All right. Thanks for joining the Oppenheimer Healthcare Conference. I'm François Brisebois. I'm one of the biotech analysts at the firm. We do cover the next presenting company here with an outperform rating. It's Compass Pathways. With that, what I'll do just to kick it off here, thank you for everyone for joining, but I'll pass it on to Steve Schultz, who's the SVP of IR, and he'll present the company. And then, in terms of format, what we'll do is a fireside chat. We'll go through questions. If ever you have any questions you want to ask, feel free to send them in the Q&A tab. If not, at my email, which is francois.brisebois@opco.com. On that note, thank you very much. And Steve, I'll let you present the team.
Yeah, thank you, Frank. Appreciate it. Thank you for having us at the conference today. Before I introduce the team, I just want to make a note that we will be making forward-looking statements today during this presentation, and so I would refer you to the risk factors as listed within our SEC filings. With that, today we have Kabir Nath, our Chief Executive Officer, Dr. Guy Goodwin, our Chief Medical Officer, and Mary-Rose Hughes, our Chief Financial Officer. You got the whole combination of them here.
I just want to make a note that we will be making forward-looking statements today during this present.
Okay, so I think we've presented the team, maybe even twice. But on that note, thank you for joining. And maybe, Kabir, if you could just kind of walk through for people that aren't as aware of the story. The story's been fairly popular, but for people that maybe aren't aware of the story, just a quick background of the company here.
Sure. No, thanks, Frank. And again, thanks for the invitation to be here. So Compass was founded around six years ago. It was founded based on the personal experiences of our founders who had struggled to get any form of adequate mental health treatment for their son and had discovered, in that context, psilocybin, with some of the early studies from around 10, 12 years ago after the resurgence of interest in psychedelics. Starting point for the company was to develop a proprietary synthetic form of psilocybin, which is called COMP360. That is our lead asset, which has formulation patents, method of use patents around it, and with that, drove into an aggressive clinical development program. And we are today in phase III for treatment-resistant depression. As a reminder, treatment-resistant depression is believed to apply to around 30% of all patients who are initially diagnosed with depression.
Essentially, it's a proxy for people with chronic refractory depression for whom nothing is working, who have been failed typically by multiple treatments over the course of the disease. We now have a very robust pair of phase III studies ongoing, and those were driven by and designed after the results of an extremely successful and very large phase IIb study. I'm sure in a moment we'll get a little bit more into the data. Dr. Guy Goodwin was not only the key designer of that, the PI of that, but of course, since then has become our CMO, and it's wonderful to have him guiding our journey.
TRD?
Oh, yes, go ahead. So I was just wondering, actually, on that note, you might be going into it, why TRD for you?
So originally, and as you may be aware, a lot of the smaller studies out of Hopkins and so on were in cancer patients, in, shall we say, end-of-life anxiety, depression, and so on. And actually, George and Katya's first idea was to see whether that was a place to go. A couple of things, you know, they actually spoke to regulators who recognized that that's actually a difficult indication to develop, number one, but also pointed them towards treatment-resistant depression. And as a reminder, at that time, no drug was approved for the specific indication of TRD. Some somatic therapies, such as TMS and, of course, ECT, had a form of indication, but there was no drug approved. And even today, only esketamine Spravato is approved.
So this is a population that really is in need of new options, where, as I say, you know, anything else they've tried in terms of SSRIs and so on, augmentation with antipsychotics has typically failed.
Okay, great. And, in terms of the phase IIb , can we just before we dive into the phase IIIs, can you just remind us high level what the data showed? And then as you do that, can you just kind of, you know, it's an interesting space where with TRD, if you know you're on drug and you're not feeling better, and just maybe hit about the potential concerns at one point that seemed a little misguided, maybe on the safety side of your data as well.
Go ahead.
Yeah. So the study was designed really to anticipate a number of the difficulties that have been brought up in this field. And the particular one is that with any psychoactive drug, there is the risk that they'll be unblinding. So what we chose to do was to study three doses and to be able to say, honestly, to all the participants, you will receive COMP360 psilocybin. The doses, however, were spaced. So we had 25 mg, 10 mg, and 1 mg. And we expected 25 mg to be effective and to have the sort of effect that had already been described in other studies. We expected 1 mg to act pretty much as a placebo. And we expected 10 mg to be intermediate. We were agnostic. We didn't know what would happen with 10 mg. We chose patients who, for the most part, were naive to psychedelics.
That was a particular weakness of some of the earlier studies. We also insisted that the outcomes should be rated blind to the treatment, and indeed blind to the condition of the patient. So we had remote raters. We chose a three-week outcome, and we randomized patients 1 to 1 to 1. And what we saw was a clear separation of 25 mg from 1 mg, but also a separation of 25 from 10 mg. So 10 mg behaved much more like 1 mg. Now, the reason that's important is that while the 1 mg you may anticipate had relatively modest effects in most patients, and that we could confirm by asking them, the 10 mg group had a rather comparable experience in many cases to the 25 mg. So that comparison adds great validity to the overall treatment effect that we observed.
In addition, this is a single administration in patients who are withdrawn from antidepressants if they were still taking them. We saw durability out to 12 weeks or so, which is when we ended the study. Furthermore, we were able to look a little bit further in follow-ups and see that even beyond 12 weeks, we saw reasonable durability in the small number of patients we were able to study to that point. We essentially had, at the end of that study, a preferred dose, 25 mg, which had a credible, efficacy, proof. We had durability, and we had good evidence on safety. Now, you asked about safety. The issue that arose was that there was a question about suicidality. Now, to be clear, in this study, there were no attempted suicides, and there was no suicide.
So we were dealing with events that were essentially scores on a rating scale. It's not to say they're not important. They could be indicators of problems. And we saw a slight excess of events measured in this way in the active 25 mg and 10 mg groups compared to the 1 mg. Now, the numbers were relatively small, but nevertheless, they are a reason to pay good attention when we get to the phase III study, which, because it's of a larger scale, will enable us to really pin down whether this risk is real or whether it just was a chance finding in the IIb study. Of particular concern would always be suicide, suicidal behavior. And there were three examples of suicidal behavior in patients who had failed to respond to treatment in the 25 mg group.
These events occurred more than four weeks after the administration of the drug. So our conclusion was that this is medication that is well tolerated acutely and is pretty acceptable to the great majority of patients. But for those patients who don't respond, it may, in common with other antidepressant treatments, be somewhat a case where we need to be very cautious in clinical management. And I think that will be a message that won't surprise clinicians. We are always cautious when patients are offered active treatment and they fail to respond to it. So that is where we are at the moment. And that is the mindset we've taken into the phase III.
Is it almost fair to say that the fact that those three behaviors happen in the 25 mg, it's a case of that the patients probably realize, "I definitely had active drug, and I don't feel better, so I'm a lost cause." Is that a hypothesis, or is that just we don't know? It's hard to say.
Well, I mean, that was certainly the inference that people drew. I mean, we couldn't really find evidence in the individual records that they'd clearly express that sentiment. There were other things going on in their lives, and they had, in fact, attempted suicide or self-harmed in the past. So I don't think anyone really can understand cause and effect there. The way you establish cause and effect is through randomized trials and differences that are statistically reliable between different treatments. That's what we will be doing in the phase III. It's the argument for larger numbers, really.
Okay. Why not really not use a true, real placebo? Was that a question of it would be hard to enroll if not everyone knew they were on, you know, COMP360?
No, it was really about this problem that what is the expectation. I mean, the key thing about placebo and active treatments is expectation. And what we hoped to do was to even out expectations by having everybody know that they were going to get the active drug. And it's a slightly different discrimination if you ask people to say, "Look, I'm going to give you either nothing or a very active drug," versus, "I'm going to give you an active drug at different doses, and we're going to see what happens." And that I think that mindset for the patient means probably that you have a more valid study if you use the three different doses and you don't kind of load up the patient's expectations to seek a discrimination. And that's obviously what they are likely to do if you do the placebo study.
We felt we had a more valid study, potentially. And I think the results bore out that argument for us in the event, too.
Can you discuss the FDA guidance on the space that came out last year and how it correlates or translates to your phase III or your data today?
Well, it translates very well into our phase III design, in that they recommend that there be a placebo-controlled study really to establish a safety baseline, and that there be potentially a study with different either active placebos, so-called, or with different doses of the same drug, to as a companion piece to give evidence of efficacy. So we think that we're well aligned with what the FDA have appeared to recommend, or at least to put in their discussion documents. And, you know, for that, we take comfort from that.
How do you, based on the data in the phase IIb, how do you feel comfortable that 25 mg was enough? Why not try higher? Or is that a question of the repeat dose in the phase III? How do you know that?
Yeah, I mean, I think we chose 25 mg because some of the early reports suggested that going higher than that produced an excess of adverse events directly attributable to the drug. So we were cautious. We're also mindful of the FDA's general principle that they prefer to work with the lowest effective dose. In addition, we do think that this ability to give a second administration, which we're testing out in the phase III, may give that additional efficacy without the need to go to higher doses. So on that count, that's the strategy that we have adopted.
That makes a lot of sense. Okay. And, you know, obviously a big year, Kabir, 005 mid-year, I think we had guided for data. And then the following, next year for 006. Can you just remind people what are the differences between the phase IIb and then what are the designs of 005 and 006?
Oh, so I mean, as Guy mentioned, the phase IIb was the three arms, 1 mg, 10 mg, and 25 mg, a single dose only. In this phase III, the first study, 005, is true placebo against 25 mg. The second study, 006, is the second fixed dose, again, 1 mg, 10 mg, and 25 mg. But I think the other critical difference is we have fully integrated a 52-week study into these, whereas in phase IIb, we rolled over into a new study. So in both cases, the primary endpoint is at six weeks, but then patients continue in their original randomized assignments for 26 weeks and have the option of a further dose if they've neither responded or if they have remitted and then relapsed.
So this is going to give us data on both the potential in terms of efficacy for retreatment, but also a much better sense of the range of durability for patients from one or two doses. Because clearly, that's a critical question that we need to answer both from a clinical perspective and, frankly, ultimately from a commercial perspective as well as to what we expect the durability of one or two doses to be. And then finally, in both studies, there is a further open label extension from week 26 to week 52, in which everyone who has not hitherto responded will be eligible for a dose of 25 mg. And that essentially is the incentive that we believe is required to keep patients on non-active arms in the study through the duration of the study.
So far, the evidence is that that incentive is working in terms of us not seeing any significant change in loss to follow-up from the IIb.
Okay. And can you remind us maybe the only thing we haven't touched on much is the support or psychotherapy or just what term is best to use about the phase IIb, and has that changed going into the phase IIIs?
It has not changed, but we're very clear that this is psychological support, not psychotherapy. In fact, let me just hand back to Guy to elucidate on that a little more because it is a critical distinction, particularly in light of the fact that MAPS, now Lykos, has just had a filing accepted for MDMA therapy, which is very different from what we are proposing, Guy.
Yes. I mean, our view is that if you are assisting a psychotherapy, then the psychotherapy has to have an independent validity as a treatment. And indeed, that is the case with the trauma-focused approach that MAPS is taking for PTSD. In our case, the psychological support is a preparation. It's a preparation that without the drug wouldn't have very much meaning. And for that reason, we see it in that way. Bear in mind that the experience on the day is highly personal. We have someone there, a facilitator, to help the patient and someone that they trust that they met before. But the essential journey is a personal one. It's done usually with eyeshades. It's done with the ears with headphones on, listening to music. It's very much an inward effect.
And it's, we think, that essentially what we're enabling people to do is to take the leap, to trust the drug to do the work, and to come out the other end, in a sense, in a different state from the way they went in. And that's what we observe. So we see this as crucial. We don't think this is diminishing the importance of the preparation, but we think it's recognizing that is what it is. It's closer to coaching. It's closer to having people prepared. And the key focus is safety. And that has the meaning literal safety, but it also has the sense of psychological safety that allows patients to accept the experience and to follow through on it.
That's great. Then, I'd love to hear. I don't know if this is more on Kabir's side or, in terms of Spravato, it had a slower start, but it's looking very strong now. It's looking very real. Why is that helpful? Any learnings? You know, obviously, this is a question that's come up probably for the past year, but as Spravato's turned around, anything about the centers where this is used that is encouraging for your potential, commercial opportunity?
Yeah, very much so. So I think in a number of ways, the story of Spravato is highly relevant to the potential for COMP360. So I think first, before I even get to the current success, you know, one of the it was perceived to have a slow start. Part of that was data-driven. I think there was, you know, a certain amount of skepticism about the original phase III studies, you know, the fact that they had to do five to get two positive and a relatively modest effect size. But also, as we know, it requires monitoring post-administration for a period of time in the office. And it seems that for J&J, did not really account for the fact that that was an activity that needed to be identified, covered, reimbursed. Since then, they put together packages that enable that to happen.
That was one of our key learnings. As you'll recall, we therefore, working with MAPS, applied for a CPT III tracking code specifically to cover the provision of extended services during psychedelic medication administration, recognizing that our sessions are six to eight hours. Similarly, for MAPS with MDMA, that, as we know, we were able to obtain that CPT III tracking code that's gone into effect this year. That's one critical differentiated part of the infrastructure in terms of the ability to get reimbursement for psychological support.
But more broadly, the acceptance and uptake of Spravato does tell you that there are increasing numbers of treatment centers that are scaling, able to devote some part of real estate to actually the monitoring process for Spravato, that psychiatrists are comfortable with prescribing what is a psychedelic of sorts with a dissociative side effect, that they're comfortable dealing with REMS, which frankly is also largely new for psychiatry and psychiatry offices. And what you've seen is the scaling of that infrastructure, both in terms of independent centers like Greenbrook TMS, some of these chains that have risen for interventional psychiatry, but also within regional health systems devoting capacity to this. What does that mean for us? It means that anywhere that has got comfortable with prescribing Spravato and how that fits into workflows and to reimbursement is potentially a candidate for prescribing COMP360.
But we also recognize there's a lot of work to get from being comfortable with Spravato to COMP360, given that we are tying up a piece of real estate for, you know, a full day. And so what you've seen us announce so far this year, a couple of collaborations with Greenbrook TMS, with Hackensack Meridian Health, and there'll be a couple more to come, is exactly to do that. It's exactly to establish how can COMP360 fit into the workflows of these very different settings? So one a for-profit interventional psychiatry chain, the other a regional health system with a very large catchment area and tertiary treatment centers. You'll see a couple more examples of different types of settings.
What we're spending the next couple of years doing is literally learning how COMP360 will fit into those workflows, into reimbursement, how they would expect to see it reimbursed, and then take those learnings to a range of places thereafter. So yes, I think, you know, the tailwind of Spravato is a really good indicator for us, but we know there's a lot more work to be done to make sure that COMP360 can fit into those and other treatment centers as well.
Okay, that's very extensive. Thank you, Kabir. I feel like that's a for some reason, you guys have turned CNS into a field where efficacy is expected. So now the next problem is commercial. And so it's good to see the learnings there make a big difference. And would you say, is there a study a little bit that explains because, you know, there's the push on shorter duration therapies because you said we kind of take over the whole day. You know, how do these centers even make money? Are they profitable because it seems to me the less number of patients you would have, the less paperwork and turnaround you would have.
I'm just wondering if those is it the full minutes that the patients are in the chair, or is it the number of patients that the center makes money on? Just understanding the financial incentive of the centers, I think, is interesting.
Yeah, and that's a big part of the work we're doing. Obviously, it's a complex thing to thread because, you know, one of the reasons for getting the CPT III code was to ensure that the full day is adequately reimbursed at a level that covers all those costs. Yeah, I would argue that, let's say, compared to Spravato, the fact that we're going to be a much less frequent administration is clearly good for patients and good for resource utilization. But I also have to acknowledge at the same time that centers can make money out of every Spravato administration. So these are some of the real depth of understanding of practice economics and so on that we need to get into in order to be sure that we're providing the economic incentive to treat with COMP360.
Understood. And then, maybe lastly, the pipeline. And I'm so sorry, Mary-Rose, maybe you can help us understand through the pipeline, the strategy, maybe, you know, where do we stand in terms of cash? These are long studies. At the same time, we're getting closer to summer 2024 here. So how do we feel about the financial situation?
Yeah, so from a cash perspective, we have runway until late 2025. The funds are phase III, and the two phase IIs in PTSD and anorexia. You know, we had a very successful August financing. So that looked like $125 million gross proceeds upfront and up to $160 million from the exercise of warrants as part of that financing. I would flag so the runway of late 2025 doesn't assume any proceeds from the exercise of warrants. So anything that might be exercised would be upside clearly, and it would act as a second financing event. With that being said, you know, clearly we're aware that we do need to have further fundraising rounds between now and commercialization. And I think we'll look out for opportunistic financing events, much like our August financing or catalyst-driven financing events.
You know, clearly we have a number of those coming up in the next 12-18 months.
Okay, great. And then, Kabir, what should be all the timelines? Are staying the same on the pipeline side or?
Yeah, so you will see full PTSD data in spring. So we put out a safety topline, but we will have an efficacy measure, small open label study. But I think there's a lot of interest in understanding that, particularly given that it's a very different protocol from the MAPS or Lykos protocol. And we are currently still expecting data in summer from the primary endpoint of 005.
Okay, okay, great. Well, I think we're up on time. Is there anything I forgot to mention or that covers most of the bases here?
I think it did. But thank you, Frank. Thanks for the opportunity. And we're always happy to talk to investors more. So thank you.
All right. Thank you very much, everyone.
All right.
Thank you.
Thanks. Take care.