BioXcel Therapeutics, Inc. (BTAI) Earnings Call Transcript & Summary

Good afternoon and thank you for attending the 2020 Virtual UBS Global Healthcare Conference. My name is Pehlaaj Bajwa, and I will be your host for this session. A Q&A session will follow immediately after the presentation. To submit a question, please type your question in the Q&A prompt on the presentation screen. No questions will be anonymous. I'm pleased to introduce our presenter, Dr. Vimal Mehta, Chief Executive Officer of BioXcel Therapeutics. Vimal, please go ahead.

Thanks, Pehlaaj. Good afternoon. I'm Dr. Vimal Mehta, Chief Executive Officer of BioXcel Therapeutics, a clinical-stage company utilizing artificial intelligence approaches to identify and advance novel opportunities in neuroscience and immuno-oncology. I want to thank Pehlaaj and the UBS team for organizing this conversation and providing us with another opportunity to stay in communication with our investors during this challenging time. As a reminder, I will be making forward-looking statements regarding our financial outlook in addition to regulatory and product development opportunities. This call will begin to highlight that recently, we announced the completion of patient enrollment in our SERENITY program, 2 Phase III studies of BXCL501 for the acute treatment of agitation in patients with schizophrenia and bipolar disorder. We look forward to reporting top line data from both trials in July 2020. Those are kind of my high level remarks. Now I can go back to the slides. And if you don't mind going to the Slide #3, that kind of outlines all our key milestones that are expected in 2020. This is a very rich -- data-rich year for the company. As I indicated, that Phase III data is now expected to come in July. We are also conducting a trial in Phase Ib/II dementia trial TRANQUILITY, and we are in the process of evaluating the data for dose escalation. And in addition, we are getting ready to open our opioid withdrawal symptoms trial RELEASE, which we are planning to open shortly. So a number of things happening on BXCL501, which is our lead program. It's a sublingual thin film for acute treatment of agitation. Our second program is BXCL701. It's an orally available activator of innate immunity. We are targeting some rare forms of the tumor, and we are targeting -- we have 3 ongoing trials, and I will discuss those trials overall arching strategy that we have adopted for 701. And the company has strengthened the balance sheet in February of 2020 through follow-on offering raising $60 million in net proceeds. So I'm going to the next slide, Slide #4. We utilize [indiscernible] AI platform to impact R&D economics, development, efficiency and increase, like, probability of success to identify these novel assets. We focus primarily as a company on assets that have gone all the way to the clinic, at least as of Phase I and have some established safety. And then we utilized AI to identify if they have never made it to the market or if they made it to the market with the new information that becomes available, where else we can, like, identify novel therapeutic opportunity to serve the patients. If you look at our pipeline, BXCL501 is our lead asset. That data readout is coming out in a couple of months, and we expect to file our first NDA in early 2020. And that's what the business model for the company is, 4- to 5-year development cycle from the identification of an asset to doing the preclinical and translational work to build your confidence in the hypothesis that is generated by the AI and machine learning platform and then conducting a human proof-of-concept trial like we did in Phase Ib/II with 501 and then moving to registration trial. So AI engine, always, we are working to identify assets outside 501 and 701, to which we'll build a sustainable R&D pipeline for the company. Slide 5 outlines that we are building a -- we want to be a leader in treatment of agitation and building a strong pipeline. Our pipeline has both breadth and the depth. 501, schizophrenia and bipolar, we expect to have our first NDA submitted in early 2021, and we are conducting Phase Ib/II trials in dementia and opioid withdrawal to pursue our -- to pursue additional sNDA. And delirium, hyperactive delirium is in the clinical planning stage currently. The 501 is designed to treat cooperative patient. It's a sublingual thin film. And then we are also developing additional pipeline like a KalmPen, which is IM for noncooperative patients who may not be amenable for film because they are very severely agitated. In addition, we are developing an Apple Watch to predict the agitation in dementia patients. And the goal there is, if we can develop an algorithm that can predict, based on multiple parameters we are measuring, we can -- then it can help prevent or treat agitation in early stages of dementia. And agitation is a spectrum for dementia patients, which can be from sporadic to subchronic to chronic agitation. In addition, 501 plus combination agent, that is in a formulation stage currently for the chronic agitation. So coming back, we are committed to providing innovative solutions in the agitation space, and we have built a strong pipeline to achieve that. So I'm going to go now to Slide #7, just to kind of, at a high level, outline commercial opportunity, why agitation is more important in neuropsychiatric conditions. As you can see, there are about 20 million patients who are at risk of agitation. About 10 million patients for 5 indications we are focused on, that are listed on Slide #7, they experience agitation. And patients, depending on their disease state, which disease you are dealing with, agitation can be -- they can have multiple episodes per year. It's a large health care burden. And agitation needs to be treated. Otherwise, it can be harmful for the patient or the caregiver. So it's a strong unmet medical need, and that's supported by a number of consensus publication that have been -- that there is a very strong need for a some sort of a noninvasive treatment that -- within novel mechanism that's kind of providing a solution for these patients. Current treatments are suboptimal. We expect that, on Slide #8, outlines where these patients will be treated. If you are a schizophrenia and bipolar patient, majority of them will be treated in the emergency room in the hospital setting. There are other places, these patients do get treated in the hospital in neuro and psych wards, in urgent care centers and mental clinics, particularly for schizophrenia and bipolar patients. And if it is dementia patient, they will be treated in long-term care centers, like nursing homes and assisted living. And our drug is a caregiver drug. So that's where our drug will focus on. So it just gives a very high level where these patients go for treatment. Slide 9 outlines that FDA agrees that this is a high unmet medical need. They granted us Fast Track Designation in schizophrenia, bipolar disorder and dementia, agitation resulting from those 3 indications. Current therapies are suboptimal, as we know. Verbal deescalation is used as first line and some of the antipsychotics and benzodiazepines don't serve these patients very well, and there are many issues associated with those treatments. So we believe that 501 product offers a significant advantage over the current standard of care. And the reason for that is Slide #10, that we are targeting, we believe, a central causal mechanism of agitation where 501 is stopping the release of the norepinephrine. And in addition to that mechanism, it is easy to administer sublingual formulation of the film. It's green in color, minty in taste and it has a mucoadhesive that sticks under the tongue. It's a nontraumatic experience, rapid onset, what is needed to calm the patient, as we have seen in our trials. It's noninvasive, and it's self-administered by the patients. So these are cooperative patients. Next slide, 11, outlines a little bit about the film that it has a mucoadhesion designed for optimizing compliance. It's an adaptive technology. We can add more agents. It's flexible for those reasons for the combination therapy. And we expect the patent until 2039-2041 for our film patent. We have developed the automated process. So manufacturing for Phase III registration batches have been -- was completed. And now we have done commercial scale-up using the automated process to be get ready for the commercial supply of the drug for at least the process we have built is good for 2025. So that's what we believe. We have a CMC process kind of in good shape to prepare for a commercial supply. Just to go to the data, on what basis we started our Phase III trial. This is on Slide #12. It was a 135-patient trial and 90 patients on the drug, and there were about 45 placebo patients. Trial was enrolled very fast. It was started in May 2019 and announced in July of 2019, so within 2 months. We tested 5 different doses ranging from 20 to 180 microgram. And evaluation period was 6 hours. Even though end point is at 2 hours, the measurement of PEC, the end point is change from baseline in PEC score at 2 hours. So Slide 13 outlines what we found. In this slide, we got statistically significant responses with multiple doses. And with 180-microgram, we had, like, a responder rate which has greater PEC score reduction, more than 40%, almost 90%, it's 89%; and with 120, we had 67%. So high response rate, dose-dependent responses we saw with different doses. So we have plotted a couple of doses on the graph, but you can look at the rest of the data in the table that outlines highly statistically significant responses. That gave us the confidence to go to FDA and develop plan for Phase III. Safety is on Slide 14. It shows well tolerated, no serious side effects. Most of the side effects were mild somnolence and dry mouth. Maximum tolerated dose, we believe, was not achieved. And all subjects self-administered the film. And we observed that all subjects in our Phase III also, 750 patients have self-administered the film. That's by design that these are cooperative patients. Slide 15 outlines what our pivotal -- Phase III pivotal trial design is. So as you can see that there are 2 patient populations, one is SERENITY I for agitated schizophrenia patients. Subjects are about 375, 125 in each arm of 2-drug arms, 120-microgram and 180 and a placebo arm. And similar trial design for agitated bipolar patients in SERENITY II. And primary end point is exactly the same as we have used in our Phase Ib trial, the data I just showed it to you. And operationally also, we have tried to maximize the same size that was used previously in Phase Ib in our Phase III trial as well. We had to expand few sites because we wanted to make sure we can get the recruitment completed for both patient populations. And as of today, all, like, enrollment in both patient population is complete. And like basically, we have the last patient completed because there are no follow-ups or anything. Now we are in a stage where we are cleaning -- CROs are cleaning up the data. And once data has been locked, then we will be in a position to analyze the data and announce the top line results in July. So that's what is a critical milestone for the company. In addition to SERENITY program, we are conducting a TRANQUILITY trial, Phase Ib/II. This is assessing the acute agitation in -- resulting for the dementia patients. Dementia, just a few words, is a spectrum of agitation that these patients face. It could be a pre-agitation state that we're trying to capture with our Apple Watch, but more like -- most of the time, it says sporadic agitation in the early stages of the disease. And as disease progresses, it becomes a subchronic agitation and, ultimately, chronic. What does subchronic mean and what does sporadic mean? So sporadic can be 2 episodes a month; subchronic can be 2 episodes a week, on an average, just at a high level; and chronic is that these patients are getting agitation every day, so they need to be on a chronic agitation (sic) [ medication ]. So 501 can play a very important role in patients in the acute agitation. And even if there are some chronic agitation medication development, still that may reduce number of episodes that happen for those patients, still their agitation needs to be managed. And it does take longer time for some of the chronic agitations to become effective, so 501 has an important role to play, and it will help build a market opportunity for 501. It's a design. The trial design is that we are looking at 65-year and older patients. Trials are being conducted in the long-term care centers where these patients reside, like, assisted living centers. There is a -- like it's an ascending dose, adaptive design, and there is a placebo arm to it, and we are anticipating announcing the data in mid-2020. We are using 3 end points. We call them as exploratory end points. It's a PEC score like one we use in our schizophrenia and bipolar; Pittsburgh Agitation Scale, which is a second scale we are using; and the third one is we are using a modified Cohen-Mansfield Agitation Inventory. Why we are doing that is because there is no regulatory end point that has been agreed with the FDA because we believe we are the first company that's conducting acute agitation trial in Alzheimer's/dementia. So those are the reasons that we are conducting this trial in an adaptive design. What is the outcome we are looking? Outcome we are looking is we have a tolerable and effective dose that -- and then we have the data from these scales that we can take it to the FDA and get their buy-in to initiate a late-stage clinical trial or program for dementia. So that's what our goal with this trial is, to convince the FDA to move forward with the next steps. In opioid withdrawal symptoms trial, it's relatively more straightforward because here, the end points have been agreed and FDA have approved the drug using some of the end point. They are called as COWS and SOWS, which is a Short Opiate Withdrawal Scale of Gossop. And FDA has approved drug using that. So we intend to use those end points. We are in the process of initiating the sites. And due to -- we were in the middle of the COVID. So we were waiting for it to taper down. I think we have all the pieces. There is no bottleneck to initiate this trial. These trials normally tend to be short as we have observed in our previous cases. And we will provide the guidance by when we can expect to announce the data readout from this trial. Just to remind everybody, both in dementia as well as opioid withdrawal, we had done some IV study using the current form of the drug Precedex, which is API for 501. And we saw positive results in opioid withdrawal, all 10 patients responded. We were using the COWS score then. And similarly, we saw positive, like, proof-of-concept in dementia patients. So we have a lot of data which is more translational and early proof-of-concept that we are utilizing for designing these trials and choosing our indications. So overall, on Slide #18, outlines that what is our agitation franchise. So for the cooperative patients, we are developing 501, that's in the middle in yellow. Our goal is to get first NDA to the finish line and then file our follow-on sNDAs in dementia, opioid withdrawal and delirium. Some of you might have noticed, there have been a number of articles that COVID-19 is creating a delirium effect in the ICUs post-incubation. So these patients do need a lot of help, and it's part of our strategic plan to develop 501 in that area. In addition, we are developing a KalmPen for highly, severely agitated patients, which is on the right side and developing an Apple Watch for dementia patients so that we can -- particularly in dementia patient, major event agitation is going to escalate, so that 501 can be used for prevention and/or early treatment. The key milestones are outlined on Slide #19. Phase III data readout is now more clear. It is July of 2020 and expected NDA submission is early 2021. So we are -- like we'll go for a pre-NDA meeting with the FDA and then plan to submit our NDA in early 2021 once we have the data from our SERENITY program, and it is positive. For TRANQUILITY, we are making decisions on the dose escalation and continue to provide update, how things are progressing in terms of our data readout with the TRANQUILITY trial. And we can expect that opioid withdrawal symptoms RELEASE trial will initiate shortly, and we will be in a position to provide guidance when we can expect the data readout from that trial. It's expected that we just have to open a few sites for opioid withdrawal because patient recruitment is quite high in that indication. So now I'm going to switch gears to 701, and I will spend a few minutes, maybe 5 minutes, and then I want to leave some room for Q&A, if there are any questions. I know it's late in the day and everybody must be tired. It's been a long day. So 701, on Slide #21. 701, it has a dual mechanism of action, inhibiting DPP 8 and 9 and FAP. And most important thing is it's an orally administered activator, systemic activator of innate immunity pathway. So we believe that we have, at this point, advantage because we think we have the most advanced agent in the clinic, which is systemic in nature. Hypothesis is, can we turn the cold tumors to hot and enhance the tumor responses, if these are not very cold tumors, like the one we are focusing on, and we are conducting a basket trial for that. So that's the kind of the overarching strategy for 701. We had recently announced that we have moved our neuroendocrine prostate cancer trial into the Phase II portion of the Phase Ib/II. So we were able to optimize the drug. Slide 22 outlines 3 trials that are ongoing. tNEPC is a corporate-sponsored trial. We are sponsoring a -- pancreatic cancer is in partnership with Pfizer, Merck Darmstadt and Nektar. So we are combining 3 agents. In that trial, we have the orphan drug designation in 3 indications from the FDA. And for solid tumors, like it's an open-label basket trial that is being conducted by MD Anderson. So coming back to the tNEPC, Phase II phase efficacy portion has initiated. We intend to provide our Phase Ib data and share the data that -- our finding in the Phase Ib. Bottom line is we were able to identify that a split dose, like, 2 times given combined with KEYTRUDA, was tolerable, and that's the dosing schedule we're going to continue in neuroendocrine prostate cancer trial. It's a 15+15 Simon 2-stage design. We are looking for composite response rates of greater than 15%. And we expect the data readout or interim data readout by the end of this year from the first 15 patients from tNEPC. In pancreatic cancer, our partners, Pfizer and Merck and Nektar, are conducting a trial for the double agent avelumab and bempeg. And once they give us the data, then we will start dosing 701, the triple combination. So that's where the pancreatic cancer triple combination trial is. And for our open-label basket trial that was initiated by MD Anderson Cancer. So there are 2 cohorts evaluating patients who are naive to checkpoint therapy and evaluating patients who have failed or are refractory to checkpoint therapy. So it's an open-label trial. We expect, at least from 1 cohort, we will be able to get some data by the end of this year. So overall, the key data readout on Slide 26, that gives you that, both for 501 and 701, we have a number of data readouts, and it's a data readout-rich year for the company. So thank you very much for joining me today. And with that, I will open it up for Pehlaaj if there are any questions that we can address.

Thanks, Vimal. [Operator Instructions] Our first question is, could you talk about how, if at all, COVID has altered launch or commercial planning for 501?

That's a great question. I think we have been very lucky, that fortunate that our trial and enrollment date was not [ impacted ]. Last update we provided on the SERENITY I and II was in March when we had about, like, 1/3 of the trail enrolled. And by May 12, we were able to enroll additional 500 patients. So basically, these patients need help, and these are short trials, short end points. And these trials were conducted in the clinical -- professional clinical sites, which are attached to the hospital, even though patients come to the ER. So it did not get impacted with the COVID. So we were very pleased with that. We were monitoring everything. There was a -- some sites can get impacted, but overall impact was not there. In terms of the commercial launch, currently, we are in the process of hiring Chief Commercial Officer, who is expected to join us prior to the readout for SERENITY I and II. So he will have at least almost 18 months to prepare for the launch. So I think we feel that if we can file our NDA on time and there are no delays from the FDA because there's no relapse condition with the COVID-19, we will be in good shape. If there is a relapse, that can cause some hiccups. But internally, what we have done is created a task force, which looks at different kind of risks, prioritize those risks which are more impactful and material, and then we keep evaluating the situation as we progress and then look for alternatives that what can we do to do the risk mitigation. So I think as of today, we are in good shape, and we'll continue to evaluate the future situation, what we as a company is facing, what we as a nation is facing and what is really happening at a global level.

Our next question. On the 701 side, do you have a sense of when you'll be able to present data from the open-label Phase II combination study with KEYTRUDA as well as the triple combination study?

So for the neuroendocrine prostate cancer, like, in a combination with KEYTRUDA, interim data is expected by the end of this year. So I would say Q4, sometime probably coinciding with the oncology conference. We do have the Phase Ib data that we plan to share in a relevant forum. And regarding the triple combination, that is expected that we may get the data from our partners in second half. Once we have the data, then we can start dose escalation. And it's a triple combination, so we'll start slowly. So we think that data will become available next year. But MD Anderson trial data, which is a basket trial, we believe one of the cohorts' data will be available by the end of this year.

Our last question is, are you seeing any delays stemming from your partners across 701 trials?

I think it's publicly noted that Pfizer had announced when COVID happened that they had shut down all their clinical trials. So certainly, I would imagine that's impacted or not, depending on the patient population, our trial. But that trial was already ongoing, so I don't know whether -- how much impact was there. We will get the update if there is any kind of a delay, unexpected, so we'll learn more about it. But we, at this point in time, think that we will get the data or expect to get the data in the second half of 2020.

With that, we've reached the end of the session. I'd like to thank everyone for attending the 2020 Virtual UBS Global Healthcare Conference. And you may now disconnect your lines now. Thank you.

Thank you, everyone.