the treatment and the degree to which people aren't served by what's available, that's, again, while we can't comment exactly on phase III, there's no reason to think things would be looking all that different.
Charles Duncan (Managing Director)
Okay. Let me ask you a quick for a little bit of nuance on Panorama. I like that you're using a dose that doesn't appear effective to remove expectation bias or unblinding, excuse me. Were you surprised at how sharp the dose response curve was, 50 versus 100? Do you anticipate that 50 really to have a no effect and to remove the or reduce the functional unblinding?
Rob Barrow (CEO)
Yeah, thanks so much for the question, Charles. I think there's two key features there. I'll talk on the dose response aspect first, which is that certainly, the design in the phase II study, the primary analysis was one that is aimed at defining a dose response where we pre-specified response curves and statistically showed that the data from the phase II study matched multiple of those candidate dose response curves. I'd say that the data certainly matched the potential and the assumptions we made going into the phase II study. I think it was quite stark, as you mentioned, the fact that in the primary in phase II at week four, there was less than a point improvement over placebo at the 50 microgram level. There was a 7.6 unit improvement over placebo for the 100 microgram dose.
While we were not surprised by the overall shape of the curve, it is in quite stark contrast, the difference in clinical response between 50 and 100 micrograms in the data that have been generated to date. As you recall, really, the only data in the field to look at a comprehensive dose response across a full range. Now, on the second point, it is really important for us, and we think that the field in many instances has conflated some of the issues that are at play with why we take these additional methodological steps. We talked before about potential expectancy, which we certainly expect to be the case in any clinical trial. With any treatment, universally, the truth for psychiatric drugs. For any treatment where there is a clear, discernible acute effect, there is a risk that that functional activity could unblind the patients.
Unblinding, importantly, is a binary variable. There's not a continuous degree. You can't be 20% unblinded or 80% unblinded. You're either blinded or not. What we saw in the phase II data was that all patients across the dose levels effectively were unblinded. 88% or more across all those levels were functionally unblinded. Yet we saw that stark dose response between the two levels. Really, the intent of including a 50 microgram dose is twofold. It's really important that that dose level is as close to the acute perceptual effects as the clinically active or the dose of interest that we're studying, 100 micrograms. Otherwise, it doesn't have similar functional activity, and it doesn't really aid in the functional blinding that we're pursuing.
What we're trying to do fundamentally is sever the tie between an expectancy bias and an impact on biasing the clinical outcomes. We do that through many mechanisms, one of which is using blinded centralized raters. By having that 50 microgram dose level, what we're able to do is effectively, through the consent process, inform patients that whether or not they feel effect of the drug or acute perceptual effect on the day of dosing, they may be receiving a real dose of drug, or they may be receiving a dose that previously has been shown not to be clinically active. Just because a patient assumes that just because they feel something on the day of dosing, they can't assume that they're getting a dose of drug that's going to make them better.
That's as great of a link as any study has ever been asked to go in psychiatry to try to enhance the validity and minimize the bias of these outcomes. Like with other approved GAD therapies like Xanax, for instance, there's a clear acute perceptual effect that just hasn't been looked at in the past. We feel even stronger about the validity of the data that we'll be able to generate in these studies because of these additional analyses and the additional design elements we've included in the phase III program.
Charles Duncan (Managing Director)
That's helpful, Rob. One quick last question then. Going back to an earlier question, I think that I asked, I personally asked regarding the adaptive design, what is the dropout rate that you are assuming could happen so that we can kind of gauge how it's going over the course of the trial?
Rob Barrow (CEO)
We've assumed a pooled standard deviation of 10 units and a dropout rate of about 15%.
Charles Duncan (Managing Director)
Okay, thanks. Very helpful.
Operator (participant)
Thank you. Our next question comes from François Brisebois with Oppenheimer. Your line is open.
Hi, this is Dan. I'm for Frank. Thanks for taking our question. Thanks for all the color around the enrollment as well as we think about the outcomes here. Just a quick one from us. Given all this regulatory scrutiny in this space, is the upcoming PTSD adcom, is this something you're looking to learn from to inform your own development, or is this the indications are different? Anything here? Thanks.
Rob Barrow (CEO)
Yeah, thanks so much, Dan. No, we're always looking at all the adcoms, particularly neuropsychopharmacology advisory committees, just to understand the dynamics of those. Given the difference in the population and our development plans, we certainly are focused on execution of our studies and what we'll certainly be watching and observing, but don't know that we see a direct impact on our program.
Thank you.
Operator (participant)
Thank you. Our next question comes from Joel Beatty with Baird. Your line is open.
Joel Beatty (Biotechnology Equity Research Analyst)
Hi, congrats on the progress, and thanks for taking the question. The question is, for the phase III trials in GAD, how much of a risk is there that some of those patients during the 12-week randomized phase go on to take another therapy? If that does happen, that it might happen more so in the placebo patients than the treatment patients. If that situation were to occur, how does that get handled by the stats plan? Thank you.
Rob Barrow (CEO)
Yeah, thanks so much, Joel. We certainly have a high degree of confidence in our sites and go to great lengths to ensure that all patients adhere to the trial protocol, which includes, as a monotherapy, includes taking no other pharmacotherapies during the 12-week randomized period and really throughout the duration of the study. We monitor that very closely. For patients who do violate that criteria, it is addressed in the statistical analysis plan. I don't know that we are prepared today to go through the specifics of that plan and have had great collaboration with FDA in development of our statistical analysis plan for both of the phase III studies. We certainly monitor it very closely and try to ensure adherence to the protocol at every site and have had great success historically in our engagement with these sites so far.
Joel Beatty (Biotechnology Equity Research Analyst)
Great, thank you.
Operator (participant)
Thank you. Our next question comes from Rudy Li with Chardan. Your line is open.
Rudy Li (Director)
Hi, thanks for taking my question. I have a question regarding the MDD indication. Given the competitive landscape for psychedelics, how important is MDD indication for MM-120 to compete with other psychedelic products? When should we expect updates on the timing and the design of the second MDD study? Thank you.
Rob Barrow (CEO)
Yeah, thanks so much, Rudy. Our overall, I think, focusing on the overall development plan for MM-120, we just see such a broad and massive market and opportunity to help potentially millions of patients. Having the broadest label certainly enables us to, hopefully, if the drug's approved, market to that broader population and hopefully gain access and ensure that we can help as many of those patients as possible. When we think of psychiatry, we think of the major neurotic illness in psychiatry. Having a label that covers both GAD and MDD effectively means that a patient coming in the door with either cluster of symptoms would be an on-label candidate for the product.
As we look around the landscape with many other therapies focused exclusively or primarily on treatment-resistant depression, it's just a strategic difference in how we've approached the opportunity and what we think of in terms of the expansiveness of both the market and patient opportunity, how broad of an impact we can have. That's informed everything from the selection of GAD, where there's been so few therapies in the last 20 years. Overall, there's far fewer treatments available for generalized anxiety disorder than for MDD. Also in our plans to go after these two really significant and large populations that would, in our view, be able to set us apart in maximizing the patients we can help.
Rudy Li (Director)
Cool, very helpful.
Operator (participant)
Thank you. Our next question comes from Sumant Kulkarni with Canaccord Genuity. Your line is open.
Sumant Kulkarni (Managing Director)
Good morning. Nice to see the progress, and thanks for taking my questions. I have two. The first one is, given you have Breakthrough Therapy designation for MM-120 that potentially allows for more back and forth with the FDA, could you give us any details on when you had your last interaction with the agency and if any of the changes that are currently affecting government agencies have impacted your interactions in any way?
Rob Barrow (CEO)
Yeah, thanks so much, Sumant. As you mentioned, with Breakthrough Therapy designation, we do have frequent interactions with the agency on various topics, including the clinical phase III program, but also clinical pharmacology and CMC and other aspects of the development program that are just as important to ensure the quality and adequacy of our data to support a submission, hopefully an approval. We think very highly, look at FDA as strong partners with us from the outset of our program, but especially as we've received the Breakthrough Therapy designation over the past year and brought on an incredible regulatory team who's just successfully interacted with the division extensively in the approval of COVENFY at Carina Therapeutics.
We have been really encouraged by the level of engagement and the thoughtfulness and the thoroughness with which the division and the agency more broadly have engaged with our program and feel a high degree of alignment and consistency in our approach with the expectations that we're hearing. We have been really encouraged. Certainly, there's been a lot of coverage of the disruption in Washington and all that's happening there. Fortunately, at this stage, our interactions with FDA have not been changed in any way. We have continued to, I think, watch the division of psychiatry really go out of their way and go to great lengths to be constructive and highly engaged with us.
Sumant Kulkarni (Managing Director)
Got it. Thanks. If we also fast forward to a time when other psychedelic agents that involve shorter times in the clinic might become competitors at a time when MM120 is approved as well, what would the key point be in favor of MM120 versus a deuterated DMT, for example, with the knowledge that we have not really seen phase II data on that molecule just yet?
Rob Barrow (CEO)
Look, with 50 million patients that we might be able to treat with both the indications we're going after, there are more than enough patients for many new treatment modalities. Some of the things we've been really encouraged by are both the magnitude and the durability in large, well-controlled, well-conducted studies where we are exceeding a robust placebo by more than double the standard of care. That's not something we've seen broadly with the field. In our market research, some site economics play into this where a treatment that requires a high degree of patient throughput can be problematic for these sites of care. I mean, we look at clinics that deliver Spravato, and many of these clinics have to turn over the room four or five times a day, which they're being reimbursed on an hourly rate in many instances.
That becomes a huge administrative burden and quite inefficient economically for these sites. While I think at phase III, there have been some assumptions made about the duration of various products, we have been at every turn really encouraged and highly convicted about our approach and what that will mean for sites of care and for patient access.
Rudy Li (Director)
Thanks.
Operator (participant)
Thank you. As a reminder, to ask a question, please press star 11. Our next question comes from Patrick Trujillo with H.C. Wainwright & Company. Your line is open.
Patrick Trujillo (Research Analyst)
Thanks. Good morning. A couple of follow-up questions from me. Clearly, with the phase III trial in anxiety, primary endpoint is HAMA. I'm just wondering which secondary endpoints, things like function or quality of life, could be important from both a regulatory as well as a payer perspective. Secondly, I'm curious if you can discuss some of the HEOR, health economic outcome research that's been conducted, and what further research that you plan to conduct in order to further support MM-120 after it's potentially approved. Lastly, I think the phase II-B trial showed an eight-point improvement on the HAMA relative to placebo. I'm just curious how the learnings from that trial kind of led to the powering for the phase III studies in GAD.
As well, I'm wondering, I know that data was collected on the MADRS and how the learnings from the phase II-B trial are influencing the phase III trial in MDD.
Rob Barrow (CEO)
Yeah, thanks so much, Patrick. To your first question, we're certainly looking at a number of additional secondary outcome measures in the phase III program. One that is of interest to us is CGI, which is overall disease severity and patient functioning score. That is one that we're quite interested in and the time points we're interested in for the HAMA, the primary outcome measure. In terms of the HEOR research, we've done extensive research, several of those studies, which we've now presented as posters and are advancing publications for. That covers everything from, I think, when you look at GAD, there has been such a focus shift in the last 20 to 30 years away from anxiety, which for a long time was the predominant focus of psychiatry. There's been such a shift to major depressive disorder.
We all remember the, "Everyone worries," but depression is a chemical imbalance in your brain. These are commercials from the 1990s with the advent and introduction of SRIs that led to a pretty massive diagnostic drift and for tools for depression being rolled out pretty substantially. Over that time, the burden and the prevalence of GAD has grown substantially. Now, as Dan mentioned, when we look at the broad epidemiological data and the research we've done, there's a significant portion of the population that is walking around with moderate or severe symptoms of generalized anxiety disorder that has never been diagnosed and presumably just think that's how life is, that's how human experience is.
A lot of our work so far has focused on that prevalence and also on the impact on quality of life and on economic parameters like workplace productivity, absenteeism, presenteeism, the overall economic burden on these patients. We have an incredible market access and HEOR team that is continuing this work and that allows us to ultimately try to make arguments for the value of a product. We really see that value come through overwhelmingly when we look at the magnitude of remission that we can achieve after a single administration that is durable for many months. The math becomes really remarkably favorable in terms of the health economics for a treatment such as this. On your last point, as you mentioned, 7.7 unit improvement over placebo for the 100 microgram dose in phase II.
I think it's notable there that that was an improvement over about a 14-point placebo response, which is about around 40% larger than the historical average in GAD. Most SRI studies had a placebo response of about 10 units. Now, we've assumed, as Dan mentioned, 90% power from the study to have 90% power based on a five-point improvement over placebo. I think that's a fairly conservative assumption, especially when you consider that the phase II study included five arms, four of which were a dose of active drug. In the phase III studies, we are doing a head-to-head or a three-arm study where, based on a broad body of research and into clinical trial methodologies, we would expect that to potentially reduce the placebo response. We've been quite conservative.
We also have the sample size re-estimation to make sure we do not lose that power in the study conduct. Certainly, feel quite confident in the strength of that powering and the probability of having a successful study if we see a clinically meaningful response over placebo.
Patrick Trujillo (Research Analyst)
Right. That's really helpful. If I could, just one additional question. I'm wondering how you're measuring the long-term durability of MM-120 in part B of the studies. Do you need that data in order to be able to submit for approval, or could you submit with the, I think, the 12-week data? Would that be sufficient?
Rob Barrow (CEO)
Yeah, great question. I mean, we're not in a position today to speak to what would be acceptable for the application. Certainly, as we look back at the historical precedents for depression and anxiety drugs, the outside of durability that's been required for almost all products has been, certainly in anxiety, has been between 4 and 12 weeks of activity. That's quite encouraging that we have such a long and extensive precedence there. In terms of characterizing the durability response, we're looking at beyond the 12 weeks, so the nine-months extension period with the opportunity for open-label treatment. A few things there. One is that until a patient, and importantly, until a patient actually takes the open-label product in that extension period, they're still blinded, right? They aren't told at the end of 12 weeks what treatment assignment.
We don't, at any point in the trial, until everything is completely done, will we be unblinding on a per-patient basis. Now, we can do, importantly, group-level blinding and primary analysis once we get through 12 weeks because that has no impact on the study. For patients who continue into the extension phase, until they take open-label drug, they remain blinded. We could look at things like a Kaplan-Meier curve for the durability of response after a single treatment at baseline. Presumably, there will be a higher rate of relapse or inefficacy for patients who never respond in the placebo arm. There is likely we would expect to be a longer period before an open-label treatment is administered for patients who receive MM-120 first versus placebo at the first dose.
We are looking at a number of characteristics there, both to quantify durability beyond 12 weeks after a single treatment and then the use patterns and the durability and subsequent response if patients do administer an open-label treatment in the follow-up period.
Patrick Trujillo (Research Analyst)
Great. Thanks so much.
Operator (participant)
Thank you. Our next question comes from Michael Akunowicz with Maxim Group. Your line is open.
Michael Akunowicz (Chaiman and CEO)
Hey, guys. Thank you so much for taking my questions today and congrats on all the progress we've made. I guess just one quick question here on runway and capital use. You guys have done a fantastic job managing your balance sheet so far. You do have two phase IIIs ongoing and a third launching in major depression. The conventional wisdom there would suggest you would need a confirmatory study in MDD as well. Would you expect a confirmatory in MDD to be launched concurrently with your other programs? Is this something you consider in your current runway projections?
Yeah, thanks so much, Michael. We certainly consider all of our development plans across all of our programs and our financial projections and guidance for cash and runway. Our approach in major depressive disorder is such that, as we said, we're not in a position to comment on the exact precise timing or design of the second study in MDD today. We have had constructive progress in our overall planning for our program and our assets and certainly excited to share that data at a future point in time. That will be informed by some of the progress in our ongoing phase III studies and regulatory interactions. Certainly, one of the attributes in our execution of our program is the ability to continue sites and efficiently keep them going in terms of screening and enrollment.
We're certainly mindful of the operational efficiencies of when we start studies, but also being financially prudent and responsible with how we're managing our cash and our expenses over the context of our phase III program.
All right. Thank you very much. Once again, congrats on all the progress.
Rob Barrow (CEO)
Thanks so much.
Operator (participant)
Thank you. This concludes the question-and-answer session, and you may now disconnect. Thank you for your participation, everyone. Have a great day.