Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. You're listening to Bloomberg
Speaker 1: Business Week with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 2: Remember when psychedelics were like all the raid.
Speaker 1: Totally and then they talked to you about them for
Speaker 1: a while.
Speaker 2: And then they weren't because in twenty twenty two we
Speaker 2: saw prices collapse, money was pulling out, trial results weren't
Speaker 2: where they needed to be. It's having a resurgence. According
Speaker 2: to Bloomberg Intelligence analysts, they're estimating that the psychedelic drug
Speaker 2: market could go to seven billion dollars twenty thirty two.
Speaker 1: That's a decent market.
Speaker 2: Yeah, yeah, So the market potential here, they say, is clear,
Speaker 2: but companies could still run into issues with regulators. This
Speaker 2: we know and in upscaling the products. So back with
Speaker 2: us here in studio, which we're so happy about, is
Speaker 2: Kabeir Nath, chief executive officer of Compass Pathways, and so
Speaker 2: great to have you back. You were here last in July.
Speaker 3: Kaber, that's right, and it's great to be back. Thanks
Speaker 3: for the invitation.
Speaker 2: So tell us first off, just a little background for folks.
Speaker 2: This is a your company, Compass Pathways, five hundred and
Speaker 2: fifteen million dollar market cap, not too shabby. Stock is
Speaker 2: up forty two percent year to date. We know there's
Speaker 2: a lot of volatility in this industry too, but that's
Speaker 2: not too shabby either. Tell us what's changed since you
Speaker 2: were in our studios in July.
Speaker 3: Thank you. So we're excited about the fact that we're
Speaker 3: now in a position to potentially accelerate getting this medicine
Speaker 3: to patients who so urgently needed. Let me remind you
Speaker 3: that there are three million patients living with persistent depression
Speaker 3: in the US. Fewer than five percent of them today
Speaker 3: are treated with a medicine that was actually specifically studied
Speaker 3: for or is approved for treatment resistant depression. And this
Speaker 3: is depression that is chronic, it's refactory. Often people are
Speaker 3: unable to work. It has dramatic direct healthcare costs in
Speaker 3: terms of costs of emergency room admissions in psychiatric care,
Speaker 3: but it also has real social costs for these people.
Speaker 3: So what's changed is we've had a really excellent conversation
Speaker 3: with the FDA about their desire to see subject to
Speaker 3: us to continuing to produce really strong results in terms
Speaker 3: of efficacy and safety. Their desire to see this moved
Speaker 3: more quickly. We've completed the enrollment and our second final
Speaker 3: stage study, which we did ahead of expectations, which is
Speaker 3: really down to the phase three. This is a phase three.
Speaker 3: This is the second of our final stage studies. We've
Speaker 3: completed the enrollment of that. We expect to have the
Speaker 3: primary data from that in first quarter of next year.
Speaker 3: That will give us the second of our final stage studies.
Speaker 3: And with that we are actually excited to be able
Speaker 3: to submit that to the agency and look to an
Speaker 3: accelerated approval.
Speaker 1: Wow, that sounds like a really big move. I'm curious.
Speaker 4: Just remind us, and we were talking with our healthcare team,
Speaker 4: how you guys designed the trials or research program to
Speaker 4: avoid some of the pitfalls that we've seen with I
Speaker 4: think about the ecstasy and the mm MDMA drug application
Speaker 4: theF that was for PTSD.
Speaker 1: How did you guys avoid some of those pitfalls.
Speaker 3: So first, we had the opportunity to learn from some
Speaker 3: of the lessons. We've been in an excellent dialogue with
Speaker 3: the FDA now for some six or seven years since
Speaker 3: the first start of this, Since this process, Yeah, as
Speaker 3: we know, drug developing new medicines takes a long time.
Speaker 3: On a lot of commitment. We've done this in a
Speaker 3: very robust and rigorous way. We are collecting full side
Speaker 3: effect data. We're collecting all the issues, not just your
Speaker 3: potential side effects such as headache and fatigue, which are transient,
Speaker 3: but also things like liking and so on, to make
Speaker 3: sure that there is really no abuse potential for this,
Speaker 3: and we've been collecting that right from them.
Speaker 1: Is there any abuse potential for this?
Speaker 3: There is no history in psilocybin of people actually seeking
Speaker 3: it out or of any abuse potential with psilocybin, which
Speaker 3: is an important point.
Speaker 2: I'm putting my investor hat on for a moment, and
Speaker 2: I need to ask you about intellectual property and how
Speaker 2: you handle something like that, because psychedelic compounds don't sort
Speaker 2: of fit comfortably into that compound if you will, because
Speaker 2: a lot of them are natural, they can't really be
Speaker 2: patented if you will, So how do you deal with that?
Speaker 2: And to what extent is your medicine you know, hold
Speaker 2: patents or have intellectual property.
Speaker 3: So our medicine comp three sixty is a fully synthetic
Speaker 3: formulation of psilocybin. Okay, we have polypomorph patents that address that,
Speaker 3: and therefore we have robust protection till twenty thirty eight,
Speaker 3: with the potential for extension around that, because again we
Speaker 3: went for a fully synthetic modern medicine.
Speaker 4: Have you talked directly with the Health and Human Secretary
Speaker 4: Secretary Robert F. Kennedy.
Speaker 3: We are focused on an excellent relationship with the Psychiatry
Speaker 3: division of the FDA. Okay, we've been working with the
Speaker 3: same folks for seven years now, yeh.
Speaker 4: I have certainly made some commentary around this that has given,
Speaker 4: you know, hopes and expectations that this would move along
Speaker 4: more rapidly.
Speaker 3: We're happy that there are senior figures in the administration
Speaker 3: who believe like us in the potential for psychedelic therapy.
Speaker 3: But we're really focused on delivering the right efficacy and
Speaker 3: safety through our studies and working directly with the division
Speaker 3: that's going to approve.
Speaker 2: Us SO trial three phase next year. Early next year,
Speaker 2: give us an idea of a timeline, I mean, when
Speaker 2: might we see something like this come to market.
Speaker 3: We will get the primary data, as I said, in
Speaker 3: first quarter of next year. We will need to submit
Speaker 3: some more data later in the year, but we are
Speaker 3: looking forward to being in a position to complete a
Speaker 3: submission to the FDA in the latter part of next year,
Speaker 3: and then we'll work with them as expeditionally as possible
Speaker 3: and a potential regulatory approval.
Speaker 4: So twenty six, twenty twenty seven, Like, what's I know,
Speaker 4: this stuff all takes long, and I know we consante
Speaker 4: am asking you, but I think because it's been so
Speaker 4: much out there for a while, a decade and then
Speaker 4: some right, I think we're all trying to do, certainly
Speaker 4: for an investing audience, understand when this actually hits the market.
Speaker 3: We are preparing to be ready for a commercial launch
Speaker 3: from the end of twenty twenty six.
Speaker 2: Ah, he said it, Well, thank you.
Speaker 1: What is something like this? What is something like this cost?
Speaker 2: That's the question.
Speaker 3: So it's premature to discuss the pricing for this in
Speaker 3: the moment. First, we actually still need to see some
Speaker 3: of the longer term results from our studies. In particular,
Speaker 3: we need to see over the course of the first
Speaker 3: six months what the potential for a second dose is
Speaker 3: and really therefore how many potential sessions that a patient
Speaker 3: may need to have in a given year.
Speaker 2: That's a great question. You're talking sessions. So this is
Speaker 2: not a drug that someone would continue to take or
Speaker 2: a lifelong sort of drug if you will.
Speaker 3: Absolutely, and it's a really important point there. What we
Speaker 3: have shown in our studies so far is that a
Speaker 3: single session can produce a dramatic response that lasts for
Speaker 3: six weeks today, either it's a daily oral or there
Speaker 3: is a product esketomine, which you will need to take
Speaker 3: maybe thirty to fifty times a year. What we are
Speaker 3: showing is truly transformative therefore for these patients with this
Speaker 3: infrequent session.
Speaker 4: So we're talking with Kabir Notath. He's chief executive officer
Speaker 4: of Compass Pathways. Ticker is CMPs. He's here in our
Speaker 4: Bloomberg studio, Bloomberg Headquarters. Kabir, one of the things I
Speaker 4: think about then is if all goes as you anticipate,
Speaker 4: and you've talked about the market for like who this
Speaker 4: is for specifically, then do you move on to other
Speaker 4: uses and other treatments, whether it's PTSD, whether it's drug addiction,
Speaker 4: Like I'm just curious how far you can go with this.
Speaker 3: Yes, thank you, Carol, And we are designing, have in
Speaker 3: fact already designed and finalized the design of a study
Speaker 3: in PTSD. PTSD affects thirteen million people in America. And
Speaker 3: while there's this view that it's prevalent among veterans and
Speaker 3: so on, it absolutely is that's actually only around fifteen
Speaker 3: percent of that population.
Speaker 2: Only fifteen percent.
Speaker 3: Fifteen percent, actually sixty percent of people suffering with PTSD
Speaker 3: are women, and so this is a very large population.
Speaker 3: The only two drugs medicines approved for PTSD were approved
Speaker 3: in the last century, so this is something new, different,
Speaker 3: and so we are very excited about that we have
Speaker 3: designed a study and that we will be kicking that off.
Speaker 2: I want to go back to the question of price.
Speaker 2: So what about insurance and how does that play a
Speaker 2: part in all of this.
Speaker 3: From the get go, Compass was set up in order
Speaker 3: to ensure broad and equitable access for patients, and that
Speaker 3: means the ability to work with insurers, both commercial and government.
Speaker 3: With the data we've already shown, as I say, a
Speaker 3: single administration producing statistically significant result of reductions in depressive
Speaker 3: symptoms after six weeks, we've already started to demonstrate the
Speaker 3: value that this can bring to the healthcare system. Patients
Speaker 3: living with persistent depression frequently end up in the emergency room.
Speaker 3: They sometimes have in patient's psychiatric care. There are direct
Speaker 3: costs to healthcare systems, and we have already started to
Speaker 3: demonstrate the value.
Speaker 4: You know, and forgive us, Kamir, we do you keep
Speaker 4: going back to I know you can't talk about price
Speaker 4: or your guys A just figuring that out. But we
Speaker 4: kicked off saying, according to our Bloomberg intelligence team that
Speaker 4: this market psychedelic drug development could go to seven billion
Speaker 4: dollars in sales by twenty thirty two.
Speaker 1: How much of that do you.
Speaker 4: Think is or how much of that market size do
Speaker 4: you think you could get?
Speaker 1: And I'm just trying to I'm curious.
Speaker 3: So we have the potential to be ahead of other
Speaker 3: companies in this market by two to three years, and
Speaker 3: we're excited about the opportunity to treat lots of patients.
Speaker 3: So for us, this is about the ability to make
Speaker 3: inroads into those three million patients that need a new
Speaker 3: treatment option. The only medicine that's actually approved and is
Speaker 3: being really promoted for this population today is treating maybe
Speaker 3: seventy to one hundred thousand patients, so that that population
Speaker 3: of three million, right, So what we're excited about is
Speaker 3: the ability to bring this new medicine to those patients.
Speaker 1: Is it a billion dollar dug drug. Would you anticipate
Speaker 1: We would.
Speaker 3: Hope that if we can successfully treat, if we can
Speaker 3: treat a large number of.
Speaker 4: Patients, especially if you get and you expand out, do
Speaker 4: you go for other uses?
Speaker 3: Yeah?
Speaker 2: Do you go alone?
Speaker 3: That's our intention. We've always said clearly that we believe
Speaker 3: that we can do this on our own in the
Speaker 3: US market, and that's our intention.
Speaker 2: All right, what about side effects? I mean, folks are
Speaker 2: listening to this, A lot of folks are hoping that
Speaker 2: this is all going to work and come to market
Speaker 2: sooner rather than later. What are some of the side
Speaker 2: effects though?
Speaker 3: So on the day of dosing, there's some headache, some nausea,
Speaker 3: and that passes by the second day at most, because
Speaker 3: this is a day in a treatment center. We have
Speaker 3: a fully independent group of scientists and clinicians that reviews
Speaker 3: all our safety data on a regular basis. They have
Speaker 3: access to data from all arms of our studies and
Speaker 3: they have seen no unexpected or concerning side effects that
Speaker 3: have caused them to alter the course of the study
Speaker 3: in any way.
Speaker 1: And just remind everybody, and we just got about forty
Speaker 1: seconds co here, right.
Speaker 4: When it is given to a patient, there are folks
Speaker 4: around to really watch the process, make sure things go.
Speaker 2: You're not taking this into your bathroom by yourself.
Speaker 3: This is very much delivered in a safe environment, in
Speaker 3: a medical environment, with somebody in the room who is
Speaker 3: medically trained, who's there just to a sure patient safety
Speaker 3: and comfort.
Speaker 1: Do you see the finish line?
Speaker 3: I absolutely do. We're excited about that potential.
Speaker 4: I just think how long we've been reporting on it
Speaker 4: and talking about it. It's really fun to kind of
Speaker 4: be on this journey.
Speaker 3: I'm just with you.
Speaker 2: I'm just wondering quickly regulatory hurdles in twenty twenty six.
Speaker 2: Do you think that it's going to be a more
Speaker 2: friendly regulatory environment.
Speaker 3: With the Psychiatry Division. We have an excellent relationship and
Speaker 3: that's been consistent over six seven years and we expat.
Speaker 1: Yeah, it sounds like you've been talking to them for
Speaker 1: a long long time. Kabir, thank you, Nice to have
Speaker 1: you in studio.
Speaker 4: Kabir not his chief executive officer of Compass Pathways, joining
Speaker 4: us right here,