• Operating Expenses: $57.1 million in Q3 2024.
• Research and Development (R&D) Expenses: $41.9 million in Q3 2024.
• General and Administrative (G&A) Expenses: $15.3 million in Q3 2024.
• Operating Cash Spend: $27.7 million in Q3 2024.
• Cash, Cash Equivalents, and Marketable Securities: $411.2 million as of the end of Q3 2024.
• Cash at December 31, 2023: $81.3 million.
• Cash Runway: Supports operations into 2027.

• Warning! GuruFocus has detected 4 Warning Signs with PRAX.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Praxis Precision Medicines Inc (NASDAQ:PRAX) is advancing four programs towards registration, representing a substantial multi-billion dollar opportunity.
• The phase three study for Ulixacaltamide in essential tremor is progressing well, with results expected in Q1 2025.
• Positive top-line results were reported for Vormatrigine in a phase two trial, showing a 46% reduction in motor seizures versus placebo.
• The company has a strong balance sheet with $411.2 million in cash, supporting operations into 2027.
• Praxis Precision Medicines Inc (NASDAQ:PRAX) has initiated a second registrational cohort for Vormatrigine, indicating strong momentum in their clinical programs.

Negative Points

• The interim analysis for the essential tremor study has been delayed to Q1 2025, which may impact timelines.
• There is uncertainty regarding the enrollment criteria and potential changes in the expanded cohort for Relugolix in epilepsy.
• The company faces challenges in managing placebo responses in decentralized trials, which could affect study outcomes.
• The commercial potential outside the US is considered opportunistic, indicating potential limitations in global market reach.
• There are concerns about the influence of study one results on study two in the essential tremor program, which could impact the overall program integrity.

Q & A Highlights

Q: Can you provide details on the expanded cohort for Relutrigine in the DEE study and any changes in enrollment criteria? A: Marcio Souza, CEO, explained that the expanded cohort will include 80 patients, with the main difference being the starting dose, which is now 1 mg/kg/day. This change aims for a faster and potentially deeper effect. The enrollment criteria remain largely unchanged, and they are actively screening patients. The company is also aligning with regulators on the Emerald Study Protocol, focusing on phenotypically defining patients for inclusion.

Q: Why was the interim analysis for the Essential Tremor (ET) study delayed to Q1 2025, and how will results be disclosed? A: Marcio Souza, CEO, stated that the delay ensures a comprehensive and successful program execution. The timing allows for a more synchronized readout of both studies, minimizing any negative influence on Study 2. The interim analysis will inform whether to continue, stop, or expand Study 1, with results expected to be disclosed after the interim review board's recommendations.

Q: Will the DEE study include patients with Lennox-Gastaut Syndrome (LGS), and how does this fit into the broader epilepsy strategy? A: Marcio Souza, CEO, confirmed that LGS patients will be included in the DEE study. The focus is on collecting phenotypic information, as LGS is a high user of sodium channel blockers, which aligns with the mechanism of action for Relutrigine. The inclusion criteria are part of ongoing discussions to ensure a comprehensive approach.

Q: What are the commercial prospects for DEE treatments in the US versus ex-US markets? A: Marcio Souza, CEO, highlighted that approximately 70% of the market potential is in the US, with the remaining 30% ex-US. The DEE market is considered a multi-billion-dollar opportunity, with significant unmet needs and potential for substantial revenue even with modest market share.

Q: How does the company plan to manage placebo response in the Essential Tremor study, given its decentralized design? A: Marcio Souza, CEO, noted that they have implemented measures to control placebo response, such as monitoring baseline stability and adding a maximum variability parameter between pre-randomization visits. These steps aim to ensure that the patient cohort remains consistent with previous studies while minimizing placebo effects.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.