Newron Pharmaceuticals S.p.A. (NWRN) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to the Evenamide TRS Study 014/015: 6-Month Results Conference Call. I am Sandra, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Stefan Weber, CEO of Newron. Please go ahead, sir.

Happy New Year to everybody. And welcome, everybody, to this call by Newron's team. Thanks for your patience for a few minutes, so we could allow everybody to join, who was dialing in. With me today is Ravi Anand, our Chief Medical Officer, who will join me in the presentation; and the Vice President, Commercial Affairs from Morristown. Good morning, Dennis, Dennis Dionne, who will join us for the Q&A session. This call is all to present to you the absolutely overwhelming safety and efficacy results from the first 100 patients suffering from treatment-resistant schizophrenia, no longer benefiting from their current or any other available antipsychotic who were randomized [ over ] studies 014 and 015 and got evenamide as an add-on treatment to whatever current medication they were taking. And we are today looking at the 6-months results. You might remember that we did review the 6-weeks results in June last year. At that time, we already had very promising and encouraging outcome. And we might have hoped at that time that we might be able to maintain the level of benefits. What we will show to you today is absolutely striking outcome, claimed safety and statistically significant improvement of all the patients over all the end points, and a substantial improvement over the results we had seen after 6 weeks. We indeed believe that these results could turn into the most promising, the best news for TRS patients since clozapine was approved, the only approved drug ever, in the late '80s of the last century. Before we get there, please allow me, for those who are new to the story, a few minutes of an overview on Newron before I hand over to Ravi Anand. I assume you have all been able to download or access the slide deck that was connected to the press release of this morning. So I'm going to that slide deck now, Slide 1. Newron is all about developing and getting approved, innovative treatments to improve the quality of life of patients suffering from CNS diseases. This magic machine, which is so brilliant until it failed us in diseases like Parkinson's, Alzheimer's or schizophrenia. Newron is a very small team, headquartered in Milan, Italy, with a subsidiary in Morristown, New Jersey, where we have our commercial operations, CMC, and part of our R&D team. We are listed on the Swiss Stock Exchange since 2006. And our shares can also be traded at the Dusseldorf Stock Exchange, et cetera. So please read the disclaimer on Slide 2 carefully. We move on to Slide 3, which is the highlights of the company. We have already brought a first drug to the market, Xadago, an add-on treatment in Parkinson's disease. And that compound, we took on when it was in early preclinical stages, when the company was created. We have taken that compound onto the market in the European Union. It was the first newly approved, new chemical entity in more than a decade in European Union. And we brought it to the market in the United States, where again, it was the first NCE approved in more than a decade in 2017. This drug is licensed globally, and it has paid more than EUR 70 million of down payments, milestones and royalties to us. And it comes with a long patent life until 2029 in Europe and 2031 in the United States. So for whatever, it is good. Take it as a proof that we know how to take CNS drugs to the market, to overcome all the development hurdles and the regulatory hurdles as well. Evenamide now is a real value driver for our shareholders because this drug does not only offer a new mechanism of action but also a completely new positioning in schizophrenia. We are permanently looking for additional assets that fit our strategic criteria to grow our pipeline. We have material news flow to come from evenamide, and you'll see that in a few minutes. And the management team has taken drugs to the market before, and as you just heard also from Newron. We are right now able to dispose of EUR 40 million for the next 1.5 to 2 years, which takes us well into 2024 and allows us to reach all the value inflection point of the ongoing studies. If we move to Slide 4, this is the pipeline of 3 compounds. I just want to show it to you to mention 1 thing. These compounds all come from the same class of compounds. They have 1 mechanism in common, which clearly sets them apart of everything else that is on the market in those indications. They all have a mechanism that affects, modulates, glutamate in the brain, only the excessive glutamate, leaving the [ baseplate ] glutamate intact. And this is driven by a voltage-gated sodium channel blockade. That is why these compounds are unique in Parkinson's, where they do not only improve Parkinsonism, but Xadago also reduces dyskinesia, the most common side effect to [ Levodopa ] therapy today. That is why evenamide is one of its own in schizophrenia. And that is why Ralfinamide is one of its own in certain types of pain. So let's focus now on evenamide and how it is differentiated in schizophrenia. No need to mention that schizophrenia is a huge market. We are talking about 1% of the global population, wherever you go. You're talking about more than 30 compounds not showing sufficient and sustained benefits for the patients. There's a huge need for a compound with a new mechanism of action and positioning, just like evenamide. And evenamide would indeed qualify to become the first add-on truck ever in schizophrenia. We can change nonresponders into responders. There is no need, given this is an add-on therapy, to change the current therapy, which reduces the risk of relapses, hospitalization and suicide. So it's ease of use for patients and physicians. This [indiscernible] are now coming to the treatment-resistant part of schizophrenia, become the first and only treatment resistant drug or treatment since and beyond clozapine. Of the total schizophrenia population, between 30% to 50% will, from the very beginning, be treatment-resistant or become treatment-resistant over the years. The only therapy approved for TRS is clozapine. So this would be the first drug since clozapine. Within TRS, it is our aim to keep a smaller niche indication of those patients who are treatment resistant to clozapine in the United States. That is about $200 million of annual business, and that is something that we could commercially manage. What do we have to show to you? We do already have positive results from a Phase II study in non-TRS patients, the first indication. And based on those positive results, we started the first of 2 pivotal studies in non-TRS. The study is ongoing at recruiting patients that should produce results still this year. So now we are looking at the pilot study in TRS patients, which is ongoing. 4-weeks results have already been presented in June and 6-months results are presented right now. We will then come back to you with 12-months results in the months to come. This is indeed the first study in patients suffering from TRS. And given the outcome we have seen after 6 weeks and 6 months, we have decided that we will start the first pivotal study in TRS still this year. So then we would have 1 pivotal study, non-TRS, 1 pivotal study in TRS. And that is it to file for approval. This compound offers the chance for early market access, and it comes with a long exclusivity left, 2033 from the composition of matter, and beyond in European Union, where we are benefiting from the 10-years exclusivity post approval. Said all that, let me hand over to Ravi, to start with Slide 6.

Thank you, Stefan. Good morning and good afternoon to folks from the -- attending from the U.S. I think Stefan has laid the grounds basically for schizophrenia, so I don't need to go into great detail except to once again remind folks that schizophrenia is a disease which has been known to mankind for a very, very long time. And virtually, all of the attempts to develop a treatment have been more or less following the similar mechanistic story. So we have probably over 30 unique antipsychotics on the market, and they all seem to work in short-term treatment. They do control positive symptoms for some period of time. But then overall, their efficacy begins to fade. These compounds, whether they are first generation or second generation, sometimes called as typical and atypical, do not seem to have an impact on negative symptoms, cognition, or functioning. The reasons why we seem to be following the same pathway is that we always believe that because the first drugs like [indiscernible] and [indiscernible] blocked dopamine receptors, this must be the mechanism. And all developments have tried to model that. The atypical ones realized that having too much dopamine blockade leads to significant motor side effects. So [indiscernible] antagonism was introduced to offset some of the ETS findings. But they have -- they produce problems of their own, such as sexual dysfunctions, weight gain, et cetera. But what we realized, I think -- or the field realized in the last 20, 30 years, mainly due to the advent of advanced technologies like MRS spectroscopy, positron emission tomography, that actually the causal findings or the earliest findings in patients who were not yet having the first episode of schizophrenia but were in their teens and the prodromal symptoms was that there was an excessive release of glutamate. So this glutamate's release precipitated the symptoms of schizophrenia. And since that time, there has been a significant effort to try to figure out how to use this in therapy. But to this date, all of this has failed. In schizophrenia, we also recognize there are patients who are going to be treatment-resistant right from the beginning. Right in their first episode, they do not respond to antipsychotics. These patients in their brains have high levels of glutamate but normal levels of dopamine. As there are patients who respond to antipsychotics, these are patients who have higher levels of dopamine but normal levels of glutamate. And then there are those patients who start off by responding, but within a few years, stop responding. So it seems to be there's a continuum among a subgroup of patients with psychosis where they become increasingly resistant to the effects of therapy. And there have been many definitions of treatment resistance. The latest one comes from the [ TRIP ] Committee. And what they have defined is basically that you have classes of patients who may have inadequate response, but not meet the criteria for resistance. And we think generally, there are about 40% of patients with psychosis or schizophrenia who, within a few years of treatment, are in this category. These will be classically the kind of patients who are entered in the CATIE study, 5 to 10 years of disease, switching from one antipsychotic to the other but not getting adequate relief. And there are 30% of patients who are the real treatment-resistant schizophrenia. But as I said, there's a continuum and the 30% could blend into 50% in one categorization, could shrink to 20% in another categorization. The issue with schizophrenia is that it's not just the positive symptoms which are occurring like delusions, hallucinations, which disturb everybody, but the fact that this occurs -- the first episode in males is around the age of 20 or below 20, and the female is about 5 years later, which means the patient's educational efforts, ability to function in society, the ability to live at home, all of these are compromised. And no drug to this date, including clozapine, has been able to eliminate these symptoms, reduce the progression of the disease, reduce the disability. And what is also known in schizophrenia is that there's a high incidence of suicides, high prevalence of suicidality. About 13% of patients with schizophrenia die of suicide, and 50% actually attempt suicide. And this is despite the fact these patients are on antipsychotics. So therefore, [ of ] this, we have chosen the pathway that basically what we would like to do is to target a different mechanism with evenamide. So moving on to the next slide, it's Slide 7. Clearly, schizophrenia has a very large market. Currently, with the fact that most of the drugs are generic, is still crossing $20 billion and growing. What we do not have at the present moment is a single antipsychotic that can be used as an add-on therapy for patients who are inadequate responders or treatment resistant. So one of the indications that we are looking for, for evenamide will be as an add-on therapy to any existing antipsychotic, whether it be first generation, second generation. In other words, could be dopamine antagonist or a dopamine-serotonin antagonist. And some of the data that I'll describe to you shows that the benefits of evenamide do not depend upon what the inherent mechanism of the underlying antipsychotic was. In other words, it could work with anything. The inadequate responding patient population, as I mentioned before, could be as much as 70% of patients with schizophrenia. We know from the CATIE study that these patients are unlikely to benefit significantly from any antipsychotic, and switching from one to the other in the CATIE study [ Part 2 ] did not confer any [indiscernible] benefit. So this could be a very large population. The second population, which I think we are inherently interested in, is the TRS population. There are follow-up studies done by the Institute of psychiatry, which show that in patients with TRS followed up for 10 years or more, there are glutamatergic abnormalities, but not dopaminergic abnormalities. And that is basically what we would like to target. If we are able to be successful in demonstrating a benefit in TRS patients, this would be not only a benefit for patients, for physicians, for the management of patients with schizophrenia everywhere, but also inherently would be a very strong -- help lead to a very strong health technology assessment to support coverage of the drug in the marketplace. In treatment resistance, of course, as Stefan has mentioned, clozapine is the only drug that has been approved. And that seems to work in about 30% of the patients. But what is not generally recognized as among the 30% of the patients who are put on clozapine, about 30% do not respond. And for these patients, there is no other treatment available. It's short-term therapy, but there's no real mechanistic way of dealing with these patients. In the U.S., it's estimated that this is about probably less than 200,000 patients, which will probably shrink down to about 50,000, 60,000 patients who could be managed. And they are generally distributed in the VA hospitals, in the large public institutions. And they could be easily managed by a small company. Moving on to the next slide. How did we decide that evenamide is a drug for schizophrenia? So on Slide 8, you'll see that there are a lot of models listed. We generally believe and the field believes now that schizophrenia is not really a behavioral disorder, but it's actually an information processing deficit. The average schizophrenic patient is unable to process information which is coming in from multiple sources and to be able to deal with it. And that can -- these inputs lead to false assumptions, false conclusions. And therefore, the patient, in a way, is actually reacting to the stimuli but not in a way that you and I would react. So we have concentrated most of our efforts on information processing deficits. But as you can see, we have looked at negative symptoms, positive systems, psychosis, mania, cognitive impairment, impulse control, mood symptoms. We have tested evenamide, both as a monotherapy and as add-on therapy. Now we have chosen at this moment to go with add-on therapy. The 2 reasons why, I think, first of all, in add-on therapy, the dosage required to produce a response is lower. This reduces the possibility that evenamide might be adding to any adverse events in these patients. The second is that the treatments we have currently given are not entirely useless. We do control positive symptoms to some extent. And by adding on to those, what we intend to do is to take these patients who are no longer responding to their current medication in a way, like ECT, jolt the system to make sure that the glutamate -- excessive glutamate release is inhibited, and they can start responding to it again. But at some point, it may be possible that we may also go in for monotherapy. And the next question, of course, then is basically how does evenamide work. Evenamide works through a unique mechanism. It's the only drug that we know that is working in the CNS space, which does not interact with any receptor of the 130 that are currently used -- that are currently believed to be associated with CNS actions. Evenamide is only inhibiting sodium channels in a very positive -- it's not selective for any single subtype, but it affects all subtypes of sodium channel blockers -- of sodium channel. But the important finding is that it affects them in a way that there is no interaction on any other organ systems. Mechanistic studies done with evenamide indicate that it is acting through 2 separate mechanisms. In the last graph that you can see, there is the -- an experiment, which is describing the....

Ladies and gentlemen, please hold on. We lost connection with the speakers.

Sandra, will I be online?

Yes, sir. You are online. I will inform you as soon as Mr. Ravi is connected back, okay?

Yes. So let me go on until Ravi is back. We are looking at Slide 8. That is the mechanism of action. And as Ravi has just mentioned, we are looking at the voltage-gated sodium channel blockade. And you see in the left part of the graph that this drug is only acting when it is required. In the middle chart, you see that it will only apply to those nerve cells that are excessively firing, and we leave those nerve cells intact which are normally firing.

I'm back, Stefan.

And thank you, Ravi. I'm just on Slide 8, and we are looking now at the inhibition of glutamate release now with [indiscernible] model. If you can go on there and then we can go on with Slide 10.

Okay. So first of all, as Stefan may have pointed out, basically, as you can see from the first part of the panel, this is a very smart drug. When the neuron is firing normally, you can see that the amount of medication needed to block it is 25 micromolar. But when it's not firing normally, it's inactive, then you only need 0.4 micromolar. And this is exemplified in the middle one, where you see 2 categories of neuron firing, high frequency and low firing -- low frequency. Low -- high frequency is what we see when we have epilepsy and conditions of this type. And in schizophrenia where you have burst firing. Here, 1 micromolar concentration completely wipes out all the abnormal firing. Low frequency neuron firing, which is necessary for our functioning, and if that gets blocked, you get significant side effects like with carbamazepine. You can see that 1 micromolar has no effect at all. How does this happen, this [indiscernible]? And if you can look at the right side, the microdialysis model, this is in-vivo microdialysis. So there is a way of measuring the glutamate levels in the brain. And as you can see, the flat part of the curve, which is the very beginning, there is very flat, so the basal glutamate levels do not change with evenamide. We inject Veratridine, which is a sodium channel [indiscernible], glutamate flushes out, which is the black peak. And you can see that evenamide reduces this peak, dose dependently in the blue and the red colors. So this is the only mechanism by which this drug is acting. Now based upon these data, we had discussions with regulatory authorities, and we initiated a Phase II study in the U.S., the placebo-controlled study in non-TRS patients which is in Slide 12. And in this study, what we were able to show that in a small group of patients, who are on risperidone and aripiprazole and not responding well, the addition of evenamide improves symptoms, positive symptoms. The clinical global impression of change done by psychiatrist with all scales showing a benefit for treatment. So this was the stage at which we decided basically that we have enough data to be able to go into the next category of things. So basically, what we had was regulatory interactions which as shown on Slide 13, with a whole series of European countries as well as the U.S. and Canada. And we discussed the possibility of this drug being for both indications, that is the non-TRS add-on as well as the TRS population. And they were agreeable to us, looking at having 1 positive study in both indications and discussing the results with them to see if this would be adequate for the full approval process. In addition, the FDA asked us to do some additional work, which was associated with looking at potential risks. All the preclinical work that the FDA requested has been completed and submitted. We have completed the 4-week EEG study requested by the FDA. And the remaining data that the FDA requests, basically, we expect to be able to submit once we have finished with the study 014 results, and we are submitting that report. So now we can go on to Slide 14, which is the TRS study. So before I go into that study, let me explain to you a little bit of the background of the study because I'm sure all of you have lots of questions. At the time when we planned this study and initiated in late '19 to early '20, we didn't have any data on TRS patients. And there's always a theoretical concern that by inhibiting glutamate, you may actually worsen things. Therefore, investigators were reluctant to go into a double-blind, placebo-controlled study. What they felt was that they would rather do a study in which the principal investigator was unblinded. They would not really want to have a control group, they would not really concentrate on the drug. And this would be a randomized study. The efficacy ratings will be done by a rater who was blinded to which dose the patient was receiving. There were going to be 3 doses in this study: 7.5 milligrams, 15-milligram and 30-milligram BID. But based upon the fact that we were very considerate, conservative, we agreed to start the study at 7.5 milligram and 15 milligram, perform an interim analysis to demonstrate that there were no safety concerns, and then randomize patients to the 30 milligram also. So we would change the randomization to make sure, at the end, we would have a similar number of patients. The objective of this study, as you can determine was really safety and tolerability first. Nobody has ever treated TRS patients on antipsychotics with a glutamate release inhibitor. So that was the primary objective. We took patients who were psychotic. They were all on an antipsychotic. They were -- their scores in the PANSS were anywhere between 70 to 90, which means moderate to almost severe. We excluded patients who were very severe because those patients may require hospitalization and that, we did not want to do that at this stage. Of course, we did all the efficacy measurements, the PANSS, the CGI of severity, the CGI of change, the level of functioning, et cetera. Now another question you may be expect or you have considering is why is it that we're only reporting the 100 patients' data and not the full-patient study? Because we did an interim analysis, the Safety Monitoring Board wanted to see the interim analysis before agreeing to the 30-milligram dose being included in the study. We did it, ensured that it was safe, so they could be go to 30 milligrams. But the Board also felt that since we had quite a lot of patients in the study, we wanted to be reassured that the drug was doing something and not just that we were giving patients an inert drug. So they requested us to do a blinded analysis of efficacy for the first 100 patients who completed the 6 weeks. And that's what we did. And those are the data that were released in June and showing benefit, and we will go over that. Overall, the study enrollment has been completed with 161 patients who are randomized. There is a gap between the 100 patients going in and the 161 going in. Why is that? Because we were very unfortunate to have the pandemic hit us at the moment we started the study. So while we could get the first part of the study done in enrollment terms, we really suffered a lot after that because, as you imagine, the hospitals were closed, centers were closed, patients who could not travel. So enrollment really suffered. So therefore, the first 100 patients we got in relatively early, but the last 61 took some time, but they have completed their enrollment, and we expect to announce those results in February, March. So let me just also point out some of the other essential questions that will come. Why are you not breaking it down by dose? Because this remains a study which is still blinded for the dose, we do not know, the investigators do not know what dose each patient was on. So the first 100-patient data is largely comprised of 7.5-milligram and 15-milligram BID patients. There are only about a handful of 30-milligram patients because they were the ones who were admitted into the study late. Another question which is to be expected, is really, why is it that you are not showing the exact results for week 30, although you did show that for week 6? Well, we are [indiscernible] by the fact that by showing you the week 6, when we tried to put that into post [indiscernible] afterwards or publications, we were told by all the journals that since the data are in the public domain, you cannot publish this. So in this case, what we have done is we have given you information which is providing some idea of the patient -- of the results but not the exact numbers, and those will be released at upcoming conferences and publications. So I think I've gone through up to Slide 15, most of the things that we -- are required. So let me just repeat once again. We have the 100 patients who were included in this analysis. 3 of those patients discontinued, 1 patient withdrew consent. And I'm talking about week 6 now, and 1 patient basically discontinued because had severe high fever, vomiting, nausea. So we had 97 patients who are eligible for efficacy analysis and completed the 6 weeks. Out of those 97 patients, 90 entered the extension, 7 did not because of [ withdrawal of ] concern, adverse events, et cetera. So the analysis population here is 97 patients for whom all results are based. If you go to Slide 16, you can see the results for the PANSS. We start off by a score of around 80. Now that may not sound very high to you, but please note that these are not patients who are on monotherapy, [ they're ] the ones on placebo. These are patients on an antipsychotic. So if we were to take away their antipsychotic, their scores probably would jump by another 10 points or so. When I saw the 6-week data up to day 43, they're not interesting, not overwhelming. There was a gradual improvement, but one could not say that these were outside the reach of placebo change over time. And there's some characteristics of these data, which suggest otherwise. Placebo tends to be somewhat rapid. This is a very gradual improvement that you are seeing. Now my assumption was that if this is a real effect when we look at the 6-month data, I would expect to see many of these patients going back to their original baseline or maybe worsening slightly, improving slightly, but not doing much more than that. When we looked at the week-30 data, I have to say, I was astounded because the effect continued to improve. I can grant you that you could have a 10-point change on the placebo -- from placebo in TRS patients in 6 weeks. It's difficult for me to believe that these placebo patients will -- patients' placebo continue to improve over 6 months of treatment -- over 6 months of time. If that was the case, I think we should market placebo for all TRS patients. And as you can see on the right-hand side, we've shown you just the change from baseline and what the exact values were, but not the value for week 30, which is still -- will be released at a later time point. But then the next question comes, is this improvement of any value? Is this meaningful for the patient? And once again, on Slide 17, what you're seeing is the PANSS total score responder rate. Now the responder rate here is not just anybody who has improved by 1 point. This is known as clinically important improvement in TRS patients and has been defined in the basis of clozapine studies done by the VA hospital. A 20% reduction is considered clinically important improvement. And what you can see that there's a slow degree of improvement in the number of patients who are responders. Over time, we are increasing up to day 43, which is 16%. So then when we look at week 30, again, it's a very dramatic finding that the number of who are responders -- clinically important responders, doubles at week 30. Again, going back to my previous argument, 16% responder rate to placebo, you could say that is possible. You could not say that is impossible. But why would placebo continue to produce such a significant improvement at week 30? So the longer the patients are continuing on drug, they are continuing to benefit, and the number who have a clinically important improvement keeps on going. And I should just mention that a change in the PANSS and the mean change compared to baseline is statistically significant using tests. So moving on to Slide 18, which gives you the change in the clinical global impression of severity and the clinical global investment of change over time. So first of all, I'm looking at the clinical global impression of severity. This is a judgment call by the treating psychiatrists as to how sick is the patient, not at all sick, very, very sick. Not at all sick is rated as 1, very clearly is 7. The baseline mean reading tells us that patients were between moderate and moderately severe when they came into the study. And once again, paralleling the change, what we saw in the PANSS, you see a gradual improvement up to day 43. But again, at 6 months, these patients show a further improvement in the level of severity. The CGI have changed is a difficult way to understand because there is no baseline. Again, there, 1 means excellent improvement, 7 means most severe worsening. And up to day 43, you can see the patients are improving, and 3 means mild improvement. But again, in keeping with what we saw on the PANSS and on the CGI-S, at week 30, there is a further improvement. In other words, the physician is feeling that these patients are improving even more than they have improved before. Next slide, which is looking at the CGI-S responder rate, which is now the clinical global impression of severity. How many patients improved on the CGI-S? And again, you see a small gradual increase over time to day 43 where it looks like about more than half the patients have improved in severity of illness. And at day 30, again, there is a further improvement on that. So overall, what we feel here is that -- then also looking at the CGI-S responder rate -- CGI-C responder rate, if you go to Slide 23 -- Slide 22, the first 100 patients, if you look at all the results here, the CGI-C, we looked at a responder rate as the characterization of how many patients improved by much improved or very much improved, not just minimal improvement. And once again, we find that there is a very significant improvement there. And at this is the third last row on this slide, and you can see at week 30, there is a further improvement on this. So whether we look at depends whether we look at the CGI-S, whether we look at the CGI-C, there is a continuous improvement, over time is almost like as the drug is producing a healing and a slow healing continuing. On the safety side, there's nothing to report. We -- complete -- our rate is very high. At 30 weeks, we have 85 patients of the original 100 who completed. The drop-off suicide side effects are only 2. There's no significant side effects. There is no reason for any patient to be withdrawn because of [indiscernible] laboratory values or seizures or anything of this type. So in conclusion, when we get to this, it looks on the next slide, addition of evenamide was very well tolerated. The -- all the efficacy measures show a gradual improvement over time, which is continuous in raising the possibility that higher doses even might show a better improvement than what we have. The CGI-C ratings, which is done by a psychiatrist based upon a holistic interview with the patient, and not given by a scale, indicates the clinically significant responders increase over time. Two measures we have not talked about today are level of functioning and medication satisfaction questionnaire. Surprisingly, the benefit that we saw in the PANSS and the CGI-C and the CGI-S is reflected also in the level of functioning where patients showed a greater improvement, a significant improvement in the level of functioning. And a medication satisfaction questionnaire showed ask that the patients all like the drug. And we are in favor of continuing on the medication. Moving on to Slide 23. Phase IIb and III, we will have the Study 008A, which is the non-TRS study, just started. It's a 4-week randomized study, double-blind, placebo-controlled, evaluating the effects of 30-milligram BID of evenamide versus placebo in patients who are on a second-generation antipsychotic and who are at a controlled dose. These patients have to be psychotic, they have to have measurable levels of positive symptom pathology. We expect that we will have basically 260 patients enrolled for the final analysis. And the results would be expected in 2023. On the right-hand side, you see, we will be starting the new TRS study, which will be started this year. This will probably be a 10-week randomized placebo-controlled study. The doses we'll be discussing with the health authorities, but it will probably be 15- and 30-milligrams BID. They will all be outpatients with treatment-resistant schizophrenia meeting the [ TRIP ] criteria. We'll all be on therapy with an antipsychotic and receiving treatment as usual. We will be including clozapine. We expect to have at least 450 patients included in the trial, which will be a global trial, and we expect that it will take about 18 months from the beginning to the end to complete in the field. With that, I turn it over to Stefan.

Thank you, Ravi. And I think now is the time for the Q&A. I'll hand over to Sandra to explain exactly the procedure of how to raise questions.

[Operator Instructions] The first question comes from Leonildo Delgado from Baader-Helvea.

This is Leonildo at [indiscernible]. Any ideas on how the design of the pivotal study 003 might look like? I'm thinking if the placebo will be used, what will be the expected efficacy and safety levels?

Sure. So the study, as I just probably mentioned very briefly, will be minimally a 10-week placebo-controlled study in which we will have patients with chronic schizophrenia, who have been demonstrated to have failed at least 2 antipsychotics of which one must be a second-generation antipsychotic, who are compliant with their medication, who will be having PANSS score of above 70 while on an antipsychotic, who will be having a CGI of severity of at least moderate, and who will have a responsible caregiver. These patients will be randomized to 15 or 30 milligrams or placebo, on top of whatever medication they are taking. We have had extensive discussions in the past about the outcome measure, what it should be. We would have favored more like a composite measure comprised of symptom scores, CGI of severity, CGI of change, et cetera. But whether it be the FDA, EMA, Canada, all governments have said, no, they want it to be based upon the PANSS total score. In general, what we estimate is that a minimum clinically significant difference in TRS patients would be 6 points compared to placebo. That may not sound like much, but in TRS patients, first of all, you do not get a very big change. Second, these are TRS patients on an antipsychotic. So therefore, the change that you may induce is already attenuated by the fact that there is an antipsychotic already on board. That's what is considered to be clinically significant.

Can I ask another question very quickly? So given that evenamide will be used [indiscernible], are regulators likely to prefer a lower dose on a potential approval scenario?

Yes, sure. So [indiscernible]. Let me answer the question. So first of all, for evenamide, the dose will be whatever it is. I think, 15- and 30-milligram BID. Those are the 2 doses we're proposing. I think what you're really asking is if the drug is working, is there a need to keep the risperidone dose at 6-milligram or 8-milligram or olanzapine dose at 20 milligram? And that is something which I think will be left in the hands of the treating physician. And once they begin to see the efficacy of the combination, they will probably reduce the dose of the previous antipsychotic and therefore, reduce the amount of side effects that are associated with the previous medication.

The next question comes from Bob Pooler from ValuationLAB.

And also congratulations on the exciting interim results of evenamide in TRS patients. A few questions from my side, first on the studies of 014, 015, which you presented here. Do you have an idea if the improvement seen is due to the duration of treatment, so it's 6 weeks versus 6 months, or is it due to more patients receiving a 30-milligram twice daily dose?

Sure. Bob, first of all, the 100-patient data that we are presenting, they have the same dosage as it was in the 6 weeks. So there's no new patient in the 6 months versus the 6 weeks. So it cannot be an effect of dose, it is the affect of duration. Now I don't want to get into the theory of how treatment resistance works. This long been a belief that in clozapine, the 6-week study probably underestimated the benefit of clozapine. And there have been some investigators who have always said, clozapine if you continue longer, produces a greater benefit. And I don't want to say, this drug is clozapine. I think we are not there yet. But to me, it seems like difficult to understand why a patient has -- who has responded to a certain extent at 6 weeks will continue to respond at 6 months if it is not due to drug. That's the best way I have of answering your question.

Okay. And then just going forward, if you look at the 7.50 milligram during your extension trial, what will your expectations be because then you have -- and a longer treatment duration and you have probably also the higher gauging, more patients on a higher dose?

The extension trial has the same dosages as the main trial. Of the first 100 patients, at about 92 patients on 15 and 7.5 milligram, only 8 patients on the 30 milligram. In the remaining 61 patients, we changed the randomization, so there will be more patients on 30 milligrams. So critically, yes, you are right, those 30-milligram patients when we do a dose analysis, should produce a better benefit. But as you know, with CNS drugs there is no linear progression with efficacy dose. So how you saw with lumateperone, I mean, the lower dose [indiscernible] that to be effective and not the higher dose. So my expectation is this is good enough results for me at the moment if we could just continue to show this, that will be great. But 30 milligrams having a larger effect is biologically very plausible.

Okay. And that's for both of you gentlemen. What is the most exciting result in this data set? What do you believe is most exciting for you?

For me?

And also for Ravi. Yes.

I think for me, what is most exciting is the fact is the CGI of severity result. The fact that the PANSS is a scale, you're scoring every item from 1 to 7, and you feel sometimes constrained to give a rating because the scale demands it. The CGI of severity and the CGI of change are done by a psychiatrist based upon holistic interviews with the patient and observing the patient. So what it's telling me is the psychiatrist is able to see something in the patient without the help of any scale which tells them the patient is doing better. So that, to me, was one part of the story, which is very exciting to see that well. But the second part, I think is really exciting to see is the fact that the continued improvement at 6 months really makes me, pardon the expression, [indiscernible] more than the 6 weeks data, because how could you have a placebo response improve over time? That's never been the case till now. And secondly, the fact that there is increasing improvement in patients who suggest to me that we currently need to consider longer-term treatment in these patients.

And if I may add, Bob, what I find the most exciting from my point of view, this is the first study in TRS patients with evenamide. And remember our theme was -- our theory was that it is fully due to glutamate imbalances that we see the treatment-resistant patients. And I think what we are seeing today is a potential proof that this thinking was absolutely right, and it works out in patients, and it is not due to any short-term placebo benefit. So we are very much looking forward after 6 weeks and 6 months. The next thing is that we will look at 1 year results. So we are very much appreciating these results, but we want to see the next thing now.

Well, again, if you look at study 014b, it's the final FDA safety trial, I think that's required to start the pivotal [ Phase II ] [ study III ] trial. And the primary endpoint is actually safety, tolerability after 16 weeks. So -- yes, are you surprised to see these exciting approvals after 6 weeks and 6 months treatment, in particular, let's say, the secondary endpoint is efficacy?

I think the FDA is required -- basically, the FDA's concerns originally came from safety concerns, right, if you remember correctly. We have by now supplied enough animal data to be able to address that issue. We have supplied data from EEG studies. I didn't go into the details of it because it's just [ less ], we have done EEGs in over 250 patients or so. And we have no abnormal EEG. We have done seizure checklists of a few thousands. There's not a single symptom there. We have done plasma-level monitoring in patients who are [indiscernible] poor metabolizers. There's no significant increase. So from the safety point of view, we have considered it all. And we will have data from the 008A study, which will also feed [indiscernible] to the -- submission to the FDA, which we expect to do sometimes in the end of the first quarter or the early second quarter of this year, together with data from 161 patients with TRS. So I think from the meeting the FDA point of view, I think safety wise is definitely very convincing. This is, of course, an open-label study with a randomization and with blinded raters. This was a design that I had used also for the clozapine approval for suicidality. So the FDA is not new to these devices. But again, I think the strength of the data lies in the fact that the long-term data is showing benefit.

Two questions, if I may, still. Just -- I saw Study 003 in TRS. That's their view -- I thought the treatment duration has been increased to 10 weeks from previously 8 weeks. Is that the reason why you're saying also it might take longer to see the effects of treatment -- the treatment effect, so adding 2 weeks would [indiscernible]?

Yes, Bob, you touched on the topic I didn't want to get into it, but okay. It was really -- I had proposed a 6-week study which is the standard for all schizophrenia studies. The FDA basically said now, 8 weeks. We have been getting input from various regulators or different durations. Looking at the data from this study, it tells me that 6 weeks would be a mistake. But at the same time, I don't think we can do a pivotal study for 6 months. So we temporize by saying 10 weeks, looking at some of the data that we have looks adequate. However, after the 10-week period, patients will continue on their randomized medication. So we will not be taking the blind and putting them on open-label treatment. They will continue blinded. So the primary endpoint will still be 10 weeks, but we will have the patient continuing long term up to 1 year.

Okay. And then my final question. With this exciting data, do you see more interest now in partnering coming forward? And just on the sort of timing of partnering on this data, would you -- yes, interest in partnering or you would still wait until you have the study 008A results data?

I think, Bob, it has become very obvious that this drug, evenamide, should now get into the second pivotal study without any further delay. And that is why a second pivotal study should start this year. Given that we need 6, 8 months preparation time to get it started, we don't want to waste time. And that is why we are intensifying our partnering discussions. Remember, we have different models. It might be a local, regional or global transaction. We certainly need to keep some control of the development process. So that all still applies. But now in these outstanding results that we are looking at, we do not want to lose time. And that means, yes, we might prepare and partner ahead of the 008A results.

[Operator Instructions] The next question comes from Samir Devani from Rx Securities.

Congrats on the data, very encouraging. I guess I've got a few questions. First one, Ravi, why do you think it's taking so long for the treatment effect? And is there any precedent in this field just for an effect, it takes so long? I guess that's the first question.

Okay. Let me answer it one by one because it gets complicated. The problem is that there's not too many long-term studies in treatment-resistant patients. So we have no real massive database to talk about what happens in these patient. The only study which we know really was positive, was clozapine study 30, which was only 6 weeks. But there are other studies. There is a study by Rosenheck, which is the U.S. Veteran's Administration Hospital study comparing clozapine to haloperidol in treatment-resistant patients. And that shows some similarities and some differences from this study. In that study, compared to 6 weeks, the 6-month data for clozapine change looks like it's improved. Haloperidol did not improve. On the other hand, the responder rate for clozapine at 6 weeks does not change at 6 months. That's the best I could tell you. There are a couple of other studies, which are like based upon 20 patients. So I don't want to theorize based upon that. But to me, it looks like this in treatment-resistant patients because they had so many years of damage by the antipsychotics given. There is a slow process of repair. That's the only thing I could tell you, and that's based upon some of the data. Again, I keep referring back to clozapine, where it shows clozapine, when it's given to patients with severe tardive dyskinesia does not produce an immediate improvement. But by the end of 6 months, there's a massive improvement. So it looks like the glutamate system is able to shock the other systems to start working, but it's not like pouring a bucket of water on fire. So it takes much longer. And that's one of the reasons why I think, like I just mentioned in the previous answer, we extended the study to 10 weeks.

Okay. That's helpful. I guess the second question then is just trying to think what potentially could prevent you kicking off this pivotal 003 trial. Is there anything in 014, when you release the data in March, that could throw a spanner in the works? Say, for example, you don't see a dose response when you report the full data set, will that require you to do some further work before you kick off 003?

No, I would actually argue for the opposite. The fact that if a lower dose worked, showing greater efficacy, the same efficacy as 30 milligrams, that means the risk-benefit ratio improves because at a lower dose, you're getting a better effect without having the potential baggage of adverse events. So that would not prevent us.

But then assuming that you'd need to explore some lower doses in the curve, right?

Well, we do have 7.5 milligrams. I mean, the question would be basically, what do you absolutely need to define a minimal effective dose? I think that's basically probably what the question you're getting to. I mean, with antipsychotics, the FDA has not really stressed that point, neither has EMA. Although we do technically say that, that we should try to do that one. But what we would do probably is in one of the additional studies, which we would have to do, we would do was lower dose, such as 7.5 alone and see what happens with that.

That's great. And then just a couple of questions on the non-TRS arena. In terms of 008A, how many patients have you now enrolled in that study?

Approximately 100.

Okay. And if we're looking at the key competitor seems to be Karuna's KarXT in the sort of non-TRS space, how would you compare and contrast the ARISE study to what you're planning to do?

I think it's very different, in a way. First of all, the mechanisms with 2 drugs are totally different, right? So that's a given. So in a way, I actually welcome the fact that Karuna, if it gets approved, that presents to us another drug we could add on to once patients start responding to Karuna, but that's a long-term hope. In the meantime, I think the entry category are more or less similar. We have put in some safeguards in the 008A study, which I'm not sure everybody else has done. You probably remember that we are doing very significant monitoring of plasma levels of the previous antipsychotic to make sure that nobody gets in who is not taking their medication and claims to be an inadequate responder. That's usually not done. And I can tell you, it's not done because it's pretty painful to do that and you find out all kinds of things. Second thing is, we -- our insistence is on having only 1 antipsychotic. And you can believe the patients when they say, they're taking 1 antipsychotic and when you test their plasma levels, you find there may be 1, there may be 2, there may be antipsychotics which are -- the patient is not even claiming to be taking. So from a methodological point of view, we're putting a lot more into this study that we've done. But overall, otherwise, there's no real difference. I mean you're still measuring the same scale and everything else.

Okay. That's very helpful. Congratulations on the data.

Thank you.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Mr. Weber for any closing remarks.

Yes. Thank you very much all for staying with us, staying tuned. For this extended call, I think it was very important that we went through the details, so we all have the same understanding of what we have just presented to you. I can only close this call in saying, stay tuned for the future as well. We will show to you soon the complete results of Study 014, including all 161 patients. We will then have the 1-year results, as mentioned before, on the first 100 patients. And then we will have the full study 015, so 161 patients, 1-year results next year. And on our way, we will start a second pivotal study, and we will get the results from the first pivotal study in non-TRS patients. So a lot to come, a lot of news flow. Stay tuned. Thank very much for attending and talk to you soon. Thank you.

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