Atai Life Sciences N.V. (ATAI) Earnings Call Transcript & Summary

Good morning, everyone, and welcome back to H.C. Wainwright's 27th Annual Global Investment Conference held from September 8 to September 10, 2025. My name is Patrick Trucchio. I'm a senior health care analyst at H.C. Wainwright. It's my pleasure to introduce the next company, atai Life Sciences, a clinical stage biopharmaceutical company pioneering development of highly effective mental health treatments to transform patient outcomes with a pipeline focus on short duration psychedelics aim to address the complex nature of mental health, providing commercially scalable interventional psychiatry therapies that can integrate seamlessly into health care systems. And from the company, it's my pleasure to introduce you to Srini Rao, CEO of atai. Thank you very much again for joining us.

Thank you, Patrick.

And maybe you can start first with an overview of atai's pipeline and strategic focus over the next 12 months.

Yes, absolutely. Again, thank you, and it's great to be here. So yes, in terms of our pipeline, we have three clinical stage assets. We recently announced results of BPL-003, Phase 2b results in treatment-resistant depression. That's a formulation of 5-methoxy-DMT. We have in Phase 2b VLS-01, which is a formulation of DMT. And behind those two, we have something called EMP-01, which is our R-MDMA and oral formulation that we're developing for social anxiety disorder. We also have a discovery program consisting of both psychedelic as well as non-psychedelic or hallucinogenic compounds.

How would you define atai's leadership position within the emerging short-duration psychedelics?

I mean if you -- our philosophy when we put together VLS-01 was to have something that truly slotted into the SPRAVATO paradigm. So the idea was to really have something that could drag and drop in. So what that meant was a single administration and psychedelic experience and physiological effects that should wrap up well within 2 hours, allowing for monitoring and then discharge at the 2-hour time point, just like SPRAVATO, again, very much in keeping with that. Obviously, the piece that we wanted to improve on is the durability. So SPRAVATO is efficacious, but it requires frequent redosing. And many patients, even in the maintenance phase are getting the drug every week to every 2 weeks. This is an interventional psychiatry drug, which means you have to go into the doctor's office. And again, as I mentioned, you have to get dosed and monitored for 2 hours. You're clearly not driving home. If you're doing this every week or every 2 weeks, it's difficult to hold down a typical job. Well, I mean this is a, let's call it, half a day on a good day, right? So you have to get to the doctor's office, you got to get checked in, you got to get dosed and you got to get a ride home. So 3 hours would be kind of the very -- the minimum of that. So we want something that could be dosed every 8 weeks, 12 weeks, ideally closer to the upper limit of that. So that's where our focus is. BPL was designed by another company called Beckley Psytech. We are merging or acquiring that company later this year. They had a very similar design philosophy. So if you put those two together, I mean, that is the entirety of the later-stage short-duration psychedelic market, I mean, development pipeline at this point.

Right. And so with BPL-003, this is the 5-MeO-DMT intranasal. Maybe you could walk us through the mechanism of action, formulation, how it's differentiated.

Yes. So -- as I mentioned, we have these two assets. BPL-003 is 5-methoxy-DMT and VLS-01 is DMT. So structurally different compounds, different APIs, pharmacologically differentiated. If you just look at serotonin, 5-methoxy-DMT, it has more potency and more activation of the 5-HT1A receptor versus DMT. Subjectively, people believe that 5-methoxy-DMT has a different kind of profile compared to the DMT. And that some of that was evidenced in our phase -- respective Phase 1 studies. We don't have a single Phase 1 that compares both compounds or any kind of trial. But in the independent Phase 1s, there do seem to be some subjective differences between these two compounds. In terms of the products themselves, BPL-003 is using an Aptar pump kind of just like SPRAVATO. It is a dry powder that is sprayed up into the nose. VLS-01 is using an oral thin film technology that was developed with a company that's formerly called IntelGenx that's actually been acquired by -- was acquired by atai in the fall of last year. So that's -- it's like a Listerine strip that goes under the buccal surface, the internal cheek surface and gets absorbed that way. And of course, degrades and erodes away in about 10 minutes or so.

So what are the most important takeaways from the recently reported Phase 2b trial in TRD with BPL-003?

So a couple of questions that we're trying to answer with that trial were, number one, what is the impact of short psychedelic duration on magnitude of efficacy? And what is the impact of that on durability as well. So the -- obviously, the leader in this space is COMPASS, and they published their Phase 2b results of COMP360 or oral psilocybin a couple of years ago. Psilocybin has a psychedelic effect that lasts about 4 to 6 hours. So this is something that's going to be the majority of the day, right, a vast majority of the day. And the question was always out there, if you shorten that psychedelic duration, what does that do to the efficacy and durability. In our study with BPL, the results were recently reported, we can say that there was no impact. In other words, the magnitude of efficacy that we saw was comparable to psilocybin acutely. So 3 weeks and 4 weeks data looks pretty much the same. And moreover, the durability was almost identical. The Phase 2b with BPL-003 went out to 8 weeks. The trial data -- the trial from COMPASS on COMP360 went out to 12. But nonetheless, if you look at the curves, they look pretty much the same. So that was -- those are the most important things that we learned from that trial.

That's interesting. How do you interpret the 8-milligram dose versus 12-milligram dose in terms of both efficacy and tolerability?

Yes. They were both picked as potentially efficacious doses. And the idea was to see if there was a view that the 8-milligram dose based on Phase 1 results will be better tolerated. And the question was, how would that trade-off against efficacy. And what we saw in this trial was that the 8 and 12 statistically have exactly the same level of efficacy. If you look at -- if you compare the stats on change in MADRS score, numerically, interestingly enough, the 8 was a little bit better than the 12. We don't have a very good explanation for that. There was more anxiety seen at the higher dose, unclear what to make of that at the moment. But certainly, the efficacy looks very similar, if not better.

Right. And what gives you confidence in BPL-003s scalability and fit within the interventional psychiatry model?

Yes. A lot of it is exactly what I was mentioning. I mean in the Phase 2, we looked at discharge readiness criteria. So that was subjective effects, but also blood pressure, et cetera. The majority of folks were eligible for discharge at 90 minutes and the vast majority of patients were eligible for discharge at 2 hours. So comparable to what we see with SPRAVATO in essence, if you think about dissociation in that context, but also blood pressure changes, et cetera. So I think that's a really important element. So the idea -- the concept is if a doc can administer SPRAVATO, hopefully, they can also administer this. We do have somewhat higher monitoring requirements as a psychedelic. In the case of VLS-01, you do need someone in the room. BPL actually had two people in the room. We hope that over time that, that can be scaled back further. I mean there's really no reason that SPRAVATO doesn't need someone in the room and this does. One is an anesthetic and the other one isn't. There is no therapy that occurs. I mean that's a bit of a misnomer. There are -- people do have anxiety reactions and things as they do with ketamine or as ketamine, they might need settling down. You can do that by monitoring a patient and remotely. But again, that's something that we have to generate data on.

Right. And so what does the time line look like for initiating the Phase 3 trial? And do you have an idea of what that design would look like?

Yes. I mean we haven't really guided on that. What we have said publicly at this point is that we're going to be submitting the end of Phase 2 meeting request this quarter. So that's on track. And then, of course, there's a time line to that to getting the actual meeting in place and, of course, getting the meeting minutes. But realistically, dosing towards the latter part of next year is based on what I know now, not to be held to it, but based on what I know now is not an unreasonable time line. In terms of the trials themselves, I mean, if you look at across the various companies, they all look pretty much the same, right? So it's 1 administration or 2 administrations of a compound. It's a primary endpoint that is mostly around 6 weeks, but SPRAVATO at a 4-week endpoint. There's the total trial duration of about 12 weeks, COMPASS being the exception and then open-label extension beyond that. So I would anticipate it's pretty much going to be the same as that, but there are a lot of devils in those details, and that's what is going to be the subject to the end of Phase 3.

I think there's an open-label extension readout coming in the third quarter of this year for BPL-003. What's your expectation for that readout?

So there's actually two data sets. One is from a Phase 2a. It's a small cohort, 12 subjects. It's looking at induction dosing, so 2 doses 2 weeks apart, and then following the patients for 10 weeks post that second dose. So that's the first one. And then there's the actual open-label extension data from this trial. So I mentioned that this trial had a 4-week endpoint. So single dose, 4-week endpoint, primary endpoint. They were then followed for an additional 4 weeks, and then they were redosed in an open-label fashion at 12 milligrams and followed for another 8 weeks. So obviously, the primary objective here is to assess safety because it's open label. So efficacy is a little bit more difficult. But broadly, we have these three groups that are going to be coming in. Those have got the functional placebo or active placebo and those have got 8 and 12. And so it will be interesting to see what the changes on efficacy look like after those -- with those three groups going in.

Right. And so you talked quite a bit about VLS-01. So I'm wondering what's the status of this program? When is the next data? What are your expectations for it?

Yes. So VLS-01 again is DMT. We, back in the day, picked DMT for a couple of reasons. One was that there was a publication looking at ayahuasca in a double-blind placebo-controlled trial in treatment-resistant depression. Ayahuasca is a psychedelic brew essentially used ritualistically. So DMT itself is not orally bioavailable, but this brew contains Psychotria viridis, which is a plant that has this stuff, but it also contains other plants that provide monoamine oxidase inhibitors. So when you drink it, it actually goes become orally bioavailable. It has a very low and slow pharmacokinetic profile. So the DMT serum concentrations aren't that high, but they do -- they are protracted. So that gave us comfort, and it was robustly positive. So that gave us comfort on DMT. Then there was a subsequent study of IV DMT by a company called Small Pharma, another double-blind, placebo-controlled trial, also small around 30 patients, 15 and 15-ish. And there, they had a much more rapid PK and showed efficacy again at 2 weeks. So our PK bracket is in between those. We have bracketing PK essentially. So that gives us confidence. We also have 2 doses. It's a 2-dose induction model. My view is that given the morbidity associated with depression and particularly tumor-resistant depression, we anticipate being able to get additional efficacy with the second dose. If we can drive the patients, the vast majority of patients truly into remission, you may not need a dose as frequently from there on out, right? You can maintain that a little bit longer. So that was the idea with the Phase 2b for VLS-01. Of course, we also knew that we have all the data from BPL, which helps, so we can try something a little bit different there. So that's what we're doing there.

Can you talk more about the significance of being discharge-ready within 90 minutes? And is there kind of a wide range? Are there some patients who are maybe beyond that their outliers? How should we think about this?

Yes. So it's -- again, you can go back to SPRAVATO, right? So SPRAVATO, I think it was around 85% of individuals had no more dissociation and no blood pressure elevations at 2 hours, roughly 85% might have been a little higher or lower. And that was the basis for the label. So the idea is that you get medically assessed at that point at 2 hours. And if everything looks good, if you look stable, then you can get discharged. Otherwise, you hang out a little bit longer. So that's the idea. So it was very similar in what we saw in the Phase 2b trial. It was about the same thing. Essentially, by 2 hours, it was about 85% of people met our criteria for discharge readiness. So again, very much in keeping with SPRAVATO.

And how do you envision moving BPL-003 and VLS-01 forward? Are there different patient groups that these drugs are relevant in? And are there different indications maybe that one would be relevant in versus the other?

So the second one is a really interesting point. Right now, we don't know, right? We do know that, again, anecdotally, the subjective effects are different. We know the pharmacology is different. We don't know how those elements will impact efficacy and whether they will be better set for different patient populations. I mean, we just don't have enough data on that. So that is -- that remains to be seen. Right now, we're pursuing both in TRD. People have brought the issue up of how are they going to cannibalize. I mean the reality is that SPRAVATO hit $1 billion in sales based on U.S. treatment of about 50,000 patients out of at least 3 million, right? So there's a huge unmet medical need. There's a huge total addressable market, which is quite substantial compared to what's being actually addressed. So that -- I mean, I haven't stressed too much about that. And I've also quipped that, that is literally the Oxford English dictionary definition of first world problem. You can use two drugs that you've gotten approved for TRD, and oh my God, they're going to interact with. They're going to cannibalize each other. It's like, okay, we'll get there when we get there.

Right. No, that makes sense. So then maybe just moving on to EMP-01. This is our R-MDMA. Maybe you can walk us through this program and the development rationale in social anxiety disorder.

Yes. So initially, when we started, we were contemplating PTSD. And this was based, of course, on some of the work that MAPS/Lykos was doing with the racemate of MDMA. So we tested our MDMA in a Phase 1 study, and we found that it had a very unique profile. Of course, we -- the reason we went with R is that, that's where a lot of the serotonergic effects were. And we thought the speculation was that, that was driving the entactogenic effects, the sort of elements that sort of are prosocial, but really more being able to kind of suppress some fear in terms of confronting things in your own past essentially, right? So it turns out the S-enantiomer of MDMA is a really potent stimulant. I mean it's very aggressive in that. It's a dopamine releasing agent or norepinephrine releasing agent. So that is what gives you all the dose-limiting tox that you get with racemic MDMA. So by stripping that out, we thought we could have a safer compound. When we tested in Phase 1, we found a very different profile for MDMA. It had psychedelic elements that, in some ways, resembled a classical psychedelic, but it also maintained these entactogenic pieces. So that was interesting. It was also -- MDMA is a much more -- is an externally kind of focused experience. That's why it's used as a drug of abuse when you take it and go to raves or something, right? It's prosocial. This turned out to be a more internally focused experience, kind of like what you get with a classical psychedelic. In the trial itself, we found some benefits on self-compassion that were persistent. There was other elements there that lined it up with -- I mean, PTSD would still be a very good indication for this, but social anxiety disorder is a huge indication that's really underserved. There was some data around MDMA, but really, we want to go out in a different direction with this. Social anxiety disorder is quite impactful for individuals. You don't hear about as much about it, but it became a little bit more prominent with COVID because a lot of people were impacted by this. It's several million people more compared to depression in terms of epidemiology, not well treated by current medications. There are several approvals. They were LCM placed from a long time ago for 2 SSRIs and SNRI, but nothing is particularly effective. And so this struck as an indication that could be very interesting for this particular compound.

And what's the next step for development?

So we have a double-blind placebo-controlled study that's ongoing now, Phase 2a using a regulatory endpoint. That will be reporting out in the first quarter of next year, and we will make some decisions about it at that point.

Will this drug have relevance in PTSD?

Absolutely. I mean there's no reason you can't go after PTSD. And that's obviously a really important indication with a huge unmet medical need unto itself. We'll have more clarity also on where things go with Lykos MAPS over the course of the next little bit. I don't anticipate them having a lot of success, but let's see.

So how should we think of any read-throughs, if any, from the MDMA-assisted therapy AdCom with Lykos in PTSD? Are there any read-throughs from that to your program? Or how should we think about it?

No, not really. I mean the CRO was actually released last week. Yes, it was last week. And I mean, there were a lot of fundamental things that weren't collected like adverse events of special interest. There was no durability data. There's a lot of issues with that particular program that just aren't relevant to us or any other company in the space that's developing psychedelics and we're all doing more traditional studies, et cetera. So no, we're not doing therapy. We're certainly not pitching this as drug-assisted therapy, right? I mean we -- in all cases, we're doing de minimis. It's not therapy per se. It is psychological support. It's an unusual experience. You do have to prepare the patients. You do have to assess psychological safety the day after because these kind of -- these drugs can surface things that the patient may have suppressed.

Right. So recently, there were some reported news on the M&A front. So we had AbbVie will acquire Gilgamesh bretisilocin program for up to $1.2 billion. So I guess my question is, what's your take on this deal? And what's the read-through to the atai's programs?

Yes. So obviously, incredibly validating for the entire space of psychedelics, but particularly validating for the short duration psychedelics, I would say. And the reason -- the reason for that statement is that they specifically called that out. Obviously, this -- there wasn't -- if I'm being honest, there wasn't a lot of strategic interest in the space for a while. Suddenly, there's a lot more because of the success of SPRAVATO, which is the $1.7 billion run rate this year. So there's been a lot more interest recently, but everybody is looking for things that are short duration. And bretisilocin is that, albeit in an IV infusion format. And so both BPL and VLS are that as well. So single administration, psychedelic experience wrapping up. And again, we are pretty unique in that space at this point. In terms of things that are in Phase 2b or going into Phase 3, there really isn't anybody else.

Right. Well, that was my follow-up question because the route is different and the stage of development is different. So how can we compare across these two programs?

I mean I think it's tough, right? Because that was a Phase 2a, it was four sites, but we use the same network actually. It's in the U.K., it's called the MAC network. They're very good. The four sites behave in many ways almost as one. So Phase 2a typically are -- you get a much bigger signal, et cetera. So these are much more experienced sites. So we'll see how that actually ultimately translates.

So we talked about the OLE data that's upcoming. What are the big sort of catalysts that investors should look forward to? And is there anything about the story that you think they're missing?

Yes, there's quite a few catalysts. I mean, again, we have these two trial readouts coming up. I think the next big one for BPL is going to be the end of Phase 2 meeting minutes and the clear plan that we hope to have alignment on with the agency for the Phase 3 program. And of course, Phase 3 initiation will be after that. In terms of value that's not really being seen. I think VLS-01 remains very interesting. It's got some of the best tolerability data that we've seen, albeit in a Phase 1, so it has to be replicated, but has very good tolerability. It's a slightly different paradigm, as I mentioned, with 2-dose induction. Obviously, people have said there's downsides to that because it may have the label that says that. On the other hand, the efficacy we anticipate being higher than it would be with the acute sort of headline efficacy being higher than it would be with one dose. And we'll see what happens there, too. So we're pretty excited about that one as well.

Terrific. Well, thank you very much. Always a pleasure to catch up, Srini, and thank you to atai for attending. Thanks, everyone else for attending. Have a great rest of your day and conference.