Neumora Therapeutics, Inc. (NMRA) Earnings Call Transcript & Summary

Welcome, everyone, to the 43rd Annual JPMorgan Healthcare Conference. My name is Tessa Romero, and I'm one of the senior biotech analysts here at JPMorgan. We're pleased to welcome to the stage our next presenting company, Neumora Therapeutics. And presenting on behalf of the company, we have President and CEO, Henry Gosebruch; and Head of R&D, Rob Lenz. Over to you both.

Thank you, Tess. And we're delighted to be here this morning, back at JPMorgan to share more about the exciting year ahead for Neumora and why we believe our company to be a very compelling opportunity for investors. Now before I dive in, I'd like to note that we'll be making forward-looking statements. Please review our SEC filings for some additional disclosures. Everybody in this room and listening to this webcast today share something in common. All of us know somebody impacted by a brain disease. It might be a friend, a colleague, a loved one, in fact, brain diseases impact more than 1.5 billion people globally. Collectively, these diseases are one of the largest unmet medical needs and one of the biggest health care challenges we face today. To truly address this crisis, we have to come up with better medicines, medicines that can help physicians get to better outcomes, improve quality of life for patients. And that is Neumora's mission. That is what we are focused on doing every day. Now there are 3 pillars that give us confidence that we can achieve our mission. One, we have the industry-leading CNS pipeline. Two, we've been built at scale with a strong balance sheet; and three, we have a world-class team working hard on the mission every day. So let me dive into each one of these in some more detail. We're really proud of the pipeline we built at Neumora, 7 candidates, all focused on prevalent brain diseases, all based on novel pharmacology, all with long IP that gives us plenty of opportunity to follow the signs and ultimately ensure long commercial runway. And importantly, we expect our pipeline to generate several important clinical catalysts this year that can drive significant value for shareholders and for patients. Now we were built at scale with a proven ability to raise capital. In fact, we've raised over $850 million since inception, and we've always maintained a very strong balance sheet. And that financial flexibility is quite important because it allows us not only to fund our programs, but to follow the science and adapt as we go along. And that financial flexibility is quite important. So take a look at our KOASTAL-1 results, the first Phase III results that we announced just the other day, that is our first Phase III study, and it did not reach its primary endpoint. However, there were some really positive signals in that study and some very encouraging trends. And our financial flexibility gives us the firepower to really study these trends in great detail to identify the learnings and to incorporate those learnings into the ongoing development of navacaprant. So the KOASTAL-1 study does not impact our confidence that navacaprant can be an important therapy for patients. Instead, it really fuels our motivation for our team to go back look at that data in detail, identify the learnings and incorporate learnings and the ongoing development of the program. Now speaking of our team, I really think we have a world-class team. We have a number of seasoned drug developers combined with a leading data science capability, and that team focuses on our mission every day to advance our pipeline and create new medicines for patients. Now we are working with urgency because we know patients need better treatment options. So on the left side here, we show NIH data on the biggest health care challenges in the U.S. And you can see brain diseases rank near the very top right up there with obesity and cardiovascular disease. It's really one of the major health care crisis in this country. On the right side, just a snapshot of our clinical pipeline. Each one of our clinical programs, we believe, has significant inherent value. But when you line all of them up and you look at all the indications that our clinical pipeline can address, there's really room for tremendous value creation and sustained growth for decades to come. Here's a look at our combined preclinical and clinical pipeline. Again, we're tremendously proud of this pipeline we built, 7 candidates, all focused on large prevalent brain diseases, all based on novel pharmacology with long IP. We own global rights to each one of these programs. And we're one of the few companies that is advancing both neurodegenerative and neuropsychiatry diseases. Again, this pipeline this year will generate a number of important clinical catalysts that have the potential to create significant value for shareholders and for patients. So with that, I'll turn it to Rob for some further details on our programs.

All right. Thanks, Henry. So let me start with navacaprant. This is our selective kappa opioid receptor Antagonist that's currently in Phase III for depression. Depression is the leading cause of disability worldwide. It's estimated that about 280 million people suffer from depression globally. Despite that, we haven't seen a medication with a novel mechanism of action approved for monotherapy depression in over 30 years. Now we do know that the currently available therapies do have benefit in a portion of patients, but it's estimated that around 85% of patients either don't go on an antidepressant therapy or aren't able to achieve clinical remission. It's also estimated that about 70% of patients with depression also have a core symptom of the disease called anhedonia. That's the inability to drive joy or pleasure from what would be normal activities. And unfortunately, the currently available therapies really don't have benefit in that core symptom of depression. So with navacaprant, we're encouraged by the potential that could have to impacting these patients. So -- the -- we're currently evaluating navacaprant in a Phase III -- comprehensive Phase III program called the KOASTAL program. We're also evaluating navacaprant in a Phase II study in patients with bipolar depression. The KOASTAL program comprises 3 replicate Phase III studies, KOASTAL-1, KOASTAL-2 and KOASTAL-3 and a long-term extension study. KOASTAL-2 and KOASTAL-3 were intentionally staggered to allow us to read out the KOASTAL-1 results and incorporate any learnings into those what are currently ongoing and still enrolling Phase III studies. Earlier this year, we did share some top line results from KOASTAL-1, and I'll share a bit more detail on that study now. So the study was a study evaluating navacaprant as monotherapy in adults with moderate to severe depression that baseline MADRS score of 25 or greater. And the primary outcome measure was the mean change from baseline versus placebo at week 6 on the MADRS, a scale of depressed mood and then the prespecified key secondary endpoint was the mean change from placebo at week 6 on SHAPS, which is a scale of anhedonia. And you can see on the right side of the table, there was a number of other prespecified secondary and exploratory outcome measures. So overall, the study enrolled 383 patients. You can see that the baseline characteristics listed on the left were well-balanced between the arms. In general, the baseline characteristics in the patient population was as we expected, I'd say, with one exception. Importantly, these patients did have meaningful degree of depressed mood burden as evidenced by a MADRS of greater than 32 at baseline as well as significant burden from anhedonia as evidenced by a baseline SHAPS score on average of greater than 36%. One aspect of the trial that we did not anticipate at the beginning of the trial was overall, we saw 45% of the population were males, that is certainly larger than as what's been seen in typical and recent MDD trials. Now the trial did not meet statistical significance on the primary endpoint of change from baseline versus placebo on the MADRS at week 6. On the left side, you can see those results over each of the time points. The study did not meet its prespecified key secondary endpoint with statistical significance, the SHAPS at week 6, as shown on the right, and the mean change from baseline in both navacaprant and placebo arms over time. In a prespecified subgroup analysis by sex, we did see some interesting effects, as Henry alluded to, I'll show those here. So this is showing the effects on the MADRS scale in the 2 subgroups of female on the left and male on the right. And you can see in the females that there was a consistent improvement relative to placebo across all time points that tended to increase through the duration of the study. However, in males, you did not see the same benefit in the active arm relative to placebo. One thing I would point out, the gray lines are placebo. And you can see that the male patients had a higher placebo rate than the females of about 14 on the scale, which is about 2.5 points higher than the change -- the placebo change observed in the females. This same trend of benefit in females was also observed in the key secondary outcome measure, the SHAPS. Shown here on the left, again, is the females, where you can see numeric improvements over time relative to placebo in the active arm. However, similar to the MADRS effects, there were no benefits in the overall population of males. Again, I would point out the difference in the placebo response with a larger placebo response seen in the males than the females. And this effect of benefits in females versus placebo, while no effect in male was very consistent across actually all of the secondary outcome measures that we've looked at to date. And there is also this very consistent trend of an increased placebo response in men, essentially across all of the outcome measures that we've seen to date. So importantly, navacaprant was safe in this trial. It was generally well tolerated. There were no serious adverse events in the study. What's shown here are the most common adverse events in decreasing order frequency of those greater than 2%. You can see that there's good balance across the adverse events. One I would highlight is there was a numeric imbalance with pruritus with more subjects experiencing pruritus relative to placebo. So that's not unsurprising. We did see this in our Phase I studies. And it's -- the kappa opioid receptors have been implicated biologically in part in pruritus. So this gives us some indirect evidence of target engagement from the study. On the right side of the slide shows that the overall discontinuations due to adverse events, which is a critical safety assessment. We're low in both arms with actually navacaprant having a somewhat lower rate of discontinuations due to adverse events. So overall, continue to show a very favorable safety and tolerability profile for navacaprant. So with this study now, we have upwards of 600 patients with unblinded data combined between this study and our previous Phase II study, and that really represents a rich and a powerful data set that allows us to glean more insights, not only about the drug, but also about aspects of the trial. And as we think about what are modifications that we could potentially make for the ongoing KOASTAL-2 and KOASTAL-3 studies for the program more broadly. It's still relatively early days. We just have this data for a very short period of time. There is additional data coming in, and so additional analyses are ongoing, but nonetheless, I wanted to share some of our sort of key takeaways and potential learnings at this point. One, as I mentioned, we did see a higher-than-expected placebo rate. It's particularly true in the males. Again, on the MADRS, the male subjects had on average, 2.5 points higher placebo rate than the females. In the females, we certainly saw very consistent and encouraging trends of benefit relative to placebo really on the primary and across all the secondary outcome measures. As mentioned, we did see a higher proportion of males and what's typically seen in depression trials at 45%. The typical is more around the 30% range. And then as I just mentioned, we continue to be encouraged by the safety and tolerability profile of navacaprant. There are, importantly, other data that are forthcoming, things like the exposure data or the pharmacokinetic data, which is obviously important as we contemplate things like exposure differences between males and females. So that data is outstanding, and we'll continue to collect that data and have additional analyses to further glean insights from the study. What we are doing currently is looking at a study level, at a site level, at a radar level and at a patient level to understand what are those predictors, high placebo response versus low placebo response, high drug effect versus low drug effect and to potentially help us understand the observed difference between males and females. Ultimately, the goal would be to incorporate those, right, from a much richer data set than we had when we initiated the KOASTAL-1 study. and make modifications to KOASTAL-2 and KOASTAL-3 to optimize the sites that we're utilizing in those ongoing studies as well as to potentially optimize the patient to ensure that the most appropriate patients are entering the study moving forward. One thing I would just note on the sex differences, a lot of analysis is still ongoing, as you can imagine. But we do know in the ongoing KOASTAL-2 and KOASTAL-3 studies, they're still enrolling, so it's a moving target. But we do know today that the proportion of female subjects in those studies is much higher and much more typical than what we saw in the KOASTAL-1 study. And so we don't know if that effect of differential effect in females versus males, will replicate if it does in KOASTAL-2 and/or KOASTAL-3, obviously, we'll be contemplating regulatory paths forward for that, recognizing that about 70% of all prescriptions for MDD are in females. So a lot more analysis, more insights and implications to the KOASTAL-2 and KOASTAL-3 programs will be forthcoming and look forward to providing update in our 10-K. So beyond depression, we are evaluating navacaprant in bipolar depression to like patients with -- who have major depressive disorder, patients with bipolar depression suffer from depressed mood, but a majority of them also suffer from anhedonia. And in fact, that anhedonia is what's best correlated with impaired quality of life, so having a therapy that has potential benefit in both depressed mood and anhedonia is something that could be very attractive for patients. This is a signal-seeking study looking at navacaprant versus placebo and approximately 80 patients experiencing a moderate to severe depressive episode and they have to have a MADRS score of 25 or greater upon entry. Primary endpoint is the MADRS at week 6 and a number of other secondary outcomes, importantly, including a measure of anhedonia with SHAPS. So this study is not powered for statistical significance. It's a signal-seeking study, which will look at the totality of the efficacy and safety data that really then informs us around next steps in further development, including an adequately powered clinical trial in bipolar depression 2 and also the potential expansion into the broader bipolar 1 population. So moving from navacaprant, our next most advanced asset in the pipeline is our Vasopressin 1a Receptor antagonist called NMRA-511, which is in development for Alzheimer's disease agitation. So we know that behavioral symptoms in Alzheimer's disease are incredibly prevalent and with the increasing aging of the population, the increasing epidemiology or prevalence of Alzheimer's, the burden from those behavioral symptoms is going to continue to increase. And not only are they frequent, actually, these are oftentimes much more disabling to patients than actually the cognitive deficits that people think about in Alzheimer's disease. They're highly correlated with caregiver burden and they're also highly correlated with more patient morbidity mortality and they're the most closely correlated with early placement in the long-term care facilities. Unfortunately, only a single drug today is approved in the U.S., and that's an atypical antipsychotic that has -- carries a black box warning for increased mortality in that elderly patient population. So really disease area with tremendous unmet need. The Phase Ib study, signal-seeking study is underway and look forward to sharing data from that study in the second half of this year. Now what gives us confidence around this mechanism is our several aspects. I'll just touch on a few. One is we have a highly potent and also highly selective antagonist of the Vasopressin 1a Receptor . Also, it's a drug that has excellent CNS penetration. There's a real incredibly strong scientific rationale behind the Vasopressin pathway, in particular Vasopressin 1a Receptors is modulating fear, anxiety, agitation and aggressivity, and that comes from preclinical as well as clinical data, including some of the data that we've generated in a preclinical test showing that 511 reduces signs of agitation and anxiety in marmosets. We've also been quite pleased with the clinical profile that we've seen to date. We've completed Phase I testing, including in an elderly PK intolerability study, and that gave us the confidence to progress this molecule into the proof-of-concept study in Alzheimer's disease agitation. We continue to advance our Muscarinic franchise. This is our M4 selective positive allosteric modulators . We now know there's a number of molecules binding and activating the Muscarinic receptors that have resulted in robust efficacy in the schizophrenia population. So we think there's obvious potential there. But importantly, potential beyond just acute schizophrenia in a number of diseases, including things like psychosis associated with Alzheimer's disease. With our approach we're taking, which is a selective M4 positive allosteric modulator, we think we can retain the efficacy that's been seen but minimize the side effect profile that we see with the less selective or non-selective agonist that have been evaluated to date. So 266 remains on clinical hold, but we've made great advancements across a number of our other programs, and we anticipate advancing 1 of those into the clinic in the first half of this year and look forward to sharing more details as those programs continue to progress. And then last but not least, we have an exciting preclinical pipeline comprising 4 different programs that interdict on targets that each have very strong biologic rationale, and importantly, too, those have strong human genetic validation. You can see that those have opportunity to make impacts in serious and common diseases like Parkinson's disease, Alzheimer's disease and ALS. Those programs are advancing nicely in the preclinical pipeline, and we look forward to sharing more information on those in the future. So with that, I'll turn things back over to Henry.

Great. Well, thank you, Rob. So there's a lot going on at Neumora. And I hope you can see that we're quite excited about what's to come this year based on our leading pipeline of neuroscience programs. with a number of very important catalysts for investors and patients this year. Our strong balance sheet that gives us the ability to really study the KOASTAL-1 results, figure out the learnings and incorporate those learnings into the ongoing development and of course, our very motivated team that's working hard every day to advance our pipeline and make a difference for patients. So with that, Tess, we'll turn it to you for Q&A.

All right. Great. So I thought I would start our conversation here on as you think about the -- what you have from the Phase III KOASTAL-1 trial at this point, what are you still working through? I think you talked a little bit about this, Rob, in your comments on the podium. But can you give us any more specifics there? And are you still waiting for certain parts of the data to come in at this point?

Yes. Rob, why don't you take that one?

Sure. Yes. So we have a substantial amount of the data that was part of the top line that we shared -- some of which we shared today. But we do have a number of sort of critical outstanding pieces of data, one of which, for example, is the pharmacokinetic data. So that would be obviously important to understand if there's exposure differences than what we would have predicted based on the previous data. And so what we're doing is we're not just waiting for those data. We're actually conducting a lot of ongoing analyses, really, again, not just the study level, but at a site level, at a radar level, which we know is so critical in these neuropsychiatry studies and even the patient level to really understand what are those attributes, what are those characteristics at the patient level, at the site level that could contribute to or they're predictive of either a high versus a low placebo response, a high versus a low drug response and to help explain or understand the observed differences between males and females. So that's really the focus that we'll have with the intent to sort of rapidly incorporate those learnings into the KOASTAL-2 and KOASTAL-3 programs, which, again, we intentionally had staggered the start of those, knowing that we would want to potentially incorporate learnings from that first pivotal trial.

Can you talk a little bit more about what you made of the differential response between males and females. Did you also see these types of differences in your Phase II study between the 2 genders?

Yes. So I would say we were surprised by the different effects that we saw in males and females. Based on the totality of the data that we had going into the Phase III, that's not something we would have predicted. When we looked across the totality of the clinical data, both in other -- with other approved therapies, there can be some differences, but they generally aren't sort of that significant. And then when we look specifically at the clinical data generated with the kappa opioid receptor antagonist, our own study in Phase II as well as aticaprant and the FAST-MAS study run by the NIH in their Phase II study, one would not have predicted that degree of differences between the males and females. So as I mentioned, despite us not having predicted that, we nonetheless have this observation. And I'd say it is quite consistent when we look across not just the primary and key secondary but really all of the secondary efficacy outcome measures that we have to date. So within the study, it is a true observed effect. I think the question that we have now is, is that going to be a true effect that we see in additional studies, and that's why it's important for us to go through and really dissect that data to understand why is it that the males are performing, in particular, different in this study and not just from a drug effect, but also from a placebo effect, which really suggests that there was something unique about the characteristics and the performance of the metals in the study relative to the females in the study and relative to what we would have expected based on the existent literature including from the kappa opioid receptor.

And what about the prior data? Did you look in to see if the trends held there?

Yes. So we did look at, obviously, in our Phase II study. When you start to dissect relatively small data sets, then you get into the problem of 2 small numbers. But what I will say is, we did not see anything like consistent for -- to explain the difference that we saw here. And again, when you look at aticaprant, either Phase II or the FAST-MAS study done with aticaprant by the NIH, again, one doesn't see this sort of dramatically different treatment effects across females versus males.

Can you talk a little bit in more detail about how you think about what the read throughs are from this outcome to your Phase II study in bipolar? And maybe you can set the stage a little bit for us in terms of what you're looking to show in that setting data-wise.

Sure. So I'd say the approach that we're taking with deeply interrogating the data sets that we have to inform KOASTAL-2 and KOASTAL-3, it will be the exact same approach as we think about what are those learnings that we could apply to the bipolar now acknowledge that that's a different patient population that nonetheless, it's certainly reasonable to believe that predictors placebo response, for instance, in an MDD population might also carry over to predicting high versus low placebo responses in a bipolar depression population. So I'd say we're going to take the exact same approach that we're doing to make those modifications in the KOASTAL-2 and KOASTAL-3 to the ongoing bipolar depression study, which is still active in enrolling patients. And then in terms of sort of what specifically to expect, again, that's a signal-seeking study. It's not a study that's powered to have show statistical significance on the primary outcome measure. And so in these types of early signal-seeking studies, for us, it's really about thinking about the totality of that data that we see across all the measures that we have and integrating that to come to a consolidated view on what is the best path forward for that program that would then lead into what would be an [ powered ] study that could discriminate with statistical significance. So it's going to be in the end of the day, the totality of the data, the benefit risk integrated, that's going to sort of inform us around next steps with that program.

Okay. So should we be looking at effect sizes or anything like that? Or can you give us any quantification for the win?

Yes. So again, in a signal-seeking study that doesn't have adequate power to discriminate by statistical significance, it's really inappropriate to even sort of come and predict a specific treatment effect, which is why, again, really for these studies have to look at the totality of the data. It's a single outcome measure at a single time point with a single statistical value, that's something you'd expect from a more adequately powered study like a large Phase IIb or a Phase III study. So here, it's really about that totality of the data that will either give us conviction hopefully, to move forward into a larger study in bipolar to and then potentially expand that out into the broader bipolar 1 population.

Switching gears now to NMRA-511 I think you talked a little bit about the design elements of your signal-seeking Phase Ib. What profile are you ultimately looking to show in this study?

Yes. So again, sort of similar comments that I made on the bipolar, this is a signal-seeking study. It's not a study that's powered to detect statistical significance. It's a study that has about 88 -- anticipating about 88 patients in total, so about 44 subjects per arm, which I think will give us a reasonable overall assessment of what the efficacy is across a number of measures, not just the primary outcome measure, which is the CMAI. And importantly, what the safety and tolerability profile is this is a population, again, that has a single drug approved, which is in atypical antipsychotic with the black box warning for increased mortality. So I'd say there's tremendous opportunity within this space and the study is really intended to inform, right? Do we think we've got the conviction based on that to move forward into a more definitive clinical trial.

Switching gears again now to your schizophrenia efforts. What can you tell us about the communications that you've had with the FDA with respect to the clinical hold on the NMRA-266 candidate?

Yes. So we -- our policies do not comment on ongoing discussions with the regulatory authorities. What I will share is we've continued to make, I think, great progress across the portfolio of programs that we have. And we've got a number of assets that have molecular differentiation and unique pharmacologies and we are looking forward to, as I mentioned, advancing at least one of those into the clinic in the first half of next year. So I think our strategy all along of broad investments in this space given the clinical validation is paying off and with our ability to pretty rapidly advance the portfolio.

Yes. And I'd add that certainly, once we're back in the clinic, we look forward to updating investors just on the comprehensive approach with M4 and give a thorough update on that program.

Okay. And are you able to give us a little bit more detail about what the kind of different properties and chemical composition that you're kind of doing with here to kind of like -- can you talk a little bit more about the compounds you are developing, what's the ideal profile you're targeting? How does it differ from NMRA266?

Yes. Tess, I think it's really premature to comment on that now. Again, we're on track. We're confident we'll be back in the clinic here in the first half of this year, and then we look forward to updating investors on that progress.

Okay. What did you take away from AbbVie's emraclidine results in schizophrenia that were presented last year?

Well, look, that's really a question for AbbVie. So we're not going to comment on that. But I would say we remain very enthusiastic about this class. We believe there's a big opportunity for our programs. And so we're really just focused on our programs and getting back in the clinic and providing that update to investors when we were back in the clinic.

Okay. Big picture for the company. How do you think about the pros and cons here of diversifying your portfolio versus maximizing the value of single assets across multiple indications. For example, how you have with navacaprant across various neuropsychiatric indications.

Right. I mean, look, as I hope we highlighted, we already have a very nicely diversified portfolio, right, 7 programs, preclinical going all the way to Phase III. So I think we're well diversified. We have a strong balance sheet to really explore all these programs to adapt to incorporate the learnings for KOASTAL-1 into the ongoing navacaprant development program. So, at this point, we have a lot on our plate. We're fully focused on moving those programs forward, and I think we're diversified with many catalysts and opportunities for investors to participate in some important value creation here this year and in the years to come.

Are there any other -- last question for me. Is just are there any other sort of from your kind of evolving maturing other pipeline that we didn't talk about in detail that we should particularly be monitoring in 2025 for additional updates.

Look, I think we hit the highlights, but it's, again, as I hope we convey it. There's a lot going on at Neumora, again, 7 programs, many catalysts, and it's going to be very exciting year, lots of opportunity to create value for patients and for investors. And of course, we look forward to updating investors as we continue to make good progress on each one of our assets.

Okay. Do you want to just update us maybe on the financial position and how we should be thinking about OpEx spend over the remainder of 2025?

Yes. I mean what we're saying is, again, we have a very strong balance sheet and a proven history of raising financing. That said, we have, again, a great position now. We have cash runway into the middle of '26, well funded to pursue all the things we just talked about and really follow the signs. So at this point, we feel great about our financial position, and we're fully focused on executing.

Great. I think that might be a good place to leave it. Henry, Rob, thank you so much for the presentation, and thanks, everyone, for joining.

Great. Thank you, Tess.