ACADIA Pharmaceuticals Inc. (ACAD) Earnings Call Transcript & Summary

Well, I'll start, and then Michael feel free to jump in. I guess the first thing that comes to mind when we think about DRP, particularly when we think about in the context of moving from PDP, Parkinson's disease psychosis, to dementia psychosis is there's a kind of a key similarity and a key difference between those 2. On the key similarity side, of course, when the previous generation dopaminergic drugs are used off-label in PDP because they're not approved for use there, that can interfere with motor function. So one of the hallmarks of Parkinson's disease. In dementia, it's a very similar situation where those same drugs are used off-label in dementia today because nothing is approved. And when they used off label, they can impair cognition. And it's pretty significant, it's equivalent to about 1 year of disease progression. So they accelerate cognitive decline. And so I think the concern in the medical community with using those drugs in dementia is at least as great as it is in the Parkinson's prescribing community. So that's the similarity. The difference is Parkinson's disease, of course, is treated primarily by neurologists. And all physicians, whether they're neurologists or not that treat Parkinson's patients are, number one, focused on movement. The non-motor symptoms, the hallucinations and delusions that patients experience and other symptoms they deal with, they are very aware of them. But it's not as close to the sort of the bull's eye as can I help this patient walk, can I have them -- help them feed themselves, et cetera. In dementia, it's the connectivity between cognitive loss and hallucinations or delusions. It's just much closer. So it's much more in the spectrum of disorders that are right at the forefront of physicians' mind when they're treating these patients. So we're much closer to the bull's eye there. And I think we'll benefit from that as well.

Yes. So imagine the awareness, generally, as I would say it in Wall Street parlance, the awareness for the prescribing community, but I'm going to ask you, the patient community or caregiver community is much greater in terms of this high burden set of symptoms?

Yes, absolutely. In both Parkinson's and dementia, patients typically, not always but typically develop psychosis later in the disease as the disease progresses. Both are progressive diseases. So both -- in both cases, the symptoms get worse as the patient progresses, including the psychosis. So in the case of a -- in both cases, these patients are already carrying a very high disease burden. And then as -- when you -- when they do have psychosis and in Parkinson's patients, it's about half the patients over the course of a lifetime will develop psychosis. And in dementia, it's 40% to 50% of patients, almost as many. It's just adding a completely a significant layer on top of already -- what's already a high disease burden and makes the care of these patients much more complicated. Many times, when they're at home, they are cared for by their spouse or family members. And it just makes it much more difficult, increases the burden on caregiver dramatically. And so in both cases, the symptoms are very prominent. They're very impactful on quality of life and need to be treated.

Now you had very interesting data out of DRP, the DRP study, which was itself a very interesting clinical trial design. This was data presented in peer-reviewed format at last year's CTAD. There was 2 very high-profile data sets presented at that CTAD meeting, yours and then a data set from a small company may have heard of called Biogen on a drug called aducanumab for disease-modifying activity in Alzheimer's. But I can tell you, my KOL feedback around that meeting and subsequent to that, potential future prescribers are very excited about the data that you've shown. And if you could just take a second for highlighting what you've seen out of the clinical profile of pimavanserin in dementia-related psychosis. And then we'll talk a little bit about the regulatory process to the extent that you can.

Yes. Yes. So -- well, first of all, I'll just want to remind everyone that there has been no drug approved to treat dementia patients in over 15 years. So this very, very high need that we have continues to be unmet. The -- I think -- I mean we get a very similar response in the medical community, both when we talk to KOLs as well as when we do market research with kind of community-based physicians. And I think the 2 things that really stand out in the minds of physicians when we present the profile of pimavanserin, our product X, as we call it when we do market research, is the robust efficacy. They like the fact that the pivotal study that we did was a relapse prevention study because that just relates directly to how they think about treating patients. Many times with neuropsychiatric disorders, you have drugs that are approved. And when a physician reads the label, they see, okay, the drug move X points on a scale that I don't use, and it appears that, that was beneficial to patients. But what physicians really think about is, "Will this drug help stabilize my patient? Will it help reduce the symptoms? And then will it continue longer term?" And that's exactly what we showed in the study. So we had real clinical outcomes in this study that physicians care about. The other thing that we get a lot of strong feedback on is what the drug doesn't do. We demonstrated in the clinic that it doesn't have the cognitive impairment effect that you see with the previous generation dopaminergic antipsychotics that are used off label. And then the other thing and we were a little bit surprised about how strongly this pulled through with the medical community is they really -- we understood it in Parkinson's. But in dementia, they really liked the fact that we also have demonstrated that we don't have an effect on motor function. And you can understand that in the context of Parkinson's, but even in dementia patients, they stress that these are very elderly patients, they are many times frail. They worry a lot about them being able to function and their motor functioning when they use the dopaminergic antipsychotics, they see an impairment on that front as well, even in these patients. So those are the things, both the efficacy and particularly the endpoint that we ran in the study relates to physicians. They get it. And then also the fact that we don't see an impairment in cognition, which they worry a lot about with these dopaminergic drugs, and we don't see an impairment on motor function. We're all into very, very strongly.

So that's a very interesting observation, not only out of the study, but as a point of differentiation based on your KOL feedback. And I guess, as it relates to the regulatory process, we can talk a little bit about that and timing. But with regard to the current label that is approved for Parkinson's disease psychosis, I believe that it calls out using the drug NUPLAZID in demented patients. And I guess I'm wondering, is that just perhaps a point of conservativism with regard to the data that you had when the drug was approved? And is that kind of a label restriction that could go away in the future, given the data they have now?

Yes. Well, so I think what we're referring to is all antipsychotics have a class label. Every one of them has a label that has 2 sentences. The first sentence says, there's a higher risk of mortality in dementia when antipsychotics are used in dementia-related psychosis patients. The second sentence for all drugs other than NUPLAZID, it says, this drug is not approved for use in those patients. In the case of NUPLAZID, we have a carve-out that says this drug is not approved for use in those patients unless the psychosis is related to Parkinson's disease. And so as we think about how that label and how that box language could change as we move into dementia-related psychosis, obviously, if we're approved to treat dementia-related psychosis patients, that second sentence, logically, you would think would have to be removed. And they we're left with the first sentence. And I think the -- if we wind up in a situation where the first sentence remains unchanged, I don't know if that will be -- where it will land with the FDA, but if that were the case, it would be very much akin to what we see today in the depression arena where every antidepressant has a warning in -- a box warning in the label that says when these drugs are administered in younger people, there's a higher association with suicidality. And then a physician has to make a bit of a risk assessment in terms of the patients that they're looking at. And in our case, if that's where we wind up with the FDA, it would be a very similar situation. I would just point out that today, in dementia-related psychosis because there's nothing proved, physicians are using what they've got, which are the dopaminergic antipsychotics, none of which are approved and importantly all of which have a box warning that says this drug is not approved for use in those patients. And so -- but despite that, there are about 800,000 dementia-related psychosis patients being treated today with those drugs. So we don't see -- obviously, we and the FDA will focus on what we think is most important safety information to provide to physicians. And if it turns out to be a situation that I described, we think that physicians will just put that in their benefit risk calculus.

Got it. Okay. Well, that makes sense to me. And either to you or to Michael, given the current label, it seems like you've gotten good traction with the drug in the market. And I guess, I'm wondering if some of the changes to the label were made, would that be at all an impediment from what you can see in terms of adoption of the drug? And then the second question that I wanted to ask you perhaps just speak to it quickly is you had some recent data at MDS, which talked about safety of the drug. And it looks like it's really holding up well. Actually, that was data that was a collaboration with the FDA and others that was presented. Could you speak to that?

Yes. I'll ask Michael to answer the first question, and then I'll pick up on the second part, on this paper thing eventually.

Yes. Sure, Charles. As it relates to DRP and our ability to kind of build off of the great traction we've already had with PDP, the brand awareness, the clinical impression, the mechanistic operational steps that we have in the marketplace, we're well prepared and on track to kind of take it to the next level, if you will. Obviously, the patient population for DRP is 10x larger than it is with PDP. So this is a very exciting commercial opportunity, and we're all very excited about bringing it forward. I think Steve is mentioning around the clinical profile and the safety and risk-benefit calculation. We're very comfortable with that conversation with physicians today. And I think we do a good job with that. We'll be expanding our sales footprint. We'll be leveraging our commercial operations. And importantly, we're already well on track to building a lot of market research insights and executing on disease awareness and education campaigns as we speak. So I think we're going to be very well prepared to bring this to the market and expand on and broaden the benefit of pimavanserin to a wider audience.

So we look forward to that progress, hopefully, later second half or later second quarter of next year. Steve?

Charles -- Yes, in response to the second part of that question, so first, I just wanted to clarify. So this paper came out -- our poster was published, I should say, at the MDS, the Movement Disorder Society Virtual Congress last Friday. And the authors of the paper were members of FDA, CMS and Stanford University. So it was not FDA per se, but it was members of FDA that contributed to this study. And what they studied was the use of pimavanserin versus atypical antipsychotics, this previous generation dopaminergic antipsychotics in Medicare Parkinson's patients. And what they saw is when they compare the two was an overall benefit on all-cause mortality in using pimavanserin or NUPLAZID over these dopaminergic antipsychotics. So we're very, very pleased to see this. We think it's very interesting information. We didn't do the study, and we're eager to see. I'm sure there'll be a publication on this in due course, and we're eager to see that to get in more details. But the top lines on this poster were very, very encouraging. And I would just point out that they're directionally aligned with what we see in our placebo-controlled studies, where we've -- in the placebo-controlled studies we've done since we got the approval in dementia-related psychosis. If we look at all those studies, we see no difference in mortality between patients on drug versus placebo.

That's helpful. I appreciate the clarification, and that bodes well as the drug, if it is approved, as I assume, for DRP to have a good clinical benefit not only on the symptoms but also on the downstream, call it, downside of the symptoms. So with regard to the -- moving forward with ERP, I know that you can't really say, but in terms of timing of, say, PDUFA date, you feel like you're on track. You've had decent interaction with agency, you do have breakthrough therapy designation. So I imagine you've had ongoing discussions with them.

Yes. Everything remains on track. And the dialogue that we've had with the FDA and the relationship we've had has always been very positive and supportive, and we're eager to get to the PDUFA date of April 3.

Okay. Excellent. So we only have about a minute left. And I guess I wanted to leave you with the last -- have the last thought. If we're sitting here in doing this in a year, either virtually or in person, on stage, which I would look forward to and spending time with you, I guess, what are we going to be talking about in terms of the greatest value creation in the past year as we started the beginning of this conversation?

Yes. So a year from now, we would project that we'd be talking about our launch in dementia-related psychosis, which, again, as you heard say many times before, it's 10x larger than Parkinson's disease psychosis. We'd be talking about the fact that before we reach the end of the year or the end of 2021, we should have results in our Rett syndrome study. We'll be well underway in enrollment in negative symptoms schizophrenia. And I think we'll begin to see movement forward in the earlier parts of our portfolio as a consequence of the business development we've done. And as we've said before, you will see more deals from us. So I would anticipate that we'll have more to talk by that point as well.

It's going to be an exciting year. I appreciate you sharing the ACADIA Pharmaceuticals story with me. Michael, Stephen, Mark, thank you. Hope you have a great day.

Thank you, Charles.