Good day, and welcome to Praxis' Third Quarter 2021 Update Call. As a reminder, this call maybe recorded. I would now like to turn the call over to Alex Kane, Vice President of Investor Relations and Corporate Communications..

Thank you. Good morning everyone and thank you for joining us today to discuss Praxis' third quarter 2021 corporate update. With me on today's call is our President and Chief Executive Officer, Marcio Souza; our Chief Medical Officer, Bernard Ravina; and our Chief Financial Officer, Tim Kelly.

Please note that today's prepared remarks will focus on recent business and pipeline progress along with a brief update on our third quarter 2021 financial results. We will be referring to supplement slides throughout today’s prepared remarks, which are posted on the Events & Presentation section of our Investor Relations Web site.

So please access them now if you have not already done so. Before we proceed, I would like to remind you that during today's call, we will be making certain statements that are beliefs forward-looking and subject to various risks and uncertainties.

Any statements made during this call that are not statements of historical or current facts are intended to be forward-looking statements pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1955.

We want to emphasize that such forward-looking statements reflect our current expectations, assumptions, and currently available data regarding, among other things, our business operations, development efforts, and regulatory strategy, and are neither predictions nor guarantees of future events.

Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with our business.

For additional detail on the risk factors associated with our business, I encourage you to consult the detailed forward-looking statement disclaimer on Slide 2 of the supplement slides as well as our SEC filings. I'll now turn the call over to Marcio.

Marcio?.

Thank you, Alex, and good morning, everyone. Thanks for joining the call today. It's great to be here, and we're glad to share our recent progress and what's to come with all of you. Last month, Praxis celebrated its one-year anniversary as a public company on the NASDAQ Stock Exchange.

Looking back at where we were a year ago, it's natural to take inventory for how far we've come. As a company, we've been able to make significant progress towards the goal of bringing a number of CNS drugs to people in needs and have physician practices to be able to do it over and over again.

We have a saying here at Praxis, and one that you'll hear more and more in the coming months, Dare for More. While we are proud of how far we've come in the past year, we Dare for More in every aspect of what we do.

From our cells in our everyday work to the patients we are working so hard for and across the portfolio, we are building and advancing every day. Praxis foundation approach to drug developments is the key to our ability to advance multiple problems so efficiently.

This foundation approach is based on four pillars, which seems like three and they underlie each one of our progress. First, we validate targets through genetics. While this principle applies to all our progress, our lead preclinical program, an ASO candidate of PRAX-222 provides an ideal example.

PRAX-222 targets mutations in the SCN2A gene which can cause a rare and devastating epileptic encephalopathy.

The second pillar draws upon the genetic findings and leveraged translational tools such as electroencephalogram, or EEG, which help inform development by, for example, supporting those selection and indicating whether the drug is reaching its targets.

Bernard will highlight this more in depth later when he reveals the initial EEG findings from our PRAX-562 program. The third pillar leveraged this learning and applies them to rigorous and efficiently executed development paths to proof of concept.

The recent positive trial results for PRAX-114 provides a strength signal in perimenopausal depression, or PMD, supporting our decision to move forward with the Phase 2b study in women with menopausal and mood symptoms. Finally, the fourth pillar is about implementing patient-guided development strategies.

Ultimately, this encompasses everything we do at Praxis, from early stage research into late stage developments and eventually commercialization.

Patient-guided developments particularly evident in our lead programs PRAX-114 in MDD and PRAX-944 in essential tremor, which could both address significant unmet needs for people living with these disorders.

For PRAX-114, the potential of a fast-acting antidepressant that takes days, not weeks or months to show the effects combined with improved tolerability relative to their existing therapies would certainly be meaningful for people suffering from depression.

For PRAX-944, the potential of a new treatment option, ideally developed to be given at daytime, when tremor impacts patient’s activity the most holds significant promise. The foundation approach has led to a diverse pipeline that is quickly progressing and growing, as you can see on Slide 4.

I'll point out each of our three clinical programs that’s currently in or soon to be in trials in multiple indications, which highlight the considerably expansion possibility within our existing portfolio.

In addition, our preclinical pipeline is advancing and we anticipate the first-in patient trial of PRAX-222 to initiate in the first half of next year, which would add a fourth program to our portfolio.

The maturation of the portfolio is well represented by the following slides, which shows how we expect to have six placebo-controlled trials active by the end of 2021. This includes the ongoing PRAX-114 registration trial area in monotherapy MDD and a dose-ranging Acapella study and PRAX-944 Essential1 study in ET that recently initiated.

This quarter, we expect to initiate Phase 3 studies for PRAX-114 in essential tremor and PTSD, as well as Phase 2 first-in patient studies for our third clinical program, PRAX-562, which will focus in rare adult cephalgias.

Slide 6 clearly illustrates what this foundation approach has led to, a catalyst-rich period with readouts upcoming for each of our clinical stage programs in the coming year. Bernard will discuss the trials in that momentarily.

Prior to passing the call to Bernard, I want to share that we'll be hosting a Movement Disorder Day in New York City on Friday, December 17. As you can imagine, with multiple programs and trials ongoing in essential tremor, the focus will be on our efforts there.

We are also going to highlight the opportunities for PRAX-944 as a non-dopaminergic treatment for the motor symptoms in Parkinson’s disease, and discuss why this is just the beginning for movement disorder’s franchise. For ET, you can expect a comprehensive view of our clinical results today and a look into our market assessments.

You hear more about the burden faced by people living with essential tremor and you also provide updates on the developments and regulatory paths for ongoing efforts with both PRAX-944 and 114. We're excited to be leading the first advance in pharmacological treatment for essential tremor in over 50 years.

Following our Movement Disorder Day in December, we'll be hosting a Rare Disease Day and Psychiatry Day in the first half of next year. While there's much to look forward to in the remainder of this year, 2022 is shaping up quite nicely to deliver on our promise to patients and all our stakeholders.

In the first half of the year, we expect top line results from our ongoing PRAX-114 trials in depression and anticipate starting a Phase 3 study in MDD later next year. We also share top line results in the first half of 2022 for the PRAX-562 ASSR biomarker study, which is currently dosing in the United States.

Furthermore, in the first half of '22, we plan to initiate a Phase 2 study for PRAX-944 in Parkinson's disease and a Phase 2 trial for PRAX-562 in DEEs, marking the second indication for each one of those programs.

Finally, we expect to start the Phase 1/2 trial for PRAX-222 in the first half of next year, which will be the first in-patient study for this program, and will be the first ASO in Praxis' portfolio to reach the clinical stage. In the second half of 2022, we can expect top line readouts from PRAX-114 in PTSD and ET.

Also, we plan to provide top line results from our ongoing PRAX-944 Essential1 study in ET, which would allow us to initiate a PRAX-944 Phase 3 trial in ET before the end of 2022. As you can see, we fully intend to keep up the pace to progress throughout our portfolio. I’ll now pass the call over to Dr.

Ravina to walk you through our ongoing and upcoming studies, as well as provide a look into PRAX-562 Phase 1 healthy volunteer data, which we just completed.

Bernard?.

Thanks, Marcio. To echo Marcio's comments, it's great to be here with you. I'm looking forward to providing more perspective on our clinical studies and the progress we've made this quarter. On slides 8 and 9, we've included the trial designs for the ongoing PRAX-114 Aria and Acapella studies.

Both trials are currently enrolling, and we're confident in delivering top line results in the first half of next year. Most of you have seen these slides before, so instead of reviewing all the details, I wanted to briefly call out an important aspect of the trial design for both studies.

As you can see, the primary endpoint for these trials is after two weeks, but the blinded treatment period continues out for four weeks. This is critical for two reasons.

First, we believe that 114 will work rapidly to resolve depressive symptoms, and that patients need to be treated through an episode of depression to ensure resolution and prevent relapse, whether that episode is several weeks or several months.

The design was completed in consultation with the FDA, and we believe would allow for demonstration of both fast onset and support longer term treatment with PRAX-114. Second, this design is expected to dampen the placebo effect and thereby help separate signal from noise.

Placebo effect tends to be maximal towards the end of the treatment period, and in the case of the Aria and Acapella studies, the end of treatment period is two weeks after the primary endpoint. Moving on to Slide 10.

Consistent with our focus on psychiatry, we anticipate starting a Phase 2 proof-of-concept study of PRAX-114 for the treatment of PTSD in the fourth quarter of '21, with top line data to come in the second half of '22. PTSD impacts an estimated 11 million adults in the U.S. alone.

And there's a marked and growing need that we believe could be addressed by 114. There's a strong rationale for 114 in this indication based on its mechanism of action and the clinical profile we've seen to date. And while we're well aware there are historical challenges in developing treatments for PTSD, we're confident in our approach here.

A natural role of neuroactive steroids like PRAX-114 is in mediating the response to stress. Deficits in GABA and neuroactive steroids have been documented in patients with PTSD and correlate with clinical symptom severity. Also, PRAX-114 has shown benefits in stress-induced preclinical models of depression and PTSD.

Finally, the rapid onset antidepressant and anxiolytic effects as well as the improvement in sleep seen with 114 in depression would be clinically very important if replicated in PTSD. Next, I'd like to discuss our PRAX-114 essential tremor study.

We believe that people with ET need a medication that is well tolerated, so they can function throughout the day. The goal of this trial is to determine if 114 can improve tremor without tolerability issues when taken during the day.

Our preclinical data in the model of tremor and EEG measures in humans suggests that exposures that correspond to human doses of 10 and 20 milligrams may be effective for tremor. It's important to note that this dose range was well tolerated during the day in previous healthy volunteer studies.

This trial is designed as a three-way crossover of a single dose of 10 or 20 milligrams of 114 or placebo, and this study will allow us to select the dose and regimen of 114 for subsequent trials. We're fortunate to have two distinct mechanisms to address the large ET population, which has a range of treatment needs.

In our lead movement disorders program PRAX-944, we've made good progress across three clinical trials for ET. We previously reported dose-related pharmacodynamic effects of 944 on EEG from about 5 to 120 milligrams, suggesting a broad therapeutic range.

In Part A of our Phase 2a PRAX-944 study in ET patients, which assess doses of 20 and 40 milligrams, we saw reduction in tremor amplitude in the arms of over 40%. We’ll report preliminary open label ET data from Part B later this year, assessing doses of up to 120 milligrams titrated over about four weeks.

Complete data from the open label and the randomized withdrawal period of Part B will be released in the first half of '22. In parallel to these studies, we've assessed the safety and tolerability of up to 120 milligrams of PRAX-944 in a faster 10-day titration regimen in healthy volunteers in a Phase 1 study.

This faster titration regimen confirmed the previously reported safety profile, with no SAEs or dose limiting toxicities. And we believe the results of this study will support flexibility in dosing for ET patients going forward.

Based on the overall safety profile, pharmacodynamic effects and encouraging preliminary efficacy, we've initiated the Essential1 Phase 2b trial.

Essential1 is a randomized, double blind, placebo-controlled dose ranging trial that will assess the safety, tolerability and efficacy of 20, 60, and 120 milligrams of 944 in patients with moderate to severe ET.

We expect top line data from this study in the second half of next year, which will support the design of our Phase 3 trials expected to start before the end of '22. Moving on to our rare disease portfolio, we've completed the Phase 1 SAD/MAD and Food Effect studies for PRAX-562.

Consistent with a mechanism of action and our preclinical data, 562 was well tolerated. Over 14 days of dosing, there were no drug-related SAEs or severe AEs. Over 90% of the treatment emergent adverse events were mild, and they were generally transient around the time of Cmax.

PRAX-562 show generally dose proportional PK, peak concentrations were seen two to three hours after dosing. We observed the half life for four to five days with no appreciable food effect. The highest single dose of 562 studied was 150 milligrams, and the highest multiple dose was 120 milligrams for 14 days.

Importantly, we achieved exposures that are well in excess of those needed for efficacy based on the preclinical data in epilepsy models. Additionally, we saw a dose-related trend in over 50% reduction at the highest dose of 562 on our exploratory biomarker of auditory steady state response.

As with our other programs, we have used EEG to measure effects on ion channels. And in this paradigm, we measured the EEG response to an auditory stimulus. These clinical findings on ASSR are consistent with our preclinical data where ASSR changes tended to occur at exposures well above the EC 50 in epilepsy models.

We started a follow-up healthy volunteer study in the U.S. intended to confirm and extend the ASSR pharmacodynamic findings over four weeks of dosing, which will approach steady state concentrations for 562. We expect to report top line results from this trial in the first half of '22.

The Phase 1 data in the ongoing follow-up study give us confidence in the safety and tolerability profile of 562, in what we believe is a therapeutic dose range.

Based on these encouraging data, before the end of this year, we plan to initiate a Phase 2 trial in adult cephalgias with a cohort of SUNCT and SUNA patients, and a cohort of Trigeminal Neuralgia patients. We also plan to start a PRAX-526 Phase 2 trial for the treatment of developmental epileptic encephalopathies, or DEEs, in the first half of '22.

As you've heard, there's been tremendous progress across our portfolio. We're excited to report our continued progress in the coming months as we readout a number of these trials. I'll now turn the call over to Tim for an update on the financials for the quarter.

Tim?.

Thanks, Bernard, and good morning, everybody. I'm glad to join you all today. I will focus on the key financial updates for the third quarter and would refer you to this morning's press release and our 10-Q on file with the SEC for a comprehensive review of the third quarter financial results.

As of the end of the third quarter, Praxis had $314 million in cash and investments, which is expected to fund operations into the second quarter of 2023, and through the trials and data readouts discussed on today's call.

This compares to $339 million as of the end of second quarter of 2021, a quarter-over-quarter decrease of approximately $25 million. With the breadth of portfolio that Praxis has developed, one way that we Dare for More is through leveraging our strong cash position efficiently and effectively to advance the quickly growing pipeline.

Operating expenses for the third quarter were approximately $44.8 million, an increase of roughly $8.3 million from the prior quarter, which is in line with our internal assumptions on expense growth as our portfolio advances.

The quarter-over-quarter increase in operating expenses was primarily driven by higher R&D expenses during the third quarter, related to ongoing and soon to be initiated clinical trials.

These R&D expenses comprise roughly 75% of third quarter operating expense and approximately 89% of the growth from the second quarter, with the remainder being G&A expenses.

The difference in operating expenses and cash and investments quarter-over-quarter was primarily due to an increase in R&D accruals as well as non-cash charges for stock-based compensation expense. I'll now turn the call back to Alex to cover Q&A with the operator..

Thanks, Tim, and thank you to everyone in today. For the Q&A session, we would ask that you limit yourself to one question initially. If you have follow-up questions, please feel free to return to the queue. With that, operator, please feel free to open up the line for questions..

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

Good morning, guys. Thanks for taking the question. I wanted to ask about how you're looking at some of the other endpoints in the Aria and Acapella study. You guys did walk us through why you're anticipating placebo being mitigated. But one of the other GABA agents has decided in a different trial design to elevate Day 3 as well.

Are you going to be considering elevating Day 3? Does that make sense given the chronic treatment paradigm and these two studies? How do you think about those sort of ultra-fast early time points?.

Thank you, Ritu. Thanks so much for the question and nice to hear from you. So let's maybe go back and remind everyone about what the expectation here, right, for these trials. From our perspective, we've been pretty consistent on how we see the development of GABA agents for depression. So we expect them to start acting fairly fast.

So in that regard, it makes sense to see, as we discussed on the prepared remarks, just the action pretty fast, like in a matter of days. But we do expect that effect to maximize anywhere around like 7 to 10 days or so, as we've seen before.

But quite importantly, we also expect that patients will only benefit -- truly benefit or holistically benefited, if I may, if we keep them on drug for longer.

And that's what Bernard discussed a little bit on his part of the script today in terms of going for four weeks of our trial, and that would allow us directly dose for even going longer in the commercial setting, if we ever get there. Hopefully, we will. So we don't have any plans, maybe to be a little bit more pointed on your question.

We don't have any plans to change the endpoints right now. Those were based on the preclinical and clinical data we have and on the treatment rationale, they were well discussed with the FDA and would be the right way towards depression. We're not trying to salvage this trial.

We’re trying to get that to be registrational and to help patients in needs..

Got it. Thanks for taking the question. I'll hop back in the queue..

Thank you..

Thank you. Our next question comes from Yasmeen Rahimi with Piper Sandler. Your line is open..

Hi, team. Thank you so much for hosting the call and thank you for taking my questions. Team, maybe a good place to start would be just to understand sort of as you pointed out, in the Aria study, your key secondary endpoints are going to be at Day 29 as well. So patients are dosed for over a month.

I guess what do we know about sort of the cadence of somnolence and sedation when we look between treatment duration at week two versus continued duration over to one month? And I think that's going to be really important because a lot of investors might be taking the data from Aria and compare it to maybe other classes that are currently in development.

If you could just provide some commentary how we should be thinking about it, that would be very helpful?.

Absolutely. I’m going to ask Bernard to discuss the safety profile that we see on 114 and address your question..

Yes. Thanks for the question, Yas. As we've seen before, we have a very well tolerated profile overall. And we believe that’s due to the relative preference at extrasynaptic GABAA receptors versus synaptic. We really have not seen anything like next day somnolence in our depression population or in the healthy volunteers who were dosed.

So it's been very well tolerated across the board. There is a little bit of a hypnotic effect at nighttime, which is desirable, but it's short lived around Cmax. In terms of where it occurs with respect to the dosing interval, it’s variable.

In general, we tended to see people experiencing somnolence if they were going to upfront, but it can recur overnight. So we don't see any tolerization to treatment effects. So again, it generally occurs upfront if people are going to have that side effect, but it can’t last through the dosing period.

We certainly have not seen any pattern of accumulation or worsening as people continue to take it..

Thank you, Bernard.

And then, I apologize, just a quick follow up in regards to the upcoming open label cohort from 944 that's expected in this quarter is just kind of remind us, right, like how many patients, what type of data should we be seeing, how should we be looking at this upcoming dataset? Are we looking for consistency versus the six patient data that we have seen so far? So if you could just orient that ahead of this catalyst, it could be very helpful for us? Thank you..

Yes. Thanks a lot. So we'll be presenting data from the open label portion of Part B, so up to 120 milligrams. And then in the first half of next year, we'll have the complete dataset with the randomized withdrawal. So there will be some placebo comparator there.

What we'll be looking for and what we'll be presenting is really the same kind of data you saw from Part A, with a focus on upper limb tremor. We think that's the most important aspect of tremor and the most reliably measure.

In terms of what we are looking for out of the data, this was really overall meant as a safety check for us in terms of titration on higher doses. What we had seen in that 40 milligrams was really very robust improvement of tremor control in the hands, just over 40%. We may or may not see more than that in a small cohort like this.

But certainly 40% or in that ballpark similar to what we saw with 40 milligrams would be very consistent, and certainly enough to move forward with..

And then maybe just to add to part of your question about the patient numbers that we expect. So as we mentioned before, we expect to enroll 12 patients in this cohort. Like it's probably obvious that we hedge , and we're like moving these patients along to get the results later in the year to discuss on December 17 in New York.

We're going to give a comprehensive view about the program, including any other data that we might have at that point in time to inform. I just want to go back to part of the question, we probably talked about this. We’re super excited about 944 and the potential we have..

Great. Thank you so much for taking my questions. We're looking forward to seeing you in New York..

Likewise..

Thank you. Our next question comes from Laura Chico with Wedbush Securities. Your line is open..

Hi. Good morning, guys. Thanks very much for taking the question. I guess I'll stay on the 114 track. One question for you on the Acapella study. And I apologize if I missed this in the opening remarks, but could you remind us kind of more about the powering assumptions here and what would be a positive outcome from Acapella? Thank you..

So Acapella is not powered for accuracy, and I want to be clear about that. And maybe we're not that clear in the past, right. So the way we're looking to this program may be to give out a general overview as Aria and Phase 2/3 is our first registrational trial.

When we talked to the FDA, they did agree with us that we could explore lower dose in a different trial. And that's what we were doing in Acapella. And basically, the going assumption there is that there might be a lower dose than 40 milligrams per day of PRAX-114 that generates similar or the same effects, but with lower side effects.

And that's kind of the going assumption there. So looking for trends in terms of dose-ranging kind of at a more typical Phase 2 dose-ranging study. Obviously, we are putting all the controls in place, all the quality measures were using like eligibility, verification and so on. So we should be able to trust the data that comes out of that.

But the real, I’d say, efficacy path is on 2/3 or Aria that is coming up following the year..

Thanks, Marcio..

Of course..

Thank you. Our next question comes from Myles Minter with William Blair. Your line is open..

Hi, guys. Thanks for taking the question.

Just still 944 and the faster titration Phase 1 study you conducted, can you just sort of frame for us what the nausea rates were and whether they were sort of titration limited there, relative to the titration schedule that you're using in the upcoming open label data that you're going to disclose? And are you using this faster titration schedule in the Essential1 Phase 2 trial? Thanks..

Hi, Myles. I'll start and I'll hand over to Bernard. So the part of the question is no, we are not using this schedule.

The way to look into the fast titration study that we did is when you are planning for, like blockbuster type of drug as we are thinking about 944 to be, look ahead several years and ask how physicians are going to use, what is the expectation in terms of a patient shows up to the clinic, what’s going to be important for them? And that's why the fast titration works for us.

You have a younger cohort and an older cohort on that study, so younger and older than 55 years of age. And we've seen very comparable safety. We're able to dose up to 120 on both cohort in fairly fast. So we definitely can check all the marks that you wanted there. Essential1 has started.

As you know, we're trying to run this program in parallel and accelerate as much as possible. It should be clear from all our press releases, but we do have that trial started and we do have patients enrolled on that trial. So it's moving quite nicely. So we don't expect to slow that down for the new titration.

Now, we might come back or even for the Phase 3 that we expect to initiate next year and implement that, but not for Essential1 right now. I’ll hand over to Bernard to talk a little bit about the safety profile in general..

Hi, Myles. The safety profile we saw with the fast titration was really very similar to what we saw with the original titration at 944-105 study, where we titrated over about a month. So what it overall tells us is that, as we said before, people tend to have nausea, a little dizziness when they start out.

And then they don't seem to really have issues as they titrate up. So we'll unpack those data a bit more at the Movement Disorders Day in December, but overall the profiles are looking the same with the longer or the shorter titration.

So the big picture Marcio was getting at is it's going to allow people flexibility for how quickly they want to or need to get up to higher doses..

Makes sense. Thanks. I'll hop back in the queue..

Thank you..

Thank you. And I have a follow up with Ritu Baral with Cowen. Your line is open..

Hi, guys. Thanks for taking the follow up. I wanted to move to PTSD and the rationale for 114 in PTSD, especially Marcio and Bernard, you were talking about anxiety.

How is anxiety sort of woven into the CAPS-5? I know there's various domains, but it's not -- I feel like there's anxiety components to certain questions and certain sub-domains and not others. I'm just wondering if there's certain sub-domains that you think 114 could improve the most within the CAPS-5..

Yes. We're really excited about PTSD. I think the rationale is particularly strong for the GABAA PAM, especially one with an extrasynaptic preference, given that benzos don't work particularly well in PTSD, and a lot of people actually avoid them as part of the treatment regimen.

So the overall rationale on those, right, endogenous neuroactive steroids, like allopregnanolone, are involved in modulating the response to stress and modulate the HPA axis. There's really good experimental data. And you get reductions in GABA and allopregnanolone in PTSD, and it actually correlates with clinical symptoms.

So in terms of what we're expecting to see, the CAPS-5 is the 30-item scale. It's actually pretty complicated in terms of the different factors that cut across there. But cutting across many of the items are common features of anxiety, worry and avoidance, as well as like dysphoria, depressive symptoms and anhedonia.

And so we're not focusing on any particular domain. We're looking at the overall CAPS-5 Phase 2 exploratory study. So we'll learn in particular domains as they're captured and the CAPS-5 come out. But I expect the benefit we'll see will kind of cut across the domains. It will show up in the overall score. The other factor in there is sleep.

There are a whole range of different kind of sleep impairments from just regular insomnia to nightmares that might be improved with 114. So we're looking broadly, but we expect to learn a lot from this trial..

Got it. And what is the overall prevalence of sleep disorders within PTSD? And are there any sort of trials of the sleep disorder that might, for whatever reason, contraindicate GABA? You mentioned that benzos is not really used for PTSD.

And could you go into why?.

Yes, it's incredibly prevalent, Ritu, and the PTSD is actually interesting as well. We have one of our clinicians in the company is a fellow from MGH. We have a fellowship program with them that focus on sleep or areas of sleep specifically, so it's something we would be looking quite closely at.

And obviously, the pattern has changed depending on the patients and so on. But it's pretty dramatic the impact it has.

And to the point that we always discuss this about other conditions, other mood disorders, when sleep becomes primary to the condition versus secondary, right, like are you like tired all the time or having more of sleep forces, not asleep because of that? So that is central to the condition in our view, and being able to really ease into it versus not feeling okay all the time, and Bernard mentioned benzos here, I think that's the biggest problem there, right, that they just don't feel okay at any time with that.

It seems to be a quite important differentiator for us. And I'll even go back to the preclinical models when you're talking about extinguishing fear, that is a huge rationale for us on this.

But Bernard, anything to add there?.

Yes. I’ll just say that the sleep connection like kind of comorbid with depression, stress disorders like PTSD and conditions like perimenopausal depression, but it's very common. A lot of people actually think that sleep disorders start first in our vulnerability.

But if it's something, that would be a good thing for us to follow up on more and break it out into more detail in terms of the different kinds of sleep disruptions, maybe do that at our Psychiatry Day..

Got it. Thanks for taking the follow up, guys..

Of course, anytime..

Thank you. Our next question comes from Tazeen Ahmad with Bank of America. Your line is open..

Hi. Good morning. Thanks for taking my question. I'm sorry if this part of this question has already been asked before. But Marcio, as far as the essential tremor study is concerned, I think you're going to be releasing data in two tranches. You spoke a little bit about what to expect for this quarter.

But I’m assuming the bigger data release next year, what additional data should we expect to see in totality? And what's going to be your bar for what you think is good enough to move forward overall? Thank you..

Absolutely, and thanks Tazeen. So I'll break it down like what do we expect? As Bernard mentioned, there is not a lot more to be done in terms of tremor reduction when you look into amplitudes. Of course, there is a floor effect on the Tetris. So when you look into the 40% or so that we had before, I could think that that's like outstanding.

And if you were there on that ballpark, that would be great for the next 12 patients or more that are going to be showing up in the next few months. For next year, what we're looking for, like a number of things, right, and this would be earlier in the year.

So one is the more complete datasets, like as many patients that have completed the trial that point in time, the activities of daily living that we're also measuring, we've been doing some work, like exploring some like biomarkers, like digital biomarkers, and we want to talk a little bit more about that as well and how that would enable the Phase 3 program.

And quite importantly, how much patients come back to baseline after discontinuation, right? And that's the randomized withdrawal phase of that trial, and that's why we need to wait a little bit longer to wrap that up.

That part is blinded, so it requires a little bit different type of treatment and why we're going to be showing that at the beginning of the year. Our going hypothesis is that it's going to be relatively slow coming back, because there's a more fundamental change to the network by simply reducing tremor.

But again, our going hypothesis is that the oscillations are being modulated in some fundamental treatment for essential tremors, like primordial may I say, in terms of how the brain is wired. So it might actually be that we create a more constant state of production, and that's why we were trying to explore on this trial.

The second one for Essential1 that we used to call 944, 222 and now the name is Essential1, that is a more typical parallel design, so we wouldn't be able to explore on that trial. And that's why we’re separating these two in terms of the learnings.

But in the first quarter and the beginning of the year, we should be able to see -- first or second quarter and the first half of the year, we should be able to see this patient and how much they return. And we hope they do return much for the sake of the patients, but we do expect to see a nice separation there..

I’ll just echo the point that Marcio mentioned, which is roughly 40% reduction we saw in cohort A at 40 milligrams, that was on top. Most people were taking propranolol. So we've been mostly studying this adjunctive. It allows people to come in on one medication.

But the other key point is the floor effect in the Tetris because it's almost impossible to get below a one where tremor is barely visible. So the only thing you can really do is you go up in doses, maybe have higher responder rates. But on a patient-by-patient basis, you'd have to make tremor basically invisible or go away.

So you run into these floor effects unless they have a better measure of tremor..

Okay, that's helpful. Thank you..

Of course..

Thank you. And I have a follow up with Myles Minter with William Blair. Your line is open..

Yes. Hi, guys. Thanks for taking the follow up.

Just on the Phase 2 PTSD study design, what was the rationale for doing a potentially flexed dose of 114 for patients that don't improve on the CAPS-5 over two weeks versus just running a separate 60 mg arm? I've been getting a few questions like, we'd like to see more patients on the 60 mg just given the disclosure that I think of perimenopause or depression patients have sedation at 60 mg, if you could just run me through the rationale for this, it would be great?.

Yes, I'll start with the last part of your question there, Myles. So the formulation that we're using right now is a lot tighter in terms of the exposure that it gets. So we don't expect to have much variability there. So that gives us a nice separation between 40 and 60.

So we're not really seeing much before varied loss , as we discussed on the previous formulation. So that's one. The second one, we're looking to what is the first drive to. So we want to make sure we understand.

Then we look into the actual PTSD patient and the domain, and like how much they would tolerate like exposures off a GABAA PAM or how much their brains would need or their bodies would need? And that's why we thought that if they're going on either action, that for the ones that did not move to the 20% or so in the CAPS-5 would allow for under the discretion to go up to 60.

It gives kind of the best possible way to explore in this space. We do expect most of the patients would not go up there. But it gives us an extra understanding.

And then we will run -- we're probably going to keep these patients for a few more weeks after that as well plan on the feedback we got from all the sites within of open label right after that. And that's what we have in the docks being planned.

So we're going to have a very nice exposure response, understand the safety on this population and being able to hopefully discuss with the FDA what our registrational path will look like afterwards..

Thanks..

Thank you. And at this time, I'm showing no further questions in the queue. I'd like to hand the conference back over to Marcio for any closing comments..

Thank you so much and thanks again for everyone to joining and for all the questions. And on behalf of the team here at Praxis, that was a lot of work and there was a lot that we reviewed today and we're quite pleased to share the progress.

As you saw, there was a lot going on our portfolio and virtually everything advanced quite nicely, so a busy year for us. In just one year as a public company, we advanced like basically every program to this stage. We wanted them to be through proof of concepts.

We're bringing our first ASO to the clinic early next year, as we discussed, and that's super exciting since we have a number of other ASOs to come in the near future. We more than doubled the number of Praxans as we call our fellow colleagues here that work every day to deliver these therapies to patients.

In the last 12 months as well, we surpassed 100 full time employees in the company in the last few months. And we moved to our new headquarters in Boston thankfully. Bernard and Tim are sitting just next to me here in a beautiful weather in Boston.

And finally, we have -- like all the personnel, all the funding that is necessary to continue to tag along and to deliver on the steep growth trajectory in a very practical and efficient manner, right, we're proud of how far we’ve come, no doubt whatsoever on that.

But we always say we Dare for More and we look forward to having all of you right along with us caring for the patients in need. So thanks again for the support and enjoy the rest of the day..

This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day..