Good day, ladies and gentlemen, and welcome to the Xenon Pharmaceuticals' First Quarter 2018 Earnings Conference Call. [Operator Instructions]. I would now like to introduce your host for today's conference Ms. Jodi Regts. Ms. Regts, please go ahead.

Thanks, Danielle. Good afternoon. Thank you for joining us on our call and webcast to discuss our financial and operating results for our first quarter ended March 31, 2018. Joining me on today's call are Dr. Simon Pimstone, Xenon's President and Chief Executive Officer; and Ian Mortimer, Xenon's President and Chief Financial Officer. Following this introduction, Simon will provide perspective on Xenon's progress, and then Ian will review our financial results. After that, we will open up the call to your questions. 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 mid-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 candidate; the timing of and results from ongoing clinical trials and pre-clinical 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 filing. Our results may differ materially from those projected on today's call. We undertake no obligation to publicly update any forward-looking statements. Today's press release summarizing our first quarter results and the accompanying quarterly report on Form 10-Q will be made 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.

Thank you, Jodi, and good afternoon everyone. We have spent the last number of quarters focused on advancing our ion channel neurology pipeline to where we now have multiple clinical stage assets. And importantly, we have exciting catalysts in the near-term, including clinical updates on both XEN1101 and XEN901 that we presented at an international symposium next week in Madrid. I will focus my comments today on XEN1101 and XEN901 as there is no new updates to our guidance around our partnered program with Genentech. As noted on our yearend call, Genentech has completed a Phase 1 clinical trial for GDC-0310, which is an oral selective Nav1.7 small molecule inhibitor developed for the potential treatment of pain. We look forward to updating you once Genentech's ongoing preclinical studies are completed and the final results are analyzed by Genentech. As many of you know, ion channels represent a target class for multiple approved drugs. What makes Xenon's approach unique is that we have developed ion channel modulators that posses enhanced selectivity which we believe will yield drugs with improved indices compared with existing approved products. We believe the advances we have made have the potential for a significant impact in the treatment of epilepsy and other neurological disorders. As mentioned, our pipeline includes two proprietary and highly novel product candidates currently in clinical development, XEN1101 and XEN901. Both have unique mechanisms of action and we believe they contain additional attractive pharmaceutical properties that could yield important therapeutic advances and differentiation from existing antiepileptic drugs. Last quarter, we announced the addition of XEN007, a CNS acting calcium channel inhibitor containing the active ingredient flunarizine. We have received FDA orphan-drug designation of XEN007 for the treatment of hemiplegic migraine or HM, an orphan and often severe form of migraine affecting 30,000 to 60,000…

Thanks, Simon. Staring with our financials, cash equivalence and marketable security as of March 31, 2018, we are $35.1 million. This compared to $43.7 million as of December 31, 2017. There were 14.2 million common shares and 2.9 million series 1 preferred shares outstanding as of March 31, 2018. To provide a little of background on our current shares outstanding, on March 27, we closed a previously announced transaction with Teva to terminate by mutual agreement our collaborative development and license agreement dated December 7, 2012 as amended. In connection with this closing, we cancelled a million common shares of Xenon that were owned by Teva, a transaction that was accretive to all Xenon shareholders. Prior to the cancellation of the Teva owned shares, an existing shareholder, BVF Partners L.P. and its affiliates held a position representing approximately 19.9% of Xenon's outstanding common shares. We signed an exchange agreement with BVF to allow for a one for one exchange of 2,868,000 common shares for the same number of series 1 preferred share to Xenon. Following the conversion to preferred shares, BVF now has greater flexibility with respect to their ownership position. As revenue was not material for the quarter, I'll focus my income statement comments on expenses. Research and Development expenses for the quarter ended March 31, 2018 were $5.6 million compared to $5.9 million for the same period in 2017. The decrease of $0.3 million was primarily attributable to a decrease spending on XEN801, a product candidate that is no longer being developed and the decrease in preclinical discovery and the other internal program expenses. This decrease was partially offset by increase spending XEN1101, which was acquired in April 2017, XEN901 and preclinical and discovery expenses supporting our Nav1.6 program. General and administrative expenses for the quarter ended March…

[Operator Instructions]. Our first question comes from the line of Stephen Wiley from Stifel.

Just wondering if you could maybe provide a little bit of an update with respect to where you are in terms of the juvenile tox data and some of the formulation work that will be required for both 1101 and 901 as you think about moving this into pediatric patients. And then, just also wondering when you think you might be able to initiate some of that regulatory dialogue, obviously, on the back of completing the work that I just asked the question about.

Thank you, Steve. Simon here. Thanks for the questions, an important one. We haven't yet triggered the juvenile tox, that's obviously one gating item. CMC work is initiated. That is probably a 6 to 12 month timeline and obviously, that's a fairly significant range but we're fairly early in the process at the moment, Steve. So, I don't really know where that's going to land. But we estimate probably in the 6 to 12-month timeframe. Our goal is to engage the FDA or other regulatory agencies once we have completed the Phase 1 studies in adults and healthies. The goal right now would be to at least start that engagement in the second half of the year. So don't have more visibility than that from a regulatory perspective but we expect to be able to take the completed Phase 1 data with questions to the regulatory authority such as the FDA in the second half of the year. We would expect that if we do get a path forward with the FDA in this approach, in other words, not a traditional step-down approach but being able to expedite access into these orphan high unmet need indications, we certainly would hope that could be a 2019 activity, but we don't -- we're not issuing guidance on that at this point until we have regulatory feedback.

Understood. And then, just last, you know that there's been, obviously, a lot of discussion around fenfluramine data from Zogenix in Dravet, I guess, specifically in -- just kind of wondering if you think 901 would be a drug that you could envision either working in combination with fenfluramine or providing some kind of synergistic activity on top fenfluramine.

Yes. Again, a great question. Thank you. Steve, we have really -- so, the answer to that is yes. We've really spent a lot of time thinking about this and working on a molecule that really has quite exquisite selectivity. I think the data that we'll be presenting next week should give you and others a flavor of what I'm talking about and we'll be publishing some of that data for the first time. But I think the whole goal was to really develop a drug that can potently block what we think is a critical neuroexcitatory channel in the CNS and we, again, updated to suggest that pan sodium channel blockers while primarily providing efficacy through this channel. So, the idea to really potently selectively block this channel without having ubiquitous binding to other channels should allow us to maximize the effect size and minimize toxicities, which I think both as monotherapy but, of course, is adjunctive therapy could be very useful. The 1.6 mechanism is very well-suited to Dravet. The Dravet syndrome, as you know, is caused, at least the majority of patients, by loss-of-function mutations in other sodium channel, Nav1.1. Pan sodium channel blockers are contraindicated because they block Nav1.1, you don't want to knock it down further. This 1.6 mechanism spares 1.1, we have very, very high selectivity for 1.6 over 1.1. And so, the idea is that this absolutely could be a drug that we think is quite well mechanistically suited to Dravet. We don't expect drug-drug interaction liabilities with 901; it's a very important element of that product. So, this isn't a drug that is significantly inhibits or induced by SIPs. And it's very important here that we have a drug with a differentiated mechanism of action. We know that most prescribers including in pediatrics, required drugs of different MOAs. This is very, very differentiated from anything else. And so, we do see a great potential to have a drug like this used with hopeful synergy with other drugs such as fenfluramine. Now, of course, we need to test that but this certainly something we'll look to do as we move this forward in development.

Our next question comes from Maury Raycroft from Jefferies.

To start, EILAT, for the eight subjects and the TMS analysis, can you remind me how many different doses were assessed in these subjects? And could it be possible to see a dose response using the TMS measure?

Yes, Maury. It's Simon again. There were three doses that we used and we'll present that next week. I think what we're trying to understand from that data is, is this sort of a dose threshold that allows us to see what we believe is a robust signal, and that's kind of what we set out to do. We obviously went into a priority not really knowing what doses would induce the TMS effect in either EMG or EEG and they may differ, EMG and EEGs. But we certainly are hoping to see and we went and expecting to see some threshold that if you cross at a certain dose level, we start to see something and could be really what we'll be looking for. Ultimately, we don't have the benefit with retigabine of whether they had a dose related effect because retigabine was ultimately just study that a single dose, it was the highest dose selected at 400 milligrams. So, I think they took a slightly different tact which was going with the maximum dose tolerated that was approved and run the study at that highest dose. We've done a bit of a dose titration in this pilot study starting at actually low doses and at three dose cohorts and used that as an opportunity to optimize dose selection. I think just as a caution, I think these are small -- relatively small group sizes, two to three subjects per cohort. But I think enough to give us a sense of what maybe thresholds and that's kind of what we set out to achieve with that pilot study.

Got it. That's helpful. And in the presentation at the meeting or potentially in the conference call after, will some of the direct comparisons between historical ezogabine TMS data and 1101 be made?

Yes. In fact, we'll present that as part of the update at the EILAT meeting and we'd be happy to discuss that further in the conference call following.

Great. Okay. And then, for the 42 healthy volunteers, will we be able to draw any conclusions on safety compared to ezogabine's historical safety profile and some of the drug limitations as well?

I think we'll be able to provide color around that. I think this is obviously interim; it's not a full Phase 1. So, just caution that this is not going to -- we're not going to be presenting detail safety tables as we would, obviously, with a complete Phase 1 study. But the aim and goal is to provide you with sufficient sort of color around the safety, tolerability and PK. We will show PK curves and safety will summarize and I think you'll be able to get a good flavor as to what the tolerability looks like in comparison.

Great. Very helpful. And the last question is just on 007. If you could provide any additional details on the agreement for 007 giving you access to the regulatory files and manufacturing support. I guess being comment on who the agreements are with and potentially provide more details on what you have access to.

Yes. No, we haven't provided publicly the names of the partners both on the regulatory data side and on the CMC manufacturing side, these are sort of blue chip companies well-known to this drug but we haven't disclosed names. We have access, essentially, on the regulatory side to all of the nonclinical and clinical files that are available and this is really, really critical just so people understand. The potential advantage of that, of course, is to allow us to expedite development and we believe, potentially, it could start a Phase 2 program without the need of preclinical tox to support that of Phase 1 human safety. The drug is obviously been well studied over decades, there's ample data and we now have an exclusive right of reference to all of that, including clinical data both in the clinic and whatever post marketing data is available. So, that's really on the regulatory side. On the CMC side, it's a company that manufactures the drug, sells the drug. And effectively, we have license to all of the manufacturing, actually, the methods, the validation of these methods, the documentation that comes with that that will be required for submission and actually, the family that will make the product for us. So, I think, again, a very important element of the de-risking of that drug and that the CMC is completely worked up and we will have effectively a completed CMC portion of the IND or any regulatory submission completed. So, those are the clear advantages of the license agreements we have. Anyone who wanted to develop flunarizine, which, by the way, would be only CNS acting calcium channel blocker in the U.S., anyone who wanted to develop that drug would have to start from the beginning in that they won't -- would not have a right of reference as we do have that exclusively. So, we think there is a competitive advantage to the agreements we have in place.

Our next question comes from the line of David Martin of Bloom Burton.

This is Antonia [ph] on the line on for Dave. I just have a question regarding the Phase 1 for 901. Can you please clarify whether you're in fact measuring TMS and whether -- and if so, will that data be presented next week?

Yes. Antonia, thank you. We're not -- it's currently not part of the Phase 1 plan, so there won't be data on TMS. It's not in the protocol; we're not measuring it at the moment. We are having some internal discussions as to whether we want to build that into a next program and maybe part of an early Phase 2 program. We haven't made that decision yet but we -- that is under review. So, you will not see TMS that is not being not for 901 at the moment.

But there will -- I'll just add, there will be some clinical data on 901 next week. So, as a reminder 901 is about six months behind in terms of the start of clinical development behind 1101. So, we do have a more robust package for 1101 in terms of clinical data but 901, we will have some data from the early cohorts that we'll be able to present next week as well.

Okay. And my second question and I know this was addressed kind of earlier in the discussion, but with regards to 1101, just to clarify, you said you will be comparing the parameters with the data that was generated for ezogabine. So, we will be able to compare the potency of both drugs based on the data you present?

Yes. So essentially, they're all somewhat different studies. The ezogabine was a crossover study compared to placebo and place-controlled. That is a study that we're currently running our crossover trial essentially mimics that ezogabine trial pretty much exactly, but that will available for review in Q3. What we'll presenting is subject to that switch over from the single ascending dose into TMS model across three-dose cohorts where there post drug effects with TMS is compared to the pre-drug baseline effect with TMS. So -- but yet, I think, one, we'll be able to look at the ezogabine study, and again, this is a literature example, it's not an active comparator in this trial and draw conclusions based on the effect size, particularly in the mode of thresholds which is the key metric in EMG and compare our effect size in our EMG. We will be going a little bit further than what was done with ezogabine. Ezogabine did not study the effect of the drug on the EEG. We will be presenting effects on EEG signals. Those have been shown for other antiepileptic drugs and we will -- we'll highlight that as well. So, again, these are historical controls, not part of the study but there is data out there on what other drugs have done, including ezogabine's effects on motor thresholds, which we will present and summarize and you'll be able to draw some conclusions.

[Operator Instructions]. And I'm not showing any further questions at this time. I would like to turn the call back over to Jodi Regts for closing remarks.

Thanks, everyone, for joining us today. We look forward to keeping you updated on our progress. Operator, we will now end the call.

Ladies and gentlemen, thank you for your participation in today's conference. This does conclude today's program. You may all disconnect. Everyone, have a great day.