Avadel Pharmaceuticals plc

Greetings. Welcome to Avidel Pharmaceuticals Third Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Tom McHugh, CFO. Thank you. You may begin.

Good morning, and thank you for joining us on our conference call. This morning, we issued our third quarter financial results news release, which can be accessed on our website, www.avidel.com. As a reminder, before we begin, the following presentation includes several matters that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. These risks include risks that products in the development stage may not achieve scientific objectives or milestones or meet stringent regulatory requirements, uncertainties regarding market acceptance of products, and the impact of competitive products and pricing. These and other risks are described more fully in Avadel's Public Filings and Exchange Act, including the Form 10-K for the year ended December 31, 2019, which was filed on March 16, 2020, and subsequent SEC filings. Except as required by law, Avidel undertakes no obligation to update or revise any forward-looking statements contained in this presentation to reflect new information, future events, or otherwise. On the call with me today is Greg Divis, our Chief Executive Officer, and I will now turn the call over to him.

Thank you, Tom. Good morning, everyone, and thank you for joining us on our third quarter 2020 conference call. I will begin with several important updates on our business outlook, highlighting the significant progress made and key milestones achieved over the past several months. I will then turn the call over to Tom, who will review the financial results for the quarter, and we will conclude with a Q&A session. First and foremost, as we progress toward what is the most significant milestone in our company's history to date, Q3 2020 has been a quarter where, although we had very little to say publicly, we made significant progress in identifying and unlocking substantial future potential value for our shareholders. With the continued progress on the regulatory front, including the pending filing of the NDA for our once-nightly FT218, coupled with the significant identified market expansion opportunities for a once-nightly sodium oxibate treatment, We are more excited than ever about the future for Avidel, our shareholders, and the patients we serve. With that, let's get into some details. Our team has continued to execute on or ahead of our expectations as we have advanced from top-line data in the second quarter through to full data analysis, pre-NDA meeting, ongoing productive regulatory interactions, and are now finalizing our NDA for submission before year end. I am proud of our team and their commitment to achieving this next important milestone in our pursuit of bringing one Stanley FT218 to thousands of patients with narcolepsy who we believe are dissatisfied with their current treatment options. As we have stated in the past, we are committed to delivering this NDA2 submission ahead of recent competitor benchmarks. And with our planned filing before year end, we will do just that. I am confident that we are compiling a robust and complete NDA for FE218, which includes the results from the Reston study. These results show that all three doses tested demonstrated statistically significant and clinically meaningful improvement for all three co-primary endpoints compared to placebo. Furthermore, we have completed our analysis of the secondary endpoint data. which showed that FT218 was highly significant for endpoints that tested additional measures of daytime sleepiness, sleep architecture, and other narcolepsy symptoms compared to placebo at all three doses. The full data demonstrated that FT218 was positive on all sensitivity analyses of the three co-primary endpoints, thus confirming the robustness of the data. Additional subgroup analysis of the Reston study demonstrated comparable results of FT218 in both narcolepsy patients with and without cataplexy, as well as those on concomitant weight-promoting agents compared to those not on weight-promoting agents. In addition, results from responder analyses for the maintenance of weightfulness tests and mean weekly cataplexy attacks further support the potential clinical benefits of FT218. If approved, FT218 could be the first once-nightly therapy to address both excessive daytime sleepiness and cataplexy in patients with narcolepsy. The complete clinical profile of once-nightly FT218 from primary endpoints to secondary endpoints to post-hoc responder analyses has demonstrated statistically significant results indicative of a narcolepsy treatment option we believe, if approved, can truly help patients. With that said, in order to preserve our ability to present these and more data at future medical conferences or have it published in peer-reviewed journals, we are not offering more specifics at this time. However, we look forward to presenting this data in detail as well as very interesting and compelling post hoc data at scientific conferences throughout 2021 and beyond. We are pleased with the progress we have made in Q3, specifically as it relates to our NDA. and are confident in our regulatory and filing strategy via the 505 pathway. We look forward to keeping our shareholders and all interested stakeholders updated on this submission, and we currently plan to notify you at the time of our submission as well as when we receive FDA's confirmation of acceptance. In parallel with preparing the NDA for filing, we have continued to execute our market preparation plan. Inclusive of this has been a recently completed FT218-specific commercial assessment in what has now become a very dynamic narcolepsy marketplace. This comprehensive assessment has yielded additional, very positive insights into the significant potential opportunity for FT218 to bring a meaningful therapeutic option to not only currently treated patients, but also a large contingent of patients who are candidates for sodium oxibate treatment but are not currently being treated. Simply stated, our research informs us that as many as 60% of sodium oxibate eligible patients are not receiving treatment today with the primary reason being twice nightly dosing related challenges. In fact, current or previously treated twice nightly sodium oxibate patients ranked once-nightly dosing as the most important driver of their treatment preference, placing it higher in importance than efficacy and side effect profile. Furthermore, our analysis of five years of sodium-oxidant patient claims reveals that nearly 50 percent of all newly treated twice-nightly sodium-oxidant patients discontinued their treatment within 12 months of initiation, with nearly half of that group discontinuing within the first 30 days, which we believe speaks to the dissatisfaction that exists with current twice-nightly treatment options and, most importantly, provides further support for this significant potential market opportunity for once-nightly FT218. The 60% of sodium-oxidate-eligible patients who are not receiving treatment today, based on our estimates, represents approximately 22,000 patients in addition to the roughly 15,000 patients who are currently treated with twice-nightly sodium oxibate. We believe these findings point to a significant opportunity for FT218 above and beyond the current and nearly $1.8 billion twice-nightly marketplace. This comprehensive market assessment includes in-depth research with over 200 sodium oxibate prescribers, over 220 current or previously treated sodium oxidate patients, more than 75 caregivers, more than 20 office or nursing staff from sodium oxidate treating offices, and 15 large national and regional health plans and PBMs representing a significant majority of insured lives. Furthermore, we analyzed over five years of narcolepsy patient claims data as diagnosed and treated representing over 160,000 unique narcolepsy-diagnosed patients, including more than 14,000 sodium oxibate patients. The specific and cumulative analysis of this data has provided deep insights in framing our go-to-market strategies and valuing the opportunity for FT218 for patients and for our shareholders. We unequivocally believe, based on our insights received, from large cohorts of treating physicians, treated patients, and caregivers that once nightly FT218, if approved, will be an important treatment option when considered in light of other GHB-derived treatments. In this regard, we have and remain committed to the science and the evidence as being the driver of quality patient care, and we believe the science and the evidence is on our side. Taking this a step further, a recent peer-reviewed article published in Sleep Medicine evaluated more than 60 research studies in human subjects and examined the data surrounding cardiovascular risk associated with sodium oxibate treatment. In almost two decades of use in the treatment of narcolepsy, sodium oxibate has demonstrated an excellent cardiovascular safety profile. Increased cardiovascular risk, such as incidence of hypertension, related to its sodium content has not been flagged as a therapeutic issue in the vast majority of patients. And the article concluded that existing evidence does not support an increased cardiovascular risk due to sodium oxidate exposure, even at a 9-gram daily dose. A link to this study is included in our press release. During the third quarter, we also announced the initiation of the RESTORE study, an open-label extension and SWIFT study to evaluate patients switching from twice-nightly sodium oxibate to once-nightly FT218. In addition to gathering longer-term data with once-nightly FT218, the restore study also provides us an opportunity to generate important data for physicians on switching patients from twice-nightly sodium oxibate to once-nightly FT218. We believe this data will be useful for clinicians in the future and for Avidel in our commercialization efforts for FT218, if approved. Progress has continued in our enrollment of Restore as more sites become activated under the COVID-related requirements. We are pleased with the high level of interest, especially from current twice-nightly patients, where we are seeing nearly all treated switch patients being stabilized on the same or lower dose of once-nightly FT218. compared to their previous daily dosing of the twice-nightly product. Although it is early in the trial, we are pleased with what we are learning and will update the market as appropriate. And please note, this trial is not a requirement for our NDA and has no material impact on our pending NDA submission. The third quarter was a period of significant progress for Avidel. The advancement of our NDA toward an expected filing before the end of the year, coupled with the significant market opportunities we continue to uncover, both reaffirms the strategy we embarked on over 20 months ago, as well as, most importantly, reinforces our opportunity to create significant value for our shareholders and the patients we serve. Before I provide a few closing remarks and open up the line for a brief Q&A session, I will turn the call over to Tom to provide an overview of our financial results for the quarter.