Addex Therapeutics(ADXN) - 2022 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company recognized $1.4 million of income in 2022, a decrease from $3.2 million in 2021, primarily due to reduced research funding from collaboration with Indivior [26] - R&D expenses increased to $14.7 million in 2022 from $12.8 million in 2021, attributed to increased outsourced clinical activities and share-based compensation [26] - G&A expenses rose to $7.3 million in 2022 from $5.8 million in 2021, mainly due to increased share-based compensation costs [27] - The company ended 2022 with CHF 7 million in cash, down from $20.5 million at the start of the year, after consuming $17.6 million in operations [28] Business Line Data and Key Metrics Changes - The collaboration with Indivior was extended, with an additional research funding of $1.8 million expected [5] - The mGlu2 NAM program faced challenges during the clinical candidate selection phase, leading to a return to lead optimization [5] - The M4 PAM program for schizophrenia is progressing rapidly through lead optimization, especially following positive Phase III data from a competitor [5][6] Market Data and Key Metrics Changes - The market opportunity for ADX71149 in epilepsy is significant, with over 2 million patients on Keppra, which generates close to $1 billion in annual sales [7][8] - The company has retained significant economic rights in its deal with Janssen, including prelaunch milestones of EUR 109 million and low double-digit royalties on net sales [8] Company Strategy and Development Direction - The company is focusing on advancing its preclinical pipeline, with multiple candidates moving towards IND-enabling studies [25] - Future development plans for dipraglurant include exploring indications in post-stroke recovery and pain management [29] - The company aims to secure partnerships to strengthen its balance sheet and advance its portfolio [30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged disappointing stock performance and market capitalization but expressed optimism about ongoing business discussions and potential partnerships [30] - The company is evaluating the future development of dipraglurant and believes in its value for treating PD-LID and other indications [29] Other Important Information - The company implemented cost-saving measures that significantly reduced monthly cash burn, providing a runway through the end of Q3 2023 [6] - The independent interim review committee established by Janssen will provide recommendations on the ADX71149 study in early Q2 2023 [11][28] Q&A Session Summary Question: What might Janssen consider an unexpectedly positive outcome from the epilepsy proof-of-concept study? - Management explained that Janssen is looking for a go/no-go decision based on how many patients reached their baseline seizure count in Part 1 of the study [32][33] Question: How does the M4 allosteric modulator compare to xanomeline plus trospium? - Management highlighted that their approach uses a selective positive allosteric modulator, which may avoid tolerance issues seen with agonists [35][36] Question: Why has the compensation for the Board and executives increased significantly? - The increase is linked to a reorganization of the share-based compensation program, driven by IFRS 2 calculations [40][41] Question: Why are IND-enabling studies for GABAB not happening earlier? - Management noted that Indivior is conducting thorough profiling of compounds, which has delayed the selection process [44][45] Question: Are patients being recruited for the second part of the ADX71149 study? - Management confirmed that recruitment is ongoing and that patients from Part 1 who did not meet their baseline seizure count have rolled over into Part 2 [47][49]