Welcome to the Minerva Neurosciences Year-End 2018 Conference Call. At this time, all participants are in a listen-only mode. There will be a question-and-answer session following today's prepared remarks. This call is being webcast live on the Investors section of Minerva's website at ir.minervaneurosciences.com. As a reminder, today's call is being recorded. I would now like to turn the call over to William Boni, Vice President of Investor Relations and Corporate Communications at Minerva. Please proceed.

Good morning. A press release with the company's year-end 2018 financial results became available at 7:30 a.m. Eastern Time today and can be found on the Investors section of our website. Our annual report on Form 10-K was also filed electronically with the SEC this morning and can be found on the SEC's website at www.sec.gov. Joining me on the call today from Minerva are Dr. Remy Luthringer, Executive Chairman and Chief Executive Officer; Mr. Rick Russell, President; and Mr. Geoff Race, Executive Vice President, Chief Financial Officer and Chief Business Officer. Following our prepared remarks, we will open the call for Q&A. Before we begin, I would like to remind you that today's discussion will include statements about the company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. We caution that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated. These forward-looking statements are based on our current expectations and may differ materially from actual results due to a variety of factors that are more fully detailed under the caption Risk Factors in our filings with the SEC, including our annual report on Form 10-K for the year ended December 31, 2018, filed with the SEC on March 12, 2019. Any forward-looking statements made on this call speak only as of today's date, Tuesday, March 12, 2018, and the company disclaims any obligation to update any of these forward-looking statements to reflect events or circumstances that occur after today's call, except as required by law. I would now like to turn the call over to Remy Luthringer.

Thank you, Bill and good morning everyone. Thanks for joining us today. Minerva is enrolling patients in five clinical trials with three product candidates. Each product has a potential to contribute meaningfully to the treatment of its respective target indication. For roluperidone, we are conducting a Phase 3 study in schizophrenia, specifically the negative symptoms associated with the disease. For seltorexant, we are conducting three phase 2b studies in major depressive disorder and insomnia. For MIN-117, we are engaged in a phase 2b trial in anxious depressive disorder. In addition, we continue to work on strategic research and development of each of our molecules which will inform our future regulatory and commercialization tragedy. We would like to first discuss our lead compound roluperidone also known as MIN-101. Roluperidone is a subject of an ongoing pivotal Phase 3 trial as monotherapy for the treatment of negative symptoms in patients diagnosed with schizophrenia. This multicenter, randomized, double-blind, placebo-controlled, 12-week study is designed to evaluate the efficacy and safety of 32 milligrams and 64 milligrams of roluperidone in other patients suffering from schizophrenia. So 12-week study is followed by a 40-week, open-label optional extension period during which patients on active drug during the double-blind phase will continue receiving the original dose and patients on placebo during the double-blind phase will receive either 32 milligrams or 64 milligrams of active drug. The primary endpoint is a change from baseline in negative symptoms using the positive and negative syndrome scale, PANSS, Marder's negative symptoms factor score, NSFS over the 12-week double-blind treatment period. Briefly, I will describe the main patient inclusion criteria, which include diagnosis of schizophrenia as defined by DSM-5, baseline score of equal or superior to 20 points on the seven PANSS negative items, manifestation and symptomatic stability of negative and positive symptoms…

Thank you, Remy. Earlier this morning we issued a press release summarizing our operating results for the fourth quarter and year ended December 31, 2018. A more detailed discussion of our results may be found in our quarterly report on Form 10-K filed with the SEC earlier today. Cash, cash equivalents, restricted cash and marketable securities as of December 31, 2018 were approximately $88.1 million compared to $133.2 million as of December 31, 2017. We expect that the company's existing cash and cash equivalents will be sufficient to meet its anticipated capital requirements for at least the next 12 months from today and into late 2020 based on our current operating plan. The assumptions upon, which this estimate is based are routinely evaluated and may be subject to change. Research and development expenses were $9 million in the fourth quarter of 2018, compared to $6.5 million in the fourth quarter of 2017. R&D expenses were $34.9 million for the year ended December 31, 2018, compared to $30.3 million for the year ended December 31, 2017. The increase in research and development expenses during the fourth quarter and year ended December 31, 2018, primarily reflect higher development expenses for the Phase 3 clinical trial of roluperidone and the Phase 2b clinical trial of MIN-117. During the year ended December 31, 2018 these amounts were partially offset by lower development expenses for the seltorexant program due to the amendment to our co-development and license agreement with Janssen. General and administrative expenses were $4.6 million in the fourth quarter of 2018, compared to $3 million in the fourth quarter of 2017. G&A expenses were $16.8 million for the year ended December 31, 2018, compared to $10.9 million for the year ended December 31, 2017. The increase in general and administrative expenses was primarily…

Thank you. [Operator Instructions] Our first question comes from the line of Jason Butler of JMP Securities. Your line is open.

Hi. Thanks for taking the question. I just had two. First on roluperidone, can you just give us a little bit more insight into the assessment of rate of variability, and how well you think it’s working? Are you seeing -- what happens when you see higher rates of variability than you would like to? And then secondly for seltorexant and the MDD trials, can you just give us a little bit more color on the patient population being enrolled in those two trials? Thanks.

Yes. Jason, with pleasure. And so for the first question, as you know I mean, this is my favorite topic, how to minimize the variability among rate assessment. And I think we discussed this already in some previous calls. I think the essence is to have -- as a PI and his team in the driver seat is to really before you start any inclusion of any patient, any assessment of any patient, you really need to bring them on speed and you need to try to explain them exactly what you're trying to achieve. And I think this is what we have achieved. We have really created a lot of proximity with the sites, proximity in the sense that we are sharing the same objective and we are sharing the same understanding of the disease of how we have to assess the disease. Now coming to this variability and the assessment how we are doing it? So we are -- basically in this trial we have such kind of tablet where the raters are putting in online the scales. And yes, indeed -- I mean, if I mean, there is something which is inconsistent or where it needs to be prompted to the rater, it pops up immediately and the rater can really reassess the patient and maybe change his mind knowing that he is in the driver seat and he has the final decision on all of this yes. So this is I think the most important -- what we are doing is indeed -- yes I mean, on a continuous basis, we have obviously completely blinded. We have the feedback of the different rating scales and particular is the PANSS scale. And yes, when someone is outside somehow in the normal distribution of the raters, we ask…

Great. Very helpful. Thanks for taking the question and looking forward to all of the readouts in the coming months. Thanks.

Coming soon.

Thank you. Our next question comes from the line of Joel Beatty of Citi. Your line is open.

Hi. Good morning and thanks for taking the questions. The first one is just on the timing for the different clinical trial results coming. Obviously, there are several readouts, all in like mid-year or under the first half or beginning of second half. Could you just narrow it down? Maybe, tell us the order to the extent that you're available of it? And maybe the timing of the next results?

So, Joel, yes, I can definitely give you the order. So, clearly, the first data which will come out are on seltorexant, so -- and I think what will first come out is the trial dealing with depression. Afterwards, we will have very soon -- afterwards, we will have data coming on the insomnia trial with seltorexant and this is quite concomitant with the data on the Phase 2b with 117. And a little bit later we will have the data on the Phase 3 for 101. So this is the order of data readout basically, yes.

Okay, great. And then, for seltorexant, obviously, that's in development with Janssen. Can you talk about, I guess, a few points to that collaboration. One being how you decide to share the data with the data -- top line data be coming from Janssen or Minerva? Another question would be, who decides on kind of the design of the Phase 3 program? And then also, how is cost sharing for that Phase 3 program?

So I will take the first part and maybe I give over to Geoff for the financial aspects or the economic aspects. So clearly, I mean, the -- once the data will come out, when we will have the top line results and all the results. What is planned is, the two teams, the Johnson & Johnson team and the Minerva team are sitting together and we go through all the data. Because I think there is definitely a lot of expertise on the two sides of the table and I think this has been -- since the beginning, we have really exchanged a lot about what is the best design of moving forward and then what are the best studies in the two indications we are following, yes. So, clearly, this will be a common effort to get the maximum out of the data, which will come out, yes. So this is the way we are doing it. Now about your question about Phase 3. Clearly, as you know, we have a joint steering committee and a joint development committee. And I mean here we will debate what will be the best design moving forward on this site. I mean may be Geoff you can give a little bit more granularity of how the things are organized in terms of economics?

Sure. In terms of the Phase 3, obviously, there is just one joint steering committee, but as we move into Phase 3and that design process is well underway as we speak. But in Phase 3, Minerva has responsibility -- decision-making responsibility for the design and the execution of the Phase 3 in insomnia. J&J will contribute in amount of $40 million to the cost of the insomnia study. J&J has the decision-making authority for the MDD study in Phase 3 and we share the costs of the MDD study on a 60/40 basis where Minerva takes 40% of the cost of the Phase 3.

Great. And then maybe one last question on the clinical trial results that are coming first from the trial of seltorexant with depression. What would you see as successful results? What are you looking for from that trial?

So, obviously always looking for how to say a P value but I mean not only yes because how this study has been designed, it is really to finally confirm what is the best dose moving forward, yes. So, as you know in this trial we had -- we have -- initially we have 20, 40 milligram and potentially 10-milligram versus placebo. And again -- I mean this is really a study which is designed in order to really have the maximum of information to select the right dose moving forward. So, this is really the purpose. But again I mean -- and speaking about how we are functioning together with our friends from Johnson & Johnson, we decided at the end of the day to have this study powered correctly in order to get the P value yes, and we are definitely expecting to see a P value here. So, for me, a positive study is definitely having a P value and having a very nice discrimination between one of the doses or some of the doses versus placebo, yes. And as you know when you're looking to the current meta-analysis of what is the difference, what is the delta between placebo and existing therapies speaking here obviously about SSRIs and SNRIs for example. The difference is hardly reaching two point’s difference that's between two and 2.5 points difference. So, obviously, I'm also looking to what is the size of difference between placebo and the different treatments or the different doses because this is also important. Keep in mind just that here we're in a quite specific situation because we are giving our molecule on top of antidepressants and we are dealing here with a patient population who is not responding well to existing therapies. So, I mean the reference we have here is a little bit less important but I mean -- nevertheless to see a very nice delta between placebo and treatment is extremely important. What I'm also looking for is to look to the safety profile as I explained before to answering Jason's question is that I think we have really here an unmet medical need in terms of efficacy for this patient population, for this subpopulation of patients in the ecosystem of depression. But we have also -- we need also a better safety profile and maybe a drug doing something on mood and on sleep. So, I mean I think it's a very rich study with a lot of secondary endpoint. And I think we will learn a lot sorry in order to design the best study moving forward.

Great. Thank you.

You're welcome.

Thank you. [Operator Instructions] Our next question is from the line of Biren Amin of Jefferies, and your line is open.

Yes, hi guys. Thanks for taking my questions. Maybe just to start on roluperidone. Remy, I think you talk about high quality extensively. Can you just provide us what your experience has been so far in the Phase 3 trial? Have you had any high quality issues? If so, how those have been addressed? Thanks.

So, I think I'm extremely reluctant about this one, yes. And I know that we had a lot of debate you and me about this one. When we started, I was always a little bit concerned about integrating some U.S. sites because I mean these sites are more commercially oriented and have a little bit less knowledge about the history of the patient. I think, we did a good job and I think, we won also by being very interactive with the sites. We won credibility and the sites are really understanding what we try to achieve. So I really think that we have currently 160 sites all around U.S. and Europe doing a great job there. So data will tell us, but I'm feeling very comfortable as we speak yes.

Got it. And then on the MIN-117 program with the phase IIb in depression, I think you're looking at patients that also have anxious distress with moderate and severe depression. So can you just help us think about what we should expect on the Marder score which is the primary endpoint for the trial? What would be clinically relevant and proven? Is it still the two-point improvement that you referenced earlier for the SSRI and SNRI? Is that the bar or is it something different?

So it's obviously a very -- a great question yes. So again, yes, at minimum we need to achieve this whatever two-point difference. There is no doubt about it. I obviously hope based on the knowledge we have about the drug and the doses we're using in this trial, so keep in mind that in this trial, we are using 2.5 milligram and five milligram. In the small phase IIa trial, we were using 2.5 and the lower dose. So I'm really expecting that we will see a more important difference here in terms of difference between placebo and treatment and two points. This is definitely clear. But so I think, this trial is also important to teach us about dose-dependent effects clearly between 2.5 and five milligram because that this -- the pharmacology of MIN-117 is quite rich or complex pharmacology. And I think by increasing the exposure, you're probably hitting a little bit more pathways in the brain and very important pathways to get very good response. And obviously one of -- some of these pathways sorry are also involved in controlling anxiety. So I'm really also hoping to see something in anxiety. And just to give a little bit clarity for people who are listening is that we have obviously a classical inclusion criteria for depression, but we have a minimum score in terms of anxiety. So the patients need really to have a minimum score in terms of anxiety. But -- last but not least bottom line what I'm hoping is definitely to see a significant effect because the study is powered to throw a P value. I hope to see something which is more important for depression and two points different. But two points would already be good, but I'm hoping for more. But what is also important is again thinking about the side effect profile or the additional activities of the molecule not only speaking about anxiety, but speaking about cognition, speaking about the overall level of tolerability of the drug because I think that this drug is really positioning as a chronic treatment in depressed patients. Yes, I think we have no -- it's quite interesting as the dynamic going on in the space of mood disorders. We have a lot of drugs who are addressing very acute phases of the disease as you know yes. And these drugs are extremely important, but I mean I think you cannot really think about giving them long-term and you have really a patient population out there who needs a drug which is extremely well tolerated is keeping the efficacy in terms of mood and is improving cognition, is improving sexual function, is improving anxiety levels. And I think this is exactly where we are trying to position 117 and the data will tell us -- this Phase IIb will tell us and we will design Phase III accordingly.

Would you at some point evaluate what this compound comparing it to benzodiazepines which tend to be more prescribed for anti-anxiety purposes in the U.S.?

So, by having worked on benzodiazepines, it seems the first one came out at Roche, yeah? I think that benzodiazepines are extremely good treatments, but like always people are not using them in the right way, yes? And definitely benzodiazepines are extremely good for acute anxiety, for example, but are not good for generalized anxiety disorders, because you have the problem of tolerance, you have the problem of rebound affects. So clearly, there's still a very, very, very important unmet medical need about treating generalized anxiety disorder, yes? If our data are really good in terms of anxiety -- I'm not saying that we have decided because it's -- our decision is always data driven. But if the data is extremely good in terms of anxiety, I'm not excluding the fact that we will also have some thoughts about having studies going on in anxiety, yes.

Got it. And actually one last question back on roluperidone. When -- if Phase III is positive, when could we expect that you would file the NDA? And are there any other small Phase I studies that you need to complete before you file the NDA and post-Phase III completion?

Yeah. So, great question. So, definitely I mean, we -- as we speak, we are working intensively on the NDA preparation, yes. Because you have -- it's is a big, big piece of work as you know, yes. And I think the team is really doing a great job on this. And I have to say that it is looking extremely good. So, this side, you are right. We need to complete the DDI package. So, we are currently doing some additional DDI studies in order to really have the full understanding of the molecule when we have the readout of the Phase III study -- the efficacy study. So, yes, indeed we are working on this. We are also working on some additional preclinical studies which are needed in order to file the NDA, but all this work will be completely ready when we have the readout of the Phase III study. So, afterwards as you know, we will do our best efforts to get as quickly as possible to the stage of discussing with the FDA how we file this NDA and how we move forward. To give you complete exact timing, I think it's a little bit too premature, yeah.

Got it. Thank you.

You are welcome.

Thank you. And at this time there are no further questions. I would like to turn the conference back over to Mr. Remy Luthringer for closing remarks.

Yeah. Thank you so much and thank you for everybody for your participation of -- on today's -- in today's call. And I'm really looking forward to give you updates on all these important readouts coming soon for Minerva. Thank you so much.

Ladies and gentlemen, this concludes today's presentation. Thank you once again for your participation. You may now disconnect. Everyone have a great day.