Xenon Pharmaceuticals Inc TD Cowen Novel Mechanisms in Neuropsychiatry & Epilepsy Summit

Yeah, that'd be great. Thanks, Joe, and thanks very much for hosting us, and good afternoon, everyone. As we've talked about in the past, there's really three parts to Xenon right now that we spend a lot of time with investors on. The lead molecule, azetukalner, in epilepsy, the expansion of azetukalner into the psychiatry program, and then I think we have a really interesting and evolving and maturing early-stage portfolio. We've put three molecules into phase I studies over the past 15 months, and I can touch upon those as well. I think obviously we'll spend a lot of time on the psychiatry program through Q&A, so maybe on the overall remarks, I'll focus a bit more on epilepsy and the pain portfolio, and then we can go a little bit deeper in psychiatry. Obviously we've made tremendous progress this year in epilepsy.

Azetukalner, we had incredibly strong phase IIb results a few years ago from the X-TOLE study. We were really trying to replicate that in X-TOLE2. Those results were released in March, and we exceeded, I think, all expectations, our internal expectations and your expectations, Joe, and others on the street, where we had this incredibly robust separation between 25 milligrams and placebo. Actually, the best placebo-adjusted efficacy we believe has ever been demonstrated in a focal-onset seizure study. Since March, we've really been working to get the NDA filed, and that's what we announced last week. So we filed our very first new drug application for azetukalner in focal-onset seizures, obviously backed by two robust randomized placebo-controlled studies, X-TOLE and X-TOLE2, incredibly strong efficacy, a really well-understood safety and tolerability profile. A couple of things now, obviously we'll get into the FDA review process.

The other update that we had last week as it relates to epilepsy is just how many exposures we have. We announced that we have 1,500 patient years of exposure in epilepsy. Obviously, the double blind are 8 or 12-week studies. We have a significant amount of data in open label. From X-TOLE, we now have patients that have been on the drug more than 5 years. X-TOLE2 patients are also on open label. Really exciting. We'll have an update at the American Epilepsy Society meeting in December of this year as we mature that X-TOLE open label data another year. It'll now be 60-month data. The efficacy in the long term, obviously, we're seeing really strong seizure reductions, and we're seeing these longer periods of seizure freedom, which is really important for these patients.

Then as we think about preparation for commercial, we hired Darren Cline as our Chief Commercial Officer. He's built out his commercial leadership team, and they're really excited as we think about there hasn't been a focal-onset seizure launch since 2019. This is a novel mechanism. Really, we haven't seen enough innovation in epilepsy in the more common forms of epilepsy like FOS. So we're bringing a novel mechanism. We've talked about the profile from an efficacy and safety point of view. Then just for the general neurologists, and Joe, you and I have talked a lot about this, we think this is going to be an important medicine for the specialists, the epileptologists, but also for the general neurologists, and that's because of how the drug is used. It's one pill once a day. We don't have to titrate the drug.

Really, no risk on the DDI side, so you don't have to back-titrate other medicines. So when we think about that overall profile, we think it's going to be really successful in epilepsy, and we're excited to get through the FDA review process and get this drug available for patients. As I said, we've been expanding azetukalner into psychiatry. We had an update last week, which I know we'll go into. We're getting close to the X-NOVA2 data, and we have decided to wrap that phase III program up. We'll talk about that, and we'll talk about the pause that we've had in the rest of the program. So I know you'll have a bunch of questions there, and we'll get to those. Then in the pain portfolio, I think we've made tremendous progress. We think novel analgesics and non-opioid pain medications is a tremendous opportunity.

Our lead programs are just finishing phase I. One is a Nav1.7 molecule, an inhibitor called XEN1701, and then we have a KV7 drug called XEN1120. Those will be in phase II proof of concept pain studies next year. Then we have another one seven molecule that just went into phase I. So I think you're going to see more data from our early-stage portfolio as we head into next year.

Sure. Happy to provide an overview, then we can go a little bit deeper in some of the Q&A. Maybe just even before we get to last week's announcement, I think it'd be helpful just to take a bit of step back. What was the history of this molecule and this mechanism in psychiatry? Then bring us forward to today. I'll give some updates on what we talked about last week, then obviously we've had lots of investor engagement over the past number of days, so I'll weave through some of the questions that we're receiving and some perspective on that as well. Obviously, this mechanism is well understood in epilepsy, and that's been a huge part of our development. We really believe the opportunity for potassium channel modulation has good rationale in both major depressive disorder as well as bipolar depression.

We started a number of years ago to start testing that hypothesis. That started with a phase II proof of concept study in major depressive disorder called the X-NOVA study. I would've called that more of a proof of concept, so a little bit smaller in terms of the sample size, just over 50 subjects per arm. We looked at 10 and 20 milligrams versus placebo, so a three-arm study. Those data were available a couple of years ago, and we found, I think, some interesting conclusions from that study. Number one, we saw a clear dose response. So 10 milligrams separated from placebo, and 20 milligrams separated from 10 milligrams. We saw a clear dose response. The primary endpoint was a clinical scale of depression called MADRS. One of the secondary endpoints was a different scale of depression called HAM-D17.

The reason I mention that's the endpoint we're using in phase III. This mechanism also, we believe, has the opportunity to have an impact on anhedonia, which is an important comorbidity for these depressed patients. So we looked at an endpoint of anhedonia, which is measured on a scale called SHAPS. So out of that study, we believe that we had clear drug activity, clear separation, and a dose response, and we believed we had all of the information to design a phase III program. That was on the efficacy side on those key endpoints. On the safety side, the safety of azetukalner in that X-NOVA study, it was really well tolerated.

It was better tolerated, again, a cross-trial comparison, so the caveats that come with that, but it looked like it was better tolerated in that MDD study than what we were seeing in the epilepsy studies. That was a surprise to us at the time, and I think it was a surprise to people outside the organization as well. Obviously that was part of the decision-making as we moved forward. We are now in a large phase III psychiatry program. We have two phase III MDD studies, X-NOVA2 and X-NOVA3, and we have an ongoing bipolar depression study, which we call the X-CEED study. We initiated these studies. X-NOVA2 was about 18 months ago, X-NOVA3 last year, and X-CEED a little bit more recently. Now we have overall hundreds and hundreds of patients that have been enrolled in that phase III program.

Just like normal drug development, we are looking at blinded data on an ongoing basis, and we are sharing those data also with a DSMB, just in the normal course of running those studies. Really one of the emerging profiles in phase III is that the safety in the phase III psychiatry program is starting to look more like the phase III epilepsy program and probably a little bit different than what we saw in phase II. I will go into a little bit more detail there. This is a very potent mechanism and a very potent drug in terms of reducing hyperexcitability in the brain. What we find is that the safety profile is really well understood, that there is a dose and exposure relationship here. We have some more common adverse events, things like dizziness and somnolence. These are very common adverse events for anti-seizure medicines.