Good morning, and welcome to the BioXcel Therapeutics Conference Call, which will include an update on the company's late stage clinical programs and the discussion of financial results for the fourth quarter and full-year 2023. At this time, all participants are in listen-only mode. After the formal remarks, there will be a question-and-answer session. Just to remind everyone, certain matters discussed in today's conference call and/or answers that may be given to questions asked are forward-looking statements subject to risks and uncertainties related to future events and/or the future financial or business performance of the company. Actual results could differ materially from those anticipated in those forward-looking statements. Risk factors that may affect future results are detailed in the company's quarterly report on Form 10-Q for the quarter ended September 30, 2023, which can be found at www.bioxceltherapeutics.com or on www.sec.gov, and which will be updated in its annual report on Form 10-K for the quarter ended December 31, 2023. As a reminder, today's conference is being recorded. Speaking on today's call are Dr. Vimal Mehta, Chief Executive Officer; Dr. Vince O'Neill, Chief of Product Development and Medical Officer; and Richard Steinhart, Chief Financial Officer. They will be joined in the Q&A session by Frank Yocca, Chief Scientific Officer; Matt Wiley, Chief Commercial Officer; and Dr. Rob Risinger, Chief Medical Officer of Neuroscience. It's now my pleasure to turn the call over to Dr. Mehta. Please go ahead.

Thank you, operator. Good morning and thank you for joining us. This is an exciting time for BioXcel Therapeutics. First, we are very pleased with the progress of our TRANQUILITY program. As I have communicated previously, this is a top priority for capital allocation. Second, we are focused on advancing the SERENITY program. Both programs provide significant opportunities for us to address the unmet needs in treating patients who are struggling with episodes of acute agitation. During today's call, we will dedicate our prepared remarks to updates on TRANQUILITY and SERENITY. These late-stage clinical programs represent groundbreaking opportunities to advance our goal of bringing new treatment options to patients. As a reminder, there are no currently approved acute treatments for agitation associated with Alzheimer's disease or for bipolar disorder or schizophrenia in the at-home setting. These conditions represent large untapped markets. All of us at BioXcel Therapeutics are motivated to develop new treatment options for the greatest number of patients and caregivers. Vince will now provide a detailed update on TRANQUILITY and SERENITY. After this, I will briefly discuss several corporate updates. Rich will then review our financial results before we open the call for Q&A. With that, I will turn the call over to Vince.

Thank you, Vimal. I appreciate the opportunity to speak with all of you this morning and provide an update on our two late-stage clinical programs with BioXcel 501. Let me begin with TRANQUILITY, where we are evaluating 501 as an acute treatment for agitation associated with Alzheimer's dementia, or for short, AAD. As Vimal said, TRANQUILITY remains a top priority to bring a novel treatment to this large, underserved patient population. Every year, estimates show that millions of Americans with Alzheimer's disease experience agitation. Physicians often aim to address this with neuropsychiatric drugs used off label, because there are no approved treatments specifically for acute agitation episodes. This area of neuroscience drug development for an episodic treatment is novel and uncharted, and we believe we are uniquely positioned in this space. At BioXcel Therapeutics, we have IGALMI already on the U.S. market as an approved acute treatment for bipolar disorder and schizophrenia-related agitation. This provides us with a strong foundation from which we are expanding into development in AAD in our TRANQUILITY program and into development in different settings in the bipolar and schizophrenia populations through the SERENITY program. For TRANQUILITY, we have completed now a Type B breakthrough therapy designation meeting with the FDA on February 20. This meeting followed the one we had in October of last year. Let me remind you that we are not in a position to provide detailed information about our overall program plans until after we receive and review the FDA's final meeting minutes. However, we can share now that based on the FDA's feedback, we plan to generate additional Phase 3 efficacy and safety data in care facilities to expand the database beyond the 70 patients who have been treated with 60 micrograms of 501 in TRANQUILITY 1 and 2 to date. We plan to generate these data, including repeat efficacy data, in a variety of relevant care settings and to use PEC as the primary measure as used in the prior TRANQUILITY 2 study. To remind everyone, in November 23, we announced that we were planning to conduct a Phase 3 trial in the at-home setting with safety as the primary objective, otherwise known as TRANQUILITY At Home. Given the priority to expand the database to generate additional efficacy data in care facilities, the company is now reevaluating the timing for initiating TRANQUILITY At Home. Lastly, the FDA has indicated that we will need to generate long-term safety data. However, given the lack of any regulatory precedent for episodic treatment of AD in patients, we plan to further engage with the FDA regarding this requirement. We look forward to receiving final meeting minutes from the agency and sharing more details with you later this month. We're extremely motivated by this potential opportunity to bring a much-needed acute treatment option to patients. Developing novel episodic treatments with no regulatory precedent comes with new learnings to create an optimal development path. At this time, we believe we have a clear path forward. To that point, we've had multiple meetings with the FDA for this uncharted regulatory path and have greatly appreciated the agency's guidance as we move forward to advancing our clinical program. Let's now turn to SERENITY, where we are evaluating the potential at-home use of 501 for agitation associated with bipolar disorders or schizophrenia. On March the 6, we completed a Type C meeting with the FDA. This followed the one we conducted last November. Based on FDA feedback, we plan to evaluate the 120-microgram dose of 501 as a reminder, an approved dose of IGALMI in the at-home setting in an amendment to our SERENITY 3 Part 2 protocol, which the company had voluntarily paused as we discussed the FDA's proposed changes to the protocol in light of the results of SERENITY 3 Part 1. Our current plan is to move forward with this study as amended, with safety as the primary objective and efficacy measures as exploratory endpoints. Keep in mind the label for IGALMI currently includes a limitation on use, noting the lack of efficacy or safety data beyond 24 hours. We believe that our ability to seek labeling without the current limitation will depend in part on the number of agitation episodes we observe over the three-month follow-up period. To support our pivotal trial with the 120-microgram dose, we're also planning to conduct a small study, approximately 30 patients, to evaluate the correlation between patient-reported or informant-reported efficacy with trained rater-reported efficacy using PEC scores. We expect to provide additional information about the program plans after receiving and reviewing final meeting minutes from the FDA. And with that, I will turn the call back over to Vimal.

Thank you, Vince. We are also pleased with progress in other areas of the business. On January 1, the permanent J Code for IGALMI became effective, and our commercial efforts continue to progress. In addition, we continue building a robust intellectual property portfolio and strengthening our long-term patent protection. Finally, we are pleased to have received fast track designation from the FDA for BXCL701. I would like to end my remarks by emphasizing that we remain focused on strengthening the company's balance sheet. To this end, we are actively exploring multiple financial options to extend our cash runway and fund our key clinical programs in order to create maximum value for our shareholders. I would now like to turn the call over to Rich who will review our quarter and full-year 2023 financial results. Rich?

Thank you, Vimal. Net revenue from IGALMI was $376,000 for the fourth quarter 2023 compared to $238,000 for the same period in 2022. The net revenue was $1.4 million for the full-year 2023, compared to $375,000 for 2022. Research and development expenses were $9 million for the fourth quarter of 2023, compared to $32.5 million for the same period in 2022. Research and development expenses were $84.3 million for the full-year of 2023 compared to $91.2 million in 2022. The decreased expenses for both fourth quarter and the full-year were primarily attributed to decreased productivity associated with the wind down of SERENITY III and TRANQUILITY 2 studies, a decrease in chemicals, manufacturing and control costs and a decrease in personnel related to the company prioritization in August of 2023. Selling, general, and administrative expenses were $9.6 million for the fourth quarter of 2023 compared to $20.7 million for the same period in 2022. SG&A expenses were $83.4 million for the full-year 2023, compared to $68.8 million for 2022. The increased costs for the full-year were primarily attributable to an increase in legal and professional fees associated with personnel and related expenses to support the commercialization of IGALMI in the U.S. prior to the company's reprioritization. BioXcel Therapeutics had a net loss of $22.3 million for the fourth quarter of 2023, compared to a net loss of $54.8 million for the same period in 2022. For the full-year 2023, the company reported a net loss of $179 million, compared to a net loss of $165.8 million for the full-year 2022. The loss for 2023 includes approximately $18.6 million in noncash stock-based compensation. Total cash expenditures for 2023 totaled approximately $155 million. Cash and cash equivalents totaled $65.2 million as of December 31, 2023, compared to $193.7 million as of December 31, 2022. The company estimates that its current cash and cash equivalents will fund its operations through mid-2024. The estimated cash runway does not include any potential financing activities that may be undertaken by the company. Now I'd like to turn the call back to Vimal.

Thank you, Rich. We would now like to turn the call for questions. Operator?

Thank you. We'll now be conducting a question-and-answer session. Our first question today is coming from Greg Harrison from Bank of America. Your line is now live.

Hey, good morning, guys. Thanks for taking the questions. So after your recent FDA meetings, it seems you have more clarity for the TRANQUILITY programs. Would you say now you have two separate paths to sNDA in Alzheimer's, one in the care setting and one at home? And then how are you thinking about funding the program and the company as a whole as you get both are to the end of your cash runway? Are there any specific avenues that you're exploring? Thanks.

Good morning, Greg. This is Vince, thanks for the question. To answer directly, yes, we believe so. So obviously, the TRANQUILITY efficacy and PEC primary study and also the safety home study would be run with registrational intent. So yes, in terms of funding, I would refer back to Vimal.

So as Greg stated in my opening remarks, we are looking at multiple options to fund the company. Now having clarity from the FDA clearly tells us what other trials we need to do to capture these large market opportunities both in the TRANQUILITY and SERENITY, and as we speak, we are very actively working on those funds.

Great. Thanks again.

Thank you. Our next question is coming from Robyn Karnauskas from Truist Securities. Your line is now live.

Hi, thank you for taking my questions. So I have two. After the recent meetings with the FDA, you've chosen the 120-milligram dose. And does that mean that would allow for expansion in the at-home setting? I have a follow-up for that.

Yes, good morning, Robyn. So I think the choice of 120-microgram dose, we believe, is a good choice for the following reason: efficacy is fundamentally established for that dose. That's clearly an approved dose of IGALMI, one of two approved doses of IGALMI. So yes, we believe that with that, again, a registrational intended study with safety as the primary is what we need to go back to the FDA with data in that.

And following up on that a little bit. So you'll give the minutes, have you spoken to the FDA clearly about that dose and you'll give them a later at some point?

Yes, sorry to interrupt you. Yes, absolutely. We've spoken to the FDA. We have crystal clarity, I think, on the choice of dose.

Okay. Then last question, sorry for three, that's not great. Regarding funding the program like Vimal, how do you view the situation? You mentioned having many options. How should we consider the need to finance these various programs? They are providing you with feedback. How do you perceive the options available to you?

So Robyn, good morning. In terms of the priority, we will focus on TRANQUILITY, the trial that Vince has discussed, because that can help us on a path to a potential sNDA in the care setting as discussed on this call. And also on the SERENITY program, we have clarity on what dose we can take it forward for a potential registration trial. So our trials, we have a tremendous experience in the company. We are more than 11 placebo-controlled, double-blinded trials. These trials are capital efficient, and the opportunity we have in front of us is very large. But we want to be very focused. And as I mentioned, TRANQUILITY will be the top priority followed by SERENITY.

Great. Thank you.

Thank you. Our next question is coming from Graig Suvannavejh from Mizuho Securities. Your line is now live.

Good morning. Thank you for addressing my question and for your clear responses. I have two questions, if I may. I apologize if the first has already been asked. Regarding the TRANQUILITY at-home program or the TRANQUILITY initiative as a whole, I would like to understand why there is now a need to collect efficacy data, as opposed to merely focusing on safety in previous plans. Secondly, I understand that you need to secure financing for the company moving forward. I am trying to grasp whether you could provide some insight into how much funding you estimate will be necessary to complete the TRANQUILITY at-home program in order to file an sNDA, as well as the total cost for finalizing the SERENITY program. This information is important for investors to understand what additional funds are needed to reach the next revenue milestone. Thank you.

Yes, Graig. So I'll take the first part of that question. It's obviously an important question. So after we met with the FDA last year, and we began to think about the design of the study in depth and in detail and began to engage with our advisers and KOLs, it became clear that using non-validated caregiver assessed instruments would be challenging and would, frankly, carry risk. So with that better understood, we went back to the FDA to rediscuss what 'additional efficacy' meant, and obviously, we've now agreed on a formal efficacy analysis with PEC as a primary endpoint. Clearly, an endpoint we've used before with success. So hopefully, that provides clarity.

Good morning, Graig. This is Vimal. Financing question is very relevant. Now having the clarity from the FDA was very important for us to know about what financing we need to do. So regarding the TRANQUILITY trial that Vince mentioned, it's under actively being designed, and we will be able to share more details about it once we have received meeting minutes, which we expect after 30 days from our meeting on February 20. In terms of the SERENITY at-home trial, we have tremendous experience with SERENITY 1, 2, and SERENITY 3. We have a very good idea in terms of the timing, as well as capital requirements for that trial. And as I said in the beginning, our patient costs are low for these trials. Overall, these trials are capital efficient, and they can be delivered in a reasonable time. So we are working on all of that and we will come back and lay out the plan for TRANQUILITY, as well as SERENITY. We will be having conversations with the capital required based on our current cash position and how much cash runway we need to extend using the means we have, which are equity investment versus monetization of any assets we have or partnership. But all these things are being pursued in parallel, and we will be able to provide clarity on the plan and financing as we progress.

Okay, thank you very much.

Thank you. Your next question is coming from Sumant Kulkarni from Canaccord Genuity. Your line is now live.

Good morning. Thanks for taking my questions. So you mentioned in your prepared remarks that for labeling purposes, the limitation of use is over a 24 to 40-year period, and you'll need to generate more data over three months. When you're doing so, what's the concern that agitation is not necessarily episodic? And in that case, do you still think you might pursue 501 as a rescue therapy?

So I think the first way to answer that is that's not our expectations, but I'm going to ask Dr. Risinger our CMO to comment a little bit further on that. I mean, I guess it revolves around our expectations for frequency.

Yes. I mean, without getting too detailed, the CMAI counts episodes, which includes both the number of episodes and their severity. The FDA has accepted our approach as a key measure for acute agitation. We are eager to clarify how this relates to chronic conditions involving episodes of acute agitation. We plan to discuss that data further, but the reality is that these patients experience acute episodes that require treatment, regardless of whether the treatments used are approved or not.

And then my follow-up is a financial question. So what do all these latest updates mean with respect to your ability to be in line with the covenants associated with the prior financing, how will you need to rework those again?

Good question, Sumant. We are always in discussion with our strategic partner, and they are very supportive of facilitating and having the company be able to get financing, because they really believe in this asset and they see that this is a large market opportunity. So it's a very good partnership, and we work together to chart out the optimal path. I think most important from this call is that we have clarity from an FDA perspective on what we need to do in terms of our path forward for these two projects.

Thanks very much for taking my questions. Can you hear me?

We can.

Okay. So just wanted to see if you could offer some clarity whether quantitative or qualitative regarding the paused study and how much data from that study that was collected before its pause you expect to be usable in furtherance of the development plans for 501.

I'm going to ask Dr. Risinger, our CMO to comment on that as far as we can.

Yes. When you submit for an NDA, all data in all patients who were ever treated with the medication is used. And so to that extent, safety data from that trial is entirely submitted to the FDA.

With respect to whatever information was collected on the activity profile, is any of that information likely to be useful in potentially offsetting future development costs, or I'm just trying to ascertain to what extent you have to recapitulate anything, if indeed you do.

I believe I've grasped the essence of your question regarding whether that data can be incorporated into another study. Generally, that's not feasible; each study needs to remain distinct. However, it is important to note that this does not eliminate the possibility of cost offsets, because ultimately, the FDA requires evidence of exposures and safety, and we have those details. This data is also included in the NDA package.

But I think, Ram, maybe another way to say it, it probably is in the final analysis at a minor cost consideration.

Okay. And then just really quickly, do you have any updates on your plans for OnkosXcel at this time? Thank you.

Ram, we have formally started the process to explore the opportunities, whether it's partnering or monetization. The company is extremely focused right now on seeing the plan for the Neuroscience business, which is TRANQUILITY and SERENITY. Having the clarity, we will have more time to dedicate to focus on OnkosXcel, because as you know, if we can monetize our partner that can help bring non-dilutive financing to the company.

Hey, good morning, guys. And thanks for the update. Pretty sort of piggybacking on a few of the questions we have been asked. Firstly, on the TRANQUILITY program, can you give us any indication on sort of trial size or perhaps more sort of timing? It feels like this is now going to be a back half initiation. So is it reasonable for us to assume that we'll probably see data in the back half of '25? Secondly, on the existing IGALMI launch. Sales are down sequentially. Now acknowledging there's no sales effort, it wouldn't be, you know, is it a price you can tell us why sales are not at least staying flat? And then just a point of clarification on the credit agreement. Again, acknowledging you didn't satisfy one of the requirements. Is it reasonable to expect that we'll get an update shortly after you cement things with FDA? Thank you.

Good morning, Colin. This is Vince. I'll take the first of your three-parter. In terms of timelines, we clearly want to have the meeting minutes in hand and digested before we make any definitive statements. And with that, I'll hand over to...

Sure. Good morning, this is Matt. So to answer your question about Q4 versus Q3, in Q3, remember that we had a fulsome commercial effort for most of that quarter. In Q4, we saw revenues increase 10% versus Q3. We saw our cartons shift to increase by about 8%. That's a pretty tall order considering the fact that we have six corporate account directors in the field versus the 70 reps plus managers we had previously in addition to the cats. So the cat team has really punched above their weight to get to this revenue. We've seen some of the contracting efforts in Q4 begin to matriculate. We're seeing more of that in Q1, and we expect to see continued growth.

Great, thanks and then on the credit?

Colin, this is Vimal. As I mentioned that we are closely partnering with our strategic financing partners, both Oaktree and QIA, and any questions or any conditions that need to be met, they are very collaborative with us and we update those amendments, if needed. So if there is anything needed, we will update you on what is needed on the credit agreement.

Hi, everyone. Thank you for addressing my questions. I have a couple to ask. First, I want to clarify the strategy for the TRANQUILITY program. Is the plan now to focus on expanding the label in care facilities before proceeding with the at-home trial? If so, what is the marketing strategy in that scenario? My second question, which may be directed to Richard, is regarding the significantly lower operational expenses this quarter compared to my expectations. Is Q4 a good estimate for Q1? Thank you.

Hi, good morning. This is Vince again. I'll take the first part of your question. So that is a good way to look at it, right? I think it's also probably reasonable to say that in principle or in theory, we could run studies together, but I think your description is how we look at it, and I think that's a sensible way to approach it.

In terms of the run rate, Samir, yes, it's probably a good marker, plus or minus a few dollars, but generally a pretty good marker.

This is Matt. I'll just dovetail to what Vince just said. Our market entry strategy in this market, if you think about going into the care setting, a lot of those are contracted through IDNs. So we're actively engaged with them now, and it’s going to take a much smaller footprint to engage with those care facilities in SNFs versus the home setting. So we feel that building a beachhead there makes really good commercial sense.

That's great, thanks very much.

Thank you. Our next question is a follow-up from Sumant Kulkarni from Canaccord Genuity. Your line is now live.

Thanks for taking the follow-up. So this might be somewhat of a premature question, but it's still an important one, I think, from a financial modeling perspective. So what are your latest thoughts about the eventual commercial pricing of 501 in the Alzheimer's agitation setting, as it appears that the product might be underpriced currently given the potential value it might bring to the table?

Yes. So that's a great question, and I appreciate it. I mean, right now, when you look at the price point of IGALMI, it's just over $1,400 a month. So there does seem to be some pricing flexibility in that market and one that we continue to examine.

Thank you. We reached the end of our question-and-answer session. I'd like to turn the floor back over to management for any further or closing comments.

Thank you, everyone, for joining us today and for your continued interest in BioXcel Therapeutics. Have a great day.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.