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Operator
Good morning and welcome to the BioAccel Therapeutics conference call, which will include an update on the company's late stage clinical programs and the discussion of financial results for the fourth quarter and full year 2023. At this time, all participants are in listen-only mode. If during the conference call you require operator assistance, please press star zero on your telephone keypad. After the formal remarks will be a question and answer session. If you'd like to register a question, you may press star 1 on your telephone keypad. Just to remind everyone, certain matters discussed in today's conference call and or answers that may be given to questions asked or forward-looking statements subject to risks and uncertainties related to future events and or the future financial or business performance of the company. Actual results could differ materially from those anticipated in those forward-looking statements. Risk factors that may affect future results are detailed in the company's quarterly report on Form 10-Q for the quarter ended September 30, 2023, which can be found at www.bioexhealththerapeutics.com or on www.sec.gov, and which will be updated in its annual report on Form 10-K for the year ended December 31, 2023. As a reminder, today's call is being recorded. Speaking on today's call are Dr. Vimal Mehta, Chief Executive Officer, Dr. Vince O'Neill, Chief of Product Development and Medical Officer, and Richard Steinhardt, Chief Financial Officer. They will be joined in the Q&A session by Dr. Frank Yacob, Chief Scientific Officer, Matt Wiley, Chief Commercial Officer, and Dr. Rob Reisinger, Chief Medical Officer of Neuroscience. It's now my pleasure to turn the call over to Dr. Mehta. Please go ahead.
Mehta
Thank you, operator. Good morning, and thank you for joining us. This is an exciting time for Bioexcel Therapeutics. First, we are very pleased with the progress of our Tranquility Program. As I have communicated previously, this is a top priority for capital allocation. Second, we are focused on advancing the Serenity Program. Both programs provide significant opportunities for us to address the unmet needs in treating patients struggling with episodes of acute agitation. During today's call, we will dedicate our prepared remarks to updates on tranquility and serenity. These late-stage clinical programs represent groundbreaking opportunities to advance our goal of bringing new treatment options to patients. As a reminder, there are no currently approved acute treatments for agitation associated with Alzheimer's disease or for bipolar disorder or schizophrenia in the at-home setting. These conditions represent large, untapped markets. All of us at BioAccel Therapeutics are motivated to develop new treatment options for the greatest number of patients and caregivers. Vince will now provide a detailed update on tranquility and serenity. After this, I will briefly discuss several corporate updates, which will then review our financial results before we open the call for Q&A. With that, I will turn the call over to Vince.
Vince
Thank you, Vimal. So I appreciate the opportunity to speak with all of you this morning and provide an update on our two late-stage clinical programs with BioXcel 501. Let me begin with tranquility, where we are evaluating 501 as an acute treatment for agitation associated with Alzheimer's dementia, or for short, AAD. As Vimal said, tranquility remains a top priority to bring a novel treatment to this large, underserved patient population. Every year, estimates show that millions of Americans with Alzheimer's disease experience agitation. Physicians often aim to address this with neuropsychiatric drugs used off-label because there are no approved treatments specifically for acute agitation episodes. This area of neuroscience drug development for an episodic treatment is novel and uncharted, and we believe we are uniquely positioned in this space. At BioXcel Therapeutics, we have Egalme already on the U.S. market as an approved acute treatment for bipolar disorder and schizophrenia-related agitation. This provides us with a strong foundation from which we are expanding into development in AAD in our Tranquility Program and into development in different settings in the bipolar and schizophrenia populations through the Serenity Program. For Tranquility, we have completed now a Type B Breakthrough Therapy Designation meeting with the FDA on February 20th. This meeting followed the one we had in October of last year. Let me remind you that we are not in a position to provide detailed information about our overall program plans until after we receive and review the FDA's final meeting minutes. However, we can share now that based on the FDA's feedback, we plan to generate additional Phase III efficacy and safety data in care facilities to expand the database beyond the 70 patients who have been treated with 60 micrograms of 501 in Tranquility 1 and 2 to date. We plan to generate these data, including repeat efficacy data, in a variety of relevant care settings and to use PEC as the primary efficacy measure as used in the prior Tranquility II study. To remind everyone, in November 23, we announced that we were planning to conduct a Phase III trial in the at-home setting with safety as the primary objective, otherwise known as Tranquility at Home. Given the priority to expand the database to generate additional efficacy data in care facilities, the company is now reevaluating the timing for initiating Tranquility at Home. Lastly, the FDA has indicated that we will need to generate long-term safety data. However, given the lack of any regulatory precedent for episodic treatment of AED in patients, we plan to further engage with the FDA regarding this requirement. We look forward to receiving final meeting minutes from the agency and sharing more details with you later this month. We're extremely motivated by this potential opportunity to bring a much-needed acute treatment option to patients. Developing novel episodic treatments with no regulatory precedent comes with new learnings to create an optimal development path. At this time, we believe we have a clear path forward. To that point, we've had multiple meetings with the FDA for this uncharted regulatory path and have greatly appreciated the agency's guidance as we move forward to advancing our clinical program. Let's now turn to Serenity, where we are evaluating the potential at-home use of 501 for agitation associated with bipolar disorders or schizophrenia. On March the 6th, we completed a Type C meeting with the FDA. This followed the one we conducted last November. Based on FDA feedback, we plan to evaluate the 120-microgram dose of 501 as a reminder, an approved dose of Egalme in the at-home setting in an amendment to our Serenity 3 Part 2 protocol, which the company had voluntarily paused as we discussed the FDA's proposed changes to the protocol in light of the results of Serenity 3 Part 1. And our current plan is to move forward with this study as amended, with safety as the primary objective and efficacy measures as exploratory endpoints. Keep in mind the label for agalmi currently includes a limitation on use, noting the lack of efficacy or safety data beyond 24 hours. We believe that our ability to seek labeling without the current LOU will depend in part on the number of agitation episodes we observe over the three-month follow-up period. To support our pivotal trial with the 120 microgram dose, we're also planning to conduct a small study, approximately 30 patients, to evaluate the correlation between patient-reported or informant-reported efficacy with trained rater-reported efficacy using PEC scores. We expect to provide additional information about the program plans after receiving and reviewing final meeting minutes from the FDA. And with that, I will turn the call back over to Benoit.
Mehta
Thank you, Vince. We are also pleased with progress in other areas of the business. On January 1st, the permanent J code for EGALMI became effective and our commercialization efforts continue to progress. In addition, we continue building a robust intellectual property portfolio and strengthening our long-term patent protection. Finally, we are pleased to have received fast track designation from the FDA for BXEL 701. I would like to end my remarks by emphasizing that we remain focused on strengthening the company's balance sheet. To this end, we are actively exploring multiple financial options to extend our cash runway and fund our key clinical programs in order to create maximum value for our shareholders. I would now like to turn the call over to Rich. who will review our fourth quarter and full year 2023 financial results. Rich? Thank you, Vimal.
Rich
Net revenue from El Gami was $376,000 for the fourth quarter of 2023, compared to $238,000 for the same period in 2022. Net revenue was $1.4 million for the full year 2023, compared to $375,000 for 2022. Research and development expenses were $9.9 million for the fourth quarter of 2023 compared to $32.5 million for the same period in 2022. Research and development expenses were $84.3 million for the full year of 2023 compared to $91.2 million for 2022. The decreased expenses for both fourth quarter and the full year were primarily attributed to a decrease in clinical trial activity associated with the wind down of Serenity III and Tranquility II studies, a decrease in chemical manufacturing and control costs, and a decrease in personnel related to the company's reprioritization in August of 2023. Selling general and administrative expenses were $9.6 million for the fourth quarter of 2023, compared to $20.7 million for the same period of 2022. SG&A expenses were $83.4 million for the full year of 2023 compared to $68.8 million for 2022. Increased costs for the full year are generally attributable to an increase in legal and professional fees, costs associated with personnel and related expenses to support the commercialization of the economy in the U.S. prior to the company's reprioritization. BioAccel Therapeutics had a net loss of $22.3 million for the fourth quarter of 2023 compared to a net loss of $54.8 million for the same period in 2022. For the full year 2023, the company reported a net loss of $179 million compared to a net loss of $165.8 million for the full year 2022. The loss for 2023 includes approximately $18.6 million in non-cash stock-based compensation. Total cash expenditures for 2023 totaled approximately $155 million. Cash and cash equivalents total $65.2 million as of December 31, 2023, compared to $193.7 million as of December 31, 2022. The company estimates that its current cash and cash equivalents will fund its operations through mid-2024. This estimated cash runway does not include any potential financing activities that may be undertaken by the company. Now I'd like to turn the call back to Vimal.
Mehta
Thank you, Rich. We would now like to open the call for questions. Operator?
Operator
Thank you. We'll now be conducting a question and answer session. If you'd like to be placed into question queue, please press star 1 on your telephone keypad. We ask you please limit yourselves to one question and one follow-up. Once again, that's star 1 to be placed into question queue, and please ask one question and one follow-up. Our first question today is coming from Greg Harrison from Bank of America. Your line is now live.
Greg Harrison
Hey, good morning, guys. Thanks for taking the questions. So after your recent FDA meetings, it seems you have more clarity for the Tranquility Programs. Would you say now you have two separate paths to SNDA and Alzheimer's, one in the care setting and one at home? And then how are you thinking about funding the program and the company as a whole as you get closer to the end of your cash runway? Are there any specific avenues that you're exploring? Thanks.
Vince
Good morning, Greg. This is Ben. Thanks for the question. So to answer it directly, yes, we believe so. So obviously the Tranquility Efficacy PEC Primary Study and also the Safety at Home Study would be run with registrational intent. So yes, in terms of funding, I would refer back to Bill.
Mehta
So as Greg stated in my opening remarks, we are looking at multiple options. to fund the company, now having a clarity from the FDA clearly tells us what are the trials we need to do to capture these large market opportunities, both in the tranquility and serenity. And as we speak, we are very actively working on those funds.
Greg Harrison
Great. Thanks again.
Operator
Thank you. Our next question is coming from Robin Kornoskis from Truist Securities. Your line is now live.
Robin Kornoskis
All right. Thank you for taking my question. So, I have two. After the recent meetings with the FDA, you've chosen the 120 milligram dose. And does that mean that would allow for expansion in the at-home setting? I have a follow-up for that.
Vince
Yep. Morning, Robin. So I think the choice of 120 microgram dose, we believe, is a good choice for the following reason. Efficacy is fundamentally established for that dose. That's clearly an approved dose of Egalme, one of two approved doses of Egalme. So yes, we believe that with that, again, a registrational intended study with safety as a primary is what we need to go back to the FDA with data in hand.
Robin Kornoskis
And following up on that a little bit, so you'll give them minutes. Have you spoken to the FDA clearly about that dose? And you'll give them minutes later from point.
Vince
Yes, sorry to interrupt you. Yeah, absolutely. We've spoken to the FDA. We have crystal clarity, I think, on the choice of dose.
Robin Kornoskis
Okay, then last question. Sorry for three. That's bad. Like, funding the program, Like, Vimal, like, how do you think about, you know, you have a lot going on. You talked about, like, you have a lot of options. How do we think about the fact that, you know, you have to fund a lot of these programs? They're giving you feedback. How do investors think about the fact that, actually, how did they think about the options on the table for you?
Mehta
So Robin, good morning. In terms of the priority, we will focus on Tranquility, the trial that Vince has discussed, because that can help us on a path to a potential SNDA in the care setting as discussed on this call. And also on the Serenity Program, we have a clarity what dose we can take it forward for a potential registration trial. So our trials, we have a tremendous experience in the company. We have done more than 11 placebo-controlled double-blinded trials. These trials are capital-efficient, and the opportunity we have in front of us is very large. But we want to be very focused, and as I mentioned, tranquility will be the top priority, followed by serenity.
Robin Kornoskis
Great. Thank you.
Operator
Thank you. Our next question is coming from Greg Subenades from Missoula Securities. Your line is now live.
Greg Subenades
Hey, good morning. Thanks for taking my questions and for the clarity. Two pleas for me. I don't know if the first one was already asked. My apologies. Just on the Tranquility at Home or just the Tranquility program overall, the pivot to needing to collect Now, efficacy data, can you tell us kind of what changed versus a previous plan just to focus on safety? And then secondly, while I realize that you've got to figure out the financing for the company on a go-forward basis, I'm just trying to get a sense of whether you can provide us clarity around how much you think it might take to get to complete Tranquility at home in order to be able to get it in a position to be able to file an SMDA and similarly what you think that total cost would be for completing the Serenity program. It's just important just in light of your current cash just for investors to know what more funds you need to get to really the next revenue inflection point. Thank you.
Vince
Yep. Good morning, Greg. So I'll take the first part of that question. It's obviously an important question. So after we met with the FDA last year and we began to think about the design of the study in depth and in detail and begin to engage with our advisors and KOLs, it became clear that using non-validated caregiver-assessed instruments would be challenging and would frankly carry risk. So with that better understood, we went back to the FDA to rediscuss what additional, quote, additional efficacy, unquote, meant. And obviously we've now agreed on formal efficacy analysis with PEC as a primary endpoint, clearly an endpoint we've used before with success. So hopefully that provides clarity.
Mehta
Good morning, Greg. This is Vimal. Financing question is very relevant. Now, having the clarity from the FDA was very important for us to know what financing we need to do. So regarding the Tranquility trial, efficacy trial that Vince mentioned, It's under actively being designed, and we will be able to share more details about it once we have received meeting minutes, which we expect after 30 days from our meeting on February 20th. In terms of the Serenity at-home trial, we have tremendous experience with Serenity 1, 2, and Serenity 3. We have a very good idea in terms of the timing as well as capital requirement for that trial. And as I said in the beginning, Our patient costs are low for these trials, and overall these trials are capital efficient, and they can be delivered in a reasonable time. So we are working on all of that, and we will come back and lay out the plan for tranquility as well as serenity, and we will be having conversations what the capital requirements are based on our current cash position. and how much cash we need to extend using the means we have, which are equity investment versus monetization of any assets we have or slash partnering. But all these things are being pursued in parallel, and we will be able to provide a clarity on the plan and financing as we progress. Okay. Thank you, Velma.
Operator
Thank you. Our next question is coming from Sumanth Kulkarni from Canaccord Genuity. Your line is now live.
Canaccord Genoa
Good morning. Thanks for taking my question. So you mentioned in your prepared remarks that for labeling purposes, the limitation of use is over a 24 to 48-hour period, and you'll need to generate more data over three months. When you're doing so, what's the risk that you might find that agitation is not necessarily episodic, and in that case, you still think you might pursue 501 as a rescue therapy?
Vince
So I think the first way to answer that is that's not our expectations, but I am going to ask Dr. Reisinger, our CMO, to comment a little bit further on that. I mean, I guess it revolves around our expectations for frequency.
Reisinger
Yes, I think, I mean, not to get into the weeds, but the CMAI is a tally of episodes. It's a tally of a certain number of episodes plus severity. The FDA has agreed to our PEC as a pivot endpoint for acute agitation. And we would all like to understand what the relationship is with a chronic condition with episodic or episodes of acute agitation. So we hope to be able to speak a little bit to that data, but the reality is these patients have acute episodes that need treatment even now and even with every treatment that is used, whether it's on-label or off-label.
Canaccord Genoa
And then my follow-up is a financial question. So what do all these latest updates mean with respect to your ability to be in line with the covenants associated with the prior financing, or will you need to rework those again?
Mehta
Good questions, Raman. We are always in discussions with our strategic partners, and they are very supportive of facilitating and having companies be able to get financing because they really believe in this asset and they see that this is a large market opportunity. So it's a very good partnership, and we work together to chart out the optimal path. I think most important from this call is that we have a clarity from a FDA perspective what we need to do in terms of our path forward for these two programs.
Operator
Thank you. Thank you. Next question is coming from Ram Sabharaju from H.C. Wainwright. Your line is now live.
Ram Sabharaju
Thanks very much for taking my questions. Can you hear me?
Vince
We can.
Ram Sabharaju
Okay. So just wanted to see if you could offer some clarity, whether quantitative or qualitative, regarding the paused study and how much data from that study that was collected before its pause you expect to be usable in furtherance of the development plans for 501.
Vince
I'm going to ask Dr. Risinger, CMO, to comment on that as far as he can.
Reisinger
When you submit for an NDA, all data in all patients who were ever treated with the medication is used. And so to that extent, safety data from that trial is entirely submitted to the FDA.
Ram Sabharaju
With respect to whatever information was collected on the activity profile, Is any of that information likely to be useful in potentially offsetting future development costs? I'm just trying to ascertain to what extent you have to recapitulate anything, if indeed you do.
Reisinger
I think the pregnant pause here is we're trying to... I think I capture the gist of your question in that can that data be then sort of rolled into another study? And typically you can't do that. It just has to be separate studies. That doesn't mean it doesn't offset cost because in the end FDA wants to see exposures and safety, safety, safety, and that's what we have. That safety data is part of it.
Vince
It probably is in the final analysis a minor cost consideration.
Ram Sabharaju
Okay, and then just really quickly, do you have any updates on your plans for Oncosexcel at this time? Thank you.
Mehta
Ram, we have formally started the process to explore the opportunities, whether it's partnering or monetization. The company was extremely focused right now on getting the plans for the neuroscience business, which is tranquility and serenity. Having the clarity, we will have more time to dedicate to focus on OncoXcel because, as you know, if we can monetize our partner, that can help bring non-dilutive financing to the company.
Ram Sabharaju
Thank you very much.
Operator
Thank you. Next question, please. Thank you, Ram. Thank you. Our next question today is coming from Colin Bristol from UBS. Your line is now live.
Colin Bristol
Good morning, guys, and thanks for all the updates. Probably sort of piggybacking on a few of the questions we've already been asked. Firstly, on the Tranquility Program, can you give us any indication on sort of trial size or perhaps more useful sort of timing? It feels like this is now going to be a back half initiation, so is it reasonable for us to assume that we'll probably see data in the back half of 25? Secondly, on the existing Agami launch, sales are down sequentially. Now, acknowledging there's no sales effort, is it a surprise to you or can you tell us why sales are not at least staying flat? And then just a point of clarification on the credit agreement. Again, acknowledging you didn't satisfy one of the requirements, is it reasonable to expect that we'll get an update shortly after you cement things with FDA. Thank you.
Vince
Good morning, Colin. This is Vince. I'll take the first of your three-parter. In terms of timelines, we clearly want to have the meeting minutes in hand and digested before we make any definitive statements. And with that, I'll hand over to Colin. Sure.
Colin
Good morning. This is Matt. So to answer your question about Q4 versus Q3, in Q3, remember that we had a fulsome commercial effort for most of that quarter. In Q4, we saw revenues increase 10% versus Q3. We saw our cartons shipped increase by about 8%. That's a pretty tall order considering the fact that we have six corporate account directors in the field versus the 70 reps plus managers we had in the field previously in addition to the CATs. So the CAT team has really punched above their weight to get to this revenue. We've seen some of the contracting efforts in Q4 begin to matriculate. We're seeing more of that in Q1. And we expect to see continued growth.
Colin Bristol
Great, thanks. And then on the credit.
Mehta
Hi, Colin. This is Vimal. As I mentioned that we are closely partnering with our strategic financing partners, both OKC and QIA, and any questions or any conditions that need to be met, they are very collaborative with us, and we update those amendments if needed. So if there is anything needed, we will update you what is needed on the credit account.
Colin Bristol
Thank you, this is helpful.
Operator
Thank you. Next question is coming from Samir Devani from RX Security. Your line is now live.
Samir Devani
Hi, guys. Thanks for taking my questions. I've got just a couple. So I just want to make sure I understand the Tranquility Program strategy correctly. So is it now the plan to get the label expanded first, in-care facilities and then do the subsequent at-homes trial? And if that's the case, what's the marketing strategy in that scenario? And then the second question is just on, maybe this is for Richard, OPEX is significantly lower in the quarter than I had. I'm just wondering if Q4 is a good run rate for Q1. Thanks very much.
Vince
Hi, morning. This is Vince. Again, I'll take the first part of your question. So that is a good way to look at it, right? I think it's also probably reasonable to say that in principle or in theory we could run both studies together, but I think your description is our, the way we look at it, and I think that's a sensible way to approach it.
Rich
In terms of the runway, Samir, yeah, it's probably a good marker, plus or minus a few dollars, but generally a pretty good marker. This is Matt.
Colin
I'll just dovetail to what Vince said. outlined just now, market entry strategy in this market, if you think about going into the care setting, a lot of those are contracted through IDNs, so we're actively engaged with them now, and it's going to take a much smaller footprint to engage with those care facilities and SNFs versus the home setting. So we feel that building a beachhead there makes really good commercial sense.
Samir Devani
Okay, that's great. Thanks very much.
Operator
Thank you. Our next question is a follow-up from Sumant Kulkarni from Canaccord Genoa. Your line is now live.
Canaccord Genoa
Thanks for taking the follow-up. So this might be somewhat of a premature question, but it's still an important one, I think, from a financial modeling perspective. So what are your latest thoughts about eventual commercial pricing of 501 in the Alzheimer's agitation setting, as it appears that the product might be underpriced currently given the potential value it might bring to the table?
Colin
Yeah, so that's a great question, and I appreciate it. I mean, right now, when you look at the price point of Rex Ulti, it's just over $1,400 a month. So there does seem to be some pricing flexibility in that market and one that we continue to examine.
Operator
Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over to management for any further or closing comments.
Mehta
Thank you, everyone, for joining us today and for your continued interest in bioexcel therapeutics. Have a great day.
Operator
Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.
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