Operator:

Good day, ladies and gentlemen, and welcome to the Xenon Third Quarter 2017 Financial Results. [Operator Instructions]. As a reminder, this conference call's being recorded. I would now like to turn the conference over to Jodi Regts. Ma'am, you may begin. Jodi Regts: Thank you. This afternoon Xenon announced on our Q3 conference call that GlobeNewswire was experiencing severe technical difficulties, and as a result by the start of the conference call, Xenon's news release has not yet crossed the wires. Because of this, we opted to delay the conference call and wait for the news release to be broadly distributed. This recording captures the prepared remarks of senior management for Xenon's Q3 conference call. And this webcast will be archived on our website. This webcast will discuss Xenon's financial and operating results for the third quarter ended September 30, 2017. Joining me on today's call are Dr. Simon Pimstone, Xenon's President and Chief Executive Officer; and Ian Mortimer, Xenon's Chief Financial Officer and Chief Operating Officer. Following this introduction, Simon will provide perspective on Xenon's progress, and then, Ian will review our financial results. Please be advised that during this call, we will make a number of statements that are forward-looking, including statements about the sufficiency of our capital position to execute on our business objectives and our ability to operate in a capital-efficient manner, our expectations regarding the sufficiency of our cash to fund operations into the first quarter of 2019, the timing of IND or IND equivalent submissions with regulatory agencies, the initiation of future clinical trials, the potential efficacy, future development plans and commercial potential of our and our collaborators product candidates, the timing of and results from ongoing clinical trials and preclinical development activities, our ability to achieve certain milestones, in both our proprietary and partner development programs, the plans of our collaboration partners and their interactions with regulatory agencies, the results of our research and development efforts and the status and timing of additional product candidates and related-development activities. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described from time to time in our SEC filings. Our results may differ materially from those projected on today's call. We undertake no obligation to publicly update any forward-looking statement. Today's press release summarizing our third quarter 2017 results and the accompanying quarterly report on Form 10-Q are now available under the Investors section of our website at www.xenon-pharma.com and filed with the SEC and on SEDAR. Now I'd like to turn the call over to Simon. Simon Pimstone: Thanks, Jodi. As we go closer to the end of 2017, we are highly encouraged by the progress we have made in expanding and advancing Xenon's proprietary pipeline. We continue to implement our strategy to leverage our expertise around CNS-based ion channel drug development and have sharpened our focus on advancing novel antiepileptic drugs or AEDs. In our call today, I'll begin by providing a brief overview of our partnered programs and then concentrate on 2 of our proprietary assets, XEN1101 and XEN901, both in development for the potential treatment of epilepsy. We are currently in discussions with our partner Teva to discuss the path forward for TV-45070 program, a topical pain sodium channel inhibitor that we licensed to Teva for the treatment of neuropathic pain. We will provide updates when a decision has been reached on a plan. Turning to our partnership with Genentech. Today we disclosed that GDC-0310, will not enter a Phase II clinical trial in the first quarter of 2018. This change in guidance was predicated upon new data from preclinical toxicology studies with GDC-0310. Further preclinical studies are now underway to better understand these findings. Updated guidance around GDC-0310 will be revised once the preclinical studies are completed. As a reminder, Genentech is responsible for all development decisions and for all costs under this collaboration. Therefore, we can only communicate the information that is provided to us by Genentech. Genentech remained keenly focused on GDC-0310 in the broader Nav1.7 program. While we are disappointed in this delay, we are focusing all of our resources on our proprietary programs of which we maintain complete control. We intend to drive our epilepsy programs forward in order to create imported value-creating inflection points for Xenon. We're also engaged in the second collaboration with Genentech centered on pain genetics with the goal of discovering and validating new therapeutic targets and mechanisms for treating pain. We're focused on identifying genetic targets associated with rare phenotypes, where individuals have an inability to perceive pain over individuals have not precipitated spontaneous severe pain. This collaboration continues to progress well, and we recently identified a second pain target triggering a milestone payment to Xenon in July of this year. I will now turn my comments to Xenon's fully owned assets. In the second half of this year, we have focused on building out our proprietary neurology pipeline with innovative antiepileptic drugs. Xenon's epilepsy programs are comprised of ion channel modulators that have strong human genetic validation supporting the intended drug targets. While ion channel modulators already currently used as AEDs and thus proven to be effective. We believe our approach may have become the limitations of the narrow therapeutic windows of these currently marketed AEDs by providing improved selectivity for the targets. We've been able to expand our propriety CNS pipeline through our own internal research and discovery efforts as well as through in-licensing or acquisition of external assets, XEN1101, which we acquired in April, 2017, exemplifies this strategy and fits exclusively into the strategic focus of our pipeline. XEN1101 was acquired from 1st Order Pharmaceuticals pursuant to an asset purchase agreement. And was initially developed as a next-generation potassium channel opener. The first-generation product ezogabine, also known as retigabine, or by its trade names Potiga and Trobalt was approved in 2011 for the treatment of adult focal seizures. Thus XEN1101's mechanism of action has already shown proven clinical efficacy. In addition to negotiating favorable deal terms that included modest upfront and near-term costs, we identified based on extensive preclinical studies and number of potential key advantages of XEN1101 over ezogabine, including improved pharmacokinetics, selectivity and pharmacology. Before delving into more detail around our XEN1101 program, it is important to understand ezogabine's history in order to understand our proposed path forward with XEN1101. Ezogabine was developed initially by Valeant in license to GSK for commercialization. Soon after the drug was commercially launched, ezogabine received a black box safety label in 2013, when it was noted that some adults who took the drug developed areas of pigmentation in the skin and in the eye. While the FDA black box warning was lifted in 2015 after establishing that the pigmentation did not cause vision loss. This drug-related liability and early FDA warning negatively impacted the overall trajectory of ezogabine sales, and GSK pulled ezogabine from the market around the middle of this year for commercial reasons. Knowing extremely well the history of the earlier-generation drug, I will briefly outline a number of key differentiating factors that provide XEN1101 with potential advantages over ezogabine. XEN1101 has differentiated chemistry over ezogabine. GSK has presented data indicating that its specific chemical reaction formed a dimer that would bind to melanin, which was likely the suspected cause of the observed pigmentation with patients taking ezogabine. Importantly, we do not believe that XEN1101 with its different chemical structure has the potential to form dimers. Thus far, we have been unable to replicate any dimerization with XEN1101. We have shown improved potency of XEN1101 within EC50 in the 20 to 30 nanomole range, which is approximately 10x more potent than ezogabine, against the potassium channel KCNQ2, 3 targets. XEN1101 has also demonstrated improved selectivity with 3- to 4-fold selectivity for the neuronal channels KCNQ2, 3 over other KCNQ2 -- sorry, other KCNQ channels such as KCNQ4, 5, which is found in the bladder. And XEN1101 is proven to be highly selective over other sodium, potassium and calcium channels. In preclinical studies, XEN1101 is also shown to be more potent and broadly effective than ezogabine as well as other AEDs in a number of animal epilepsy models, including treatment-resistant models at ED50 doses 3 to 4x lower than ezogabine. Based on an improved pharmacokinetics profile in in vivo testing, we believe XEN1101 is the potential for once or twice daily oral dosing, which is an advantage over the 3x oral daily dosing regimen of ezogabine. This should yield improved CNS tolerability for XEN1101 over what was observed with ezogabine. In addition, because of ezogabine's regulatory approval and commercial launch, we recognize the advantage of fast-follow status along an already established clinical and regulatory pathway. As we announced in October, XEN1101 is now entered a first-in-human Phase I clinical trial. The XEN1101 Phase 1 clinical trial is a randomized double blind placebo control study that would evaluate the safety, tolerability and PK of both single ascending doses and multiple ascending doses of XEN1101 in healthy subjects. In addition to safety and PK data, the clinical trial has been designed to include a pharmacodynamic readouts by incorporating a pilot transcranial magnetic stimulation or TMS substudy. The TMS model substudy is designed to demonstrate delivery of XEN1101 into the central nervous system and to observe a change in cortical excitability is measured by EEG and/or EMG activity. We elected to do this TMS study since certain other AEDs that have provided seizure control in epilepsy patients have shown an effect in the TMS model. A positive TMS readout would certainly provide a preliminary indication of a PD effect and validation that XEN1101 is getting to the intended targets. Following the completion of the Phase I clinical trial and if supported by the data, it is anticipated that XEN1101 will advance into our Phase II proof-of-concept trial in the third quarter of 2018, evaluating its efficacy as a treatment for adults focal seizures following the path already established by ezogabine. We also intend to explore plans to advance XEN1101 into rare pediatric forms of epilepsy as soon as feasible thereafter. I've spoken previously, about the human genetic validation of Kv7.2 as a target and the scientific rationale to develop XEN1101 as an innovative antiepileptic drug. Briefly, the KCNQ2 gene close to the Kv7.2 voltage gated potassium channel. Loss of function missense mutations in KCNQ2 cause an extremely severe a single-gene epilepsy disorder characterized by multiple, daily, treatment-resistant seizures often presenting within the first week of life. XEN1101, which directly opens the Kv7.2 channel, represents a potential treatment for this treatment-resistant, early infantile epileptic KCNQ2 encephalopathy, also categorized as EIEE7. In parallel, with our ongoing development plans to study XEN1101 in adults with focal seizures, in a Phase II proof-of-concept clinical trial, we're also exploring the options around the regulatory pathways required to study XEN1101 in pediatric patients with EIEE7. Staying within our epilepsy programs, we are also developing XEN901, which is a potent and selective inhibitor of the sodium channel Nav1.6. XEN901 is approximately 1 quarter behind the XEN1101 and its development. You will recall that XEN901 is an asset that was discovered and developed by Xenon's internal research team. Where we leverage our extensive knowledge of ion channel development and we believe we are trailblazers in the NAV1.6 space. Like XEN1101, XEN901 has strong human genetic validation to provide the rationale for treating epilepsy by blocking this Nav1.6 sodium channel. Nav1.6 is the most highly expressed sodium channel in the excitatory pathways in the central nervous system. When mutations in the SCN8A gene cause a gain of function, children present with the very severe form of epilepsy. This is early infantile epileptic encephalopathy, also known as EIEE13. We have developed a mouse model that reproduces this human phenotype with gain of function mutations. And with XEN901, we have demonstrated that we were able to significantly lessen the seizure burden in this animal model. We generated data looking at the effects of XEN901 across multiple different mutations that occur in humans. We were able to inhibit the Nav1.6 channel across these mutations that we identified. Additionally, we have examined XEN901 in preclinical models of both genetically defined as well as more general types of epilepsy. These studies have shown that XEN901 demonstrated efficacy against seizures in both the MES model, which is designed to be predictive of adult focal seizures as well as an SCN8A Nav1.6 genetic gain of function model, which is designed to be predictive of the pediatric genetic epilepsy EIEE13. When compared to phenytoin in the SCN8A model, phenytoin being the gold standard sodium channel blocker that's used to treat patients with epilepsy, approximately 1,000-fold lower brain exposures were required with XEN901, to achieve the same degree of efficacy as phenytoin. As with XEN1101, this extensive preclinical validation is driving our clinical development plans, and we intend to file an IND equivalent for XEN901 by the end of this year in order to initiate a Phase I trial. Similar to XEN1101, we intend to pursue dual clinical development pathways by first following an established pathway examining XEN901 in adult focal seizures while also pursuing options around developing XEN901 for a rare pediatric indication such as EIEE13. As we look ahead to the important milestones within our proprietary programs, we anticipate a number of key inflection points. As noted the XEN1101 Phase I clinical trial is underway. We anticipate the initial TMS readout in the first quarter of next year, and the full Phase I results within the first half of 2018. If supported by the data, we anticipate beginning an XEN1101 Phase II clinical trial examining its efficacy in treating adult focal seizures in the third quarter of 2018. We expect to file an IND equivalent for XEN901 program by the end of this year. Provided XEN901 follows roughly the same time lines as XEN1101, and if supported by the data from the Phase I trial, we could have both of these programs in Phase II development by the end of next year. I hope my comments today convey how excited we are about the advancement of XEN1101 into the clinic as well as the further advancement of both of our ion channel-based epilepsy programs and their potential to treat both adult focal seizures as well as address rare orphan pediatric populations. We look forward to keeping you updated as our clinical development proceeds. I'd like to turn this over to Ian to summarize our financial results for the third quarter of 2017. Ian? Ian Mortimer: Thanks, Simon. I'm going to focus my comments on the key aspects of our third quarter financial results, including our current cash position and cash runway as well as operating expenses. Cash and cash equivalents and marketable securities as of September 30, 2017, were $43.8 million, compared to $64.1 million as of December 31, 2016. Based on our current assumptions, which include fully supporting the planned clinical development of XEN1101 and XEN901 as previously guided, we anticipate having sufficient cash to fund operations into the first quarter of 2019, excluding any revenue generated from existing partnerships or potential new partnering arrangements. Research and development expenses for the quarter were $7.2 million, compared to $6 million for the same period in 2016. The increase of $1.2 million was primarily attributable to increased spending on the preclinical discovery and other internal programs as well as XEN1101, and partially offset by a decrease in XEN801 expenses, which is no longer being developed and a decrease in collaboration expenses. General and administrative expenses for the quarter were $1.7 million, compared to $1.8 million for the same period in 2016. This decrease of $0.1 million is primarily attributable to the fair value adjustment on liability classified stock options. Other income for the quarter was $0.9 million, compared to other expense of $0.4 million for the same period in 2016. The change was primarily driven by an increase in unrealized foreign exchange gains arising from the translation of Canadian denominated balances to U.S. dollars. Net loss for the quarter was $7.7 million, unchanged from the same period in 2016, due to lower revenue, higher R&D expenses, partially offset by higher unrealized foreign exchange gains recorded in the quarter ended September 30, 2017. So in summary, as we continue to build an innovative portfolio of antiepileptic drugs, we plan to efficiently and strategically manage our resources and cash runway. And looking ahead, we envision our 2 proprietary epilepsy programs advancing through clinical development, and both in Phase II clinical trials by the end of 2018, if supported by the data. We are excited by this work within our proprietary programs and we look forward to keeping you updated on our progress. So thank you for joining us on the call today, and we look forward to providing updates on our progress throughout the remainder of the year. Operator, we can now end the call. Operator: Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program, and you may all disconnect. Everyone, have a great day.