Transcript from seeking Alpha with manual corrections in Missling's presentation. Perhaps we should petition to company to provide a transcript for presentations like this...
I'll try to check the rest of the presentation later today but I believe this is the most important part, some good stuff was left out of the Seeking Alpha version.
Anavex Life Sciences Corp. (AVXL) CEO Christopher Missling on Q4 2021 Results - Earnings Call Transcript Nov. 24, 2021 9:35 PM ET Anavex Life Sciences Corp. (AVXL)2 Comments Q4: 2021-11-24 Earnings Summary EPS of -$0.15 misses by $0.01 | Revenue of $0.00 beats by $0.00 Anavex Life Sciences Corp. (NASDAQ:AVXL) Q4 2021 Earnings Conference Call November 24, 2021 4:30 PM ET
Company Participants
Clint Tomlinson - IR
Christopher Missling - President & CEO
Sandra Boenisch - Principal Financial Officer & Treasurer
Conference Call Participants
Raghuram Selvaraju - H.C. Wainwright
Soumit Roy - Jones Trading
Operator
Welcome to the Anavex Life Sciences Fiscal 2021 Fourth Quarter Conference Call. My name is Vage [ph] and I'll your Operator for today's call.
At this time, all participants are in a listen-only mode. [Operator instructions] Please note this conference call is being recorded.
I'll now turn the call over to your host Clint Tomlinson. Sir, you may begin.
Clint Tomlinson
Thank you and good afternoon, everyone. We appreciate you joining us today for Anavex Life Sciences fourth quarter conference call, to review financial results and discuss the company's business updates. The taped replay of this call will be available after the call. The call will also be available for replay on Anavex's website at www.anavex.com.
With us today is Dr. Christopher Missling, President and Chief Executive Officer; and Sandra Boenisch, Principal Financial Officer.
Following management's remarks, there will be a question and answer session. Before we begin, please note that during this conference call the company will make some projections and forward looking statements. These statements are only predictions based on current information and expectations and involve a number of risks and uncertainties. We encourage you to review the company's filings with the SEC. This includes, without limitation, the company's Form-10K and 10-Q, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward looking statements. These factors may include, without limitation, risks inherent in the development and or commercialization of potential products, uncertainty in the results of clinical trials or regulatory approvals, need an ability to obtain future capital and maintenance of intellectual property rights.
And with that, I'd like to turn the call over to Dr. Missling.
Christopher Missling
Thank you, Clint. We really appreciate everyone joining us on today's conference call to review our most recent reported financial results and to provide obvious business update.
We concluded an exceptional fiscal year 2021 while continuing our momentum highlighted by the efficient execution and full enrollment of three precision medicine clinical trials including the Phase 2/3 Anavex clinical trial in Alzheimer disease, the AVATAR Phase 2/3 clinical trial in Rett Syndrome, the ANAVEX 2-73 clinical Phase 2/3 AVATAR Rett Syndrome as well as the Phase 1 study ANAVEX 3-71. Starting with our lead drug candidate 2-73, we expect top line results from the second placebo controlled study for the treatment of outpatients with Rett Syndrome, which are expected to be announced around calendar year end 2021.
This study took place in Australia and the United Kingdom using a higher dose than the US based phase two study and enrolled 33 patients over a seven week treatment period, including ANAVEX 2-73 specific precision medicine biomarkers. Top line results from the placebo controlled Excellence phase 2/3 study for the treatment of pediatric patients with Rett syndrome are expected in the first half of 2022.
This Phase 2/3 study in pediatric patients with Rett Syndrome, age 5 to 18 will evaluate the safety and efficacy of 2-73 in approximately 84 patients over a 12 week treatment period, including 2-73 specific precision medicine biomarkers. Regarding our Alzheimer disease program top line results from the placebo controlled phase 2b/3 Anavex 2-73 AD (??) study for for the treatment of Alzheimer disease are confirmed and are expected in the second half of 2022.
The double blind placebo controlled 509 patient late stage Phase 2b/3 study in patients with Alzheimer disease exceeded enrollment of the targeted patient number at 52 sites across North America, Europe and Australia using ADAS-Cogs for cognition and ADCS-ADL for activities of daily living and function as primary endpoints. This multicenter, double blind clinical trial is measuring efficacy, tolerability and safety of two different, once daily all ANAVEX 2-73 doses or placebo.
As reported last month, the independent data safety monitoring board for the company's phase 2B/3 study completed its most recent pre-planned review of the preliminary Phase 2B/3 study data in Alzheimer patients. As specified in a protocol, the DSMB(?) reviewed the interim safety data for the 2-73 Phase 2B/3 disease clinical study and its open label extension Attention AD study. Upon review of the interim safety data, the DSMB recommended to continue the study without modification.
We were very excited also to report that the top line data from another (???) compound, ANAVEX 3-71, which has received orphan drug designation by the FDA for Frontotemporal dementia, a placebo control Phase 1 study in ANAVEX 3-71 evaluating Anavex 3-71 in humans are expected around calendar year end 2021. During 2022, we are also moving closer to further expanding the pipeline for 2-73 using gene biomarkers of response, applying precision medicine, for another neurological disorder with unmet medical need. Including a planned initiation of 2-73 imaging focus, Parkinson's disease clinical study, a planned initiation also of a Phase 2-73 three clinical trials for the treatment of a new rare disease indication and lastly, a planned initiation of a pivotal Phase 2 specialty study in Fragile X syndrome, the most frequent genetic cause of Autism Spectrumm Disorder.
In further lights(?), we recently announced in August of this year strong pre-clinical data in Fragile X Syndrome published in the peer reviewed journal Scientific Reports. The study evaluated 2-73 in Fmr1 knockout mice, a validated animal model for the disease which (???) of heart activity and restoration of associated learning that [indiscernible]. Furthermore 2-73 demonstrated dose dependence of Sigma-1 receptor occupancy PET study.
So now, I would like to direct the call to Sandra Boenisch, Principal Financial Officer for a brief financial summary of the recently reported year end.
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Sandra Boenisch
Thank you, Christopher and good afternoon to everybody. We continue to maintain a strong balance sheet and fiscal responsibility. Our cash position on September 30, 2021 was $152.1 million, which we believe is sufficient cash runway to fund operations and clinical programs beyond 2025. During fiscal 2021 cash utilization and operations was $30.4 million. We reported a net loss of $37.9 million for the full fiscal year, which is $0.54 per share as compared to $26.3 million or $0.45 per share in the comparable year 2020.
Research and development expenses for the year were $33 million compared to $25.2 million for the comparable fiscal year. The increase is primarily attributable to the continued advancement of our ongoing clinical trials. Most notably the full enrollment of our international Phase 2B/3 Alzheimer's disease trial and the related open label extension and the continued enrollment and advancement of the Rett Syndrome studies and expansion of these trials internationally. General and administrative expenses were $9 million for the year as compared to $5.9 million in the prior year. The increase is mostly significantly associated with an increase in personnel and associated non-cash stock option compensation charges.
Thank you. And now I'll return the call back over to you, Christopher.
Christopher Missling
Thank you, Samra. And as we look to the remainder of 2021 and into 2022, I'm very excited about the company's potential as we continue to advance and expand our position medicine to programs. As we look ahead, we will continue to focus on driving meaningful growth across our broad CMA one platform, portfolio to deliver transformational treatments for patients with both degenerative and developmental neurological disorders around the world.
So we look forward to providing further updates of advanced and continue and at this point, I like to also wish everyone a happy Thanksgiving. I would like now to open the call for questions. Operator, please go ahead.
Question-and-Answer Session
Operator
[Operator instructions] And our first question comes from Charles Duncan from Cantor Fitzgerald. Your line is open.
Unidentified Analyst
This is Pete [ph] for Charles. Good afternoon Christopher and team and congratulations on the progress and appreciate all the updates. I have a couple of questions regarding Rett Syndrome. When you think about the efficacy measures that were made in the efficacy scene in the US adult study, how do you feel about the samples size or the planned effect size out of AVATAR and also the excellence study. And we saw that you upsized the sample size for excellence from 69 to 84 subjects which role that decision, if you can give us some color on that.
Christopher Missling
Appreciate it and thank you. So the efficacy effect size was really significant in the first US study, which was using a low dose, as you remember, and the effect size was in the range 1.3 to 1.1 -- 0.3, which is considered very large. And since we expect those response based on higher doses, we basically inclined to believe that the second study, the other AVATAR study might show a similar if not higher effect size, given that we are using a higher dose in the AVATAR study compared to the US study.
The extension of patient number in the excellent study from originally 69 to 84 was based on a request a regulatory request to also have an additional sub analysis of the number of patient in different age groups for example, from five to 18 to also have an additional analysis of patients from five to 12, and then from 12 or 13 to 18 in order to make sure we have enough power for this additional calculation, we thought it was prudent to just add additional number of patients with ended up to the total number of 84 as we communicated.
Unidentified Analyst
Thank you. Very helpful. We also saw that you made a few changes to the primary and second very endpoint in the excellent study. Can you give us a help us understand on what drove those decisions, was a result of advice or interactions with the FDA or any other regulatory agency,
Christopher Missling
Right. So we have noticed that the RSQ is really the most rigorous, more rigorous endpoint. It is really going through 45, very dedicated questions and detailed question, which can be answered very precisely. There's also the ability which we have seen, and we have demonstrated that in our presentation of doing sub-analysis of the sub scores of the entire score of the RSPQ, however, when we look at that we noticed that there was a weaker ability to make this because it's a really a global assessment and it also has a very known and it's published weak I would say reliability, but we basically include that still, but we didn't want to overemphasize that score. So that was the background for the focus on the RSPQ.
Unidentified Analyst
All right. Thank you. And my last question regards to the Parkinson's disease dementia program, can you provide any updates on that program, have you met with the agency to discuss it and or do you plan to anytime in the near future?
Christopher Missling
Yeah, we plan, Right. Thank you very much. Yes. We plan to do that. We actually are in the process of now discussing the data with the foundations and we are expecting to get a valuable feedback for input on the design of pivotal studies for Parkinson and also pivotal study for Parkinson dementia. And with that, in our package, if you like, we then feel more robustly educated and fully informed to go to do the discussion with the agency about a proper pivotal study in the respective communications.
Unidentified Analyst
Do you think, by some chance you're going to wait for the imaging study results or it'll the meeting will occur beforehand.
Christopher Missling
This will be before the imaging study, but definitely we are still including which we have not yet reported the total gene analysis of the PD study. So that means we've not only looked at the Sigma one gene expression changes of the mRNA, but also the gene expression of all participants that is in the active arm, as well as in the placebo arm and believe that additional intelligence can be drawn out that to make an informed design of a study, which increases further the chances of a pivotal study down the road.
Unidentified Analyst
All right. Thank you. Thank you very much for taking my questions and congratulations again on the progress and happy Thanksgiving,
Christopher Missling
Thank you.
Operator
Next question comes from Raghuram Selvaraju from H.C. Wainwright. Your line is open.
Raghuram Selvaraju
Congrats for the progress and thanks for taking our questions. So firstly, how early in 2022, do you envisage filing an NDA for [indiscernible] in Rett Syndrome, providing you positive readouts from the three trials?
Christopher Missling
It's really, I would let the data first come out and then we can talk about that, but obviously pending data as soon as possible.
Raghuram Selvaraju
Excellent and then with regards to 2-73 what learnings are you transitioning into your Fragile X syndrome development? For example, are you planning on cross analyzing data from the Rett Syndrome and the fragile X syndrome trials, given that the two syndromes sort of share over overlapping symptoms as well as underlying cellular mechanisms?
Christopher Missling
That exactly right. So two pockets here to look at one is the preclinical pocket, and we see a very strong in the animal model of a Fragile X and leading to even reversal of the pathology. And then we look also at the clinical study of the Rett Syndrome, and we see that the phenotypes are overlapping between these two indications. And there are some end points, which are included in the Rett Syndrome study for example, atoms [ph] is one of them and that had been responding very well with the drug and we believe this could be also used as a key measure for the Rett Syndrome for the Fragile X study, since that has been also even used prior in Fragile X study as our primary endpoint. The decision is not yet made exactly about how to use that endpoint, but this could be one potential venue.
Raghuram Selvaraju
Okay. Very helpful. And we read with interest your recent published paper in expert opinion on therapeutic targets where you described 273 and 371 as hand in hand targets for Alzheimer's disease. We were wondering if you've number one, benchmark these drugs together pre-clinically, and number two, test a company nation if not, do you plan to do so.
Christopher Missling
So the two compounds came from different angles and different labs but they are now moving more into what we call, we try to learn as we go. But so far we could not find parable assay other than a very early preclinical assay of target engagement. And there are differences in the affinities of the Sigma 1 receptor and also difference to the muscarinic receptor, which we believe is also important.
And ultimately we will be only able to see really the difference of the two if we run really both indication world drug and the same indication in the same trial. So we think that each drug has its own merits and it could very well be that 371 is really good at focusing more in Frontotemporal, and could also be very good at [indiscernible] but right now we have 273 more advance, so we will eventually find out,
Raghuram Selvaraju
Appreciate the color. And then just finally you've talked about 273 using in a prophylactic manner. We saw a recent science advances article, which describes a unique kind of brain protein signature in younger cohorts, mean age of 39. Are you currently working on or planning a genetic or protein test in a younger cohort to kind of help your 273 administration in the future?
Christopher Missling
Yeah, we look into that and it's a very good point because while the disease is showing up correlating with age, it's clear that early intervention is really most likely the most efficient way to incubate this disease. And our preclinical data indicates that potential, which was done very successfully in animals that who got the drug before they got injected with a toxic, a better load. And they never developed the symptoms of Alzheimer disease. So there's really high likelihood that we should or encouragement to also proceed. And we sat and we committed to eventually do that with the appropriate in the appropriate time, down the road. So we are committed to look into that what you described early on.
Raghuram Selvaraju
Okay. Excellent. That's it from us? Congrats again, and happy Thanksgiving to you and everyone on the call. Thanks.
Operator
Next question comes from Soumit Roy from Jones Trading. Your line is open.
Soumit Roy
Hello everyone. And thank you for taking the question. Could you give us a little color around the upcoming Rett study? So as I understand, there will be different dose cohorts. So is, could you give us an idea of the size and is there going to be intra cohort dose escalation? What should we expect?
Christopher Missling
Yeah. So let me explain that there is not a different dose. It's just a target dose is higher than the US study. So there's only one dose and one placebo arm, and that one dose will be a target dose. So that is just higher than the US study. So there will be not multiple doses, technically it's just one higher dose.
Soumit Roy
Okay. Got it. So, and you are not disclosing if it's going to be 10, 20 or 30,
Christopher Missling
Right. We will find out when we disclose the data and then we'll be able to learn about that.
Soumit Roy
Got it. And any color on the Alzheimer's trial, what are you planning as patients are coming out of the 48 week? Is, are they going to go into maintenance trial or what is the plan there?
Christopher Missling
Right. So we have an extension study called ATTENTION-AD, which is a two year study of following up as an open label after the 48 week, which has started, after the first patient finished the 48 weeks. And because these patients have actually, some of them finished this phase two open label extension, they had requested to continue to stay on the study drug.
And so what we did, we initiated and we're successful in expanding now this ATTENTION-AD study open label extension from two years to three years. So patients who are finish the study, the placebo control study, enter into the extension study finish the two years will now continue to go into the third year. And that is because of request by the patient, the caretakers and the physician. It also, I like to add that the I like to add also that the conversion from the placebo controlled part of the study to the open label is very high it's above 94% currently, which is a good sign.
Soumit Roy
Great. It's really good to hear. And one last question on the back to the Rec program, where are you on the conversation turning whether these going to be the data [ph]
Christopher Missling
It's really a question now of the data and the data has to speak for itself. And we also said it's a potential pill study. So the word really weighs in, and the data really will determine this how this will be looked at. We have to point out that for adults, there is no treatment available. And the patient population is also harder to bring into the trial because they're more at large. They also are because of the disease early passing on, they're not many patient available to find in a trial. So the focus is really on the study for that reason, but still there's an unmet need for patients of all ages for X syndrome.
So we could expect, you could even start a rolling submission with the adult trial, if need be that could be approved first before the pediatric really gets filed. I would say it cannot be excluded and, but I cannot promise it either. So that's why I said we would have with ANAVEX [ph] study and the US two independent placebo control study in disease, which usually is beyond the request from for rare diseases usually. So this will be successful, a very powerful package.
Soumit Roy
Got it. Congratulate again for on all the progress and happy Thanksgiving.
Christopher Missling
Happy Thanksgiving. Thank you,
Operator
Next question comes from [ph] from BTIG. Your line is open.
Unidentified Analyst
Hi. Thanks very much for taking the question. So the first one is on Rett Syndrome and so the definition of a responder, is that on each efficacy endpoint, is that going to be the same in pediatric patient as two, an adult patient, and also the definition of a responder is that consistent with how clinicians are viewing as clinic meaningful improvement?
Christopher Missling
That's correct. It's consistent first study and then consistent with the assessment. That's correct.
Unidentified Analyst
Okay. Then I think I didn't see an update on the 371 program in 2020 sorry, 2022 in terms of upcoming milestone. So I just wanted to check if frontal temporal dementia is still going to be the first indication for that program. And when do you expect a study potentially to start.
Christopher Missling
Right. So we have mentioned that we would move ahead with prototype dementia, but we like to have really the solid phase one data in hand before we say we commit to this. And but we definitely will move forward with FTD or any other related dementia indication.
Unidentified Analyst
Okay. And then on the pipeline, I think well, it's very encouraged to be able to target multiple indications, but just wonder which indications do you think you would like to prioritize going for? Of course, the Rett Syndrome and is going to be the lead indication, but which indication do you think might be suited for partnerships?
Christopher Missling
So we believe that we have with the red disease franchise, which is Rett Syndrome FX and others the ability, and it's not been the first time that a company has built this into a commercial entity with the disease targeting rare diseases. So that seems to be very doable. It comes to the indication like Alzheimer disease and Parkinson disease, which requires also the involvement of a detailing practitioners, physicians of general physicians. Then it might be more powerful to penetrate the market with the support of a large pharma partner and at the right time to make sure that we retain most upside for Anavex and for our holders, this will be done at the right time and not to prematurely to give up to much of the upside, but it is no doubt that these large indications require additional support.
Unidentified Analyst
Okay, great. Thank you very much. And happy Thanksgiving.
Operator
And your next question comes from [indiscernible]. Your line is likewise. And that concludes the question and answer portion. And it also concludes the conference call. Thank you for participating. You may now disconnect.
