Aptinyx Inc.

Good afternoon and welcome to the App2Next fourth quarter and year end 2021 financial results conference call. At this time, all participants are on the listen-only mode. Following the formal remarks, we will open up the call for your questions. Please be advised the call is being recorded at the company's request. At this time, I would like to turn the call over to Pat Flavin, Senior Manager of Corporate Development and Investor Relations at App2Next. Pat, please proceed.

Good afternoon, everyone, and thank you for joining us on today's conference call to discuss AppSynix's fourth quarter and year-end 2021 financial and operating results. We invite you to visit the investor section of the AppSynix website to view our press release describing financial results and business highlights. On today's call, Andy Kidd, our president and chief executive officer, will discuss our business and clinical development progress. Then, Nashish Khanna, our chief financial officer and chief business officer, we'll review our financial results. I would like to remind everyone that statements made during this conference call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that can cause actual results to differ materially. Any forward-looking statements are made only as of today, and we disclaim any obligation to update these forward-looking statements. Please see the forward-looking statement disclaimer in our financial results release issued this afternoon and the risk factors in the company's current and subsequent filings with the SEC. It's now my pleasure to turn the call over to Andy.

Thank you, Pat, and good afternoon, everyone.

We appreciate you joining us on today's call. 2021 marked a year of significant progress for AppSynx. Our mission is to develop transformative therapies for challenging disorders of the brain and nervous system, and over the course of the past year, we've taken major strides toward that goal. We are on track for a series of catalytic milestones and data readouts across our pipeline of NMDA receptor positive allosteric modulators, and expect that 2022 will be a pivotal year for the company. In the next few months, we expect readouts from our two Phase IIb studies in chronic pain with NYX2925, starting with diabetic peripheral neuropathy, or DPN, data very shortly in April, with fibromyalgia data then expected in the July to August timeframes. In addition, we expect a readout from our exploratory study of NYX458 and cognitive impairment associated with Parkinson's disease and dementia with Lewy bodies within the next 12 months. Finally, we've been initiating two Phase IIb studies with NYX783 and PTSD and expect data from those studies starting in the second half of next year. We're supported by a balance sheet that fuels these development programs and is expected to provide operational runway well into 2023. Let's discuss our clinical development programs in more detail, beginning with NYX2925 and chronic pain. As I mentioned, each of our chronic pain indications, DPN and fibromyalgia, will read out in the next few months. Despite the challenging external environment throughout 2020 and 2021, our Phase 2b study in DPN completed enrollment well within schedule last October. With a 12-week treatment period and 30-day follow-up, we've completed last patient last visit and are expecting to receive and communicate data during April. The study design integrates several key lessons from our prior Phase IIa study in DPN that read out in 2019. Firstly, we're focusing on a patient population with four years or more of DPN disease duration. We observed a stronger response in patients with longer disease duration in our prior study. We believe this is because the abnormalities in brain processing within the prefrontal cortex of the brain that our mechanism targets take time to become manifest. In addition, we are assessing NYX2925 as a monotherapy without any concomitant analgesics and with a 12-month treatment period. We expect these design choices will increase the chances of separation from placebo and are in line with regulatory requirements for approval. The DPN study evaluates 12 weeks of daily dosing with 50 milligrams of NYX2925 or placebo. And the primary endpoint is the change from baseline to week 12 in patient-reported average daily pain, averaged over a week and evaluated using the 0 to 10 numeric rating scale, or NRS. The study is powered to detect an effect size that is clinically meaningful. Depending on the degree of variation seen with pain score differences, the lower bound of what is needed to achieve statistical significance would be somewhere between a 0.5 and 0.7 difference between NYX2925 and placebo on the 0 to 10 NRS scale. Next steps following this study would include an end of Phase II meeting with FDA to discuss requirements for Phase III and NDA. Our Phase IIb study in fibromyalgia completed enrollment at the end of February, and so it's just a few months behind our timeline for DPN. we expect to have data reading out in July or August. This phase 2b study in fibromyalgia is similar in design to our DPM study. It evaluates NYX2925 as a monotherapy with no concomitant analgesics and with a 12-week treatment period. The primary endpoint is the change from baseline to week 12 in patient-reported average daily pain, averaged over a week, and evaluated using the 0 to 10 NRS. In this study, as well as the 50 milligram dose, we're also evaluating a 100 milligram dose since we saw promising effects with a higher dose level in a prior neuroimaging study in fibromyalgia. We believe, based on this neuroimaging study and the underlying disease biology, that the abnormalities in pain processing within the prefrontal cortex of the brain that our mechanism targets are present in fibromyalgia at the start of the condition. We therefore do not have a disease duration requirement as we do for DPN. The study is powered in a similar way to the DPN study, and the next steps would include meeting with FDA to determine the requirements for Phase III and NDA. If both programs advance into Phase III, we expect there will be synergies in clinical safety and non-clinical development work between the two. We would also consider further indication expansion with chronic pain, as there are a number of other neuropathic pain conditions and musculoskeletal pain conditions in which we think our mechanism is relevant. Finally, we expect that positive data in one or both of these studies would unlock very significant value for aptinix. The clinical unmet need in chronic pain is substantial. A drug with evidence of efficacy and a strong safety profile would have a potential commercial opportunity well into the billions of dollars of annual sales in the U.S. market alone. Next, we'll discuss NYX73, our product candidate in development for the treatment of post-traumatic stress disorder, or PTSD. In December, we commenced Phase IIb development of NYX783 in patients with PTSD with the first of two Phase IIb studies. In the first Phase IIb study, approximately 300 patients with PTSD will be randomized to placebo or 50 milligrams of NYX783 and evaluated over a 10-week treatment period. We anticipate reporting data from this first Phase IIb study of NYX783 in the second half of 2023. The second Phase IIb study has the same design as the first, except that it will test a 150 milligram dose level of NYX783. This dose has not been tested in patients before, but based on recent preclinical data, we think there's potential for this higher dose to be effective. We have been planning to initiate the 150 milligram Phase IIb during Q1. We've completed all of the operational steps required, but as we've worked to activate the first group of sites, We now expect to begin screening patients in April. The two-study approach in PTSD is among a range of measures we're employing to minimize and mitigate the placebo response and variability during Phase IIb. Having two studies for two different dose levels limits the number of arms per study, a factor which is correlated with lower placebo effects. In addition, two studies limits the number of sites and clinical investigators per arm which should help to control the variance in measuring clinician-assessed endpoints. We're also not allowing concomitant PTSD pharmacotherapies in either of these studies. Finally, let's discuss NYX458 in cognitive impairment. We're currently evaluating NYX458 in an exploratory Phase II study of cognitive impairment associated with Parkinson's disease and dementia with Lewy bodies. This double-blind, placebo-controlled study evaluates a 30 milligram dose of NYX458 versus placebo in approximately 100 patients over 12 weeks of treatment. This is our first study in patients with cognitive impairment and is primarily meant to detect and characterize signals of activity. As well as safety and tolerability, we're evaluating the effects of NYX458 across a battery of neurocognitive tests able to measure changes in attention, memory, and executive function. These cognitive domains are impacted in Parkinson's disease and dementia with Lewy bodies and are NMDA receptor-dependent phenomena. As we mentioned during our portfolio day in February, we did see a slowdown in clinical trial enrollment in the U.S. after Thanksgiving and continuing into January, at least partially related to the Omicron variant of COVID. We've seen activity return to normal since then and we still expect to be able to read out data from this study late in the fourth quarter of 2022 or in the first quarter of 2023. In addition to the progress we've made in advancing our pipeline, we recently hosted a portfolio day for investors on February 9th. This included a review of the chronic pain treatment landscape by Dr. Richard Rout, a board-certified physician in pain medicine and anesthesiology at the Carolinas Pain Institute, and an investigator in our DPN studies. This event is available for review on our website. We also announced the formation of a scientific advisory board comprising leading researchers and physicians in the areas of neuropsychiatry, neurology, and chronic pain, including Chadi Abdullah, MD, from Baylor College of Medicine, Leslie Arnold, MD, from the University of Cincinnati College of Medicine, Peter LeWitt, MD, from Wayne State University School of Medicine, and Jerry Santacora, MD, PhD, from Yale University School of Medicine. The Scientific Advisory Board will work closely with us to establish scientific and clinical input as we advance our pipeline. Before I hand over to Ashish to review our fourth quarter and year-end 2021 financials, I'd like to take a moment to acknowledge and thank our AppSynics employees and our external partners for their tireless work over the past year. We have fewer than 40 internal employees who have successfully managed the ever-fluctuating external landscape, working closely with multiple external partners vendors, clinical trial sites, and investigators in challenging circumstances. This has been a difficult time for clinical trial sites and, of course, for patients, and we're very appreciative to all of those who have contributed to our clinical research efforts. It is only because of these dedicated efforts in the service of our mission to patients that we've been able to advance our pipeline to this critical point and are able to look forward to the data readouts that we expect both in the next few months and over the next few years. Ashish.

Thank you, Andy. Beginning with the balance sheet, we ended the fourth quarter of 2021 with $106 million in cash and cash equivalents compared to $141 million at the end of 2020. That year-end 2021 cash figure does not include $10 million from the second tranche of our capital credit facility, which we drew down earlier this month and reported today in our 10-K filing. With respect to our income statement, as expected, we had zero revenue in the fourth quarters of both 2021 and 2020. We did have $1 million in revenue over the full year 2021 as compared to $1.6 million in revenue for the full year 2020. In both of those years, the revenues were related to our research collaboration agreement with Allergan, now a subsidiary of AbbVie. That research collaboration came to its contractual conclusion early in 2021, and we have not been reliant on it or any other source of income to fund our operations. The majority of our spend remains heavily concentrated in research and development. R&D expenses totaled $14.1 million and $55.4 million for the fourth quarter and full year 2021, respectively, as compared to $6.8 million and $32.8 million for the same periods in 2021. The rise in R&D expenses in 2021 was primarily driven by increased spending related to clinical development across each of our Phase II programs during the year. This followed a period in 2020 during which we temporarily paused patient enrollment in three of our four then ongoing Phase II studies, contributing to less than expected R&D spend during that year. We reported G&A expenses of $5.1 million and $20.1 million for the fourth quarter and full year 2021 respectively, as compared to $4.8 million and $19.5 million for the same periods in 2020. Finally, we reported a net loss of $19.6 million and $74.9 million for the fourth quarter and full year 2021 respectively, as compared to a net loss of $11.5 million and $50.1 million for the same period in 2020. I'll now turn the call back over to Andy.

Thanks, Ashish. As we approach a steady cadence of important data readouts, the first of which is expected in the next few weeks, we look forward to moving into our next stage of growth as a company. We're pleased to be well positioned both financially and operationally to continue to advance our pipeline towards the patients that desperately need better therapies.

We are happy to begin taking your questions now.

Thank you. If you'd like to ask a question, please press star followed by 1 on your telephone keypad. If for any reason you'd like to remove that question, please press star followed by 2. Again, to ask a question, press star 1. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking your question. We will pause here briefly as questions are registered. The first question comes from Chris Raymond with Piper Sandler. Please proceed.

Hey, thanks for taking the question. I just have maybe one and then one follow-up. So I guess just, guys, you know, on the 2925 data, you obviously have the DPN data coming first. That's next month. And then the fibromyalgia, you know, data, obviously, I think you said, Andy, it's now July or August. So I think, you know, this question's come up before, but I just want to maybe ask it again since we're so close here to these events. These are obviously different disease states, but there's similarities, I guess, in terms of the clinical measure with NRS and what's considered clinically relevant. Maybe just frame for us, you know, the differences between these two programs and why maybe or why not investors should see the outcome in DPN as a direct read-through to fibromyalgia. Yeah.

Yeah, thanks, Chris. It's a great question.

You know, fortunately, probably one that will have a limited shelf life because, as you pointed out, the gap between the data from the two studies is about three or four months, and so we will know the answer before too long. But I think it would be helpful to frame out, as you suggested, the key differences and similarities. We, of course, think there will be some read-through, but we do not think it's absolute certainty. read through. There are some important differences. I think the main difference between the two conditions really is that obviously DPN begins as a peripheral neuropathic condition. In fact, it's classified by FDA or was classified in their chronic pain guidance as a peripheral neuropathy. It clearly starts with nerve damage in the periphery. And as I mentioned in my remarks, the kinds of centralization of pain processing abnormalities that our mechanism targets take a while to become established in DPN. Whereas in fibromyalgia, based on imaging and based on studies that have been done by others in the disease state, we think that those central pain processing abnormalities kind of characterize the condition or an inherent part of the condition. So there's some different underlying biology. Of course, we've tried to take kind of that with the study design, but nonetheless, different underlying biology. There's also different extent to which I think our precedent data informs specific elements such as dose. We think we have good clinical proof of concept in both indications, but obviously we're looking at two different doses in fibromyalgia versus one in BPN. So I think those are a couple of reasons why, you know, both biology and dosing-wise, you know, there's less than 100% read-through between the two indications, substantially less, I think I would say. But clearly, on the similarity side, as you mentioned, some of the study design elements are very similar. And also, of course, ultimately, our drug is, we think, acting in the prefrontal cortex to establish better control and modulation of abnormal pain in the brain. So there's a clear similarity with which part of the brain we're targeting. So, yeah, I think, as we've consistently said, we believe there is read-through, but we do not believe there is complete read-through. There is still a reasonable amount of independence between the risk and these two indications.

Thank you for that. And maybe just a quick follow-up. Andy, I think you highlighted... with the timeline section of your prepared comments. I think I heard 458, the cognitive impairment data could now slip into next year. Can you maybe put some color on that? What's the driver for that? I think the last update, it was an end of year thing, or maybe I'm misreading.

So, Chris, that's partially right. I think in our last quarterly call, we were saying end of year. When we did our portfolio day in February and kind of updated across the pipeline, we provided a modification to still potentially possible by end of year, but may move into a Q1 as well. So I think it's somewhere between the two right now. The reason for that that we outlined as the portfolio day, and I very briefly recapped it in my remarks today, but I can explain it more, is We saw, probably not surprisingly, after Thanksgiving, as the Omicron wave started to take effect in the U.S., sort of broader environment, we did start to see a slowdown in enrollment. Now, you often see a slowdown in enrollment in clinical trials over the holidays anyway. We do think it was exacerbated a little bit by Omicron, potentially affecting patients' willingness to enroll in studies, but potentially also, we know in some cases, affecting clinical trial sites. Of course, had issues with staff having to quarantine or isolate and so on. We were tracking that, of course, through January, and when we did the portfolio day in February, we provided the update. I think, as I mentioned, since then, it looks as though enrollment has returned back to its prior level. And so I think we're now still comfortable to guide that, you know, that slowdown caused a delay, but there's not an ever-increasing delay. So therefore, we would expect to have data again potentially by the end of this year or into Q1 of next year.

Got it. Thank you.

Thank you, Chris. The next question comes from Charles Duncan with Canton Fitzgerald. Please proceed.

Hi. Yeah. Good afternoon, Andy and Ashish and team. Congratulations on the progress in the chronic pain programs. Looking forward to seeing that data soon. I had a couple of questions on 2925 in DPN, and in particular, I just wondered if you could frame for us a little bit of perspective on what a 0.5 to 0.7 NRS difference means in terms of clinical meaningfulness, in terms of your feedback from investigators and clinicians.

Yeah, certainly, Charles. When we talk to clinicians about what is clinically meaningful in pain studies or chronic pain studies in general, I think it is a little bit of a complicated question and they have a couple of different ways of thinking about it. So on the one hand, a lot of times when people are asking, they're trying to get at what you just described, which is what degree of separation between active and placebo is considered meaningful. I think That generally comes in the range that we just described of 0.5 to 0.7 or higher would be clinically meaningful. I would say that a lot of pain clinicians and Richard Rank, who was on our portfolio days, one of them would say, you know, I really want to be convinced that the drug is not the same as placebo. I want to see statistical significance in the separation. Some margin, but I'm not too focused on actually exactly what that is. because I know that the clinical study environment is an artificial environment. We know that placebo effects are a significant issue. And I think in addition, the field now generally views placebo and drug effects as not always purely additive, but actually potentially somewhat overlapping phenomena. And so that sort of tends to be the answer on separation. When you then talk about other indicators of clinical meaningfulness, they will say what I would look at generally if I'm deciding whether to give this drug to a patient is the reduction from baseline since that's what a patient will experience in the real world. And then potentially also as you're considering a population or what are my go-to therapies that I will prescribe frequently, what's the expected response rate for a given amount of pain reduction? And 30% is a threshold that's commonly used. What percentage of my patients would I expect to see getting a 30% or so reduction in pain. And I think those two measures of change from baseline on average and then the responder rate are put in the context of the safety and tolerability profile. And of course, the better the safety and tolerability profile, the more probably margin there is or potentially lower the bar would be for clinical meaningfulness on the efficacy side because there are so few options out there that provide a good risk-benefit profile to a lot of these patients. So, it gets a little more nuanced, and I think that our sense, as we look at the data, will be it's important to show separation from placebo, but there is also some focus in the real world on the magnitude of response and the consistency of the response.

Okay, and response rates, it sounds like. And then second question regarding, and this kind of points to next steps, but just regarding the definition of the period for chronification or centralizing the pain being four years, I'm sure it's not a hard point in time. You know, maybe three-year patients have that as well. But how did you define that? How do you practically define that? in terms of symptom presentation? How do you ensure that the majority of your patients have had sufficient time to see centralization of the pain? Is it through a prescribing pattern or how's it done in this trial? And how would you anticipate it going forward?

It's quite a tricky question, Charles. There have been a lot of people who've tried to use clinical measures to characterize the centralization of pain. And of course, there are some symptoms like hypersensitivity to pain, allodynia and so on, that should be characteristic of centralized pain. It tends to be a little difficult, though, using kind of real pain measurement instruments to come up with good, consistent screening approaches. So we don't have a lot to work with there. I think in addition to There's a better characterized time frame for some kinds of centralization, the sort of amplification of pain in the spinal cord, for example. It might start to happen around six months. But for the kind of chronic pain that we're, or chronification of pain that we're looking at involving the corticolimbic parts of the brain, including the prefrontal cortex, it may be that that takes longer than the changes in the spinal cord do. It's not an area that's been extensively studied. So I think we are... trying to advance the two ideas in parallel. So on the one hand, in the study, we're really just using duration of disease. And of course, patients have to have enough pain, enough magnitude of pain to get into the study. And then I think in parallel, working with our scientific advisory board, working with others to try to clarify and advance the understanding of exactly what there could be that is a sign of the prefrontal cortex hypofunction that our mechanism can work against if it's not just using the passage of time as a way to try to get to those patients. So it's a little bit of a working process, and it has, I think, for the field in general, been a relatively difficult area to produce a clear or measurable biomarker or something of that nature.

Yeah, but it's a really interesting hypothesis. Last question in terms of next steps. Could you imagine... that this particular Phase 2b could be one of two potential pivotal studies, or would you anticipate wanting or needing to conduct two additional pivotal studies should the data read out cleanly and you move forward in DPN?

It's certainly, I think, possible that this data could serve as pivotal. The study we did design trying to follow as far as we could the requirements that had been previously laid out by FDA for chronic pain. However, we didn't meet with FDA in advance to clarify or confirm that. So I would say it is a possibility. We consider it really an upside scenario. And even if it doesn't turn out to be the case that this could serve as a pivotal, it will certainly give us a very good guide as we design our pivotal since we'd expect, again, the design to follow very closely our phase three.

Perfect. Thanks for taking my questions. Good luck with the upcoming data.

Thanks, Charles.

Thank you, Charles. The next question comes from with Cowan. Please proceed.

Hi, guys. Thanks for taking the question. On the fibromyalgia trial, Andy, you mentioned you're looking at the 50 and the 150. and that the statistical analysis plan was otherwise very similar to the DTN study that's going to be reading out next month. Can you talk about, I guess, the primary analysis between the 50 and the 150 in fibromyalgia? Is it going to be sort of a blended analysis versus placebo? Or are you taking two looks and taking an alpha hit between the two doses?

Thanks, Ritu.

Yeah, so fibromyalgia, I think it's 50 and 100 are the two doses. The 150 is for PTSD. No, that's fine. So yeah, so 50 and 100. Look, I don't think at this stage we really want to get into too much detail in our statistical analysis plan. I think it is certainly all pre-specified and clearly laid out. I guess as a main objective, I would say we are interested to see which of these two doses performs better, you know, with a view to then what would our strategy be in phase three. So I think I'll just restrict my comments there. I wouldn't expect anything out of the ordinary, and everything certainly will be very clearly pre-specified in our SAP. We're just not sharing too many details about the SAP right now.

Okay. And then you made a very intriguing comment about other pain conditions that you're considering with unmet need, with rationale. Can you talk about some of those conditions that you're at least considering, especially the ones that have rationale around NMDA modulation?

Yeah, absolutely. So, you know, a lot of pain conditions will have a rationale based on simply the experience of prolonged pain causing some of these chronic abnormalities. So it is a fairly wide-open field. I think that we will be looking at the data from these two indications to try to help us prioritize. Certainly, there are other types of neuropathy that we're very interested in, and we have conducted preclinical studies and published preclinical data in some of those, in particular in chemotherapy-induced neuropathic pain, where we published the clinical data in the last year or two. And I think on the musculoskeletal side, you know, we're certainly interested in a range of different conditions, including osteoarthritis and so on. I think where we go and how we prioritize those indications will be driven somewhat by the data that we see in these two studies.

Got it. And very last quick question. Is there anything significant in the delay in screening start for the 150 milligram PTSD study? Was that COVID related? Were there any IRB issues, et cetera?

Yeah, thanks, Ritu. No, there weren't IRB issues. Again, like I said, we actually had everything in place on our side and with the key external partners to operationally be ready. It really was just driven by taking not very much longer, obviously just a few weeks longer to get the first wave of sites initiated and up and running. It's hard to tell to your question what is a COVID-related delay at this point because, as I mentioned, COVID has impacted clinical study sites from particularly a staffing point of view. And so there is that as a backdrop to everything. I think there is in the U.S. obviously a reasonable amount of other studies, and that's a change from a few years ago, and I think a welcome one because it shows much greater attention on PTSD and many other therapies that are being developed. But there are a few more studies out there, so it just means that the process of prioritizing the sites is a little bit more complex because there's a few other studies out there. So probably a combination of those things. Not really a very significant delay, we don't think. And we look forward to getting up and running and screening in a few weeks.

Great. Thanks for taking all the questions.

Thanks, Ritu.

Thank you, Ritu. The next question comes from Gary Notchman with BMO. Please proceed.

Thanks, guys. Also on 2925, will you have two separate end of phase two meetings for each of the indications in DPN and fibro, or will it make more sense for them to be considered together when planning the phase three program? And if both fibro doses, the 50 and the 100 milligrams show efficacy, or the 100 milligram is better, since DPN is just 50, would that complicate going for a single chronic pain indication? with 2925?

Yeah, thanks, Gary.

So, on the first point around the meeting, we're planning right now to have two separate FDA interactions. We think it probably makes more sense to keep moving with DPN as opposed to waiting for fibro data. Given the likely timing of FDA meetings and fibro data, though, we certainly wouldn't anticipate kicking off a DPN study before we had seen the fibro data and would be able to make sure if there were or if there was anything that would inform the protocol that there would be time to incorporate that. So I certainly wouldn't take away from that that we'll be rushing too far ahead with DPN, but we do think it makes sense to meet separately and capture a little bit of the timing upside on DPN. With respect to The ultimate question of label and dosing, it's difficult to say. I think that would be a question to discuss with FDA. I would say the path to a broader label is something that we would like to clarify with FDA. It was, we believe, one of the reasons why the prior chronic pain drug development guidance was actually pulled back. Um, not many sponsors had availed themselves of the framework that was in that guidance for achieving broader label language. Um, and, um, it's, it's possible that there's some different thinking that FDA has on that. And, uh, I think it would be difficult to comment on whether different doses being optimally effective in different indications would, uh, would be any kind of a challenge there. I, I'm not sure I would foresee that being a challenge, but, uh, I think that whole question would be something that we'll discuss with FDA.

Okay, great. And then for 458 and cognitive impairment, what do you think the rough split will be on the 100 patients between Parkinson's and Lewy body dementia? I know you've been asked that in the past, but maybe what you're thinking at this point. And any issues from COVID with those patients? uh in either patient group um and then just explain a little bit more uh what you're hoping to show on the efficacy side in terms of what kind of signal we might be able to see yeah thanks uh thanks gary so i think on the split um we don't have a very specific pre-formed goal around that split um and you know in terms of the expectations

You know, it depends a little bit. You can look at the different prevalence, but you also then have to consider who's likely to step forward and participate in a clinical trial and then pass the inclusion-exclusion criteria. So other than saying, I think we would certainly hope that there is a reasonable representation of all of the different groups of patients, and that's Parkinson's NCI, Parkinson's dementia, and dementia with Lewy bodies. I wouldn't go any further right now in terms of, you know, particular or specific recommendations. expectations there. With respect to COVID potentially making a difference, yeah, I think, you know, like I mentioned, there was a little bit of a slowdown, it looked like, in enrollment with the Omicron wave over December and January. It's a little difficult for us to tell exactly how much of that is really to do with patient behavior, though, versus the sites that also have issues with site stopping, as I mentioned. We've generally been a little more cautious in restarting this study, and it didn't restart it until after the vaccine rollout in 2021 to more vulnerable populations, including obviously those over the age of 65. The age range in this study is 55 to 85, but the majority of the subjects we'd expect would be towards the higher end of that range. And so we've, I think, generally been sensitive to that and how we've set up the protocol and try to make the site-patient interactions as efficient as possible. And we haven't had, I think, any sense that there's an issue, that patients are willing to take part in the study. And other than that slight slowdown over the holidays, it seems to be going well. In terms of the efficacy signal, the – yeah, the – Efficacy endpoints that we'll be paying the most attention to are a series of six different neurocognitive tests, things like the Groton-Mays, the two-back test, the international shopping list, and so on, that are fairly well known, have been used in cognitive studies quite widely, and are targeted at measuring different domains, executive function, working memory, and attention in particular, that are known to be NMDA-dependent phenomena, also characterize the types of cognitive impairment you see in Parkinson's disease And I think we're really looking on those different tests for a signature of how does this drug improve cognitive performance in these patients and see what that profile looks like. And I think that will then help us as we move forward into Phase IIb and Phase III studies as we're trying to select the right endpoints, which we'll need for those studies, which will have to be more straightforward, easy to implement cognitive tests, and also probably some measures of function And we can come to the recommendation on how to do that based on the profile that we see with these more sensitive, more specific neurocognitive tests.

Okay, that's helpful. And just last quick one for Ashish. How much more flexibility do you have to tap into the credit facility with K2? How much is left on it after taking down the last 10 million? Thanks. Yeah, thanks, Gary.

So the entire facility was $50 million. The first tranche we took down shortly after signing, $15 million. We've taken down in March, as I noted, another 10. That leaves $25 million that would be accessible upon positive data milestones and mutual agreement with the lender.

Okay, great. Thank you.

Thank you, Gary. The next question comes from Mark Goodman with SBB Clearink. Please proceed.

Hey, thanks for taking my question. It's really on the line for Mark. So I have a question regarding NMDA Act 458. So there are several other NMDA products entering mid-stage studies for cognitive impairment. Can you remind us about NMDA Act 458's current evidence to support its efficacy in this indication? And how could this product be differentiated versus other NMDA products? And secondly, can you remind us the discontinuation rate so far in ongoing DPN trial? Are there any new safety signals that you observed?

Okay, great. Thank you. Yes, so let's start with 458.

So the evidence for efficacy we have here, of course, so far is all preclinical. We're in our first inpatient study right now. The most, I think, interesting piece of preclinical evidence that we have is from a study in non-human primates using a neurotoxin called MPTP to create a cognitive deficit. It's caused by dopaminergic cell depletion and so very similar to what is seen in Parkinson's disease. And in that study, we saw a marked and sustained cognitive deficit that was created by this neurotoxin. But it was largely very rapidly reversed by just a single dose of NYX458 across a range of different measures of cognitive performance. And the improvement was sustained actually for a few weeks before returning back to the impairment level. It was very encouraging, very exciting preclinical data. We also had some data from rodent models of various different kinds, but that was probably the most translatable preclinical data. So we were very excited to take the drug into the clinic. We did decide, and it was a conscious decision, that our first study in patients would be a robustly designed, double-blind, randomized, placebo-controlled study of 12 weeks duration, and partly because we couldn't convince ourselves that any kind of shorter or less robust task would really be meaningful. So as a result of that, as you mentioned, there are a few other compounds out there that are targeting NMDA modulation in cognitive impairment. But so far, the only data we've seen from any of those is from these smaller, often open-label studies. And so it looks promising, but it's difficult to say I think really what the degree of efficacy is. So in terms of differentiation, of course, we know more about our compounds than we do about those others. We certainly know with our compounds that the safety and tolerability profile has been very good across all of our clinical stage compounds and all of the studies so far that we've conducted. So we would certainly hope that that would continue. And in addition, I think the targeted effects that our drug seems to have on areas of NMDA hypofunction may enable a fairly clean focus or ability to improve cognitive symptoms without impacting anything else. So I think that's as much as we can really say because we don't know a lot about those other compounds. But we're, again, mostly focused on 458 and certainly think that the study that's in process will be a really good test of what the drug can do to improve cognition. With respect to 2925, we haven't talked specifically about discontinuation rate for 2925 and DPA. And I think what I would say is we, of course, had projected a planned discontinuation rate at the beginning of the study, and actually we projected it before the pandemic because technically the study kicked off right before the pandemic. And we have seen discontinuation broadly in line with that. So I think from an operational perspective, we've been pretty comfortable with how the study has proceeded.

Thanks. That's very helpful.

Thank you, Mark. The next question comes from June Lee with Truist Securities. Please proceed.

Good evening. This is Les for June. Thank you for taking my questions. I have two. First, on the 7A3, any notable differences in the PTSD patient screening criteria that you plan to initiate next month for the 150 meg dose that you've learned from initiating the 50 milligram dose? And then second, on the 2925, pending data in DPN and fibromyalgia, would you consider a partnership for the pivotal studies, or are your development plans strictly internal? And is it possible that you could have DPN data as early as the AAN meeting next month? Thank you.

Okay, thanks, Les. So 783, I'll take the 783, and then I'll

I have Ashish actually answer your question on 2925 around partnerships. For 73 screening, we are trying to make sure that the two studies in PTSD are essentially the same. So there are very minor differences. Really, the dose, obviously, is the principal one. The main design element, particularly in terms of inclusion-exclusion criteria, we want to be the same or as close to the same as possible. So I don't think we've learned anything yet in the 50 milligram dose that we weren't expecting to see. I think that study's been progressing well. And so we certainly haven't made any changes to the 150 milligram protocol. And I do think throughout both of those studies, Were we to make any tweaks or modifications, we would likely make them to both, but we haven't seen the need to do that yet. Ashish, I'll let you answer the 2925 partnership question.

Yeah, thanks, Andy. You know, I think we've been pretty clear and consistent before that we believe that if we see the therapeutic profile that we hope to show in the Phase IIb, that this is a pain therapy that has broad application and would probably best be served with the assistance of a commercial partner with larger, more well-established commercial capabilities. And certainly, I think that would be something we would explore at some point prior to commercialization. We have a team that is well-poised and prepared to take the next steps in development after Phase 2b. already underway with those preparations. And as Andy's noted before, the phase three we don't anticipate would be dramatically different from what we've already done in phase two B. We're always open to partnerships that can add value to the programs, that can advance these programs toward patients more rapidly or more responsibly, and those that offer optimal value to shareholders. So we'll engage in the wake of the data in an evaluation of whether a near-term partnership opportunity represents that high-value juncture or whether that's something down the road on the R&D path, but we're certainly open to it.

Great. Thank you for the clarification.

Thank you. The next question comes from Laura Chico with LitBush Securities. Please proceed.

Good afternoon. Thanks for taking the question. And I might just ask this one a little bit differently than previously asked. But I guess with respect to 2925, when you're thinking about portfolio allocation, I'm wondering how much of a consideration safety data might come into play when we get the VPN and FM readouts. Obviously, efficacy is going to be essential. Many chronic pain agents have REMS programs, so I'm curious if there's anything in the Phase II readouts that might be informative in terms of differentiating 2925 from a safety tolerability perspective. And then I have one follow-up for you.

Yeah, thanks, Laura. Yeah, I think you're right. There definitely is a concern in general with the current chronic pain treatments about some of the side effects and safety issues. There are a range of those, and they range from, you know, some things that are more serious to some things that are, you know, maybe less serious but very common and can be quite bothersome for patients like dizziness or drowsiness. And then also some issues with dependence, obviously, and abuse potential. So I think those are the main things that we'll be looking at in the data. Of course, as usual, we'll be looking to make sure, you know, that there aren't, any concerns with serious or severe adverse events. We haven't had those, obviously, in our prior studies, and so that'll be an important thing to look at. But also, then, even in the mild and moderate adverse events, is there anything that is more common, that is a concern? We, again, expect and hope that that will not be the case. I think, generally, our mild and moderate adverse event profile in prior studies has been very similar to what we've seen in the placebo group. And so we would certainly hope to see a continuation of that. That would be, or those two findings together, I think would be a huge potential differentiator, provided, of course, that we see good efficacy as well. But that would be really important for persistence with therapy, for the willingness of physicians to prescribe broadly, and of course for patients to perceive that there's a risk-benefit from their point of view On abuse potential and so forth, in this data, we do look quite carefully at any of the adverse events that are reported to determine that there's no underlying potential for abuse liability or anything like that. So that's another thing that we'd be looking at as well. And again, in the past, we haven't seen anything there. So we'd be hoping for as clean a bill of health as possible on those three areas. And if we got that, that would, as you mentioned, it would certainly be a very important factor in this disease area.

Okay. That's super helpful, Andy. Maybe the quick follow-up then would just be, you know, in a best case scenario, you get positive readouts from FM, from DPN, while the 783 program is progressing. I guess, you know, fast forward ahead a year or so, How do you prioritize pivotal advancement if you're successful with 2925783? Should we presume all the indications are proceeding, or would there be kind of a more, a closer assessment and allocation of resources in terms of advancing programs? Thank you.

Thanks, Laura. Yeah, I would certainly assume that we will make it happen in terms of, you know, finding between, as Ashish mentioned, external partnerships and, of course, further financing by Epsonix, that we will make it happen that the pipeline can advance. So there shouldn't be any concern about having to prioritize or reduce the number of studies that are in process or anything like that. I think quite the contrary. I think, as I mentioned in my remarks, we would view positive data in DPN and or fibromyalgia as hugely catalytic for the company. and we would absolutely expect to move forward as quickly as we can in both of those indications and continue to keep the rest of the pipeline in PTSD and cognitive impairment moving as well. And in addition, I think we do still want to make sure it's understood by investors in the longer term, and the timing of this is probably more of a question because I think this would probably not be an immediate priority in the way that moving 2925 into phase three and making sure that 783 and 458 keep progressing as quickly as possible would be. But in the longer run, we do have over 1,000 other molecules in our pre-IND pipeline. We still have, I think, a lot of potential with our mechanism that we can apply in other areas. And in the longer run, that's also something we would be keen to finance.

Thanks, Andy. Thank you, Laura. The next question comes from Miles Minter with William Blair. Please proceed.

Hi, this is Sarah on the line for Miles. Thanks for taking the questions. I've got two quick ones. First, can you comment on if you're monitoring the blinded data in a chronic pain trial? And if so, are you seeing an improvement in pain scores from week four to week 12? And then I've got a second after that.

Thanks, Sarah. So, no, we are not. scrutinizing the blinded data and trying to draw conclusions from that. So that's a fairly quick answer. I think we'll draw the conclusions when we eventually get to see the non-blinded data set.

Got it. Thanks. And then the second one was, was the powering for the secondary outcome measures in fibromyalgia study factored into the study design, or was that study powered only for the primary endpoint?

Yeah, thanks, Sarah. The powering was primarily for the primary endpoint.

Got it. Thank you.

Okay. Thank you. The next question comes from Ram Selvaraju with HC Wainwright. Please proceed.

Afternoon, Andy and the team. This is Maz on for Ram. So firstly, with regard to 2925 in painful DPN and fibromyalgia, do you think return to more physical active work for some patients as the pandemic recedes has kind of a meaningful bearing on average daily pain scores, pain and walking? And is this something you're monitoring?

Thanks, Maz.

Yeah, I don't know that we've heard, you know, widespread reports of that as a phenomenon that would hit in a specific way and within a specific, you know, three-month time period for each patient that is obviously in the study. You know, the course of the pandemic from March 2020 to today has, I think, been quite different for different individuals and different types of jobs, including those that aren't working and in different parts of the country. So, I think it's very difficult to kind of generalize on that. Again, some people have been working as normal, some have not, and the time course has been very different. We haven't heard anything that's been a consistent concern about a widespread or mainstream change in activity patterns that was kind of synchronized enough to cause a concern in a clinical trial. So it's a good question, but it's not something that we have really been concerned about or that's been put on our radar as a concern.

Okay, good to know. And then secondly, was there a reason you staggered the initiation of the two 783 trials, the two doses? I'm kind of concerned about the patients in the 150 milligram dose knowing they're on a high dose versus previous patients, or were they all blinded to this?

So, yeah, so the process will be at each site that only one of the studies will be in process. So it won't be something that's a factor we don't think in the enrollment of the patients or anything like that. I think in terms of the staggering, it was partly to do with the fact that as As you may recall, going back to kind of when we kicked off the study, we already had tested the 50 milligram dose. We were already anticipating that we would move forward with that dose, and we were able to move more quickly. We had, among other things, just the fairly mundane matter of actually having existing physical supplies of the drug ready to go and things like that. So we certainly felt as though it would be more efficient and quicker to start one study as quickly as possible. and then the other study later, and it made sense to sequence them this way because of that factor with the investigational product. So, yeah, so it was partly a decision and partly actually more an upside that we were able to move more quickly with the 50-milligram dose. And so far, as I mentioned, although, you know, they were staggered, and although the 50-milligram – the 150-milligram study – we think we'll start screening in April. We really don't have any longer-term concerns. I think it's taken slightly longer than we had thought to get some of the sites activated, but we don't really have a concern at this point on the most important goal, which of course is to get the majority of the sites up and running, get the study enrolled and completed.

Okay, great. Thanks for clarifying. And if I can squeeze one more in, I was interested in Parkinson's patients and a large percentage of them report pain. So I was wondering if you've experienced pain reporting by your pd patients in in that trial and if you think um you know any significant pain improvements are possible in pd patients with 458 um given you have kind of a similar hypothesis with hypoactive regions the prefrontal cortex being targeted with 2925 yeah it's an interesting question uh we aren't obviously we're not uh

Well, I shouldn't say obviously. We're not screening for the presence of pain in the study, of course, and we don't have a specific measure for soliciting changes in pain in that study. But it will be interesting. It's the kind of thing that there may be reports of in the study. We may get some sense as to whether that sort of overlap exists. So, yeah, it's an interesting area to look at.

Fantastic. Thanks for taking our questions. Look forward to the year ahead.

Thank you. We have no further questions at this time. I would like to turn the call back over to Andy for any closing remarks.

Thank you, Celia, and thank you to everybody on the line for your thoughtful questions. We appreciate your time and attention, and we wish everyone a very pleasant evening.

That concludes the Aptinex fourth quarter and year in 2021 financial results conference call. Thank you for your participation. You may now disconnect your lines.