Everybody, thanks for joining us for our next session. Welcome to the Bank of America Healthcare Conference. I'm Tazeen Ahmad. I'm one of the Senior SMID Biotech Analysts here at the bank. It's my pleasure to have several members of our next presenting company with me on stage. Neurocrine Biosciences sitting up here with me are CEO Kevin Gorman. Good morning, Kevin.
Good morning.
To the left of me are Kyle Gano and Matt Abernethy, Chief Business Development and Strategy Officer and Chief Financial Officer, respectively. Good morning, gentlemen.
Good morning.
Good morning, Tazeen.
Thanks very much for making the short trip over from San Diego this morning. So maybe we can start off with an overview of Neurocrine. Obviously, in the space of biotech, Neurocrine is well known. But for those who may not know, recent happenings of the company, I think, Kevin, it would be helpful to get a summary of the many things that have been going on.
Thank you, Tazeen. Thanks for the invitation and the opportunity to speak here to you and to Bank of America. We are going to be making forward-looking statements, so I would direct you to our recent SEC filings for all cautions and warnings. Neurocrine's been around for like 32 years now. We've been an R&D exclusive company for 25 of those years, a commercial company for 7 of those years. So we are still fairly new when it comes to the commercial platform. So if you look at Neurocrine, we've been a neuroscience company. We've stuck to our knitting throughout that entire 32 years at this point. And what does neuroscience mean to us? Neuroscience means that neurology, neuroendocrinology, neuropsychiatry, and neuroendocrinology. And we have programs in place in all of those.
If you look at us from a commercial aspect, we have three drugs that have been discovered, developed, and approved by the FDA at Neurocrine. And knock on wood, there's going to be another one soon. So the major drug there is Ingrezza, which is for tardive dyskinesia. Tardive dyskinesia is an irreversible movement disorder, devastating movement disorder for many of the patients. And it comes from taking long-term treatment with antipsychotics. So there's approximately 600,000-700,000 patients in the United States who have tardive dyskinesia. Ingrezza's been on the market for seven years. We're the market leader. We've given guidance this year of net sales to be between $2.1 - $2.2 billion. It's been life-changing for patients.
I got to say, and I speak for my colleagues and everyone at Neurocrine, boy, it's been phenomenal to hear from patients and to see the difference it's made in their lives. Ingrezza was also recently approved for the chorea associated with Huntington's chorea. Again, it's the movement disorder that of the 15,000-20,000 patients who have Huntington's chorea, they have, I would say, about 80% of them have the chorea movements that really impacts their last years of life that they have. They can't care for themselves. It is a devastating disease. We do not change the course of that disease, but by stopping the movements, by and large, or tampering them down significantly, we make the last years of their lives a whole lot easier for them. Within Ingrezza, we had a recent FDA approval also for a new formulation that is called Ingrezza Sprinkle.
What that is, is it's a capsule that you don't take by mouth. Ingrezza's a 1-capsule, once-daily drug, but that you can open this up. It's got granules in it, sprinkles, if you will. You can sprinkle it on your food and eat it. It can also be placed within an NG tube. Why that's important is because many of the patients, both with TD and with HD, have problems swallowing. They have dysphagia. They also have jaw clenching. That makes taking pills very difficult. In addition, even if they don't have that, what TD patients are taking, on average, about 7-8 other daily medications. This just cuts down another pill that you have to swallow.
So most anything that they're eating or drinking, they can just open it up, sprinkle it in there, and then they can take that by mouth that way. So that was just approved by the FDA, and we're looking forward to being able to launch that a little later this year. What's the other big event that we have going on in Neurocrine? And that is on our neuroendocrine side. So here is a disease, congenital adrenal hyperplasia. It's a mouthful, so we'll call it CAH for short. Children are born with a congenital defect. They can't make cortisol. And there's two things that happen when you can't make cortisol. Up until the early 1960s, all of them died shortly after birth because you need cortisol in order to live. But then hydrocortisone was invented, mainly as an anti-inflammatory in the early 1960s.
But the endocrinologists soon realized, "We can replace now. We can give them hydrocortisone to replace their natural cortisol." The only problem is that in all endocrine systems and this is an endocrine system with three players involved in it, the hypothalamus, the pituitary, the adrenals that go on, called the HPA axis, there's all sorts of feedback regulation that goes here. When you can't make cortisol, all of the precursors that are made by the adrenals shunt into making massive levels of androgens. Massive levels of androgens have a bunch of deleterious effects on bone health, on cardiovascular. You can imagine in women, little girls, it starts leading to a lot of male characteristics that are very difficult for them to deal with, shorten lifespan, shorten height. So in order to try to combat that, you can't just give low-dose hydrocortisone.
You have to give very high-dose hydrocortisone, well, in order to tamp down now the androgens, which is where everything shunts through. The problem with high-dose hydrocortisone for your entire life is that then a lot of those things that I just said were problems with high androgen levels come into play also: osteopenia, osteoporosis, metabolic disorder, obesity, cardiovascular disease. So the bottom line is that endocrinologists are damned if they do and damned if they don't. If they try to under-treat with hydrocortisone, the patient is left with extremely high levels of androgens, which have devastating effects. If they use hydrocortisone at high levels, they bring the androgens down. But now the patient is trying to deal with all the deleterious effects of the hydrocortisone. We have a drug which impacts the top of that chain of events that takes place.
What it does is it recaptures the regulation of that hypothalamic-pituitary-adrenal axis. It's not a steroid. And what it does is it brings down the androgens dramatically, but to the low levels of normal in patients. Well, what we showed in two phase III clinical trials, one in pediatric population and one in the adult population, is, yes, we dramatically lowered the androgen levels. And we were able to then lower the amount of hydrocortisone that they had to take each day. And for a significant number of patients, took that hydrocortisone down to just replacement levels. For the vast majority of the patients, took it down to just replacement levels or near replacement levels. So all of a sudden, for the first time in 60 years, there's now a drug that can treat these patients.
Crinecerfont takes down their androgen levels, allows the physician to then lower their hydrocortisone levels. So it's not a trade-off that they have to deal. The NDAs were submitted at the very end of last month, so we await to hear from FDA and start our conversations in their review of our NDA going through there. We have breakthrough designation that was given to us by FDA. And we hope to hear from them to see if we can't get priority review also on that. So there's two big important events that we have. A multibillion-dollar drug that is on the market that has exclusivity that goes out until 2038, our CAH compound that has orphan drug designation, breakthrough designation that's at FDA. And we have high hopes for that as being the next blockbuster that we can launch here.
We would be launching CAH ourselves and marketing that ourselves, just as we do with Ingrezza, our TD drug. But having said that, most of our discussions with investors and sell-side have actually been around all of our other programs that we have in the clinic. It's kind of like going back to seven years ago and heading up an R&D company again, which is really a lot of fun. We have approximately 15 different programs in the clinic running the gamut from Phase I to Phase III programs right now. Lots of very exciting things, again, covering three of the four things that I said we do, meaning neurology, neuroendocrinology, and neuropsychiatry. Neuroimmunology is still in a preclinical phase. So there are things that people are very, very interested in that's in Phase II trials. And next quarter, we will be reading out two important Phase II studies.
One is for an M4 muscarinic agonist that is in clinical development for schizophrenia. So that'll be reading out in Q3. There are two other companies that have done an outstanding job in showing that M4 is involved in the treatment and control of or agonists for M4 are involved in the treatment and control of schizophrenia. That's Karuna. And that is Cerevel. And so we're coming up behind those three. But let's see how our data works out. We all three are taking very different approaches in agonizing that receptor, which we can talk about later. But importantly, we have an entire portfolio of muscarinic agonists and antagonists. So we know the muscarinic system is very, very important, and it consists of five different receptors. For CNS diseases, you really want to deal with two of those, M1 and M4.
And as I just said, our compound that's reading out Phase II next quarter, and much like the Karuna compound and the Cerevel compound, primarily an M4 agonist at that receptor. We also have, in Phase I right now, an M4 preferring, but it also hits M1 somewhat as an agonist. We also have another compound in Phase I that's M1 preferring. It also hits M4. And then we have another one, which is a balanced agonist of M1, M4. This is an important system. In psychiatric diseases, we have to see in the human condition, and we're the only ones that have all of these potential therapeutics that we're going to be studying in humans. We also have an M1 antagonist that we've put into the clinic, and that's for movement disorders, much like what we've been doing with Ingrezza for movement disorders.
So in addition to all that, we just read out a Phase II study. And we read out a Phase II study with an AMPA modulator. Everybody over time who's had an AMPA modulator, they didn't work in major depressive disorder. Here, we had a great Phase II clinical study with our AMPA. And I'm sure we're going to talk about that a little bit more up here. But a very clear-cut, very high-efficacy readout with an outstanding safety readout that we had with that. And so we're getting ready to meet with FDA on that program and then bring that program, once we reach agreement on the registration program, bring those into those registrational trials for inadequate MDD patients with an inadequate response to current therapeutics, which is the majority of the major depressive population.
We have seven other Phase I's that are going on that are going to be reading out later this year into the next year. In addition to all of that, and we're primarily a small molecule company if you look at what is in the clinical trials right now, but take a snapshot of us today and take a snapshot of us three to five years from now. What you're going to see is that portfolio is going to transform. We'll still have lots of small molecules. Mainly, the small molecules are going to be in psychiatry. You are going to see that Neurocrine is going to have probably an equal number of large molecules, biologics. They're going to span between peptides, proteins, antibodies, monospecific, bispecific, and gene therapies that we have approximately 25 preclinical programs going on in Neurocrine right now.
We have seven programs in gene therapy with, I think, the state-of-the-art vectors that we have, capsids that we're in collaboration with Voyager that cross the blood-brain barrier highly efficiently. So those are going to be entering into the clinic next year that we anticipate because our goal at Neurocrine is to be the leading neuroscience company in the world. And being serious about that goal, what you need to be able to do is plan for, by the end of this decade, we will be curing or changing the disease courses in many neurological diseases, so not just symptomatic treatment any longer. And so that's why you have to invest in the large molecules that can do that. So Tazeen, I'm going to stop there and let you get a word in edgewise. Okay.
Remember last year at this conference, I asked you why people think you don't have a pipeline?
Yeah, that's right.
Yeah?
Yeah.
It's changed in a year. Okay. You've said a lot. Maybe let's go back to CAH for one minute. You've applied. Do you expect to find out from FDA if there's going to be an AdCom when they tell you that they accept the filing, or could that happen later?
That can happen later. I think that what we look for in day 74 is when the agency would get back to us on two things, accepting there's two filings. One is for the clinical safety. The other is for a liquid formulation. So we have a liquid formulation for the very small kids. And then that's a separate NDA from the NDA that has the adult and the pediatric data in it. I think approximately 180 adult patients, about 103 pediatric patients in there. Those two NDAs are linked to one another. We would anticipate the same PDUFA date since they were simultaneously submitted. At day 74, we would also anticipate to hear from them whether we would have priority review or not. But they can choose. They don't have to tell us right then and there whether they're going to do an advisory committee meeting.
Unfortunately, preparing for an advisory committee meeting takes a long time, a lot of effort, a lot of money on our part. We've already started all of that work.
Yeah. The reason I ask is if you do get a priority review, there would be less time to review, right? So I'm just wondering if it's a priority review, if that means less likely to have an AdCom. And I don't know why you wouldn't get a priority review because it's CAH, and there's really nothing available.
Yeah. From your lips to God's ears. Yeah, I don't know. I don't know how to handicap whether the agency would want an AdCom if they have questions that they want to get external advice on, whether those would be questions on efficacy or whether those would be questions on safety. I have to say, the efficacy that we saw in both of those Phase III clinical trials was just outstanding. It blew away our most optimistic expectations. The only thing better than the efficacy that we saw was the tolerability and safety profile that we saw there. That was, again, just outstanding. And seeing all the patients virtually roll over into the extension studies has been terrific. But the agency, again, it's the first time since hydrocortisone was invented that these patients have a drug available to them.
They just may want to have an AdCom for that. Hard to say.
But for us, we don't know what question they would truly try to be getting answered. But it would give us an excellent opportunity to tell the story about how crinecerfont can help patients with CAH. So we're preparing for it. But I think I agree with your commentary, Tazeen, that we're not clear on what question they'd be trying to answer based upon what we saw in the study results.
Yeah. So maybe, Matt, on the top of crinecerfont, I think so we're bullish. We model almost $1 billion in sales at peak. I think some analysts are higher than I am. How are you, as a company you've obviously been bullish about how you're talking about the product, but how are you thinking about it in terms of there could be potential competition down the line from at least one other company? How does that market opportunity potentially change if it's not just Neurocrine fully accepting that Neurocrine would, regardless, be first-to-market?
Yeah. I think you just said it. First-to-market, first medicine for patients in over 50 years. And if it's safe and if it's efficacious, it's going to be hard to displace the use of a medicine like crinecerfont. So my sense is that we'll see how it performs in the real commercial market. But based upon what we saw in the clinical trials, it's going to be an excellent medication that can help. I think Dr. Auchus said unprompted, up to 80% of patients, he believes, who have CAH. So we clearly keep an eye on competition. But for us, with the data that we have in hand, the ability to treat peds immediately, which is the most motivated patient population and those that need care first, we feel like we're really well-positioned for long-term success with crinecerfont in patients with CAH.
Yeah. I guess another question along those lines, Matt, between adult and pediatric population, clearly, it seems like the pediatric population might be more motivated. So would we be correct in assuming that, initially, at least most of the traction should be coming from the peds market?
Well, I think there's two dimensions. One is the patient side. Like you said, clearly, pediatrics, most motivated, the second being women, and then third being adult males. You also then have the motivation to treat by the clinicians. And those who what we call part of centers of excellence or centers of almost excellence, those are going to be the ones that prescribe first. They're involved with the trials. They have understood how it works. And our sense is, once there's adoption there, the local endocrinologist as well as even general practitioners who treat patients with CAH are going to hear about the success based upon feedback from the centers of excellence. In addition to that, I think we've flagged this publicly. It's really exciting to see the build-out of our CAH franchise in the commercial team.
Our expectation is we're going to have the full sales force in place by the middle of July with the whole mission of doing a lot of disease state awareness and just identification of where patients are being treated and understanding what patients are dealing with day in, day out with CAH and trying to engage with the clinicians. So once we do get approval, we're going to be able to hit the ground running quite quickly.
Okay. This might be a question more for Eric, but I'll ask you since he's not here. How are you thinking about the major difference in launching in a rare disease endocrinology market versus the experience you've had in psychiatry and neurology so far for Ingrezza?
That is a better question for Eric. But I think the piece that's different is that these patients are all diagnosed. The piece that's similar is they don't know any better than what they have today. So whether it's tardive dyskinesia, they don't know to talk to their psychiatrist about tardive dyskinesia. They may not even be able to articulate if it bothers them or not. Similarly, a CAH patient, their only form of treatment has been given really high doses of steroid, and that's the best that we can do. So they just deal with all the consequences that come with life. So a lot of what we're going to be doing, patient identification, why is it important to control androgens? That's not a basic question that a patient would understand. What's the long-term side effects of taking high-dose glucocorticoids?
That's not something a clinician sits down and talks to their patients about because there's no other alternative. So I think that this is going to be a process of engaging with patients, helping them understand that there can be something better as well as those local endocrinologists. So there are similarities, but the fact that these are diagnosed patients makes it a bit easier, especially since you have centers of excellence. So there may be a bit of demand upfront from those centers of excellence. But then, I think, similar to Ingrezza, it's going to be slow, linear, blocking and tackling, getting patients on medicine.
Okay. And since you're going to now enter the endocrinology space, not that you need it because Kevin clearly outlined all of the different programs that you have, but Kyle, do you think that you'd be looking more at endocrinology for biz dev purposes now that you're about to launch on an endo product?
I think that we've always been very agnostic in terms of the therapeutic areas that we've had an interest in, in particular from the outside looking in. I'll tell you right now that most of our interest in the activities that we have within business development is geared towards some of the things that Kevin mentioned that are earlier stage within the portfolio and looking at other modalities and driving forward, let's say, accelerating what we're trying to do in research to make sure that we're moving these programs forward as quickly as we can in the clinic and then into Phase II. So while we certainly look out there far and wide for things that are later stage or that might fit nicely into our commercial basket of neurology and psychiatry, now endocrinology, we don't feel like we have a great urgency to do that right now.
We'll see how that evolves over the coming years. But right now, it's really a focus on how can we accelerate those things that are in research and make sure that we continue to fill our early-stage portfolio.
Okay. So let's go back to some of the pipeline updates, Kevin, that you talked about. I did want to talk about 845, which is the AMPA potentiator for which you had positive data released recently. I think it's an intriguing topic to a lot of folks because it could be a very large opportunity, market size-wise, for Neurocrine. You've talked about presenting details of that data at an upcoming medical meeting. To the extent that you can give us color about dosing because that does seem to be what most people are focused on, where is your confidence in this program coming from based on what you've seen so far?
Yeah. So much like I spoke about our Phase III CAH trials as outstanding efficacy but even the outstanding safety and tolerability profile, to have 845 come along, number one, most people have failed with this mechanism. But it's with our partner, Takeda. They discovered this compound in their labs and then partnered with us. I have to give a tremendous amount of kudos and congratulations to our colleagues at Takeda. They developed thousands of compounds against the AMPA receptor. They put them through every test that's imaginable. They spent the real time and effort preclinically on this, and they came up with an outstanding molecule. They then trusted us, put it in our hands. And I think our team did a great job of designing conduct of some Phase I's and Phase II clinical trials that, again, showed unprecedented efficacy here with the AMPA.
We have an effect size with one of the two doses that we studied of 0.73, a p-value of 0.0015. You have a placebo-adjusted change in MADRS of -7.3. I mean, you go through all of that, and you just say, "This is an outstanding result." What makes it even more surprising and compelling is if I showed you the safety tables for placebo in the two doses studied, you'd never be able to figure out which one's placebo and which one's drug dose. The drug was exceptionally well-tolerated. That's a different place to be in treating major depression, especially in treating major depression. The patients that we have in here is this the adjunctive treatment in patients who are inadequately treated. So they're on one or two antidepressants already and still have moderate to severe depression. They are not refractory. That's not the patient population we went into.
We went into those that are inadequate response to antidepressants and saw a great treatment effect there. So we're going to be meeting with FDA, and we're going to be mapping forward the clinical trials, the clinical trials that would take us to registration at this point in time. You're not going to hear a whole lot from us on the doses for competitive and also for intellectual property reasons. You're probably not going to see the way that we behave and have always behaved with our data. You're probably not going to see Phase II published or presented until we're well into Phase III. But you also know us for a long time. When we have equivocal results that make us have to look sideways at data and everything, we're real open and honest about that. We say, "Damn. Wish it could have been clearer. Damn.
We got to do more Phase II's." When we have things that are a clear failure, we come right out and say, "This one didn't make it." That's certainly not the case here. This is much like when we talked about Ingrezza for TD, much like when we talked about Ingrezza for HD, much like when we talked about crinecerfont for CAH. Here we are again with 845. It is very clear that this drug is highly efficacious and very well-tolerated, and we're charging into registration program.
Okay. I'm going to squeeze in one more question. Just when you talk about competitive reasons, is it mechanistically there are other companies pursuing AMPA still, or is it the indication?
Kyle?
Yeah. I think we have a long history of people finding assets in the same category and using our learnings to quickly catch up with us. And there are a number of AMPA programs out there. Most of them had failed for reasons of toxicity. But we certainly don't want to make that easier for them by giving them a potential roadmap to a phase II trial that's positive. I think that's one of the variables Kevin mentioned, the IP piece. And also, we're well aware this is psychiatry. There's high placebo responses in these trials. And by keeping the data close to the vest, we can help control that narrative in phase III, making sure that we deliver everyone here another very positive phase III outcome. And that's really the goal here for us and patients.
Okay. Fair enough. We're out of time. So thanks, guys, for coming downstairs and talking to us for the last 32 minutes or so. And thanks, everybody, for joining in the room. Hope everybody has a great rest of the session. Thanks.
Thank you, Tazeen.
Thank you.
Thank you.