Definium Therapeutics, Inc. Q1 FY2024 earnings call

• Transition of Schond Greenway as Chief Financial Officer, with an executive search firm retained for a new CFO.
• Positive 12-week data from Phase IIb clinical trial for MM120 in GAD, with FDA designating MM120 as a breakthrough therapy.
• Successful oversubscribed underwritten offering and private placement raising approximately $175 million.
• Scientific posters and presentations shared at various medical meetings, including data from MM120 Phase IIb trial and studies on GAD epidemiology.
• MM120 Phase IIb results exceeded target product profile, showing significant improvement in endpoints for up to 12 weeks with a single dose.
• MM120 PK bridging trial demonstrated benefits of ODT formulation, leading to progression into Phase III development.
• Anticipation of end of Phase II meeting with FDA in Q2 2024 and initiation of Phase III in H2 2024.
• MM402 program initiated first clinical trial in adult healthy volunteers, with collaborators conducting comparative Phase I trials.

As of March 31, 2024, MindMed had cash and cash equivalents totaling $252.3 million compared to $99.7 million as of December 31, 2023. Net cash used in operating activities for the quarter ended March 31, 2024, was $16.6 million compared to $13.3 million in the same period of 2023. Research and development expenses were $11.7 million in Q1 2024, a decrease of $0.9 million from $12.6 million in 2023. General and administrative expenses were $10.5 million in Q1 2024, an increase of $2.2 million from $8.3 million in 2023. The company's net loss for Q1 2024 was $54.4 million compared to $24.8 million in the same period of 2023, primarily due to changes in the fair value of financing warrants.

• Expect to advance MM120 into pivotal Phase III clinical trials for GAD.
• Anticipate end of Phase II meeting with FDA in Q2 2024 to align on Phase III development scope.
• Initiate Phase III clinical program for MM120 in GAD in H2 2024.
• Actively evaluating additional clinical indications for MM120, including depression.
• MM402 program aims to develop a regularly administered product for core symptoms of ASD.

• Changes in market conditions.
• Difficulties associated with research and development and regulatory approval processes.
• Uncertainties related to the interpretation and impact of preclinical and clinical data.

Q: Congrats on the progress. So Lykos just announced that the FDA is hosting an AdCom meeting for its MDMA therapy, PTSD. So can you maybe talk about the implications to MM120? And just curious what are the key topics that you're looking at for this AdCom meeting?

A: Yes. Thanks so much, Rudy. I'll start it off and instantly invite Dr. Karlin to comment as well. We certainly, I think, as a field, and we as a company expected advisory committee for any first entrant drug classing, it's important to draw a clear distinction between the mechanism of action, the message of how MDMA is administered in Lykos' clinical program for PTSD. And the distinct way in which MM120 is being developed and studied, but generally we would expect there to be an advisory committee for novel treatments such as this. So I think there has been some commentary, publicly trying to read into this and hope there's much to be read into and all of us across the board we feel expected to be occurring. In terms of subject matter, so we will be following very closely and looking to understand points of interest for the advisory committee. And we've seen the ICER report on Lykos' program. We have intentionally from day 1, designed our program to answer many of the key questions that have been presented in our field and they are covered in FDA's guidance and feel very confident that we will continue to demonstrate to best-in-class scientific rigor and approach to addressing those questions. But -- so we'll follow the areas of interest from the advisory committee members and look forward to hopefully a successful outcome for Lykos and MDMA?

Q: At the recent APA presentation, you showed some trends over time in both HAM-A and PGIS, and it looked like directionally, they were similar, but maybe there were some subtle differences there. I was wondering if you could talk about that and just, I guess, how that's impacting what your base case is here for the durability of the administration based on both this and other evolving data? And then secondarily, I think the [indiscernible] change here, I think, really underscores what could be potential antidepressive effect. And so I know you sort of alluded to it a little bit in the prepared remarks, but I'd be curious to hear what more specifically -- what some of the factors that you guys are going to be considering in determining whether or not to move this forward in major depressive disorder or other depression indications and I guess how you're thinking about what the potential indications might be there?

A: Perfect. Brian, I'll turn it over to Dan to talk about your first question, then I'll maybe address the second one. Dan? Yes, absolutely. And thanks so much for the question. So when we look across all of the different measured data that we've shown publicly so far, what we see is directional agreement and to a very large extent, magnitude agreement as well. So in general, each of these different scales gives us confidence in the different domains that they pick up, that the effect we're seeing is real, is not an artifact of one particular scale or one particular method of administering a scale. Of course, CGI collected by a blinded radar is going to reflect slightly different things than a PGI that may be more determined by a patient's individual experience in the treatment. But particularly the fact that we're seeing week 12 slight degradation on the PGI, it doesn't give us any concerns about the robust activity of the drug, particularly since we're seeing such strong significance across the clinician-rated measures. Rob, do you want to speak about the [indiscernible] or do you want me to? Yes, absolutely. I would just note, too, on that first point, Brian, that obviously, the HAM-A value scale is the gold standard for anti-anxiety approval. So that's where we're going to be focused in our dialogue with FDA. Again, we look at -- while we talk about the pairwise comparison here, you have to remember that he was a large 200-patient study. We had robust power and statistical conclusions on the HAM-A. Certainly, we're looking at the secondary endpoint looking at pairwise comparisons we're talking about around 40 patients per arm in the Phase II study. So that has progressed and look at the numerical changes, even those would be -- likely to be statistically significant if we saw the same effects in a larger population. In terms of the depression indication, something we've alluded to and spoken about before publicly, which is that we're actively assessing additional indications. I think as we look at the landscape -- in psychiatry, and really look at the promise of this drug class and the kind of magnitude, that we believe we can achieve in terms of really changing the direction of what we've talked about a lot is the epidemic of brain health and mental health in this country. Depression and anxiety has such a strong overlap in interplay and looking at a major depressive disorder and other related indications makes quite a bit of sense, of course, as we think about how getting the drug in the hands of clinicians and making sure it has the opportunity for the broadest impact and broadest uptake. So we'll provide guidance at the right point in time if and when we come to a determination on the exact indication and clinical development plans for any subsequent clinical indications -- obviously with the [indiscernible] scores, it would be -- it's hard to overlook at the magnitude of response we've done the potential antidepressant effect in our Phase II study, building that on top of a prior study from our colleagues showing a 16-week durable effect in major depressive disorder. There's obviously we think an opportunity there and something that we'll be looking at very closely and giving further guidance on the future?

Q: This is Dan on for Frank. Firstly, with regard to the planned Phase III, could you give us some color on how you're thinking about the design of that study? Any similarities or differences to the Phase IIb? And specifically, does the Zydis ODT formulations PK impact the Phase III design anyway?

A: Yes. So in terms of plan Phase III studies we're going to reserve sort of final determination of the protocols until we have our end Phase II meeting and reached a complete alignment with the agency on the path forward to those pivotal studies. But given our interactions to date, we certainly feel we have a high degree of understanding of the right approach there. And by and large, that the Phase III clinical trials will be extremely similar, if not virtually identical to our Phase II clinical trial design with the exception that we intend to go forward with -- for purposes of the statistical comparison of the overall design comparing 100-microgram ODTs, as you mentioned, to a placebo. The ODT formulation in and of itself has no impact on the design of the Phase III program. We were really encouraged by the PK bridging results and from what we've seen in that study, both quantitatively and the results we report but also qualitatively and report talking to the investigators in that Phase I study, but believe that certainly going forward the 100-microgram dose is optimal in our view. And we're particularly encouraged about the prospects as we go into that clinical trial. So really no impact in terms of study design, but even higher conviction about the clinical potential of that formulation?

Q: So what are your latest thoughts on potentially developing MM120 for depression? And would that be a program that the organization is ready to run simultaneously with the pivotal program in GAD and other things you're doing on 402? Or are you focusing on GAD with undivided attention until you get more clarity on trial results there?

A: Yes. Thanks so much, Sumant. Yes. No. As I mentioned earlier, we certainly are taking a very hard look at the market dynamics and the opportunity and depression and related indications. We have built the company really from the ground up over the past 3 years and have done so all along the way with the ability to -- with I, of course, to executing on technical development programs, but also with the ability to take on multiple programs far beyond what's currently in our pipeline. So the infrastructure and our team and our ability to execute operationalized multiple programs in the pipeline has been something that we've been working towards and have been doing over the past several years. And so we certainly believe and expect that we'll be in a position to execute on multiple clinical indications potentially in parallel. We never lose focus on our furthest long asset, the furthest long program, which is, of course, MM120 in GAD. But even as we've conceived of operationalizing other indications like for instance, potentially in depression, there are many operational efficiencies and quite a bit of overlap. So we'll be in a position to give further guidance and we decided to launch a program in a second indication with 120. But based on our team's abilities and based on certainly the existing evidence, I believe there's opportunity in depression and a number of other indications in brain health?

Q: I'd like to talk a little bit about -- if you wouldn't mind addressing how heavily pretreated the Phase IIb population was. And in the commercial setting once we get there, where do you see MM120 being used, especially considering that there is a large population that is undiagnosed -- without treatment, where would MM120 fit in based on your Phase IIb trial, your Phase III design once you agree with the FDA, et cetera?

A: So I'll take the second part of the question first, which is to say when we conceive of where MM120 could fit in the real world in clinical practice, I think as a field, there's been some of a constraining of views on the opportunity in a concept that these therapies could only be reserved for the most severe patients who have failed everything else. And what we're really seeing over and over in the clinical data is that there seems to be a sort of trajectory change. And so in GAD in particular, what we observe is that patients who go undiagnosed and/or have severe GAD, end up spending years going to the doctor having other related comorbidities and they have a huge impact on their quality of life and also a huge impact on the health care system. Now where the value also comes from, we talked about reimbursement. We talked about the burden on the health care system from a financial point of view are in those patients to go undiagnosed who has severe GAD to walk around not knowing that they have severe GAD. And so we actually see the opportunity is far more expansive than simply the patients who have failed everything out. Now that is not to say that we expect and we're going to be marketing as a first-line therapy per se. We obviously are going to be focused in our commercial activities and certainly believe there is enormous value to be gained by focusing on the patients who had severe -- on prior treatments and who have severe disease. But we certainly believe there's a likelihood that patients who are not at the end of their treatment course and have failed everything else could potentially benefit. And that really also aligns with the data we've been able to generate. Now we see a nice mix that is largely representative of the real-world population in our clinical trial. So certainly, a significant portion of the patients have prior treatments and have scaled numerous prior treatments. When we look at slices of the data, we don't see a meaningful difference between response regardless of treatment history, which, again, I think in depression, there's much better definition of treatment resistance and focus on last-line patients, but in GAD it's somewhat of a different dynamic that we think is more favorable, both from a business standpoint and from a clinical impact standpoint?

Q: I have a couple of follow-up questions. The first is on the new epidemiological data presented at APA. Just in terms of the potential impact on commercialization of MM120 in GAD. I'm wondering if you can talk about the prospects or possibility of having this validated GAD-7 screening tool more widely deployed in the real-world health care setting as part of this potential commercialization? Secondly, if this data itself is helpful or can be built upon as part of health economic outcomes research? Or is there some other use for it that could be beneficial for the potential launch of MM120? And then separately, just there's some UHB data upcoming. So I was wondering, first, if you can give us an idea of potential read-through regarding durability of treatment we should expect from the Phase II UHB data being presented by the Biological Psychiatry and whether or not findings in that study could impact discussions with the FDA regarding the MM120 Phase III program and what way could that data maybe be helpful to you? And then separately, regarding MM402, can you talk about the potential read-through from the UHP Phase I trial to your program and how you think about next steps for MM402 and ASD assuming a positive outcome from your [ GAD ] study?

A: Yes. I'll try to take these one by one. So certainly, in terms of the prevalence, although we've been talking about the underdiagnosis of GAD, the fact that there is a tool that can, we believe, validly pick up GAD is yet to be diagnosed. The fact that, that is now being recommended for implementation and has not been fully implemented, suggests to us that really what we're seeing in terms of current epidemiological data is just the tip of the iceberg. The market is actually much, much larger than we're seeing in the statistics today or in the last several years. So that obviously has a huge impact from a health and societal level. But from a market opportunity, of course, it means that the market may be -- or does the magnitude margin that we're expecting based on current epidemiological data. And that aligns with certainly what we hear and hear from clinical practitioners -- that we absolutely actively are working on [ HER ], health economics research to quantify the scale and the scope of the impact that we can ultimately see here. And to demonstrate the value proposition to all of the key stakeholders who are going to need to be aligned to enable the broad uptake of our products. So something we are actively engaged and have a really talented group that is working on that. Potential read-through of the UHP study. Certainly, as we look back over the past couple of years, we initially had -- [ best-care initiated ] data on lysergide, different dose and regimen, but that demonstrated the durable effects out to really about 6 months after treatment for the patients who got LSD or lysergide first. And in this study, we now have a follow-up even further with those patients. So as we've conceived the Phase II results that we were able to achieve, we've also seen -- largely in terms of HAM-A scores, a sort of flat lining where we didn't see a regression back to baseline or worsening of symptoms on average over time. And so if we ultimately are seeing those effects [indiscernible] investigated in initiated smaller studies, but these are effects that are shown to be durable for many months longer. I think one only think it bodes well for the potential of what we'll be able to demonstrate as we go forward into longer something like open-label study that's planned for Phase III. And similarly, with MM402, of course, it's very difficult to have read through from a healthy volunteer population into a disordered population in terms of results from a Phase I study. But certainly, the understanding we'll have in terms of the -- some of the mechanisms underlying the activity of MM402, the demonstration of tolerability and sort of [indiscernible] profile that we'll be able to report out and observe with MM402 of the doses of 250 milligrams will be certainly encouraging for us and won't be informative as we continue to design our program. But again, it's hard to -- we don't want to overextend the interpretation of healthy volunteer data when we talked about going into Phase II and later research?