Xenon Pharmaceuticals Inc.

Good afternoon and thank you for standing by. At this time, I'd like to welcome everyone to Zenon Pharmaceuticals Inc. Third Quarter 2024 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press start, followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I will now turn the conference over to Chad Fugier, Vice President of Investor Relations.

Please go ahead sir.

Good afternoon. Thank you for joining us on our call and webcast to discuss Zenon Third Quarter 2024 financial and operating results. Joining me today are Ian Mortimer, Zenon's President and Chief Executive Officer.

Dr. Chris Kenney. I'm just gonna jump

in for Chad. So Ian will begin with a summary of our recent progress across our business. Chris Kenney will provide an overview of our clinical stage programs and ongoing outreach to the medical community. And I will close with a summary of our financial results and anticipated milestones. We will then open the call up for your questions. Please be advised that during this call, we will make a number of statements that are forward looking, including statements regarding the timing of and potential results from clinical trials, the potential efficacy, safety profiles, future development plans and current and anticipated indications, addressable market regulatory success and commercial potential of our and our partners product candidates, the efficacy of our clinical trial designs, our ability to successfully develop and achieve milestones in our clinical development program, the timing and results of our interactions with regulators, our ability to successfully obtain regulatory approvals anticipated timing of the top line data readout for our clinical trials of the Zetu-Kelner and our expectation that we will have sufficient cash to fund operations into 2027. Today's press release summarizing Xenon third quarter, 2024 financial results and the accompanying quarterly report on form 10Q will be made available under the investor section of our website as -.com and filed with the SEC and on Cedar Plus. Now I'd like to turn the call over to Ian.

Thank you Sherry and good afternoon everyone and thanks for joining us on our call today. We have made significant progress over the past quarter consistent with our overall strategy of being at the forefront of discovery and development of ion channel therapeutics. And our focus hasn't changed to maximize the full potential of our lead product, Zetu-Kelner, to build upon our leadership position in the KV7 space and to continue to mature our promising ion channel pipeline. Xenon's leadership position in the KV7 field is unmatched as a Zetu-Kelner represents the only highly potent and selective KV7 potassium channel opener in clinical development for multiple indications that is backed by long-term efficacy and safety data in patients living with epilepsy and encouraging proof of concept data in patients with major depressive disorder. Within our portfolio, we remain focused on three key areas. Continuing the execution of our phase three Zetu-Kelner epilepsy program while raising the profile of Zetu-Kelner with both physician and patient communities, advancing our phase three Zetu-Kelner MDD program with a focus on Xnova2, which is expected to initiate before the end of this year and expanding our pipeline. Both through the advancement of our portfolio of next generation ion channel modulators as well as further potential indication expansion of Zetu-Kelner. As I said earlier, Xenon's leadership in the KV7 landscape is unmatched. Zetu-Kelner represents the most advanced clinically validated potassium channel modulator in late stage clinical development. Our substantial clinical experience with Zetu-Kelner includes robust long-term efficacy and safety data with over 600 patient years of exposure in focal epilepsy patients. Importantly, we have generated highly compelling double-blind efficacy data from our EXTOL study that we believe demonstrates the best placebo adjusted results ever seen in a clinical study in patients with focal onset seizures. In our EXTOL open label extension study, we are seeing patients experience the long-term benefits of seizure freedom and improved quality of life as well as a favorable safety profile. We believe that Zetu-Kelner represents a potentially best in class anti-seizure medication that could be paradigm shifting in the treatment of epilepsy. In addition to the impressive efficacy data generated to date, Zetu-Kelner has other important attributes, such as once daily dosing without the need for titration, rapid onset of effect, novel mechanism of action, and potential mood benefit. The body of compelling clinical evidence that we have amassed to date continues to generate significant excitement from physicians and key opinion leaders as they see the potential of what Zetu-Kelner could mean to the epilepsy community. As we continue to educate key stakeholders around the benefits of Zetu-Kelner, Xenon will have an increased presence at the upcoming American Epilepsy Society meeting, or AES, taking place December 6th through the 10th in Los Angeles. We'll have new data presentations and updated results from our ongoing XTOL Open Label Extension Study. Patients in the XTOL OLE have now been on drug for at least three years, with some patients in the OLE having more than five years of exposure to Zetu-Kelner. We continue to see better efficacy in the open label extension, the longer patients are on drug, and many patients are experiencing the long-term benefits of seizure freedom and improved quality of life, and we're excited to present this new 36-month data at AES next month. We believe this long-term data package will support our regulatory filings on the pathway towards commercialization and is a key differentiator when compared to other molecules in earlier stage clinical development. Further, we are in an incredibly fortunate position in that Zetu-Kelner's attributes enable significant potential across both epilepsy and neuropsychiatry, including MDD and potential other indications. Physicians who treat MDD are looking for medications with novel mechanisms and favorable product profiles, such as the ability to address anhedonia, demonstrate a rapid onset of effect, or avoid adverse effects that are seen with standard of care agents, such as sexual dysfunction or weight gain. As we shared last quarter, clinical site planning is well underway, and we expect to initiate our phase three MDD program before the end of this year. 15 years beyond Zetu-Kelner to our broader pipeline. Our discovery team has applied its many years of experience in ion channels to advance multiple KV7 product candidates that are chemically diverse from Zetu-Kelner so that we can leverage the target's pipeline and the mechanism potential, providing us with numerous clinical development opportunities across a broad range of therapeutic indications, including seizure disorders, pain, and neuropsych conditions, and ultimately extending the reach of this differentiated mechanism to even more patients in need of better therapeutic options. Today, we have multiple KV7 candidates in our pipeline, and IND enabling work is currently underway to support our goal of filing an IND or equivalent for the first of these candidates in 2025. Staying on the topic of our early stage pipeline, we continue to make meaningful progress within our NAV 1.7 sodium channel program as well. We are proud of Xenon's pioneering work to identifying promising genetic targets associated with rare phenotypes. It was through these efforts that the connection was made between individuals who had the inability to perceive pain and the complete loss of function mutations in the gene encoding for NAV 1.7. Inversely, individuals who experienced non-precipitated spontaneous severe pain correlated with NAV 1.7 gain a function mutation. This identification of NAV 1.7 as an important pain-related target also offered the possibility of a new class of pain medications that are not burdened by the liabilities of opioids. Importantly, we believe that NAV 1.7 has by far the strongest genetic validation amongst pain targets, and we continue to pursue the development of novel -opioid-based pain medications. And while the development of ion channel therapeutics is certainly a complex challenge, we are applying all of the knowledge gained from the past molecules to advance novel, selective NAV 1.7 inhibitors within our portfolio of next-generation modulators. Currently, ion DNA enabling work is underway with a lead NAV 1.7 development candidate in support of our goal of filing an IMD or equivalent in 2025, enabling us to generate important, de-risking proof of concept data. In addition to NAV 1.7 and KV7, we are also advancing potentiators of NAV 1.1 with the aim of addressing the underlying etiology of Dravet syndrome and delivering a disease-modifying therapy in support of our hypothesis that a precision medicine therapy for Dravet syndrome should restore NAV 1.1 activity specifically without impacting other neuronal functions or proteins. We look forward to presenting some of our preclinical NAV 1.1 data, including protection against spontaneous seizures and SUDEP, as well as strengthening long-term potentiation at the upcoming AES meeting. These data support an incredibly compelling profile for a small molecule NAV 1.1 potentiator when compared to other drugs available and in development to treat Dravet syndrome. Finally, as I continue to reiterate, it's an exciting time for Xenon due to the advancement of our clinical programs and our progress towards commercialization. In August of this year, Dr. Matthew Ronchheim joined our senior executive team as chief operating officer based in Boston, overseeing our R&D operations and providing strategic and operational leadership for our pipeline of small molecule programs and preparation for the anticipated commercial launch of the Zetecalner. Matt's extensive operational, pharmaceutical development and manufacturing expertise are important as we expand our phase three programs, plan for regulatory submissions and commercialization, as well as progressing our broad portfolio of early stage assets. Matt has already made a positive impact and we look forward to his continued leadership. With that, I'll now turn the call over to Chris Kenny to provide a brief overview of our clinical stage programs and our ongoing outreach with healthcare providers at key medical congresses. Chris, over to you.

Okay, thanks a lot Ian. I'm pleased to report that our late stage clinical development programs for Zetecalner are progressing as planned. Our phase three epilepsy program includes XTOL2 and XTOL3 in focal onset seizures and exact and primary generalized tonic-clonic seizures. Importantly, the first top line focal onset seizure data readout from XTOL2 is anticipated in the second half of 2025. In support of an anticipated NDA filing, we plan to submit the results from XTOL2 along with the existing data package from XTOL and additional safety data from other clinical trials. In parallel with the significant progress made across our phase three Zetecalner programs, our medical affairs team continues to engage with the broader medical community to highlight the robust scientific evidence generated to date. We're in an enviable position as not only can we showcase the positive results from our completed XTOL trial, but we have our ongoing seven-year open-label extension study providing further long-term data from patients living with epilepsy, which we believe is a key differentiator from other molecules currently in development. To give you a sense of some of these interactions, in September, we attended the European Epilepsy Congress, which attracted more than 3,600 delegates from around the globe. Xenon had a strong presence, presenting three posters and hosting a scientific exhibit. We successfully engaged with key opinion leaders, prescribing clinicians, and principal investigators from our study sites. Many of our discussions centered around the XTOL data, which we believe demonstrate the best placebo-adjusted clinical efficacy in the most refractory patient population trial, as well as a favorable tolerability profile in adult patients with focal-onset seizures. Furthermore, we continue to receive strong feedback from the epilepsy community on the long-term efficacy data from our XTOL open-label extension study, which shows increased seizure reductions with patients on a ZETU calendar out to 30 months experiencing a greater than 90% reduction in median monthly seizure frequency. Additionally, approximately one in four patients on a ZETU calendar for at least two years in the XTOL open-label trial have been seizure-free for a full year or longer, giving both us and the epilepsy community tremendous confidence in the ZETU calendar's potential to address the significant need for new anti-seizure medications. These data are particularly impressive, given that the literature concludes the likelihood of achieving seizure control once a patient has failed three anti-seizure medications is less than 5%. And we believe that future open-label extension data updates, including our upcoming 36-month data set at AES, will continue to strengthen our leadership position. Physicians regularly treating epilepsy patients are impressed by the ZETU calendar data gathered to date, noting that it sets an incredibly high bar, not just for other KV7 drugs in earlier stage clinical development, but other anti-seizure medications within the current treatment landscape. This is especially true when considering some of the ZETU calendars potentially differentiating attributes, such as its positive impact on mood. Our outreach to the medical community is not limited to epilepsy. We're also engaging with prescribing physicians in the MDD space. With our phase three MDD program, the first of three planned phase three clinical trials examining a ZETU calendar in major depressive disorder, is anticipated to initiate before year end. At the end of October, we attended the site Congress in Boston, giving us another key opportunity to interact with physicians in the MDD space and present our phase two ex nova data, discuss the potential use of a ZETU calendar as a treatment for MDD, and outline our near term plans to initiate a phase three program in major depressive disorder. We continue to emphasize the ZETU calendars potentially differentiated profile versus standard of care agents in MDD, as physicians continue to have a particular interest in a ZETU calendars novel selective KB7 mechanism of action and its potential benefit on anhedonia, rapid onset of effect, as well as its potentially favorable tolerability profile, with no notable adverse effects on sexual function or weight gain. We have the benefit of being able to reference not just the ex nova data for efficacy, but also the long-term tolerability data gathered from our ongoing XTOL open label extension study. We're excited to be advancing another late stage clinical development program for ZETU calendar, with the hope of addressing the needs of patients diagnosed with MDD, who are still struggling to find effective treatments. We also continue to support the investigator led MDD study conducted by Dr. James Murrow of Mount Sinai School of Medicine and Dr. Sanjay Matthew at the Baylor College of Medicine. This 60 patient placebo controlled phase two trial has a functional primary endpoint with the objective of evaluating the effect of a ZETU calendar on brain measures of reward, as measured by the change in activation within the bilateral ventral striatum from baseline to end of treatment at week eight, as assessed by functional MRI. Also, the study is evaluating secondary endpoints that include MODRUS and SHAPS. Patient enrollment was recently completed and results anticipated in the first half of 2025. Now looking ahead, we're incredibly excited to expand our presence at AES this year as part of our ongoing outreach to the medical community. As the premier epilepsy conference, AES is an important venue for us as we continue to strengthen our profile and reputation as a leader in epilepsy, laying the foundational framework for a successful future potential launch in epilepsy. We have scheduled numerous meetings with physicians, key opinion leaders, academic leaders, and patient advocacy groups. I'm extremely proud that we have five accepted abstracts at this medical meeting and look forward to presenting these posters, including an update to our XTOL open label extension study. We have expanded our presence in the exhibit hall and are eager to welcome all visitors to the Xenon booth who are interested in learning more about Izetu Kalner and our broader pipeline. I'll now turn the call over to Sherry, who will provide an overview of our third quarter financial results and upcoming milestones. Sherry?

Thanks, Chris. Looking briefly at our third quarter financial results, as of September 30, 2024, we had cash and cash equivalents and marketable securities of 803.3 million, compared to 930.9 million as of December 31, 2023. Based on current operating plans, including the completion of the Izetu Kalner phase three epilepsy studies and fully supporting late stage clinical development of Izetu Kalner and MDD, we anticipate having sufficient cash to fund operations into 2027. I'd refer you to our news release and 10 key report for further details around our financial results. We anticipate that 2025 will be a pivotal and transformational year for Xenon with several important milestones on the horizon. First and foremost, we're driving towards the highly significant data readout from XTOL 2 expected in the second half of 2025. Importantly, positive results from XTOL 2 will enable the submission of our NDA with the goal of advancing Izetu Kalner towards commercialization. In the MDD program, we're anticipating results from the investigator sponsored phase two proof of concept study of Izetu Kalner and MDD in the first half of 2025. In addition, our company sponsored broad phase three MDD program will be well underway with the initiation of ExNova 2 anticipated before this year end. As we continue to advance our early stage preclinical pipeline, we anticipate filing multiple INDs or equivalent in 2025 with the goal of initiating first in human trials across multiple targets, while also exploring other potential indications for Izetu Kalner that may be well suited for late stage clinical development. With this in mind, we have built a foundation of strong thoughtful fiscal management, which positions us to execute on our planned strategies to advance Izetu Kalner through late stage clinical development in both epilepsy and MDD, while at the same time supporting a robust pipeline of next generation ion channel therapeutic candidates. To summarize some of the key takeaways from today's call, we believe strongly in Izetu Kalner's compelling clinical profile, which is built on its unique mechanism of action and supported by the meaningful body of clinical data we've generated thus far. We're excited to engage with key patient and physician communities to raise further awareness about the potential of Izetu Kalner in the future treatment of epilepsy at the upcoming ADS meeting, where we will also present the latest data from our ongoing XTOL OLE study. For those of you on the call attending AES, we look forward to connecting with you in Los Angeles. And looking slightly further out, we look forward to connecting at the upcoming JP Morgan Conference, which will give us an opportunity to kick off the year and outline our key goals for 2025 in more detail. I hope you share our excitement as we continue to execute our clinical development plans and anticipate these key events next year. Thank you for your attention today, and we look forward to sharing more in the coming months. I'll now ask the operator to open the line for any questions.

Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. And we do request for today's session that you please limit to one question only. Your first question comes from the line of Paul Matys with Stifel. Your line is open.

Hi there, this is Julian for Paul. Thanks so much for taking our question and congrats on the progress. Just wondering if you could provide a little bit of color, again, on enrollment dynamics and whether things are tracking according to your expectations, any other details or learnings perhaps since our last quarterly update. And then secondly, quickly, just on the NDD investigator-sponsored study, I'm just curious on how you perceive that study, either reading onto or not reading onto your phase three pivotal program and thus confidence in execution of your own study. Thank you.

Thanks very much for the question. So I'm happy to take the first one and

maybe start on the second one. And Chris Kenny, you can provide your perspective on the IST and MDD as well. Yeah, obviously we get a lot of questions on just how we're doing in the phase three epilepsy program. We're really comfortable where we are. I'm not sure anything's changed in the last quarter to your very specific question. I would always remind people that I think we have more experience kind of in the contemporary clinical trial environment of executing large focal epilepsy studies. So we're very comfortable on where we are. Obviously we always give the best information we can and currently the guidance for XTOL-2 is to have top line data in the second half of next year. So I don't think there's anything specific that you haven't heard from us and seen from us that I need to add to that answer. In terms of MDD, yeah, I'll give maybe a perspective on the read through to what we're thinking about. And then Chris can just remind the group what we expect to see from that study because the end points, Chris mentioned in his prepared remarks, but they are slightly different than what we would look at on the sponsor side. We've always said that these are two really important KOLs in terms of the group at Mount Sinai and at Baylor with Dr. Murrow and Dr. Matthew. And they had done a lot of the early and pioneering work around this mechanism in major depression. And so we're very happy to support them in terms of drug supply and collaborate with them. They're key collaborators with us. That said, it's a small IST at two medical centers and it's not something that we're reading through to our own MDD program. We've committed to running three phase three clinical trials in major depression with the 20 milligram dose of a Zetu Kalanur. And as we mentioned, the first of those studies, ExNova2, we've made really nice progress and that'll be up and running shortly. So really no read through in terms of what that study may show. It looks like we'll have top line data from that study in the first half of 2025. Chris, do you wanna add your perspective?

Sure, just as a reminder, the investigator initiated trial has enrolled 60 patients, one arm in placebo and one arm in active. And as a reminder, our ExNova study had like 168 patients. And as we go forward into phase three, our phase three studies are gonna have 450 patients. So I'm just trying to make the point that the investigator initiated trial is relatively small in size, 30 patients per treatment arm. And so it's underpowered from the standpoint of the clinical outcomes like MODRAS and SHAPS. What it is powered for is to show improvements in FMRI based upon the FMRI work that was done with azogabine and moderate to severe depression. And so it will be interesting. I think two things will be interesting from that study. One is, is there a readout on FMRI, which is it's a bit academic, but it's still be quite interesting to understand why this mechanism is helpful in major depressive disorder. The hypothesis is that it helps out with the reward circuit. So that'll be interesting. But to Ian's point, it's not gonna gate our phase three plans. And the other thing that, I think this study will be interesting is, we saw great tolerability in our phase two study. And so it'll be nice to confirm that or confirm or refute that when we see those results next year.

That's all I have, thanks.

Thank

you, operator. We can go to the

next question.

Next question comes from the line of Tessa Romero, with JP Morgan. Your line is open.

Hi team, this is Caroline Pocher. I'm for Tessa Romero with JP Morgan. Thanks for taking our questions. So first from us, when can we expect to learn more about the clinical profile of the lead NAV 1.7 candidate, including the level of receptor occupancy and potentially its signing site? And then if I could just sneak another one in, based on your prepared remarks, it sounds like a proof of concept study is in the cards for next year. Could you just frame what such a study could look like for NAV 1.7? Thank you.

Great, thanks very much. I'm happy to take that one. Yeah, we've been, I think a lot of the overall properties, you've hit a couple receptor occupancy and binding site. I mean, it's even broader than that in terms of just the selectivity profile, the bio-distribution. There's a number of things that we track that I think we've learned a ton from the field. We haven't provided a lot of that information publicly and I don't think you're gonna hear a lot from us. I think that's really important learnings that we've made that we're incorporating into our program that we're not sharing broadly. But needless to say, we believe we have the right profile of molecules to really run the correct human experiment to see whether selective NAV 1.7 sodium channel inhibition with high receptor occupancy can provide analgesia. So I think we're very comfortable that we have the right profile to test the hypothesis in humans, which what we're really excited about. In terms of the clinical development plan, so the initial study will be a standard, first in human study, sad, mad. And then when we talk about proof of concept, not fully designed yet, but probably is no surprise. We're really thinking about running a proof of concept study in bunionectomy. So we're starting to bring all of that planning together. But first step would be to get through GLP toxicology

and file an IND and get into the first in human studies.

Next question comes from the line of Andrew Chai with Jeffries, your line is open.

Hey, good afternoon. Thanks for the updates. Thanks for taking my question. Maybe a brief question is just for the ongoing ex-tol studies, ex-tol two and three. What are you assuming for the placebo rate on seizure reduction? Is it similar to what you saw in the phase two B? And how are you controlling for placebo risk if there is one? Thanks.

Thanks, Andrew.

Chris,

maybe I'll start

because I might take the question in a little bit of a different direction, Andrew, just to provide a little bit of context and perspective that I think would be helpful. And then Chris, maybe you can just weigh in on controlling the placebo rate in epilepsy studies in terms of jurisdiction and quality of sites that we're working with. But Andrew, in terms of our modeling, because I think the question really comes down to what are we comfortable with in terms of the study design and the powering and the statistical analysis. So what we've done is we've looked at all of the data we generated in the ex-tol study. Obviously that was a large forearm study, three active doses in placebo. And that's really forms the basis of our statistical model on powering. So we've used the actual placebo rates, which if you recall from our ex-tol study, but just as a reminder, that was kind of in high teens in terms of the placebo rate. And that's kind of what we expected going into the phase two study. So I think it was really well executed and what we would expect. And then we can take those actual data in terms of the placebo rate, the active rate, the standard deviation into our model for phase three. And as I think what we said previously is that the high dose of 25 milligrams, we have more than 99% power and we have around 90% power for the lower dose of 15 milligrams. And so in terms of the sizing of the studies, we really went off that lower dose because we have considerable power at the high dose. Chris, maybe just so you can comment on the execution of phase three in terms of placebo rate.

Yeah, I mean, one of the luxuries of epilepsy compared to other areas of neurology or psychiatry is the translatability of the data going from phase two to phase three. But that said, there are several things that we're doing to try to mitigate the risk of an increasing placebo effect. And it largely has to do with geography. So there are known geographical regions where the placebo effect in epilepsy is higher relative to others. And the other thing that we've used is to target experienced sites, not just experienced sites based upon other drugs, but actually sites that have experience working with a Zetu calendar. And then we've also been fairly picky about the sites in general that we allow into the study in terms of their experience with epilepsy. So you could potentially open up a study like this to many other sites. And we've been quite choosy. And most all of our sites have dedicated expertise within epilepsy. So those are the main ways in which we're working on mitigating the placebo effect going from phase two to phase three.

Awesome. And Chris, I'll add, and Andrew, I'll add one more, which I think is really interesting, is the use of electronic diaries. And when we were initiating the EXFOL study, that was a real conversation internally, because it was where it seemed to be a transition between companies using and sponsors using paper diaries or electronic diaries. And obviously, we can't run the experiment twice, but I think we do have a feeling internally that the electronic diary and the technology that we used in phase two, and we're using electronic diaries in phase three as well, has helped on that side, because we're continuously reminding patients to enter in their seizure data. And we can track that real time in

the cloud to make sure that there's not missing data. I think that's also beneficial.

Next question comes from the line of Brian Abrahams with RBC Capital Markets. Your line is open.

Hi there. Thanks for taking my question, and congrats on the continued progress. As we head into AES, I'm wondering if you could talk a little bit more about what some of the highest-focused elements of the 36-month data will be relative to prior cuts. Your level of confidence in the continued safety process, and then some of the key aspects that you're going to be highlighting and seeking input on there as you ramp up your presence and engagement. Thanks.

Thanks, Brian. Yeah, really important questions.

I think this AES is really the most important medical congress in epilepsy, and it's a huge amount of planning for our team going into it. We're going to have an incredible presence there. We're really excited about showcasing all of the work we're doing across the portfolio. So maybe I'll start, and both Chris Kenny and Chris Von Sager to provide their perspective as well, because both of their teams are going to have a really large presence there, both as we continue on our medical communication side as well as the preparation on the commercial side of the business. But I'll give my perspective initially on the 36-month data. So the nice thing is, Brian, you've seen the OLE data cuts from us before, so you're going to see consistency there. You're going to see all of the patients have gone through 36 months. We have a cut of those data where we can show what the population looks like in terms of the seizure reduction. And as we've mentioned, we've seen improved seizure reduction over time for those that stay on drug, just as a reminder. The second thing we'll see is just what the seizure freedom rate is. And that number continues to go up because patients are on the drug for longer. And so for that 12-month seizure freedom rate, which is really kind of the focus of the clinical and medical community, is that more patients have the opportunity to have that 12 months of seizure freedom. So we're excited to be able to communicate that. I don't want to lose the point that Chris Kenny made in his prepared remarks. You shouldn't, you know, if we look at the literature, that this patient population, given the number of drugs that they have failed, and kind of the refractory nature of them, we really shouldn't be seeing seizure freedom, or the literature would suggest it should be less than 5%. But we've seen considerably higher seizure freedom in our 24-month cut of the data last year, and we'll be updating it for 36 months this year. And on the safety side, you know, one of the things, again, that gives us a lot of confidence is we've seen a real consistency in the safety profile. So we will provide a safety update. But the types of adverse events that we're seeing in the double-blind period is consistent with what we're seeing in open-label extension as well. So as we mentioned, now that we have patients over five years of dosing, and we have over 600 patient years of exposure, we're really understanding the adverse event and safety profile over all of the molecule, and have real comfort and confidence around that. But Chris Kenny, why don't you start with your perspective, and then Chris von Seger, and I know this is a big meeting for your team as well.

Yeah, it's our Super Bowl. We have a lot going on at AES, above and beyond the open-label extension poster, but that's what, Brian, you focused the question on that. I think Ian covered it pretty thoroughly. The only thing that I'll add is that we'll also have retention rates out for a longer period of time, not just at one year and two year, but out to three years. And I think what we're seeing is that patients who, you know, once they reach two years, they really tend to stay in the study for a long time. And just to build on what Ian said about seizure freedom, just the longer that study goes, the longer we're able to look at seizure freedom over longer periods of time. I think you'll be impressed with the data. Chris?

Yeah, and beyond just the data platform itself, which we're really excited about, AES reference, that's a phenomenal opportunity for us to engage with potential future prescribers in this marketplace. And we think about AES as a high concentration of epileptologists and broader neurologists with a focus on epilepsy. And our team is going en masse in order to have the opportunity to interact with as many potential, both key opinion leaders as well as potential future prescribers in this marketplace as possible to hear feedback on a depth to calendar, the profile, and how it could potentially fit into a marketplace. So this meeting represents, as Chris has already mentioned, our Super Bowl for not just data, but the opportunity to interact with a number of leading positions in the space.

Next question comes from the line of Brian Skirney with Beard. Your line is open.

Hi, this is Luke on for Brian. Thanks for taking the question. On FOS, can you share your current thinking on bringing Azetocalinar into development for pediatric patients? And is this something that could commence ahead of XTOL2 data? And is there anything unique from XTOL2 in how you would conduct a study? Thanks.

Thanks, Luke. Yeah, good questions. We haven't actually talked about the pediatric development probably for a few quarters now, so a nice reminder. So yes, we have agreed upon pediatric plans with both FDA as well as EMA. So we know exactly what we need to do to bring the molecule into younger patients. So just as a reminder, in FOS, XTOL2 and XTOL3 are focused on adults. Actually, in our primary generalized tonic-lonic seizure study, we're going down to -year-olds, so that was based on some FDA feedback. So that study is looking at 12 and above. But we have an agreed-upon plan, and essentially you go through younger cohorts of patients over time. There's nothing specific in the XTOL2 data that we're looking for that necessarily informs there. A lot of the work we're doing is really the pediatric formulation, juvenile toxicology, the other work that we need to do to get into younger patients. So a lot of that work is happening in parallel, and then over time you'll see kind of these age groups of cohorts as we step down all the way into very, very young patients over time. So the pediatric plan is ongoing kind of in parallel in the background, and you'll start to see some clinical development over the next couple of years in younger FLS patients. And then as I mentioned, on the primary generalized side, we're already down to age 12.

Yeah, the only thing I'll add to that is that you asked a question about, Luca, you asked about the unique take on the pediatric. The only other thing that we need to take into account is that, of course, those patients are lighter in weight, so we have to make dose adjustments. But that's it. Otherwise, Ian covered everything. Thanks.

Next question.

Thanks, Luca.

Next question comes from the line of Jason Gerberi with Bank of America. Your line is open.

Hey, guys. Thanks for taking my question. Mine just is a patent question, actually. So specifically your food effect patent. My understanding is the strength of these patents tends to be, can you get some sort of incorporation in the product labeling around the food effects such that generics wouldn't be able to eventually one day carve it out in their own insert? So just wanted to get your confidence when you think about the Phase III study protocol and getting label language around a recommendation for dosing close to meal time, which I think is sort of key to that bioavailability argument with that patent.

Thanks, Jason. Thanks, Jason. I think you framed it really well. Sherry, you can go into the details on our approach.

Yeah, I won't get into too much detail on this, Jason, as I'm sure you can appreciate. There are some sensitivities around this. But look, overall, we're very comfortable in this food effect patent, but more broadly in our patent portfolio, which takes us out to 2030. So we're not seeing any food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but we're seeing some food effect patent in the 2019-20, but yes, we have been dosing a Zetucalner with food in proximity with the evening meal through our phase two study X-Tol as well as in phase three development, both in our epilepsy program as well as in MDD. So we do reasonably expect that that will be on label at the end of the day, given that's how the drug has been dosed, and not doing so would potentially have implications on both or either of efficacy and tolerability.

Next question

comes from the line of Sarah Schwarm with William Blair. Your line is

open. Hi, congrats on another great quarter and thanks for taking my questions. So given what we know about other sodium channel targeting therapeutics in the clinic to treat pain, would you expect to pursue both acute and chronic pain indications, or do you anticipate a little bit more of a narrow focus? I know you mentioned bunionectomy studies earlier, but is there kind of anything specific to NAV1.7 that would be more well suited to one pain setting or the other? And relatedly, given your expertise in ion channel chemistry, would you ever look to develop a NAV1.8 inhibitor or do you see that space is increasingly crowded here?

Thanks. Thanks, Sarah. Yeah, happy to answer those questions.

So a priori, the target of NAV1.7 does not lend itself just to acute or chronic, nociceptive or neuropathic. So as we sit today and with the caveat that it's still early days, this is still a preclinical asset, I think we want to do a proof of concept study like bunionectomy to show target engagement and that we can get an analgesic effect. But as we think about the mid and later stage clinical development, nothing's off the table right now. So I think we would be looking at all of those things because, as I mentioned, kind of going into this, we're not guided one way or another based on the genetics or based on the target. In terms of NAV1.7 versus 1.8, that's a question we often get. We like 1.7 as a target, a number of reasons. We think the genetics are stronger. I think you mentioned it's a less competitive space. I think it's been harder chemistries. And I think we have a real leadership position there that we can capitalize on. We have some other ideas on where we may want to go, which we haven't really talked about publicly, but we don't have a formal NAV1.8 program just to address that question head on. We've really focused on NAV1.7 because I think it is a target where we're

uniquely suited to be able to run the human clinical experiment.

Next question comes from the line of Paul Choi with Goldman Sachs. Your line is open.

Hi. Thanks for taking our question. Clinicaltrials.gov is currently showing that the XTOL3 study will reach primary completion just four months after XTOL2. So presumably the top-line results should be available roughly or concurrently with your planned NDA filing for azeptic ulnar following XTOL2. So can you maybe just update us on your latest thinking of how XTOL3 might figure as part of your data strategy for your filing? Will it be included in the NDA or is it primarily for the European filing? Just your latest thoughts there would be great. Thank you.

Yeah, thanks, Paul. I'm happy to start. Chris, if you've got comments, please add in. Yeah, I mean, we said for some time that we've prioritized XTOL2 over XTOL3, and that's being pulled through a couple of different ways. One, XTOL2 was just initiated before XTOL3 in terms of those first clinical sites up and running. We also prioritized a number of the sites that had experience with the molecule into XTOL2. And we did have a bias in jurisdiction as well, where these studies get up and running generally quicker in the US than they do in some other jurisdictions. And so we've biased a number of those sites into XTOL2. And the priority and the focus on XTOL2 is really because that's on the critical path, as you've mentioned, to filing the NDA and commercialization in the US. In terms of XTOL3, yes, we think it's important for filing in jurisdictions outside of the US. So you're absolutely right there. And it's really important for our overall safety database. So, you know, obviously we think about safety in terms of the requirements under under ICH, but also just exposures in the labeled population. So, you know, I think we're going to have a huge we've talked a lot this afternoon about our long term exposure. We're going to have lots of long term exposure, but I think we're going to have a lot of unique exposures as well, both with XTOL, XTOL2, XTOL3 and XACT and all of the open label work. So I think that kind of provides the perspective in terms of how the interplay between the two studies. Chris Kenny, anything that I missed?

No, you didn't miss it, but I just think it's really worth emphasizing that we are positioning the XTOL study as our first pivotal trial in focal onset seizures. Once we get the second trial, presumably XTOL2, we will submit the NDA so that there will be no hold up waiting for XTOL3 to submit the NDA. I just want to be just want to make sure that's absolutely clear.

Next question comes from the line of Daniel Brill with Raymond James. Your line is open.

Hi guys, thanks so much for the question. Chris, you commented during the prepared remarks that in XTOL, a ZETU calendar demonstrated the best placebo controlled efficacy to date. If the effect size happens to diminish in XTOL2 relative to XTOL, what impact might that have, if any, on its value proposition? Thanks so much.

Chris, do you want me to start and then you carry on?

Okay, cool. Thanks, Danielle. Yeah, I mean, the message really is that I think we've set an incredibly high bar here, right? So in terms of our review of the literature with all the caveats of cross trial comparisons, we believe is that ZETU counter has the best efficacy on a placebo adjusted basis. So looking at 25 milligrams, the MPC primary endpoint in XTOL minus the placebo rate has the highest number that we can see in the literature. And just as a reminder, in the most severe or refractory population ever trialed, at least based on our review of the literature. So I know we're doing cross trial comparisons, but I think it's a very impressive efficacy outcome and has set a very, very high bar. Because as we've just talked about in the last question, because we're filing on XTOL and XTOL2, that doesn't change, right? We, you know, no one is going to, those data are completed, that double blind is unblinded. We have those data already. So, you know, the nice thing about epilepsy is we see this reproducibility and consistency study to study, but there's always going to be differences. And I think there's always going to be a different rate, you know. And so to your very specific question, Danielle, if the XTOL2 data aren't quite as robust as XTOL, I still think we have the XTOL data and XTOL2, we believe, are going to be confirmatory that this is an efficacious agent and an important molecule. And there's all of the other attributes as well. So we actually don't anchor too much on exactly what the efficacy readout is going to be in XTOL2 and what the implications may be. And I think Chris Kenny should provide his perspective, but Chris von Segeren as well, because ultimately, you know, I think you're asking a commercial question if we see something different in XTOL2 than in XTOL. So, Chris Kenny, maybe you want to add and then Chris von Segeren.

I'll just say one thing quickly. I mean, we really emphasize the XTOL data because it's what we have and because we think it's quite compelling. It's not that we're looking at XTOL2 or 3 and saying, I think the data is going to be better or worse or the same. It's sort of hard to predict these things. So it's really we're just making that emphasis because it's the actual data that we have in hand. But, I mean, ultimately, what we need is for the trial to be positive and then we can submit the NDA. Chris?

Yeah. And then if we think about the positioning of Zephyr-Caltin and a potential future commercial environment, clearly what we said in the past is that physicians are looking for new medicines to address continued seizures in this patient population. And efficacy is an important value attribute. But when we think about efficacy, there are multiple dimensions beyond just the top line data. We were going to share the updated open label data, which are going to show continued durable response and impressive seizure freedom data over time. That's the totality of the efficacy story in addition to potential rapidity of onset as demonstrated by week one efficacy. And then there are a whole host of other ease of use attributes that consistently are identified by physicians as a reason to turn to a Zeta-calner for a patient who's continuing to suffer from residual seizures. So while efficacy is important, the totality of the data package associated with this molecule, we consistently hear time and time again is compelling. And therefore, we believe it will offer a really important treatment alternative to patients

in this marketplace.

Next question comes from

the line of Mark Goodman with Learing Partners. Your line is open.

Ian, can you just talk about the strategy for MDD program just in total with respect to when are we going to get the second trial started and the third trial started and how you're thinking about that, how to stagger it, and just in the same light as the way you talk about the epilepsy program just so we have an update. Thanks.

Yeah, thanks, Mark. Yeah, very consistent with the epilepsy program. So essentially, we want to run the phase three studies and MDD in parallel, but they just never practically start at the same time. So we're not gating Xnova 3 on an outcome on Xnova 2, but there will be a natural stagger. It's usually kind of in a couple of quarters between, we're right now focused on Xnova 2 and getting that up and running, and then there'll be a bit of a natural delay before Xnova 3 is run. But both of those studies and then Xnova 4, those studies will be run essentially in parallel. As you know, the MDD studies are a little quicker to enroll than our epilepsy studies. And so maybe I'll kind of zoom out a little bit. And if we think about over the next couple of years, 2025, 2026, 2027, there's going to be a huge amount of clinical data coming from Xenon with a Zetu calendar kind of across

the entire portfolio.

Next question comes

from the line of Joseph Thoom with TV Cowan. Your line is open.

Hi there. Good afternoon and thank you for taking my question. Maybe as we think about the KV7 development candidates that you have in the early pipeline, how are those differentiated from a Zetu calendar? Do they have different selectivity, different PK, or sort of what will you be looking for for those assets? And then related to an earlier question, would all of these have, I guess, a new IP portfolio around it? Can you talk a little bit about that as well? Thank you.

Yeah, thanks, Joe. Yeah, to answer your last question first, yes, these are all novel structures, novel Marquees. So yes, all different intellectual property when compared to a Zetu calendar. You know, one of the interesting things in discussions we have internally when we think about the KV7 molecules and maybe franchise is there's nothing specific in the profile of a Zetu calendar that we're trying to change or improve on. So, you know, as you can understand, these things are multifactorial, right? We're looking at a whole bunch of different properties on these molecules, but we haven't really zeroed in on any one specific thing. You know, you mentioned PK or selectivity. There's nothing one thing that we're really focused in on because I think the profile, you know, as Chris and Chris just mentioned is so compelling of a Zetu calendar. That said, we absolutely have chemical diversity. And so these are novel, but we do have chemical diversity. And in terms of really what some of those properties are going to be, I mean, I think we're really excited about the properties preclinically. But I think the proofs really as we transition those into the clinic and we start to learn about the PK in a human and also making sure, you know, one of the nice things about epilepsy, and I know we're going to go broader than epilepsy for our KV portfolio. But we also know kind of the exposure levels that we're looking for in a human because the translatability in terms of some of the preclinical work. We know that we're in the will be in the right range. We also know with a Zetu calendar at a certain exposure in the plasma, we're seeing an anti seizure effect. We're also seeing an antidepressant effect. And so we know we can look at that translatability from animals into humans as well. So yeah, it's a real exciting time for the early stage portfolio. You know, in addition to KV with the 1.7 program and the 1.1 program, but I think you're going to see multiple molecules on KV7, you know, mature and head into human clinical development over the next couple of years. And some of them will look, we expect will look more like a Zetu calendar and some I think will probably have some different properties which we'll learn about in the development.

And

our last question comes from the line of Laura Chico with Wedbush Securities. Your line is open.

Hello, thank you for taking our question. This is Dylan on for Laura Chico. We're just wondering, so how should we think about the cadence of readouts for the ion channel portfolio? And should we be looking for data in the 2025 timeframe?

So thanks for the question, Dylan. We haven't got to that level of granularity

yet. I think from the prepared remarks and what you've seen in our press release and in our queue, the KV7 molecules and the 1.7 molecules are a little bit ahead of where we are with now 1.1. So what we said is we're in IND enabling studies for KV7 and for NAV 1.7. So those molecules are going to transition. You know, if everything goes well in the remaining non-clinical studies, those will transition into human clinical development next year. I think depending, and we'll give updates during 2025 as those transition, and depending on the timing of that transition is when we'll have a better idea of when we're going to see some human PK data as well as our sad MAD data. And then we can start talking about some of the properties of those molecules like we talked about on the last question, an earlier question in terms of exposure as it relates to receptor occupancy in terms of our NAV 1.7 program. So I think we're going to learn a lot in those first in human studies. And then we'd move into the proof of concept studies thereafter. So stay

tuned for further updates in 2025.

If there are no further questions at this time, I will turn the call back over to Sherry Olin for closing remarks.

Great. Thanks everyone for joining us today. If we didn't manage to get to your question during a lot of time, we'll reach out directly to connect. Operator, we can now end the call. And this concludes this conference call. You may now disconnect.