COMPASS Pathways Q3 2023 Earnings Call Transcript

Quartr
Provided by Quartr
November 2, 2023

There are 12 speakers on the call.

Operator

Good day, ladies and gentlemen, and welcome to the Compass Pathways Third Quarter 2023 Conference Call. At this time, all participants are in a listen only mode. As a reminder, this call is being recorded. I would now like to introduce your host for today's call, Stephen Schultz. You may begin.

Speaker 1

Welcome all of you and thank you for joining us today for our Q3 2023 results conference call. Again, my name is Steve Schultz, Senior Vice President of Investor Relations at Compass Pathways. Today, I'm joined by Kabir Nath, our Chief Executive Officer Mary Rose Hughes, our Interim Chief Financial Officer and Doctor. Guy Goodwin, our Chief Medical Officer. The call is being recorded and will be available on the Compass Pathways Investor Relations website shortly after the conclusion and will be archived for a period of 30 days.

Speaker 1

Before we begin, let me remind everyone that during the call today, The team will be making forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as amended. You should not place undue reliance on these forward looking statements. Actual events or results could differ materially from those expressed or implied by any forward looking statements as a result of various risks, uncertainties and other factors, including those risks And uncertainties described under the heading Risk Factors in our quarterly report on Form 10 Q filed with the U. S. Securities and Exchange Commission and in subsequent filings made by Compass with the SEC.

Speaker 1

Additionally, these forward looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to I'll now hand the call over to Kabir Nath.

Speaker 2

Thank you, Steve. Good day, everyone, and thank you for joining us. Let me begin by welcoming Mary Rose Hughes to our call As Interim Chief Financial Officer, Mary Rose has been with Compass since May 2020 when she joined as our 2nd finance team member. She's been instrumental in laying the foundation for our finance organization and led the finance team for our NASDAQ IPO And 3 subsequent equity and debt financings. Mary Rose leads and manages all aspects of our finance operation With the exception of Investor Relations, where she has begun to partner more extensively with Steve.

Speaker 2

I want to thank Mike Fauve For his service and contributions as CFO and in particular for the significant financing we executed in August. We've now initiated an active search for a new CFO, and you should expect a smooth transition as we're in discussions with several strong candidates. After some introductory remarks about the business in the Q3, I will hand the call over to Guy to provide clinical and regulatory updates And then to Mary Rose for the financial update. COMF-five And COMP-six, our Phase 3 trials in treatment resistant depression or TRD remain on track And we continue to expect primary endpoint readouts in summer 2024mid 2025 respectively. Guy will provide more detail on our TRD trials and our other clinical programs in a moment.

Speaker 2

Looking at the external environment, we also continue to see strong esketamine sales sold under the brand name Spravato, Which achieved global sales of $183,000,000 this quarter, an increase of 82% compared to the Q3 of last year. This puts SPRAVATO on a run rate of well over $600,000,000 for 2023 continuing to demonstrate the unmet need We believe this growth continues to be an important driver for the infrastructure of interventional psychiatry facilities And other treatment centers that we expect will be capable of delivering COM360 treatment if approved. We find this continued development very encouraging. This quarter, we also welcomed Daphne Karedas To the Compass Board of Directors, currently President and Chief Financial Officer at Flare Therapeutics, Daphne is a terrific addition to our Board As her biotech experience includes corporate financial management, investment management and investment banking, Adip Biopharma Industry experience and her understanding of investor priorities will help ensure The Compass remains on firm financial and strategic ground. Finally, In August, we completed an up to $285,000,000 private placement financing With $125,000,000 in gross proceeds upfront and up to an additional approximately $160,000,000 in proceeds if the warrants are fully exercised.

Speaker 2

The financing structure was dictated by the investors involved and was very attractive for Compass With the upfront investment accompanied by a warrant of a 30% premium to the last sale price. This effectively functions as an additional financing vehicle if and when the investors exercise their warrants. This financing, supported by a group of premier specialist biotech investors extends our cash runway to late 2025 through multiple planned pivotal readouts. This strong financial foundation permits Compass to move forward confidently with our clinical programs as well as all supporting studies for potential new drug application filing with the FDA. We also continue to invest in our pre commercial work to ensure we're prepared for a successful COM360 launch, if approved, all with the aim of providing broad and equitable access to patients in need of better treatments.

Speaker 2

With that, let me now hand the call to Guy to update you on regulatory and clinical news during the quarter. Guy? Thank you, Kabir. As you've

Speaker 3

heard, both of our Phase III trials in TRD continue to advance with active recruitment. At this time, 3 quarters of the COMF-five sites have been initiated. And for COMF-six, We now have approval for sites in the U. S, Canada, U. K.

Speaker 3

And a number of EU countries. Patient demand is strong given the degree of unmet needs in this population. As I have said before, the process of getting clinical sites Up and running is a complex one, especially navigating the additional administrative detail of working through the DEA licensing and Schedule 1 requirement. Screening and scheduling visits is also demanding for new sites. These complexities can impact the rates of early recruitment.

Speaker 3

So as you would expect, we are paying very close attention to these factors and implementing all steps to ensure we remain on track. Patient demand is strong, however, and is the key We're maximizing eventual rates of accrual at each site. Looking across our area of science, the expertise we have developed In managing the complexity of the Schedule 1 and meeting the clinical and patient management requirements for robust global trials of psychedelics Represent a competitive advantage. Beyond treatment resistant depression, our open label Phase 2 study In post traumatic stress disorder, evaluating safety and tolerability is fully recruited. We expect the top line readout this year and presentation of the full data set to follow next year.

Speaker 3

As we said before, anorexia nervosa is challenging. Patients do not necessarily recognize their need for treatment. This is one reason why it is so difficult to address and why it is so important that we work to find a solution. Anorexia nervosa carries with it the highest mortality rate of any mental health condition and there are no FDA approved treatments available today. We are not yet ready to update the guidance on completion of this study as we have taken some steps including adding 2 additional clinical sites in Ireland and Texas, phone based screening, reduced numbers of in person visits And other protocol amendments to reduce the burden on the patient.

Speaker 3

I will now hand the call to Mary Rose for the financial overview.

Speaker 4

Thank you, Guy. I will now cover the highlights of our Q3 financial results. Comparing this year to last, For the Q3 2023, net loss was $33,400,000 or $0.67 per share, including non cash share based compensation of $4,400,000 compared to a net loss of $18,400,000 or $0.43 per share, including non cash share based compensation of $3,500,000 for Q3 2022. I will now turn to analysis of our current Q3 results compared to the prior Q2 results. Our current quarter financial results reflect our continued success in advancing our Phase III trials in treatment resistant depression and encouraging progress in extending our cash runway with the proceeds from the August financing.

Speaker 4

Cash used in operations in the Q3 were $17,100,000 Towards the higher end of the guidance range we provided last quarter due to the R and D tax credit not yet being received, We now anticipate receiving the credit in the 4th quarter. In this quarter, net loss was $33,400,000 or $0.67 per share compared with a net loss of $28,300,000 or $0.62 per share for the prior quarter. These results include non cash share based compensation of $4,400,000 in this quarter and $4,600,000 in the prior quarter. R and D expenses were $21,500,000 in this quarter compared with $19,800,000 in the prior quarter. The increase was mainly due to external development expenses related to progression of our Phase 3 program.

Speaker 4

G and A expenses were broadly consistent in both quarters at $12,500,000 in this quarter and $12,800,000 in the prior quarter. Turning to our balance sheet. Cash increased by $99,900,000 in the Q3 of 2023. In August, we entered into a securities purchase agreement and received net proceeds of $116,900,000 upon closing. And if investors exercise their warrants, we will receive up to an additional approximately $160,000,000 in cash proceeds.

Speaker 4

Long term debt under our Hercules loan facility was $28,400,000 at the end of the 3rd quarter. Regarding Q4 financial guidance, we expect net cash used in operating activities to be between $9,000,000 $15,000,000 We are now expecting to receive our estimated $14,000,000 R and D tax credit in the 4th quarter. However, the timing of this is uncertain. Turning to full year financial guidance. We are narrowing the range for cash used in operations to between $79,000,000

Speaker 5

and $85,000,000

Speaker 4

We have narrowed our full year range as we approach the end of the year and are able to forecast remaining spend in 2023 Compass continues to maintain a strong financial position with cash and cash Equivalent of $248,000,000 at September 30, 2023, compared with $143,200,000 at December 31, 2022. The August financing has extended our runway into late 2025, which we will continue to manage carefully in order to continue advancing our pivotal programs and achieve important milestones that we believe will create value for our shareholders. Thank you. I'll now turn the call back to Kabir.

Speaker 2

Thank you, Mary Rose. Let me say again that we are pleased with our ongoing progress. Phase 3 clinical site initiations Continue to grow in both trials and in numerous countries. We're less than a year from our initial Phase 3 top line data. So 2024 should be an exciting year for Compass and we look forward to updating you further as we approach this milestone.

Speaker 2

We're also encouraged that interventional psychiatry treatment infrastructure continues to evolve and expand. The growth of esketamine is evidence that people living with TRD need novel rapid acting treatments. We believe COM360 will be an important option for these patients. From January 2024, The new CPT-three tracking code for the provision of services associated with psychedelic medications, which we've discussed extensively in previous calls will also be effective. This may well contribute To the development of both awareness and infrastructure ahead of any potential launch of COM360, if approved, And it's an important component of ensuring broad and equitable access to treatment for patients.

Speaker 2

In closing, with our strong balance sheet, we can navigate these challenging market conditions. We will invest the funds raised in our financing wisely. Our Phase 3 program in treatment resistant depression and our follow on indications are our clear focus. On behalf of the entire Compass team, I want to thank those investors Thank you again for your participation in today's call. We will now turn to Q and A.

Speaker 2

So I'll hand the call back to the operator.

Operator

Thank you. Our first question comes from Ritu Baral with TD Cohen. Your line is open.

Speaker 6

Good morning, guys. Thanks for taking the question. Sabir, I wanted to ask you for a little more detail if you have it around This question of administration centers, potential administration centers, do you have an idea right now as To the number of clinical centers that are giving, SPRAVATO or even Ketamine And what percentage of the existing centers may be appropriate, have the potential expansion capacity For COMF360. And then as a quick follow-up to that, As you open your sites in the clinical sites, and congrats on getting 5 open, all the 5 ones open. As you finish opening them, and they start enrollment, do you feel that they have, in effect, Been completely trained to act as commercial centers or post approval post potential approval, Would there have to be further training and setup before they could flip to commercial?

Speaker 6

Thanks.

Speaker 2

Thanks, Rita. And just to check, you can hear me clearly?

Speaker 5

Yes.

Speaker 2

Great. Thank you for your question. So To the first question, we don't have exact numbers, but our belief is that there are several 100 Treatment centers today that are able to offer esketamine. And that's a mix of some of these interventional psychiatry centers that we've talked about, But also the fact that it's clearly being administered within regional health systems within some of the larger clinics. I think it's important to distinguish that from Ketamine Clinics.

Speaker 2

And again, we've seen clearly that those that were just offering off label Ketamine Have struggled economically and there are more of those, but we don't necessarily see those as appropriate sites For the potential delivery of COM360. But essentially anywhere that is today offering SPRAVATO, we certainly see as being potentially adaptable for the delivery of COM360, and we see the numbers continuing to grow. Part of the pre commercial work we are doing is clearly to acquaint ourselves with some of those to start talking to regional health systems and so on Around how they would see the opportunity to bring COM360 on board. In terms of sites and again just to clarify, We have the majority of sites for 5 now up and running with a few more site initiations to go. So as we've said in the past, our sites are a mixture.

Speaker 2

There are a mixture of some truly academic sites that you wouldn't necessarily expect to be significant from a commercial perspective, But then a number of others that we absolutely do believe will be able to scale rapidly into commercial. In terms of the training, I'll comment, but I will also ask Guy to add his thoughts. Clearly, the training we're delivering today It's intensive and designed for a clinical trial setting. And obviously, that's a unique and very different setting From what we would expect a real world commercial setting to be. By definition, the therapies there are getting very comfortable With the support of patients during the administration of psilocybin, but your specific question as to whether there may need to be some different Modest tailored training for commercial is one we are continuing to work through because it is clearly a different setting from a clinical trial phase.

Speaker 2

Guy, do you want to add anything there? No, just to say that

Speaker 3

I think our training program has evolved really well in the last year, stimulus being the trial, And it will continue to evolve as we move towards commercialization. We work with providers to think about exactly how it will work in practice. So I think we're well on track to see changes, which will be beneficial in the long term.

Speaker 6

Great. Thank you so much.

Operator

One moment for our next question. Our next question comes from Charles Duncan with Cantor. Your line is open.

Speaker 7

Yes. Good morning, Kabir and team. First of all, congratulations on the progress with site openings. Thanks for taking our questions. I had just a couple of questions.

Speaker 7

When you consider the rate limiting steps to progress In 5 and 6, I'm wondering if you believe that site openings Are perhaps a bigger modulator than patient demand. And for those sites That you have opened for 5, are you seeing more than call it a single patient being enrolled? Thanks.

Speaker 3

Thanks, Charles. We're certainly seeing more than single patients. It's still for some of the sites, it's still quite early. The earliest sites have got going pretty well. And we will wait to see exactly how the run rate picks up over the next few weeks.

Speaker 3

As I tried to explain, it is early in the setup Where there are delays and where new sites have difficulty coming to terms with things, but we're pretty confident that those who've got our earliest and who are most Experienced is showing a good run rate, yes.

Speaker 7

Okay. That's helpful. And then moving on to the PTSD, the open label study, No data yet this year, given that it's open label, signal seeking, what would you see as a win? Surely, you're not looking for a P value or anything like that, but I'm quite intrigued with this. So interested to know What would encourage you to call it operationalize the next step?

Speaker 3

Well, it's a safety study. So Acceptability will be the number one question, just how well it went for the patients, how well it went for the therapies. The second issue is obviously, we look at effect sizes of the response in the secondary measures we're making, particularly The measures of trauma memory and what we will do is obviously compare that with existing studies. We can look across the MAP As much as it's difficult to do that with different trials, it's too tempting, and we'll be making decisions on the basis of what we find. So we're looking forward to doing that next year.

Speaker 7

Did you anticipate operationalizing a study next year in PPSD?

Speaker 2

So as we've said, we are very focused on our TRD program, but also completing PTSD and anorexia. Look, clearly, if we see a strong signal, we're always driven by unmet need in the science And we will consider a strategy for how we might take that forward, but there are no decisions at this point.

Speaker 7

Okay. And the cash guide through 5 or mid not 5, excuse me, 25, does that contemplate a study, Kabir? Or Would that be a different set of thinking?

Speaker 4

Yes. So that's through to late 2025. So it doesn't contemplate a Further study, we would consider that as a biopsy, as Kavir said, if the evidence is promising, but not right now.

Speaker 7

Okay, very good. Thanks for taking the questions. Thank you. Thank you, Charles.

Operator

One moment for our next question. Our next question comes from Francois Brisebois with Oppenheimer. Your line is open.

Speaker 5

Hi. Thanks for taking the questions. Just a couple here. So can you you said that you had been discussing with sites about potentially switching Are also allowing COM360 down the road at sites that currently have SPRAVATO that delivers SPRAVATO. How are those discussions going?

Speaker 5

Is there any what potential pushback could there be from sites? Thank you.

Speaker 2

So, yes, I mean, thank you, Frank, for the question. I mean, as I said, I mean, in principle, The premise we're taking in is that anyone who is delayed today delivering SPRAVATO for patients with treatment resistant depression Should first be very interested in potentially delivering COM360 for the same population, but also have clearly taken steps Around establishing physical settings that could be appropriate for COM360. Clearly, The economics of delivering these 2 are very different. So just as a reminder, esketamine per label is 8 administrations in the first Mark 4 in the second and that after requires fairly frequent administrations, but it's a shorter duration of time in the clinic With the monitoring period. With COM360, we're obviously looking at something that is a longer session on the day of dosing, But much less frequent.

Speaker 2

So part of the work we're doing as we engage with these is to really get a deep understanding of the practice economics and Ensure that the appropriate incentives are in place to make it feasible for these places not only to treat with SPRAVATO, but also with COM360. And of course, it's in that context that the work we did on the CPT-three code is so important.

Speaker 5

Great. And then can you help us understand economically forest center and maybe that's evolving, but is it more practical or profitable To have multiple sessions, but then maybe have some holes between sessions or to have a longer session with one patient, What makes more sense economically for the center?

Speaker 2

So what I would say is when you've seen one center, you've seen one center. So that's Part of the answer to that, and that's one of the reasons why this is a lot of work as we build this.

Speaker 8

But I guess to turn

Speaker 2

it around, Frank, I mean, we know But our job is to make sure that it is economically attractive to provide COM360 and we have to understand how that compares to SPRAVATO or TMS or whatever other interventions that these centers may be delivering.

Speaker 5

Okay. And just quickly on my last one, in terms of the press release and You had mentioned a publication recently. Can you just elaborate more on the significance of AI in this space?

Speaker 3

Well, AI is obviously at the top of everyone's mind at the moment. And we've looked We use machine learning and we're using large language models to try and understand the processes that go on both in preparing patients and also in Our initial efforts of this suggest that certainly the session after treatment, We can look at the actual utterances that take place between the therapist and the patient and make a pretty good estimate of whether people are going to be I mean, that's not that's something that is essentially confirming what our other measures tell us. So it's not actually predictive In the sense that it precedes treatment, but we are looking in some detail whether it's possible to do that and whether there are ways of Really understanding patient experience, patient presentation using the kind of measures that emerge from these very complex models that can now be constructed. I think there are other ways in which AI might contribute to training, and we're also And at some point next year, we'll probably tell you a bit more about that because it's quite interesting.

Speaker 2

Thank you. Thanks, Frank.

Operator

One moment for our next question. Our next question comes from Patrick Trucchio with H. C. Wainwright. Your line is open.

Speaker 9

Thanks. Good morning. I have a question about some of the dynamics that we're seeing in the field. So As we begin to see these additional psychedelic compounds generate clinical data in depression and anxiety, I'm wondering if you could provide some perspective on COM360 relative to these compounds and what you see as advantages of your approach to COM360 treatment as compared to others in the field?

Speaker 2

So let me start, and I'm sure Guy will add as well. So I mean, I think, first, we are focused on Generating and delivering the evidence for COM360. And just as a reminder, the Phase 2b we conducted remains by a significant way the largest A most robust study yet done with any psychedelic compound with the potential exception of esketamine if you regard that study group as So I think our view is others have got to generate data on the same sort of And with the same sort of robustness before we can really start comparing across molecules or approaches. Again, as you know, our Phase 3 is designed not only to replicate, but potentially enhance The benefits of COM360 with the repeat dose administration and also generate much more robust data around durability. So very candidly, Patrick, I don't think we're at the stage of making comparisons across assets and so on.

Speaker 2

But if there's a specific Do you want to ask us to address? I'm sure Guy or I could take that.

Speaker 9

Yes. I was Just curious as there's some of these second generation compounds that have Starting to generate data, so with DMT or even with CYP3 as we look ahead Perhaps larger studies with those compounds, how do you think about those relative to COM360?

Speaker 3

Well, I think it would be good to see them, Patrick. It would be good to see a proper study really, and we await those with great interest.

Speaker 9

Fair enough. So then, I guess just a follow-up question on the digital strategy. How do you envision digital being part of the go to market strategy with COM360 In depression, is there an opportunity perhaps to partner with some of the emerging digital therapeutics companies in mental healthcare?

Speaker 2

So I think we've always been clear to say that we regard digital at the time of launch as Tools that potentially are a benefit to both patients and therapists. While we're doing some very interesting work around Understanding some of the markers, understanding, as Guy described just now, how we can actually link What happens in sessions between the therapist and the patient to outcomes? Our expectation is not that, that will be In place for launch, we clearly need to do a lot more work about building robust datasets and validating those. So what we're looking at at launch is Digital tools, if you like, an app, MyPathfinder, Therapist Companion as well. I think clearly digital therapeutics per se has been a pretty challenging field in mental health.

Speaker 2

We haven't really seen anyone establish Scale there yet, but our ambition is To help get patients with serious mental illness to better outcomes. And yes, I can see down the road that could be the potential The synergies are working with some of these other companies that have made progress in that. But right now, that's not a core focus or a core priority for us.

Speaker 9

Yes. That's helpful. And then just one last one. There's a number of these investigator initiated studies They're ongoing across several indications. I'm wondering if you can give us an idea of which of these studies might complete this year or next and which do you think could provide helpful insights

Speaker 3

Yes. I'll take that, Patrick. I mean, we have one, which is I think will be published next year, Which was in TRD in patients primarily drawn from the VA system who have a lot of pre occurring trauma And we also have another one which looks at suicidality rather specifically. And I think that we'll probably have some preliminary data certainly in 2024. I think in addition, we've already I think we've already We've made you aware of the anorexia study in Imperial, but that will probably be fully published later in 2024.

Speaker 3

So I think those three Examples are probably the best. And I mean, we can't be entirely predict some of the others that are As you know, we can't predict any of them properly because they're not our studies. But we know that the 3 I've mentioned will be reporting in some detail in 2024. And of course, they're rather relevant, particularly the TRD and the suicidality studies that they're rather relevant to our core Focus. So we'll be very interested in those.

Speaker 9

Right. Terrific. Okay. Thank you so much.

Operator

One moment for our next question. One moment for our next question. Our next question comes from Jason McCarthy with Maxim Group. Your line is open.

Speaker 8

Hey, guys. This is Michael Okunovich on the line. So I guess to kick off, I'd just like to see if you could expand a little bit on Francois's question regarding the AI model. Given that this is something of an early response analysis rather than a predictive marker, would you look at whether this could be part of the J. Muse:] So, I think, the first question is from the physician process or whether a patient would go into only needing one dose or potentially repeat dose like you're evaluating in the 6

Speaker 3

Thanks. That's a very interesting question. At the moment, We don't know how I mean, at the moment, we're thinking a bit more in relation to the quality of the therapy inputs And how we can feedback to therapists how they're doing. There is this predictive component Very early on, but we're not clear that, that is more predictive than the very early change in symptoms that we also see. That's why I want to be clear that it's not fully predictive in the sense that we don't know that patients are responding by other measures.

Speaker 3

So I think the question is how far it can be automated, how far it's acceptable to actually record Our patients and therapists outside an experimental setting. So I think we're cautious about how it's likely to be practical to apply it. But we do think that it can improve our understanding. It supports our clinical measures because it's clearly not administered by someone. It Purely arises from natural ecologically sound interactions.

Speaker 3

And it also, as I say, may help us in the way in which we Refining the therapist training, which will be very key to how we launch COM360.

Speaker 8

Yes. Thank you for that. And then just one more for me and I'll hop back in the queue. I'd just like to see if you could comment on if Is there anything that you're specifically looking at or evaluating from the MAPS regulatory process and launch prep To possibly help inform your strategic direction for COM360.

Speaker 2

So all I would say on that is obviously we don't have any specific insights into either of those, either their regulatory process or what they're doing for launch prep. But yes, we will clearly be watching that. We will be watching the process of the application, assuming it's Successful assuming the BezanAd comments on and indeed how they prepare for launch. And obviously, we do talk to many of the same sites Many of

Speaker 8

the same positions. All right. Thank you very much for taking my questions today. Thank

Speaker 3

you.

Operator

Our next question comes from Sumant Kulkarni with Canaccord Genuity. Your line is open.

Speaker 10

Good afternoon and morning, Tex. Thanks for taking my question. It's been some time since the Phase 2b trial has ended, But are you still following some patients that were enrolled in that? Do you have any additional anecdotes on how patients might be doing now? And are there any more data we could expect on that?

Speaker 3

Yes. Hi, Samant. Well, we have got, of course, the follow-up data that we're in the process of writing up in full. So that's not people we're still following, but it's data that we haven't fully digested. We will be showing that, I suspect, in 2024.

Speaker 3

There are individual PIs who have a lot of interest in their patients, as you might imagine, and we know that they are conducting quite long term follow ups In the Netherlands, for example, these are not studies that we are sponsoring, so they're really They're not ones we have a great deal of detail about, but we know that they're going on. And we'll be obviously very interested in what those conclusions look like from those studies.

Speaker 10

And then a follow-up on your Phase 3 COMF-five program or even 6, How closely will you be monitoring blinded data, if at all?

Speaker 3

We won't be monitoring any blind we don't monitor blinded data. The data is by definition doesn't come to us. It comes to a third party.

Speaker 8

Thanks.

Operator

One moment for our next question. Our next question comes from Gavin Clark Gartner with Evercore ISI. Your line is

Speaker 1

Ben? Hey, I'm just wondering what screen fail rate you're seeing thus far and how this compares to your assumptions when you design the trial? Thanks.

Speaker 3

We're not really giving out that kind of data, I'm afraid.

Operator

One moment for our next question. Our next question comes from Tom Schroeder with BTIG. Your line is open.

Speaker 11

Good morning. We're all asking kind of similar questions. But I'm curious if in the site recruitment process you're getting a sense Of the final commercial footprint, are you having your pick of sites, which is to say many places want to get involved and then you decide? Or is it kind of the expected power sites? And I'm really wondering if you're getting a sense of whether this will look a little bit like the CAR T world, Where everybody sees this, they're excited about it, but the actual physical footprint is much smaller.

Speaker 11

Thank you.

Speaker 2

Yes. I mean, let me start on that and see if Guy wants to contribute. I mean, I think two things to say. 1, We are being very careful about site selection. I mean, I think everyone knows that large trials in psychiatry are complicated and there are plenty of anecdotes About where poor site selection has contributed to poor results.

Speaker 2

We are very much in control of that process. We're careful. Obviously, we have the nucleus of sites that were successful in Phase 2b or the core of the Phase 3 program. But in going beyond that, It's picking that right mix of academic sites, one that can scale to commercial and so on. I think the second thing I would say clearly though is from a patient demand, as Guy said, there is very significant patient demand and interest in that.

Speaker 2

So obviously not every psychiatrist in a single practice will be in a position to offer COM360 But I think as our trials evolve as others do and so on as SPRAVATTA continues to scale, You're seeing an ever increasing number of potential sites that could deliver this commercially.

Speaker 3

If I could just add, I think the analogy with CAR T isn't Right. I mean, our trials are more difficult to do than clinical practice, and that really makes a difference. If you talk to people who are providers of Clinical services, they really don't have experience or appetite to do clinical trials, but they do have an appetite to provide a good service to an ill served patient population. So we have literally had conversations with providers who were very keen to think about how we could look at implementing treatment in their centers, But really wouldn't dream of offering to do a clinical trial because it's just a different kind of activity. And bear in mind, when you give a clinical trial, You're offering people quite a high chance of failure because of the control arm.

Speaker 3

And that has to be something that the investigator understands and can live with. And for many clinicians, it's really against their human spirit. They really don't like that. So people who do trials are unusual And getting those centers is tough. Getting people to deliver the same treatment in real life, I think will be different and easier compared to clinical trial.

Speaker 11

Great. Thank you for the detail.

Operator

Thank you. That concludes the question and answer session. At this time, I would like I'll turn the call back to management for closing remarks.

Speaker 2

Thanks very much. So once again, thank you everyone for participating on today's call. And as we said, With the private placement financing that we raised in August, that's significant financing, which has the potential for a further financial vehicle as well, We're in a position of strength to continue to execute confidently on our Phase 3 program in TRD. We look forward to updating you with PTSD data At the end of this year and as we've always said, with further milestones in next year. Again, thank you very much all for your attention today.

Operator

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

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Key Takeaways

  • COMF-five and COMP-six Phase III trials remain on track with primary endpoint readouts expected in summer 2024 and mid-2025, respectively.
  • Completed a $285 million private placement in August, securing $125 million upfront and potential for an additional $160 million from warrant exercises, extending cash runway to late 2025.
  • Reported a Q3 2023 net loss of $33.4 million ($0.67/share) versus $18.4 million a year ago, driven by higher R&D expenses, with cash used in operations of $17.1 million.
  • Spravato sales rose 82% year-over-year to $183 million in Q3, implying a 2023 run rate above $600 million and supporting expansion of interventional psychiatry facilities.
  • The open-label Phase II PTSD study is fully recruited, with topline safety and tolerability data expected later this year to inform potential next steps.
AI Generated. May Contain Errors.
Earnings Conference Call
COMPASS Pathways Q3 2023
00:00 / 00:00