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spk05: Good morning. Welcome to the Saraville Therapeutics First Quarter 2021 Financial Results Conference Call. At this time, all participants are in listen-only mode. Later, you will have an opportunity to ask questions during the Q&A portion of the call. Please note that this call may be recorded. I will now turn the call over to Matt Calistri, Vice President of Investor Relations.
spk10: Thank you. Good morning, everyone. We appreciate you joining us for our first quarter 2021 results call. On today's call, you will be hearing from Dr. Tony Coles, our chairperson and chief executive officer, Dr. Ray Sanchez, our chief medical officer, Dr. John Renger, our chief scientific officer, and Kathy Yee, our chief financial officer. We will also have a brief introduction to Abe Cisse, our new president. please refer to our press release from this morning detailing our Q1 performance as well as our updated corporate presentation, both of which are available on our website. I would like to remind you that we will be making forward-looking statements that reflect our current views related to our financial performance, future events, and industry and market conditions, as well as forward-looking statements including the potential attributes and benefits of our product candidates and the format and timing of Cerevel's product development activities and clinical trials. We strongly encourage you to review the information that we file with the SEC regarding specific risks and uncertainties. I will now hand it over to Dr. Tony Coles, Chairperson and CEO of Cerevel, to provide an overview of our achievements and outlook.
spk03: Thanks, Matt, and good morning, everyone. Thank you for joining us for our first quarter 2021 results and business update call. Here at Ceravel, we're building the premier neuroscience company and working to do so in all respects by bringing together the people, the pipeline, and the capital we need to develop new therapies for patients in need. And we've made terrific progress in all three of these essential areas in recent months. On the people front, I'm really pleased that we have welcomed Abe Cisse to our newly created role of president. With nearly two decades of healthcare operating experience, Abe's strong track record of building commercial organizations and broad leadership capabilities is exactly what Cerevel needs as we plan for our successful transition from a clinical stage organization to a fully integrated biopharma company. As president, Abe will oversee strategy, corporate and business development, portfolio and program management, and importantly, he'll be responsible for developing our commercial infrastructure and launch capabilities. I know Abe's going to make a great contribution to Cerevel as we look ahead to introducing new therapies for patients with schizophrenia, anxiety, epilepsy, Parkinson's, and the other debilitating conditions we're focused on addressing. I'd love to turn the call over to Abe for just a moment so he can introduce himself.
spk02: Abe, good morning. Good morning, and thank you so much, Tony. I appreciate the chance to say a few words. I'm so pleased to be here at Cerebell, and I'm really looking forward to working with this talented team to build a business infrastructure we will need for the next phase of our journey to transform what is possible in neuroscience. As everyone on this call well knows, Ceravel is truly an outstanding organization, one with a deep pipeline of promising novel compounds that you do not often see in companies at this stage of development. This is what drew me to Ceravel, the great potential of the pipeline coupled with the fantastic team that Tony and others have built here. I'm truly honored to have the chance to bring my expertise and experience to this exciting organization, and I look forward to all that we will be able to accomplish together. Tony, I'll turn the call back to you.
spk03: Thanks, Dave. We're delighted to have you with us as we continue our efforts to bring new neuroscience therapies to patients and to build out the company. Also on the people front, we recently announced the appointment of Scott Acamini as our chief legal officer beginning later this month. Scott brings extensive legal experience in the biopharma industry, having guided multiple companies as general counsel and through complex, competitive, legal, and regulatory landscapes. We're excited and honored to have both Abe and Scott with us here at Cerevel. Turning now to the pipeline, our portfolio of neuroscience assets consists of five clinical stage programs and multiple preclinical compounds, benefiting from the more than 10 years and over a billion dollars of investment at Pfizer. Through the first part of this year, we've continued our steadied and focused execution on our portfolio. All of the programs remain on track for our anticipated data readout timelines, and we are now dosing in all six of our ongoing clinical trials and have randomized patients into both of the ongoing open-label extension trials for Tavapidon and Derigabat. As we look forward to the rest of this year, we're eagerly awaiting two key data readouts. The first is our Phase 1B study for CVL231 in schizophrenia patients, and the second is our Phase 1 trial for DERIGABAT in healthy volunteers for acute anxiety. We have multiple INDs forthcoming for preclinical programs, including two this year, PCORA and PDE4, both of which are under evaluation for their potential in major depressive disorder. In addition, with the opening of our new facility in Cambridge Crossing, we continue to focus on leveraging enabling technologies such as gene editing and artificial intelligence to identify new drug targets for neuroscience diseases. And finally, as for capital, we were proud to announce last month our strategic $125 million financing for Tevapidon. Through innovative deal-making and thoughtful risk sharing, we have funded the full phase three program for Tevapidon through NDA submission. This transaction also provides us flexibility to allocate capital to our most promising earlier stage assets as they advance into the clinic, and importantly, it extends our cash runway into 2024. So as you can see, we continue to make great progress here at Cerevel as we execute on our near-term priorities build out the capabilities we need for longer-term success, and focus on people, pipeline, and funding. I'd now like to ask Dr. Ray Sanchez, our Chief Medical Officer, to provide the latest updates on our clinical development efforts. Ray?
spk09: Thank you, Tony, and good morning to all of you. As Tony mentioned, we continue to execute well on our extensive pipeline of neuroscience assets. and we are on course for up to eight data readouts by the end of 2023. I'd like to update you on the progress for each of our key programs, starting with CVL231, our M4 positive allosteric modulator, or PAM. We're currently conducting a Phase 1 retrial of CVL231 in patients with schizophrenia. The data readout of both Parts A and B of the trial remains on track for midyear. The goal of this Phase 1B trial is first and foremost to assess the safety and pharmacokinetic profile of CBL231, and we believe we can achieve a differentiated safety and tolerability profile that avoids the gastrointestinal and other side effects seen with other muscarinic agents. The ongoing Part B portion contains a placebo-controlled pharmacodynamic assessment to detect trends in the antipsychotic potential of the compounds. as measured by the PANS total score over six weeks of treatment. Given the strength of the muscarinic mechanism, we do hope to identify a clinically meaningful magnitude of effect that will inform our efficient advancement into the next phase of development. For context, approved agents have, generally speaking, shown an absolute reduction in the PANS total score versus baseline of 10 to 15 points or greater and or a 5 to 10 point benefit on a placebo-adjusted basis. Again, we are expecting data for both Parts A and B in the middle of this year. We're also expecting another data readout for this year for DERIGABAT, our alpha-235 selective GABA-A receptor PAM in acute anxiety. Our phase one proof of principle trial is ongoing and is now expected to read out in the fourth quarter of 2021. We're also dosing in our phase two proof of concept trial in focal epilepsy, known as the REALIZE trial, as well as its corresponding open-label extension trial. Data in focal epilepsy is expected to read out in the second half of 2022. Meanwhile, our Phase III TEMPO program for tevapidon in Parkinson's disease is ongoing. We continue to dose in all three of the Phase III trials, TEMPO III in late-stage Parkinson's and TEMPOS I and II in early-stage Parkinson's. In addition, we're also dosing both rollover and de novo patients in TEMPO4, our 58-week open-label extension trial. We expect data from TEMPO3 in the first half of 2023 and data from TEMPOS1 and 2 in the second half of 2023. Now that I've covered our three lead clinical programs, I would like to hand it over to John Renger, our Chief Scientific Officer, to briefly discuss some of our other programs.
spk11: John? Thanks, Ray, and good morning, everyone. Let's begin with CVL871, which is nearest to entering the clinic, before discussing CVL936 and some of our upcoming INDs. We plan to study CVL871, a D1-D5 partial agonist, in dementia-related apathy. Apathy is among the most common neuropsychiatric comorbidities associated with dementia, afflicting approximately half of the more than 50 million dementia patients globally. It represents a constellation of symptoms, including diminished motivation, social disengagement, and a reduction in emotional responsiveness. These symptoms result in a loss of interest in personal wellbeing and relationships, as well as interference with normal daily functioning, including motivation to eat, to dress, to maintain personal hygiene, or to take medications. The presence of apathy has been shown to be related to decrease in quality of life, increased morbidity and mortality, along with early institutionalization and also significant caregiver burden. Apathy is also a strong predictor of disease progression. We believe that CVL871 could be a potential treatment to address this constellation of symptoms that constitute dementia-related apathy. CVL871 is a D1-D5 partial agonist that has a unique profile from tevapidon, whereas tevapidon drives up to 70% receptor activation of the dopamine D1-5 receptors CBL871 has a lower level of partial agonism and about 40% receptor activation. We believe that this feature makes it an optimal compound for modulating the complex neuronal pathways that control motivation and reward, pathways where the dopamine D1, D5 receptors play a key role. The impact of dopamine activation on apathy symptoms in a clinical setting has been supported by two independent Phase II clinical trials of methylphenidate, a norepinephrine dopamine reuptake inhibitor, which showed improvements on both the NPI apathy global score and the apathy evaluation scale. As you may recall, in March, we submitted an IND for CVL871. We now expect to begin screening in our exploratory phase 2A trial within the next few weeks, and data are expected in the second half of 2022. Next, with respect to CVL936, our D3-preferring dopamine receptor antagonist, I'm really excited to say that we have received a Notice of Award for Cooperative Funding from the National Institute on Drug Abuse, or NIDA, to support its development in opioid use disorder. We plan to initiate preclinical tox studies before continuing our phase one single and multiple ascending dose trials with 936. Finally, as a reminder, and as you all know, we have a robust preclinical and early discovery infrastructure, and we expect to submit two new INDs this year. We are studying CVL354, our Kappa opioid receptor antagonist, also known as ACORA, intended for major depressive disorder, MDD, and substance use disorder. We plan to submit our IND by the end of the second quarter. Additionally, by the end of this year, we hope to submit an IND for CBL-047, our selected PDE-4B inhibitor, which we believe has potential in both MDD and schizophrenia. Overall, in due order to our team's dedication and hard work, We're continuing to steadily advance all of our programs, and we remain on track to meet our expected development timelines. We're really looking forward to multiple data readouts this year, and we're really excited to update you on the continued progress of our portfolio. I'd now like to turn it over to Kathy Yee, our Chief Financial Officer, to review our financial performance for the first quarter of this year. Kathy?
spk01: Thank you, John. Let me start with first quarter 2021 operating results. R&D expenses for the quarter were $37 million compared to $27 million for the same period in 2020. The increase in R&D expenses was primarily driven by advancement of our late-stage and early-stage programs, as well as increased infrastructure costs to support the progress of our pipeline. We expect our R&D expenses to steadily increase as we progress our trials. General and administrative expenses in the first quarter were $14 million compared to $11 million for the prior year period. G&A expense included equity-based compensation of approximately $4 million in the first quarter of 2021 and $2 million in the first quarter of 2020. The increase in G&A expenses was driven primarily by one-time non-cash expenses associated with stock option compensation. as well as infrastructure costs to support the growth of the company. As of March 31, 2021, cash and cash equivalents were $343 million compared to $47.5 million for the prior year period. This cash position does not include our recently announced $125 million non-dilutive financing for Tavapadon, from which we received the first payment of $31 million in April. With this strong cash position and additional payments expected in the next three years, we will fully fund our phase three program for Tevapidon through NDA submission. And we have additional flexibility to allocate capital to earlier stage assets. Overall, we expect our current position to fund our lead clinical assets to the next inflection point, and our expected cash runway is now extended into 2024. We expect that our eight data readouts over the next three years will provide sufficient opportunity to fund the next phase of our program development. I'd like to now hand the call back over to Tony to conclude.
spk03: Thanks, Kathy, Ray, and JR. As you can see, CEREL continues to maintain momentum as we build our company and advance our pipeline. We're laser-focused on execution as we seek to bring new potential therapies to the millions of patients facing challenging neuroscience diseases. We're looking forward to the data readouts we've just discussed in schizophrenia and in anxiety later this year, as well as continued progress in our clinical trials for epilepsy and Parkinson's. And as you've heard today, we also plan to initiate work in dementia-related apathy, substance use disorder, and potentially major depressive disorder. We look forward to updating you on these efforts in the months to come. As always, I'd like to thank our employees who have shown so much passion for making an impact on the lives of patients and their caregivers. I'd also like to thank the participants and investigators in our clinical trials for their continued courageous contribution to the development of our innovative therapies. I can honestly say we could not do without you. Operator, with that, we can now open the call for questions.
spk05: At this time, if you would like to ask an audio question, please press star 1 on your touchtone phone. Once again, that is star 1 to ask an audio question. Your first question comes from Paul Matisse with Stifel.
spk06: Great. Thanks so much, and congrats on the progress. Two questions on – yeah, thank you, Tony. Great. Two questions on CVL231, if you don't mind. First, I would think by now you're either fully enrolled or close to it. Where do you expect the final sample size to end up, and what's your kind of final expectation for how well-powered this study is for the clinical efficacy signal that you might hope to see? And then second, you know, I think the prior safety work that's been done with this compound, you've disclosed safety tolerability at a high level, but not super granularly. I guess... Based on the data that you have, what made you confident that you didn't need to titrate this drug to improve tolerability and retention? And are you still kind of confident in that going into this readout from what you've seen with this trial, at least on kind of a blinded basis? Thanks so much.
spk03: Sure. Thanks, Paul, for the questions. I think I'll ask Ray to take both those questions. So I want to summarize them very quickly, Paul. You talked about the enrollment and then want to have some visibility on our expectation for the final sample size and the potential power to detect a difference or a trend in efficacy. And then you also want to have some understanding about the rest of the profile for 231. So, Ray, why don't you take both of those?
spk09: Yeah. Thank you, Tony. Hi, Paul. Good morning. So, the first one is, yes, we are fully enrolled. As you know, that CVL 2 through 1 design had 25 patients randomized for a total of 75. We expect to get somewhere, given the discontinuation rate, somewhere between 60 to 65 patients or completers that will give us enough information to be able to understand the signal and the benefits of 2 through 1 in terms of its antipsychotic effect as well as all the other The other objectives, of course, safety, tolerability, and the PKA profile as well. In terms of the powering, you know, we're 59% power to detect a seven-point placebo-adjusted difference, and that's typically what has been seen historically with a lot of the atypicals, so that's how we came up with that estimate. In terms of the titration pieces, you know that Part A looked at titration in terms of the top dose of 20 milligrams BAD or the 40 milligrams versus the other doses that were not titrated. And we did not see any significant differences in terms of tolerability or safety when the drug was titrated versus when it was not. So we are not using titration currently and we will of course look at the totality of the data. both on Parts A and Part B, to make a more informed decision as we are developing our Phase II program.
spk03: Thank you, Ray. Also, Ray, just if you could, just clarify the comment on discontinuations. None of those were unexpected or negative in any way, but just amplify that a little bit. It's really par for the course for these kinds of trials.
spk09: Sure, sure. So there's two parameters, of course, that we look at. We look at, you know, the number of patients that we screen in order to randomize into the trial and, of course, the natural discontinuations that occur throughout the trial. And, you know, the discontinuation rate that we experience is quite typical for these types of trials and nothing unusual. So based on the totality of those individuals randomized and the total that we get, we observe a discontinuation rate of close to 20%, which is pretty reasonable.
spk03: That's kind of par for the course. So nothing unusual, no safety signals, nothing to be concerned with. I just wanted to underscore, just so people have a sense of the benchmark for what a standard discontinuation rate might look like depending on the trial. Okay, thanks. Paul, thanks for the question. Operator, we will take the next one.
spk05: Your next question comes from the line of Michael He with Jefferies.
spk04: Hi, good morning, guys. Hi, good morning. Yeah, good morning. Two follow-up questions on 231. Could you remind us about tolerability side effects as it relates to cardiovascular effects? I know that these are transient, but just remind us what would be expected of and or what do other drugs of that class show if we went back to other studies and how would you benchmark that maybe that would set the stage for expectations. And then also I think that you're very nicely running additional PET studies that go along with it. Maybe you could just inform us how that would help drive a decision because I think both doses, I believe, should have pretty high receptor occupancy. So maybe you're just trying to tease out, maybe help out, which would actually be more biologically the right dose to take forward. Maybe you can comment about that as well. Thank you.
spk03: Okay, good. Why don't, actually, I think, Mike, we'll take the second question first, and then we'll come back to the tolerability question you raised. I will say one thing. You asked about other drugs in this class, and I'll just remind everyone that, to our knowledge, this is the only M4 positive allosteric modulator that's being developed. There are other agonist-related compounds that hit M4 and M1, but our whole thesis, of course, is that the selectivity of the M4 mechanism is what provides a potential benefit. So with that, JR, if you would start with the answer to the PET studies, and then we'll come back to the tolerability question.
spk11: Sure. Thanks, Tony. And thanks, Michael, for the question. So, yeah, so I'll just clarify. So we actually have two different sets of PET studies that are ongoing. So one is a receptor occupancy study. And as you know, when you take a compound in a clinic, you make projections about the dose that you want to achieve to test the mechanism, and you base your receptor occupancy projections on typically preclinical efficacy data. So what we want to do is multiple things with the PET study. So one is what we want to understand is what is the relationship in the human brain between the peripheral PK exposure, the drug level in the periphery, and what is the CNS level at the binding site at the receptor in the brain. And so for the receptor occupancy studies, there's a couple of things we're going to get out of this information. One is what is the receptor occupancy across the different concentrations, but also what we want to do is understand particularly going forward into the studies in the late development area, what are the appropriate dose ranges to test the mechanism and really the accuracy of the PET receptor occupancy studies helps us understand what the appropriate dose ranging will be as we go forward in later development. Also, it helps us understand receptor occupancy over the dose timing after the dose. And so you get a C-max and you get a C-troph, and we're really, you know, with the two doses that we've taken forward, as you said, they're really significantly above where we anticipate that we need to be. The difference is between the BID dosing and the QD dosing, what is really the trough concentration and what is the receptor occupancy at the C24, the concentration at 24 hours before the patient takes the next dose. And so it really is a very informative set of data that really helps us with dose ranging and being successful in the next set of studies. We're also doing the dopamine displacement, and that relates what is the receptor occupancy or the binding of the drug at the receptor and its impact on dopamine. And this is really a PK-PD relationship, again, to help us understand dose ranging Because both of these doses are high, we're going to have to pick a lower dose to have an effective dose range as we go forward. I hope that helps, Michael. Back to you, Tony.
spk03: J.R., thank you for that. J.R., why don't you also start a response to the question on tolerability and what we've observed so far in Phase 1, and then we'll let Ray talk about clinical significance of any of those findings.
spk11: Sure. Thanks, Tony. So Michael, as you may be aware, um, we had before entering the clinic, there was a number of tox studies that were done and they showed a transient increases in heart rate and blood pressure. And they were transient in both in two different forms or two different timelines. So transient in that they were briefly increased around the C max time period. But as we dose for multiple days, the effect tolerated. And so what you saw is a bigger effect with the first dose on the first day than you see on the second, third, and subsequent days. And so it was transient both for a short period during the day, but also there was a tolerance that appeared where the effect that we saw in the first dose was larger than we saw in subsequent doses. As you know, the data that we've released so far from the single ascending dose study in the clinical setting recapitulated those transient increases in heart rate and blood pressure. As you know, none of those increases were concerning to the point that anyone was outside a range of what we considered safe and tolerable. And as you know, we've gone through the Part A of our Phase 1B program up to doses up to 40 milligrams per day, which was doses 20 mg BID and 30 mg QD. As you know, those two top doses that we had in Part A were both carried forward into Part B, and we had no concerns about taking those doses forward, being safe and tolerable. And that Part A dosing, as you may remember, was up to 21 days at target dose. And so we feel like we have a good understanding so far with the data we have around safety and tolerability. And with that, I'll turn it back to Tony and Ray. Thank you all.
spk03: There are, Ray, anything you'd like to add either about clinical significance or how we will ensure that we've got a clean and safe therapeutic going forward?
spk09: Yeah, to Tony, just to add to what John mentioned, you know, currently we're very encouraged by the data we've observed. There have been no clinically meaningful changes in blood pressure or heart rate. Obviously, we'll continue to evaluate that as the Part B data reads out, but we're encouraged by what we're seeing, and so we await that. But to date, nothing that's clinically meaningful, and so we're very excited about the potential of this therapy for those patients who need it.
spk03: Okay, good. Thank you, guys. Operator, we'll take the next question. Thanks, Mike, for the questions.
spk05: Your next question comes from the line of Greg Sivanovin with Goldman Sachs.
spk08: Thank you. Hey, Greg. Hey, Tony. Good morning, and good morning to the rest of the team. Congratulations on the continued progress. I've got three questions, if I could. One, the first, just following up on the series of questions on 231. Just wanted to make sure that when we see the data, is the goal to be able to select just one dose to take into your further studies, or is there still a possibility that multiple doses will be evaluated My second question has to do with your 871 program, and I just wanted to get a better understanding of the endpoint. I don't have a lot of experience with apathy trials, and I just wanted to get a better sense of what has been the history with apathy-type trials, if there is one, and I'm assuming perhaps that the endpoint you're using is validated or previously used in other clinical trials. And then my last question, maybe this is for Kathy, is just if we could just discuss the Vapidon financing just a little bit more. I understand from your prepared comments that there was an initial tranche of monies that was, you know, I guess, recorded by the company. And I'm just wondering what the cadence of the next payments for Lapidon are and whether they're tied to certain milestones. Thanks.
spk03: Okay. Thank you, Greg. Let's do them in this order. I'm going to ask Ray to address the question about selection of a dose for the Phase II programs for 231. I will say, and then I'm going to ask them to take your 871 question, but I will say just on 871 and dementia-related apathy, I'll remind everyone that there are over 50 million patients with dementia worldwide. We mentioned this in our prepared comments. It's our belief that about half of them have apathy, but there is no currently approved medication for apathy, which is really a syndrome. that occurs across the various forms of dementia. So this would be a first indication opportunity for apathy in dementia-related disorders. Obviously, we are working very closely with the FDA and had a series of successful conversations with them about how we structure the trials and what we think about in terms of how putting all that together to answer these questions But I just wanted to provide that context, Greg, because there really is no prior experience with this particular approach, and that's why our collaboration with the FDA is so important. So, Ray, why don't you, if you can, just address the dose question for him for anything you want to add to my answer on the 871 apathy comments, and then we'll turn it over to Kathy for expansion on Tavapadon financing.
spk09: Yeah, thank you, Tony. Greg, good morning. So the first question in terms of dosing is, as you know, that part of the objective of the current trial is really looking at the PK profile of the two doses that we're investigating. And part of the exercise for us moving forward, collected with the receptor occupancy trials that John outlined earlier, is really to understand the dose range. So we're going to have to show in phase two and beyond, we will have to show the minimum effective dose as well as the top dose. So the plan really is to look at two doses. What is the minimum effective dose and then what is your top dose? So that's that first question. In terms of the second question on dementia-related apathy, A lot of the work that's been done has been mostly with methylphenidate, as you know, and they use the neuropsychiatric inventory, Part A. We're looking at a series of various endpoints. The neuropsychiatric inventory, Part C, which is broader, adds caregiver distress to the assessment, which is very important. We're also looking at the dementia apathy inventory rating scale, as a whole series of other scales. And really the objective of the Phase 2A trial is really to understand which of these scales is the best for signal detection as well as to show the benefits of this compound in treating apathy. And so working very closely with the FDA, we will look at the collective data as a function of these various scales. and then be able to do the validation work to carve a path forward to registration. So we're excited about the potential, as Tony mentioned, to address the need in this patient population, but it is iterative based on what I just outlined and, again, working very closely with the agency.
spk03: Great. Thank you, Ray. Kathy, anything additional to wrap on financing?
spk01: Yes. Hi, Greg. The payment schedule related to Vapidon financing is fairly in the same range of what we received in April. And these payments are automatic. There is no contingencies or any other milestones tied to this payment. Does that answer your question?
spk08: Yeah. And from a modeling, well, this is a, I guess, more of a cash thing, but is this, given your expected timelines, should we be thinking about another tranche in this year or for next year?
spk01: For next year.
spk08: Okay.
spk03: Thank you. Okay. Thank you, Greg. Good. Thanks, Kathy. I think it is important to note that there are no contingencies on the payments that we expect this year and next. Good. Operator, we'll take the next question.
spk05: Your next question comes from the line of Omar Rafat with Evercore.
spk07: Hi, guys. Thanks for taking my questions. I have a few, if I may. Sorry, can you hear me?
spk03: Yes. I was just saying good morning.
spk07: Oh, good morning. Good morning to you all. I had a couple quick ones on the acute anxiety trial and then one on the Tavapidon deal, if I may. So on the acute anxiety trial, I Is the duration too short to start to understand the addiction and sedation profile? Perhaps you could speak to benzo data from an eight-day duration, whether we should or shouldn't expect much there, as well as your expectations on the 7.5 and the 25 milligram dose. Separately, and maybe, Tony, this might be more directed at you, given all your experience over the years in various companies and various settings, I feel like Tevapidon phase two data speaks for itself, especially in early PD. And most observers would look at that and say, you know what, the clinical risk, especially in the early trial, is fairly limited. So in that vein, it was very interesting to see that the way the deal was structured, it allows investors on Tevapidon to get their cost bases out for the most part on approval alone. And I guess, how did you think about that? To what extent was that part of sort of the negotiation on your end to maybe structure it more on some sort of commercial sales threshold to recover cost bases, et cetera? I'd be very curious. Thank you.
spk03: Okay. Very good. Let's see. Ray, if you'd be good enough to take the questions around Dirigabat and the duration of the trial and the dosing.
spk09: Sure, sure. Thank you, Tony. Good morning, Umar. So, Umar, if you look at the trial we're conducting in anxiety, which is a phase one proof of principle trial, it's a CO2 challenge or hypercapnia model, which, as you know, has been well validated and historically sensitive to anxiolytic medications, including the SSRIs and the benzodiazepines. And so just like J&J, that used this model to make a decision with their erection 1 inhibitor program to go into major depressive disorder with anxious distress. We do think that this is a model that, as you know, induces panic symptoms. And then the objective is really to understand the utility of the compound, in this case, to, in fact, show a signal in treating the panic symptoms that have been induced by the CO2 challenge using the panic symptoms checklist as the primary endpoint. And we're looking at two doses, similar doses that we're looking at in epilepsy, both at 15 milligrams and 50 milligrams a day for 60 and 80 percent receptor occupancies. which we believe will achieve efficacy both as a minimum effective dose and also as a top dose. But importantly, there's alprazolam, extended release one milligram BID or twice a day, which is also used in the J&J OREXIN-1 trials as an active comparator to show what that demonstrates and then juxtapose our data with the data they achieved as well as the data that we achieved, which will then allow us to make an informed decision of what steps to take next in terms of an indication in patients with anxiety. So that's the trial, the model, and the duration of those different cohorts of eight days should be sufficient to show a signal in the panic symptoms that are induced by the model.
spk03: Very good. Thank you, Ray. And then, Omar, to Vapidon, a couple of things I'd say, I think. First of all, the point we made when we announced the deal is, you know, the whole origin story for Cerevel has been about innovative dealmaking. You know, the capture of these particular assets and putting them into Cerevel, Bain's capital commitment as a part of that, Pfizer continuing, and ownership stake both at the origin of the company and in the SPAC pipe transaction. So we've had a lot of, I'd say, creative deal-making around both the origin of the company and we're continuing that in how we think about capitalizing the company as well. One of the things that was really important in this particular transaction was to leverage what I call the power of the pipeline and in both capitalizing the company but funding the assets as well. We've got a wide birth of a broad number of assets and programs, some of which, like Tabapadon, lend themselves to non-equity dilutive financing. And when you think about the strategic direction for the company, the build-out of the portfolio, and the fact that we had an opportunity to do some non-equity dilutive financing, It all came together and made sense because it provides us the maximum amount of flexibility, not just to add dollars to the balance sheet, but in how we designed the transaction itself, which does give us a lot of flexibility. We can pay or repay early. We can repay on the basis of commercial success. I'll remind everyone that this is a risk-shared deal. meaning that there is no recourse, no repayment without approval of Vapidon under the ordinary scenarios that we've talked about. So it just gives us an enormous amount of flexibility, and I'm particularly interested. I enjoy the deal-making aspect of what we do in this business and thinking creatively about how you advance a pipeline. Obviously, we'll use this as one of the many levers that we'll think about for capitalizing the company, But I love the strategic nature of this, the flexibility it creates, the opportunity to repay at different time points at our option and at our discretion based on what we see. And then I importantly love the risk sharing aspect. So more to come on all the progress that we're making in the clinic. But just keep in mind that we really want to continue this heritage of strategic deal making. Operator Will, we'll take the next question.
spk05: At this time, presenters, there are no further questions. I will now turn the call back to Tony Coles for closing remarks.
spk03: Okay. Well, thank you, guys, for joining us this morning. This is our second official call as a public company. We appreciate your support, and particularly the support of both the employees and the people who make our trials possible, importantly the patients. We look forward to future updates. Everything so far is on track, and we are delivering as we said at the beginning of our conversation about the kind of company we want to build and becoming the premier neuroscience company. So we've got a lot of potential shots on goal. We've got a terrific team. Happy to have Scott and Abe with us now. So I think we've got all the elements that we need to create the kind of success we hope we can. Thanks for joining us this morning, and we look forward to our next update. Thank you.
spk05: Thank you. This concludes today's conference call. You may now disconnect.
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