Axsome Therapeutics, Inc. (AXSM) Q4 2020 Earnings Call Transcript

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Axsome Therapeutics, Inc. (AXSM 0.24%)
Q4 2020 Earnings Call
Mar 1, 2021, 8:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning and welcome to the Axsome Therapeutics Conference Call. [Operator Instructions]

I would now like to turn the conference over to your host, Mark Jacobson, Chief Operating Officer at Axsome Therapeutics. Please go ahead.

Mark Jacobson -- Chief Operating Officer

Thank you, operator. Good morning and thank you all for joining us on today's conference call.

Our earnings press release providing a corporate update and details of the Company's financial results for the fourth quarter and full year of 2020 crossed the wire a short time ago and is available on our website at axsome.com. During today's call, we will be making certain forward-looking statements. These statements may include statements regarding, among other things, the efficacy, safety and intended utilization of our investigational agents, our clinical and nonclinical plans, our plans to present or report additional data, the anticipated conduct and the source of future clinical trials, regulatory plans, future research and development plans, commercial plans and possible intended use of cash and investments.

These forward-looking statements are based on current information, assumption and expectations that are subject to change and involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports. You are cautioned not to place undue reliance on these forward-looking statements, which are made only as of today's date, and the Company disclaims any obligation to update such statements.

Joining me on the call today are Dr. Herriot Tabuteau, Chief Executive Officer; Nick Pizzie, Chief Financial Officer; Lori Englebert, Senior Vice President of Commercial and Business Development; Dr. Amanda Jones, Senior Vice President of Clinical Development; and Dr. Cedric O'Gorman, Senior Vice President of Medical Affairs. Herriot will first provide an overview of the Company and then review recent developments and upcoming milestones. Following Herriot, Nick will review our financial results. We will then open the line for questions.

And with that, I will turn the call over to Herriot.

Herriot Tabuteau -- Chief Executive Officer

Thank you, Mark. Good morning, everyone, and thank you all for joining Axsome Therapeutics fourth quarter and full year 2020 financial results and business update conference call.

This past year was one of focused execution for Axsome as we advanced our industry-leading CNS pipeline toward marketing application submissions. Our portfolio comprises four late-stage product candidates under development with six distinct indications representing unmet medical needs that affect over 60 million patients in the U.S. alone. Our focus this year will be on the regulatory activities surrounding our NDA filings for AXS-05 and AXS-07 launch readiness to ensure a successful transition to commercialization assuming product approvals and continued advancement of the rest of our late-stage CNS pipeline. I will provide a brief update on our pipeline in pre-commercial activities before turning it over to Nick, who will provide a financial update.

Starting with our first lead product candidate AXS-05. The new drug application or NDA for AXS-05 for the treatment of MDD has been submitted. We intend to issue a press release following the FDA's decision regarding its acceptance of the filing. This NDA submission is a major milestone for the Company because it brings us closer to potentially making this innovative treatment available to the millions of patients who are living with depression. AXS-05 is a novel, oral, NMDA receptor antagonist with multimodal activity. If approved, AXS-05 has the potential to be the first new oral mechanism of action for depression in over 60 years.

In the fourth quarter, we announced positive results in the long-term, open-label, Phase 3 COMET trial demonstrating rapid, substantial and durable improvements in depressive symptoms and functional impairment that was sustained over the 12-month treatment period with AXS-05. AXS-05 was well tolerated with long-term treatment with a safety profile consistent with that observed in the previously reported controlled trials. We also announced positive results from a Phase 2 open-label COMET sub-studies in patients failing one prior treatment, failing two prior treatments and in patients with suicidal ideation.

Moving on to our Alzheimer's disease agitation program with AXS-05. Alzheimer's disease agitation is a serious and debilitating condition for which there is currently no approved treatment. Last year, we announced positive results from the pivotal ADVANCE-1 trial, which demonstrated rapid and substantial improvement of agitation in patients with Alzheimer's disease with AXS-05 treatment. We subsequently received Breakthrough Therapy designation for AXS-05 in this indication. In December, we launched our second pivotal trial, the ACCORD study, which is a double-blind, placebo-controlled, randomized withdrawal study.

Turning now to our migraine program with AXS-07. We are completing compilation of the NDA, which we expect to submit to the FDA early in the second quarter. There is a significant unmet need for more efficacious treatments for migraine. The World Health Organization ranks the disability from severe migraine attacks on par with that from dementia, quadriplegia, or active psychosis. AXS-07's novel, oral, multi-mechanistic approach may help to address this unmet need.

In the fourth quarter, we announced positive results from a long-term open-label MOVEMENT trial of AXS-07, demonstrating rapid, substantial and durable relief of migraine pain and associated symptoms over the 12-month treatment period. AXS-07 was well tolerated over the long-term treatment with a safety profile consistent with that observed in the previously reported controlled trials.

Moving next to our AXS-12 product candidate for narcolepsy. Narcolepsy is a serious and debilitating condition with limited treatment options. Results from our Phase 2 trial demonstrated the potential for AXS-12 to address a broad range of narcolepsy symptoms. We expect to initiate a Phase 3 trial of AXS-12 in narcolepsy in the second quarter.

For our AXS-14 product candidate for the treatment of fibromyalgia, we are scheduled to meet with the FDA in the second quarter of this year to discuss the development plan for this program. AXS-14 has previously met the primary endpoints in a Phase 3 and in a Phase 2 trial for the treatment of fibromyalgia.

Our intellectual property portfolio continues to grow with recently issued and allowed patents for AXS-05 and AXS-07. The number of issued U.S. patents for these product candidates now total 50 for each with protection extending to 2040 and 2036, respectively. With potential FDA decisions, on two NDA filings over the coming year, preparations for potential commercial launch are well under way. All functional commercial leadership is in place and the team continues to expand. Sales force structure and designs have been finalized and the hiring of sales managers and representatives will begin shortly. The infrastructure for our proprietary DCC or digital centric commercialization platform is in place and payer engagement activities have started. We are excited by the differentiated clinical profile of our numerous product candidates, the potential of our investigational medicines to deliver significant benefit to patients and our planned commercialization approach.

I will now turn the call over to Nick who will provide a financial update.

Nick Pizzie -- Chief Financial Officer

Thank you, Herriot, and good morning, everyone.

Today, I will discuss our fourth quarter 2020 results and provide some financial guidance. We ended the fourth quarter with approximately $184 million in cash compared to roughly $202 million at the end of the third quarter, a net decrease of approximately $18 million. R&D expenses were $17.4 million for the fourth quarter ended December 31, 2020 versus $19.2 million for the comparable period in 2019. The decrease of $1.8 million was driven by the completion of a majority of our clinical trials, which were ongoing in the comparable prior period offset by cost-related to the preparation of AXS-05 and AXS-07 NDA submission.

G&A expenses were $10.4 million for the quarter ended December 31, 2020 and $5.2 million for the comparable period in 2019. The change was primarily due to an increase in non-cash related stock compensation expense, along with the continued build-out of the commercial function. Net loss was $29.2 million or $0.78 loss per share for the quarter ended December 31, 2020 compared to a net loss of $24.8 million or $0.71 loss per share for the comparable period in 2019. Net loss for the year ended December 31, 2020 was $102.9 million or a loss per share of $2.77 compared to a net loss of $68.3 million or $2.01 loss per share for the comparable period in 2019.

As a reminder, in Q3 of 2020, we secured a $225 million term loan facility with Hercules Capital, of which $175 million in funding remains available. This committed, non-dilutive capital gives us additional financial flexibility through the anticipated potential commercial launches. We believe our current cash position of $184 million along with the remaining committed capital from our $225 million term loan facility is sufficient to fund our anticipated operations based on our current operating plan into at least 2024.

That concludes our fourth quarter 2020 financial review. I will now turn the call back to Mark to lead the Q&A discussion.

Mark Jacobson -- Chief Operating Officer

Thank you, Nick. Operator, may we please have our first question.

Questions and Answers:

Operator

Thank you very much. [Operator Instructions] Your first question comes from Charles Duncan from Cantor Fitzgerald. Your line is open.

Charles Duncan -- Cantor Fitzgerald -- Analyst

Hey, good morning, Herriot and team. Thanks for taking our questions. Yeah, busy time for you. Congrats on the forward motion and progress with AXS-05. I had a couple of quick question. With regard to the label and I imagine you'll be talking about this more in terms of the claims that you're asking for with AXS-05 NDA. I guess I'm wondering, would you anticipate the label to -- perhaps approved label to be explicit regarding the COMET's outcome or COMET's results with one and two failures and suicidal ideation? Or would that just be data included in the label and would be a generalized MDD approval, if granted?

Herriot Tabuteau -- Chief Executive Officer

Good morning, Charles, and thanks for the question. So. the label that we are targeting and that we have submitted the NDA for is the treatment of major depressive disorder, MDD. And the -- now our clinical trials or our controlled clinical trials as well as open-label long-term studies do include a broad range of patients who have MDD. And so, we would not expect specific indications, for example, suicidal ideation to be in the label. And however, patients with MDD do have suicidal ideation and patients with MDD have been treated with more than one prior treatment. So those data from a COMET trial, they have been included in the NDA submission. Those are data which certainly will be published and which we think will be very useful to clinicians and we'll be able to make those data available to clinicians using our medical science liaison functions.

Charles Duncan -- Cantor Fitzgerald -- Analyst

Okay. Okay, that makes sense. Should be useful for prescribers. Just sticking with AXS-05, one last quick question, regarding the ACCORD study in Alzheimer's agitation, can you provide any additional color on how that study is going in terms of enrollment? And what you anticipate the, call it, screen failure rate to be or the number of patients enrolled versus going onto, I guess, the blinded portion and then being withdrawn?

Herriot Tabuteau -- Chief Executive Officer

Those are great questions. It's early days in the study, so we launched the trial at the end of December. As you know -- so it's very early days, especially for this type of study whereby you do have this lead anywhere. Everyone is treated with AXS-05 in an open-label fashion, and then they are monitored, not just for response, but for stable response prior to randomization. We'll have more to tell you, and we'll be happy to share some of those observations and incorporate them into any kind of timing updates with regards to the trial, but right now, it's too early.

Charles Duncan -- Cantor Fitzgerald -- Analyst

Okay. Last question regarding commercial. You mentioned the sales force sizing have been finalized, and I guess, I'm wondering, what do you anticipate that sizing to be roughly, not specifically. And then the breakdown of psych versus neuro focus and how do you plan to accomplish that?

Herriot Tabuteau -- Chief Executive Officer

Thanks, Charles, for the question. I'm going to turn it over to Lori.

Lori Englebert -- Senior Vice President, Commercial and Business Development

Hey, Charles, thanks for the question. I think you probably will not be surprised if we tell you we're not going to tell you the exact size of the sales force, but what I can

Tell you is that we are highly confident that the size that we have anticipated will cover the amount of physicians that will be high prescribers of AXS-05. And we do believe that our digital centric commercialization approach will be able to provide information to physicians when they need it, how they want it and time that they want it. And I think that's really important to understand because our promotion is not just personal. They will be a large component of non-personal promotion as well.

And regarding your question around AXS-07 and that launch, look, everything we're doing in preparation for the AXS-05 launch is working under the assumption that AXS-07 will follow very closely after. So, all of the structures that we're putting into place, sales force, digital will all be readily capable of scaling at the time of launch for AXS-07.

Charles Duncan -- Cantor Fitzgerald -- Analyst

Okay. That's helpful. Thanks, Lori and Herriot for the added color, should be effective. Looking forward to the progress this year.

Herriot Tabuteau -- Chief Executive Officer

Thank you.

Operator

Your next question will come from Marc Goodman from SVB Leerink. Your line is open.

Marc Goodman -- SVB Leerink -- Analyst

Yes, good morning. I understand you're not going to give us the number of reps, but can you give us a sense of the spend that you're going to do this year, may be some type of spending guidance? Specifically for SG&A is what I was focused on. Second, can you just give us a sense of the payor discussions so far for depression and how those are going and how they are appreciating the differentiation in a mechanism, just curious how that's going?

And then third, just curious on the fibromyalgia you're going to meet with the FDA. Can you talk about the different scenarios if they come back and say, OK, you can file with what you have, are you prepared to file and then move forward and market this product on your own? Are you thinking about potentially partnering it just because it's such a large indication? And if they say do another study, prepare to start another study before the end of the year? Thanks.

Herriot Tabuteau -- Chief Executive Officer

Thanks for the multi-part question there. So, I'll take the fibromyalgia question first and I'll turn it over to Nick, and then to Lori for the other questions on spend and payor discussions.

With regards to fibromyalgia, we're looking forward to our FDA meeting, which is scheduled in the second quarter to discuss the development path forward for that product candidate. This will be our first meeting with the FDA. So we've gotten the data. So we'll have a lot more to tell you hopefully once we have that meeting. As a reminder, there are two studies, two efficacy trials with controlled [Phonetic] trials, which have been completed and which were positive. So that puts us in a very good position.

In the theoretical -- under the theoretical scenario, where let's say there was absolutely nothing more that we had to do from a clinical perspective. We would still need to manufacture commercial supplies. And what I can tell you is that work is already under way to make sure that we can manufacture the product. This is a novel chemical entity and so therefore there's been a lot of work that our senior team has been doing in order to synthesize it. So that work is well under way and is progressing well.

I will turn it over to Nick to answer your first question.

Nick Pizzie -- Chief Financial Officer

Thanks, Herriot. Thanks, Marc, for the question. As you know, we don't give necessarily expense guidance, but I can give a little bit of guidance on the cash runway. As a reminder, we had $184 million in cash at year end. We, additionally, have the $225 million debt facility. So, we feel like we're in a really strong position from our financial resource base. The cash runway, just so you're aware, this takes us into at least 2024 based on our current operating plan and includes all launch readiness, all launch expenses, including field force for AXS-05 and AXS-07. Also includes funding for the second Phase 3 Alzheimer's agitation trial, continuation of the MERIT trial for TRD and soon to be started AXS-12 trial in narcolepsy. So, the runway currently, just in conclusion, takes us through both potential launches upon NDA approval for both MDD, as well as the acute treatment of migraine.

Lori Englebert -- Senior Vice President, Commercial and Business Development

And I'll quickly answer the payor question. So, I think we all know depression is the number one cause of disability worldwide. And the prevalence of depression is just continuing to grow especially with the pandemic sometimes, we've heard to the tune of 3 times. So payors are paying attention, right, and to process patients and it costs money, and they are acutely aware of the other clinical profiles of products that are already on the market.

When we discuss with payors and what we've seen in early discussions, yes, bringing forth a novel mechanism of action that's patient-friendly and reminding them that this will be the first one in 60 years, it's interesting to them, very interesting to them. But what really sticks out is our clinical profile. So our data is highly differentiated versus the other products on the market. And what I believe we've heard and again in early discussions, what attracts them most is the rapid onset of remission and the durability that we show with the product.

Operator

And your next question comes from Joon Lee from Truist Securities. Your line is open.

Joon Lee -- Truist Securities -- Analyst

Hi. Thanks for taking our questions, and thanks for the updates. So, following up on the peer discussion and your mention of rise in prevalence of depression, a bunch of follow-up on that. In one of your slides, you note increase in the prevalence depression from 22 million pre-pandemic to 71 million during the pandemic, more than 3 times increase in prevalence. And fortunately, you've already completed your Phase 3, but if you were to conduct a Phase 3 trial today, would you do anything differently? What I'm trying to understand is, is the new cases of depression during the pandemic are bona fide MDD or something more multifactorial in nature. And if you would have need to upsize the study or something like that to suppress [Indecipherable] and is this phenomenon unique to the U.S. or similar in other countries? Maybe just would love to hear your thoughts there? Thank you.

Herriot Tabuteau -- Chief Executive Officer

Yeah. Thanks, Joon, for the question. A lot of theoreticals there. But you -- I think, you do raise some interesting questions. So, from a public health perspective, it's very clear. The effect of the pandemic on mental health and also on depression symptoms, it's been very well documented, I think definitely in some high profile journals by some well-respected clinicians. So, the data are clear. There is a significant increase in depressive symptoms and Lori can maybe speak to this a little bit, but we started to also see that work its way into prescription trends. Now -- so what that means is there is acute need to treat patients, and also, there is a great opportunity for companies that can provide novel mechanism of action that will work quickly, that will help these patients. So, that's only clinical need side of things.

Now, from a clinical trial conduct perspective, I think that you do bring up an interesting point that there is an unknown there, and that unknown is what impact with the pandemic and with the mental illness from a pandemic have potentially on being able to test your drug to see if it works. That's a theoretical and we -- so we can't really say too much about that. One of the things that we did do was to look at the impact of AXS-05 during the pandemic through our long-term open-label safety extension trial. And so, we were very interested to see what impact our drug would have on patients on their depressive symptoms in the context of the pandemic, and we can only speak to our data. And what we showed, as you know, and what we reported was very profound reductions in depressive symptoms, incredibly high rates of response in remission that either were maintained or increased over the 12-month treatment period.

Joon Lee -- Truist Securities -- Analyst

Fantastic. Thank you.

Operator

And your next question comes from Joseph Thome from Cowen & Company. Your line is open.

Joseph Thome -- Cowen & Company -- Analyst

Hi, there. Thank you for taking my question. A little bit on the COMET data. In those subset data, was there anything that surprised you in terms of response in any of the individual subsets? And maybe in terms of positioning upon launch, is there anything your MSL team is doing to position the therapy in a certain subset of patients that will be maybe more early adopters. And then finally, related to that, does the subset data give you any read through into your expectations for MERIT later this year?

Herriot Tabuteau -- Chief Executive Officer

So, thanks for the question. In terms of points that were surprising in the data, I think we -- it was good to see that the rapid onset of action and the significant percentage of the patients achieving remission and response that we saw in the controlled trials were replicated in the COMET data. One of the sub-studies that we were really interested in was the suicidal ideation sub-study. Small number of patients, but as you can imagine rapid onset of action is really important for that symptom and in those patients. And what we saw was that there was a resolution of suicidal ideation in that subgroup in 60% of the patients at week one and that only increased to the vast majority of patients after two weeks.

So, that was definitely interesting. And I think number two on the list was the fact that the efficacy that we saw in the controlled trials did translate also to patients who had to fail two prior treatments. So, patients who are traditionally referred to as treatment-resistant depression patients. So, it was really good to see that in a real world setting.

As it relates to expectations, as it relates to what implications that would have for the MERIT study, those points, those observations can only be positive in terms of the profile of the product, and we've never done a randomized withdrawal study design before. So, it will be interesting to see what those show and that's the benefit and one of the reasons why we conduct Phase 2 trial, so we're looking forward to see how the product performs in that setting and and I'm going to turn it over to Cedric to talk about MSL strategies.

Cedric O'Gorman -- Senior Vice President, Medical Affairs

Yeah, thanks Herriot. I would just say that these data from COMET are very exciting, I mean in terms of response on matrix, remission on that matrix and also the fact that it translates into clinically observable response and remission rates and this was clear across the overall COMET as well as those who have failed to respond to antidepressants in the current episode on suicide litigation. So, the MSLs have these data in hand. We've been out talking to key opinion leaders getting their insights on the data that's been a great progressive adaptivity to it and excitement about the new mechanism of action. And I think that what's important from COMET is not only are you seeing these responses early on, but they're being sustained and with really sort of impressive and compliance and maintenance with treatment up to 12 months.

That's what's really exciting is that the drug appears to be working but also patients are willing to stay on it over the long term. So, the MSLs are out there right now getting insights and talking about these data and we'll be presenting data at upcoming conferences as well.

Joseph Thome -- Cowen & Company -- Analyst

Excellent. Thank you so much.

Operator

Your next question will come from Myles Minter from William Blair. Your line is open.

Myles Minter -- William Blair -- Analyst

Hey everyone. Thanks for taking the questions. I'm just wondering from the payer perspective whether you've sort of engaged in the conversations regarding where your AXS-05 might actually sit in the treatment paradigm from their perspective and whether the DCC platform that you're running on the commercial front whether that's actually touching base with the appropriate prescribing physicians that are seeing patients, say, with like two or more prior failed antidepressants?

Lori Englebert -- Senior Vice President, Commercial and Business Development

Hey, Miles. Thanks for the question. I think it's a little bit too early for us to know where the payer discussions are going to net out. So answering your first question is difficult at this time. We do -- as I mentioned earlier we are very encouraged by those discussions that we are having right now, they seem to respond very well to our clinical data package that we're putting in front of them. In terms of the DCC approach, I'm not quite sure I understand or understood your question correctly. Could you repeat it? Would you mind repeating it?

Myles Minter -- William Blair -- Analyst

Yeah. I'm just wondering like with the target prescribing accounts for that platform and also for your salesforce, what the breakdown of patients that have failed two or more prior therapies would be at those target accounts and that are classified as TRD patients versus standard MDD?

Herriot Tabuteau -- Chief Executive Officer

Yeah, I think I understand your question. So, I'll turn it over -- I'll turn it back to Lori but I just wanted to just point out that the data are pretty clear that roughly two-thirds or more of patients already fail or respond inadequately to at least one prior treatment.

Lori Englebert -- Senior Vice President, Commercial and Business Development

Yeah, I agree. The majority of our target physicians are high prescribing physicians. So, the likelihood that they're treating patients who have failed one or more is really high.

Myles Minter -- William Blair -- Analyst

Okay, cool. And then maybe on AXS-07 and then the MOVEMENT trial data looks really good from my perspective. If you're giving any updates as to the frequency of dosing for patients out to 12 months and also were those patients treated at the earliest signs of migraine like an intercept or at confirmed migraine like in MOMENTUM?

Herriot Tabuteau -- Chief Executive Officer

Thanks for the question, Myles. I want to turn it over to Amanda.

Amanda Jones -- Senior Vice President, Clinical Development

Hi, Myles. For the MOVEMENT study, the patients were allowed to treat -- at any point in time following the onset of migraine pain. So, it really reflects more of the real world data and real world use of the drug and also the data that was captured during the MOMENTUM and INTERCEPT trial.

Myles Minter -- William Blair -- Analyst

Okay, cool. Thanks for the questions.

Operator

Your next question will come from Vamil Divan from Mizuho. Your line is open.

Inanc -- Mizuho -- Analyst

Hey, guys. This is Inanc [Phonetic] for Vamil. Just want a couple of questions. On AXS-07, just wondering why the push back to 2Q earnings and 2Q's filing, whether it's the same issue for the most previously discussed or something that's different? And secondly, on -- just thinking about pricing ahead, just wondering how you're thinking about pricing for AXS-05 in MDD, but you will also have agitation and the pricing there could be different. I'm just wondering how you are approaching this and how your, I guess, discussion with payors might be going. Thanks.

Lori Englebert -- Senior Vice President, Commercial and Business Development

Hi. Thanks for the question. Regarding pricing, so, whenever you approach pricing discussions with payors, typically companies focused on fair and timely access and a large portion of that will be associated with where you price. But the balance of that is we need to price for the value that the product brings. And so, we're working through that right now to make sure that we understand how we appropriately price to represent what value we're bringing to the market.

Amanda Jones -- Senior Vice President, Clinical Development

Amanda, [Indecipherable] with regards to the AD agitation? Yeah and that incompetents for AD agitation piece of that.

Inanc -- Mizuho -- Analyst

Okay. Thanks.

Operator

And your next question will come from Matt Kaplan from Ladenburg Thalmann. Your line is open.

Matt Kaplan -- Ladenburg Thalmann -- Analyst

Hi. Good morning, Herriot and everyone else.

Herriot Tabuteau -- Chief Executive Officer

Good morning, Matt.

Matt Kaplan -- Ladenburg Thalmann -- Analyst

I want to congratulate you on the progress during the quarter. Can you give us a sense now that you've submitted the AXS-05 NDA. I guess, given the Breakthrough designation you have in MDD, what are your expectations for a potential priority review?

Herriot Tabuteau -- Chief Executive Officer

So as you mentioned, we do have Breakthrough Therapy designation for the product and we do believe that we qualify for priority review, which is six-month review. However, that is a determination, which is made by the FDA. And the way that it works is that priority review is not automatic. At the time of the NDA filing, you do request priority review and it is determination, which is made and communicated to the Company upon the FDA's decision of whether or not to file the application. So, our plans with regards to launch extended prep predicated [Phonetic] they assume a six-month review, but again, that is really up to the FDA.

Matt Kaplan -- Ladenburg Thalmann -- Analyst

Okay, helpful. And then in terms of AXS-07, I guess, we focused a bit on the commercial prep on AXS-05 already, but I guess maybe more for Lori, where are you in the preparation in terms of research you're doing and their interaction for AXS-07 given I guess it's kind of the near-term NDA filing there?

Lori Englebert -- Senior Vice President, Commercial and Business Development

Yeah. Hey, thanks, Matt, for the question. Regarding AXS-07, as I mentioned earlier, we have always anticipated that AXS-07 would follow very closely behind AXS-05 in terms of launch. And therefore we've actually been preparing on all fronts to have a staggered approach, but scalable if we were to receive approval for AXS-07. In terms of payor negotiations, exactly we have performed market research, but have not started the AXS-07 payor discussions as yet.

Matt Kaplan -- Ladenburg Thalmann -- Analyst

Okay, very good. And then last question. In terms of -- Herriot, you mentioned you're on track to start the Phase 3 for AXS-12 in narcolepsy cataplexy next quarter. Can you give us a sense on what your thinking is in terms of the design of that trial and kind of timeline to completion potentially?

Herriot Tabuteau -- Chief Executive Officer

So with regards to the trial design, it will be a parallel-group design. So it will be similar in some ways to the Phase 2 trial, which we conducted except the Phase 2 trial was a crossover design, this will be a parallel-group design. So we expect -- we would expect to randomize subjects to AXS-12 and into placebo. And then with regards to expectations around how long it will take to enroll the study, once we start the study, we'll provide you details with regards to the size of the study and that of course will determine potentially how fast it could enroll. One of the things that we can point to or the metrics around the Phase 2 enrollment is a reminder that was a 21-patient study, which was conducted at roughly 12 sites and that enrolled in the approximately six months.

Matt Kaplan -- Ladenburg Thalmann -- Analyst

Great. Thanks for the added detail.

Operator

Your next question will come from Vikram Purohit from Morgan Stanley. Your line is open.

Vikram Purohit -- Morgan Stanley -- Analyst

Great. Thanks for taking my question. Just had one on AXS-05 for smoking cessation. So, I've seen your release that you have an FDA meeting scheduled here for the third quarter. I just wanted to see what you're looking to learn from a meeting with the FDA here and what you think an eventual subsequent pivotal study in this indication could look like?

Herriot Tabuteau -- Chief Executive Officer

Thanks for the question. We're very excited about smoking cessation and on the back of the positive Phase 2 data. From a small study, we are looking to meet with the FDA to figure out what an efficacy trial would look like. So the Phase 2 study did look at smoking behavior, but that is not a registration endpoint. Certainly, it was very helpful for signal detection, which we saw. And the -- so what we're going to be looking to get out of that meeting is guidance and agreement on the design of the next study, which would be an efficacy trial. So we're very much looking forward to those discussions. Registration trials in smoking cessation typically the endpoint is abstinence, so that is what we would expect for the next study.

Vikram Purohit -- Morgan Stanley -- Analyst

Okay, got it. Thank you.

Operator

And your next question will come from Chris Howerton from Jefferies. Your line is open.

Chris Howerton -- Jefferies -- Analyst

Hi. Good morning. Appreciate you taking the time with questions. Congratulations. So, I guess -- most of it been asked at this point, but I guess for AXS-05 with respect to Alzheimer's disease agitation, there is a possibility that we're going to get increased competition within that space over the next couple of years with a variety of companies developing therapeutics there. So I guess how is it that you see AXS-05 competing in this landscape, particularly obviously as we all know safety is the key concern for this patient population? Thank you.

Herriot Tabuteau -- Chief Executive Officer

Thanks for the question. It's a very interesting and serious disease area. The term on that medical need gets turned around quite a bit, but here this would be a good [Speech Overlap]. Yeah, it would be, yeah. So, you're talking about a disease where there currently is no product that is approved and the drugs that are used off-label have black box warnings against their use in that specific patient population. And yet clinicians do need to treat these patients because of the seriousness of the condition.

So right now, there is nothing approved from a competitive perspective. So, it really all depends on the clinical data. It's very difficult for us to comment on drugs that are in development. We know that this is an area that has not been kind to drug development. And we're very fortunate that we have the one pivotal trial that is positive that did show really good efficacy, which was rapid, but also really good safety. So, the drug was incredibly well tolerated in the ADVANCE-1 trial. And so, we're looking forward to enrolling and completing the ACCORD study.

And with regards to -- just further to other products that are in development, one thing that I would say is that it shows that there is just a significant clinical need. And it would be great to have numerous products that are available to treat these patients given the seriousness of the condition, but it's impossible to comment on theoreticals, when we have not seen positive data from other companies.

Chris Howerton -- Jefferies -- Analyst

Okay. All right. Well, thank you, Herriot. Appreciate it. And I also look forward to that as well. Thanks.

Herriot Tabuteau -- Chief Executive Officer

Thank you.

Operator

And your next question will come from Yatin Suneja from Guggenheim. Your line is open.

Eddie Hickman -- Guggenheim -- Analyst

Hey, guys, this is Eddie on Yatin. Thanks for taking my questions. So just a follow-up on TRD. Can you -- given what you saw in STRIDE and then recently with the COMET study, can you give us an update on sort of what the development path looks like in the timeline to get sort of an sNDA in TRD and how will the MERIT data coming later this year, sort of influence that path? Thanks so much.

Herriot Tabuteau -- Chief Executive Officer

The indication that we filed is MDD. And so, that's the broadest indication, so that encompasses the entire spectrum of major depressive disorder. So, we are very happy with that indication should we be successful with the NDA review. And we do not intend to conduct another Phase 3 trial in treatment-resistant depression. What we have done and is to generate data that will help clinicians to understand, how the product performs in a wide range of patients with major depressive disorder, including patients who failed two prior treatments. So from that perspective, we're very happy that the described study was conducted. We think the COMET TRD data does provide very helpful information to clinicians in a real world perspective and we think that the MERIT study may also provide data that will be useful to clinicians again in the right setting, but it's in a scientific setting.

Eddie Hickman -- Guggenheim -- Analyst

Great. Thank you so much.

Operator

We have time for just a few more question, and we're trying to get through as many as possible. Your next question is from Ram Selvaraju from H.C. Wainwright. Your line is open.

Ram Selvaraju -- H.C. Wainwright -- Analyst

Thank you so much for taking my questions. And I wanted to ask about the general allocation of sales and marketing commercialization resources across the different indications for AXS-05. As you look toward the possibility of this drug potentially being triple or even a potential quadruple threat in the CNS neuropsych space. And in particular, if you could talk through how you anticipate the different sales and marketing strategy to be taken with AXS-05 effectively being deployed, and if you can especially describe any particular initiatives that are likely to be aimed at specific types of institution with the aim of optimizing the commercial value of this product?

Herriot Tabuteau -- Chief Executive Officer

Thanks, Ram, for the question. I'll turn it over to Lori, but you do raise some interesting questions which we've certainly thought about, and the team with regards to the potential different indications for AXS-05.

Lori Englebert -- Senior Vice President, Commercial and Business Development

Yeah. Hey, Ram. Thanks for the question. It's a little bit difficult question to answer at this point in time. AD agitation, we need to see, how the trial finalizes, but we are absolutely, always thinking about how we leverage the sales force, when we leverage the sales force and what that overlap of physicians might look like. Again, as we build our sales force sizing and design and structure, we did not with the understanding that we would have follow-on indications coming in particularly different disease areas and also different treating physicians. So we've taken great efforts to ensure that there is efficiency there, if that were to happen.

Ram Selvaraju -- H.C. Wainwright -- Analyst

So, and specifically with respect to the smoking cessation indication, are you looking at that as being primarily an indication where the principal commercialization trust would be through advertising as opposed to boots on the ground relative to, for example, MDD or Alzheimer's associated agitation? Or are you thinking about it in terms of the situation where you might need to feel totally separate sales force in order to potentially market AXS-05 in that indication as well?

Herriot Tabuteau -- Chief Executive Officer

Yeah, Ram, it's premature for us to talk about marketing for smoking cessation. So, let's first conduct the trials and see what the profile is and -- but those would also be great questions and great problems to have, which we would certainly solve should we have positive deal.

Ram Selvaraju -- H.C. Wainwright -- Analyst

Okay. And then I was just wondering, I know that you haven't had the actual meeting discussion yet on the fibromyalgia candidate, but have you received any indication, one way or another, as to whether the FDA considers the current efficacy data package to be adequate or if they are looking for you to conduct an entire additional registrational program aimed at adding to the efficacy data package for assembling a potentially fileable approvable application in fibromyalgia?

Herriot Tabuteau -- Chief Executive Officer

We have not met with the FDA and we're not going to speculate on what the outcomes of those discussions might be. But we're very much looking forward to sitting down with them and discussing what we view to be unique data in this area which is still an area of high unmet medical need. As a reminder, there are only three approved products to treat fibromyalgia. It is a condition that has a variety of symptoms, many of which are not addressed by the small number of currently available treatments.

Ram Selvaraju -- H.C. Wainwright -- Analyst

Okay. And then lastly just a housekeeping item on stock-based comp. How are anticipating stock-based comps to trend this year relative to last year and looking at your upcoming hiring plans and in particular, sales and marketing infrastructure build out, should we expect a significant increase in stock-based comp expense for 2021 relative to 2020?

Nick Pizzie -- Chief Financial Officer

Hey, Ram. This is Nick Pizzie. Yeah, I can answer that question. So, we did have an increase in stock-based comp year-over-year and that's just correlated obviously to our stock price, specifically this year and as we build a field force [Technical Issues] and continue to ramp up other functions you would continue to expect an increase in stock-based comp and obviously dependent on where our share price is based on the black field [Phonetic] calculation when we do that. And it is amortized over a four-year period typically for our stock-based comp. So, it wouldn't be all in one year when we have an impact from the field force.

Ram Selvaraju -- H.C. Wainwright -- Analyst

Thank you.

Operator

And your next question will come from Ashwani Verma from Bank of America. Your line is open.

Ashwani Verma -- Bank of America -- Analyst

Hi, there. Thanks for taking the question. I just had one. So in terms of the AXS-05 patent, just trying to figure out, how many of these 50 plus patents that you have cited can be listed on the Orange Book? My understanding is that as a new NDA, you'll have to file the Form 3542 and list the patents that pertain to the specific attributes of the drug for the MDD label in this situation. Just curious, how many of the parents would meet that criteria?

Herriot Tabuteau -- Chief Executive Officer

Hi, Ashwan. Thanks for the question. As a reminder, we have approximately 50 or more than 50 patents in the U.S. covering AXS-05, and the vast majority of those patents are Orange Book listables. And the other point to mention is that most of those patents provide the protection out to 2034, the more recent ones provide protection out to 2040. And in addition, the new patents encompass different families of patents, so not only do we have a pharmacokinetic patent, but we also have method of treating disease patents. Furthermore, we would expect that the patent families would continue to expand.

Ashwani Verma -- Bank of America -- Analyst

Got it. And just to follow like have you filed that formulation patent that you talked about earlier?

Herriot Tabuteau -- Chief Executive Officer

Yeah. So the -- I'm not certain of which formulation patent you're referring to -- you're referring to particular patent. Typically what we do is we do talk about patents that have issued. We do have some claims around our formulation specifically, so some of the new patents that have issued specifically speak to our formulation, as well as the method of treating disease. And I think what I was referring to is additional patent families, which we would expect to file in the future so that further expand the patent portfolio.

Ashwani Verma -- Bank of America -- Analyst

Got it. Thank you so much.

Herriot Tabuteau -- Chief Executive Officer

Okay. Thank you.

Operator

Your next question will come from David Hoang from SMBC. Your line is open.

David Hoang -- SMBC -- Analyst

Hey, thanks for taking the questions, and fitting me in here. So just a quick couple. You talked about the digital-centric approach to the sales force and the launch. And I'm just curious as to what gives you confidence that that type of approach detailing physicians in that way would be successful versus more traditional in-person effort by the sales force?

Lori Englebert -- Senior Vice President, Commercial and Business Development

Hey, David, thanks for the question. We have high confidence mostly based on data. We do know that psychiatrists and neurologists are two of the highest adopters of remote detailing. In fact, a lot of psychiatrists we know actually prefer it. Psychiatrists actually trend anywhere from 60% to 70% of their details are remote and that's recent data, and that was actually higher than data even six months ago when the pandemic was actually much more prevalent. So we feel pretty confident that this is a sound approach, and we certainly are not alone in this. Most companies are doing this. And physicians right now are currently dictating how they want to see sales reps. So, they will tell you if they want you to come in in-person or they want you to come in via remote detail. And we're going to use data analytics to make sure that we're approaching them correctly.

David Hoang -- SMBC -- Analyst

Okay. Great. That's really helpful. Thanks. And then just on AXS-05 in Alzheimer's agitation, just wondering about the environment for usage there. Do you envision that the drug will be mostly something for the home and community setting or you also expect to see sort of a large uptick in the long-term care setting?

Herriot Tabuteau -- Chief Executive Officer

So our studies were -- well we conducted one trial, our pivotal trial and also just our currently ongoing study is or were conducted in patients who are based in the community. And we did that for a lot of reasons. And then, so there is no reason to believe that the drug would not work in any setting. And the reason why we focused on community-dwelling patients is, one, you want to prevent patients from actually being institutionalized. So if you can treat them, you want to keep them out of the hospitals and out of nursing homes. And so -- and however, once you're sure that the product works, so there is no reason to think that the pharmacology is going to change depending on the setting.

David Hoang -- SMBC -- Analyst

Got it. Great. Thanks so much for taking my questions.

Operator

We have no further questions in queue. I turn the call back over to the presenters for closing remarks.

Herriot Tabuteau -- Chief Executive Officer

Well, thank you all for joining us on the call today. This year will be an important one for Axsome as we move closer to potential commercialization on our product candidates. We look forward to keeping you updated on our progress.

Operator

[Operator Closing Remarks]

Duration: 58 minutes

Call participants:

Mark Jacobson -- Chief Operating Officer

Herriot Tabuteau -- Chief Executive Officer

Nick Pizzie -- Chief Financial Officer

Lori Englebert -- Senior Vice President, Commercial and Business Development

Cedric O'Gorman -- Senior Vice President, Medical Affairs

Amanda Jones -- Senior Vice President, Clinical Development

Charles Duncan -- Cantor Fitzgerald -- Analyst

Marc Goodman -- SVB Leerink -- Analyst

Joon Lee -- Truist Securities -- Analyst

Joseph Thome -- Cowen & Company -- Analyst

Myles Minter -- William Blair -- Analyst

Inanc -- Mizuho -- Analyst

Matt Kaplan -- Ladenburg Thalmann -- Analyst

Vikram Purohit -- Morgan Stanley -- Analyst

Chris Howerton -- Jefferies -- Analyst

Eddie Hickman -- Guggenheim -- Analyst

Ram Selvaraju -- H.C. Wainwright -- Analyst

Ashwani Verma -- Bank of America -- Analyst

David Hoang -- SMBC -- Analyst

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