STIFEL 2026 HEALTHCARE CONFERENCE - OVID THERAPEUTICS INC

Welcome. My name is Matthew Tan. I'm here for Paul Matisse, and I'm very pleased to be joined by Meg Alexander, President and CEO from Ovid Therapeutics. Thank you so much for joining us today. I know you guys have a lot of exciting catalysts coming up. Maybe do you want to give us an overview, starting with KCC2, and then we can move on from there? Sure. I'd be happy to. And Matthew and Stiefel team, thank you for hosting us. So I'm the CEO of Ovid Therapeutics, and it is a really exciting time for Ovid. I tease our team that we're in the playoffs, and the reason why is we have a number of programs that have what I think will be very exciting card turnovers or data milestones in the span of the next six and 12 months. And I'll start maybe just quickly. I'll acclimate everyone to the company and then the pipeline, and we can absolutely dig into KCC2, and that will be fun. So Ovid is a neurotherapeutics company. We are a company that exists to try to make better and gentler medicines for brain conditions, both neurology and neuropsychiatry. And the way we did this, the way that we developed the company and the pipeline that you see in front of you, is we very deliberately went out and we tried to look at targets that we thought had relevance across a number of conditions that drive essentially too much excitation of your neurons. And we tried to do and drug those targets with truly differentiated mechanisms of action. unfortunately, in the world of neurology and really even psychiatry, there haven't been new mechanisms that have come to the fore. And as a result, we're not really seeing a step change for patients. So that was very intentional on our part in how we curated the pipeline. And we only do small molecule medicines. We want medicines that are easy for patients to use. And this is the area and modality that we're strong at. And that strategy has helped us build the pipeline that you see in front of you. I'll start at the bottom in a moment. But basically, we have a pipeline that has two very different mechanisms of action in it. One is an anticonvulsant mechanism. And that program is at the top in these kind of teal buckets. And that's called OV329. And it's a mechanism that's a validated anticonvolsant mechanism, so it's validated in seizures and epilepsies. But the only other company that tried to develop for this mechanism had a kind of first-generation drug that had a compound-specific toxicity. We had to work on that. We've done so. And now we've got multiple epilepsy programs for the program OV329, both in adult epilepses, but also in a number of very bad pediatric epilepsys, and specifically developmental epileptic encephalopathies, where our drug, this inhibition of an enzyme that degrades the main inhibitory neurotransmitter, GABA, is inhibited, basically. So we'll talk about that in a few minutes. But what I'm really excited to talk about is exactly what Matthew suggested, which is our KCC2 direct activator. So KCC1 may sound like some kind of Soviet rocket ship, but it's actually been a long wanted to be drugged target, rather, for the brain. And the reason why is it's a very special target. It's only in the brain. Essentially, when it doesn't work, the braking system in our brains, GABA, the main inhibitory neurotransmitter, can't do its job. It can't be functional. And it's been very, very difficult to drug. Lots of people have tried to do this for more than 20 years because it potentially has very broad therapeutic utility, which we'll talk about in a moment. But now we've finally done it. We've solved chemistry, formulation challenges, other characterization challenges, and we have a really exciting molecule, OV4071, in the clinic in a phase one study. And we're soon to trigger actually a pretty exciting translational study there, which will tell us even more about how directly activating KCC2 may have therapeutic potential. So I'll take a pause there, and мы can dive into KCC1 next, if that's where you want to go. Okay, great. You'll have to forgive me because it's the earlier part of the pipeline. We're going to have to flip through a lot of slides, and then we're going to have to back it up again. But it's kind of fun to start with this one because this is the program that, while it's earliest, I think is one of the ones that investors are most excited about now. I'm excited about both. We love all of our children and our pipeline. So KCC2, I started on this a few moments ago, but, you know, why is this target a big deal? And the reason why is it is potentially a master switch on neural hyperexcitability. And there's some really important things about that, what I mean. The one is what I said before, which is the main braking system in our brain, the main inhibitory neurotransmitter, GABA, can't be hyperpolarizing. it can't be functional if this particular target doesn't balance the right amount of ions in and out of a neuron. That's essentially what this target's job is, KCC2, is to pump out enough chloride that enables GABA to be inhibitory. But what's exciting about it is it's only expressed in the CNS. So unlike a lot of other ion transporters that drug developers like me have tried to drug, we don't see the same tolerability and safety profile because it's not expressed in other tissues and organs in the body. Unlike other things that we do in the CNS, you can't over-modulate this target. So its job is to balance ions, as I mentioned, potassium and chloride. It's almost impossible to get it to spit out too much chloride. So it's more precise in what it does, where other things in the brain, we're always trying to get this balance right. And then finally, there was always literature that suggested that drugging this target It may have very broad applications, everywhere from seizures and pain and epilepsies to autism and, interestingly, a lot of basically psychiatric symptoms as well. But no one actually ever had a direct activator to be able to prove it. And now we do, and we are, and were actively doing that. So I've talked about the way it works. I don't think we need to talk so much about the mechanism. I think what's more exciting to do is to talk about this molecule that's in the clinic and performing. So what we know today about OV4071, which is an oral direct activator of KCC2, which means it's going to be, we believe, very amenable for chronic use across a number of conditions, is that we, you know, for starters, when you talk about first-in-human biology, safety and tolerability profile matters. And we have not only superb safety margins in animals, we're in a phase one study right now. And that's going well. We've gone through several SAD cohorts. We've moved into the MAD portion and feeling very good about the prospects. But what's also exciting about this particular molecule, OV471, is that it's very potent. It's highly consistent, frankly, in a way that I've never seen a molecule perform in my career to date. and I'm not young, been in healthcare for 25 years, and it seems to have extremely broad neuroactivity. So what I mean by that is no one ever had one of these to be able to test what could drug in KCC2 do. And now we're actually seeing in animals, albeit we were trying to prove this very shortly in humans, we're seeing the types of activity that the literature always hinted at, but no one could actually prove before. So we're seeing profound activity in areas of psychosis domains. We've run more than 100 pharmacology and pharmacodynamic studies across this program and our tool program. And we're seeing rapid activity to essentially rescue various symptoms of positive symptoms of psychoses. We're seeing it work very well in negative symptom domains and in enhancement in cognition, which is the holy grail in areasof psychosis that unfortunately as a field we haven't been able to achieve yet. So it's very exciting. And it's got the right drug-like properties to be able to be developed in the clinic. And I started to talk about some of the domains where we've seen activity. This is an eye shot that if you can read this in the back row, I'd be very impressed. But what it essentially is showing is some of what the literature has suggested, right? And now that we are able to prove in animals, in genetic, behavioral, stimulant, different animal models of pharmacology. But we now have more than 40 studies in psychosis that are very encouraging, highly consistent, and they've been repeated and validated across many CROs. So we believe in the evidence. But We're also seeing exciting data in areas like RET, interesting signals in pain and seizures. So We have more work to do there, but the opportunity of drugging KCC2 may actually be this profound. And as I said before, we're in a phase one study right now. So that's going quite well. And once we get to a certain stage in that study, we were planning to trigger another translational study, which is called a ketamine challenge. That sometimes raises eyebrows. But what essentially the study allows us to do is to make the target KCC2 less functional in the brain and to essentially make the brain a little bit more like someone who had a form of psychosis in a resting state. And then what we're able to do is essentially look, is OB-471 getting into the brain? Is it neuroactive? Is It acting on mechanism? And we can look at this through things like electrophysiology, things like EEG, ERP. And finally, we have a number of biomarkers in this ketamine challenge that allow us to look into the brain and seeing are we correcting or bringing back to a normal physiological state the neurotransmission in the brain such that we've essentially made somebody like you, Matthew, with the ketamine have a brain that's having a barren activity, more like someone with schizophrenia at rest. So giving 4071, can we return the neurottransmission closer to a typical physiological state? And we run a number of biomarkers in the study, a big battery of them, that help us look at the signatures that happen when someone has something like a resting state of schizophrenia on certain biomarker panels. And can we correct those with OV4071? And why we do all that is we can actually get early insights into predictive clinical effect. So we can say, OK, is what we're doing in a human matching all of these studies that we've run in animals. It helps us make smart decisions about the indications that we're pursuing, as well as the endpoints that we'RE pursuing. So I'm very excited by that, and we're planning to go into acute schizophrenia around the middle of next year as the initial proof-of-concept study. We think this is a very big drug in terms of its anti-psychotic opportunity. We're starting with acute schizophrenia. If we see the right signals there, we think we could go much broader than that into various neurodegenerative forms of psychosis. But the biological rationale for drugging KCC2 and schizophrenia has been there. We know in postmortem data for people who have schizophrenia that they have reduced KCC1 expression in the prefrontal cortex. And we know that essentially the glutamatergic surge or too much excitation that happens in our prefrontale cortexes, drives some of the dopamine surge that we see in the striatum, and mediates some of the negative symptoms of disease as well, too. So there's good reasons that we could always know KCC2 could have a role in psychosis and specifically in schizophrenia. But now we have many genetic and behavioral models that have also confirmed not just the reduced expression of KCC1 and people have schizophrenia, but that by rescuing KCC3 function in these animals and genetic models can have a profound rescuing effect, both on positive symptoms and on cognition. So we have so much data, we can't run through it all, but maybe I'll hit one or two and then we'll take a pause, Matthew. This was one of the first aha moments for us, this particular experiment with KCC2. And this is a stimulant-based hyper-locomotion model. And essentially what it does is it makes the animal's behavior kind of go off the wall. We know how much a mouse typically travels around. And what you're seeing is basically a dose-dependent reduction in hyperlocomotion when we give our KCC2 direct activator, OV4071. But what's important is so many drugs in the CNS work because they basically dampen our brains, right? And they're highly sedating. It's a big problem, right, for people who want to have a job, you want to have a life. And it's a huge problem for people with hyperloquism. And so, you know, what's exciting about KCC1, back to the point that you can't over-modulate it, like I said earlier, which means we're not seeing the same levels of sedation, yet we're seeing pretty profound rescue effects across so many of these studies. So that would be a very big deal to the patient community. We know when we look into the brains of the animals and sacrifice them, that neurotransmission and the changes that we are trying to achieve in people who have schizophrenia, for example, we have good evidence to show that that's actually what's happening in the animals. So when stimulant models, genetic models, we can see that there's less dopamine in the striatum of these animals when we sacrifice them, meaning that upstream, we're able to mitigate some of that excess excitation that comes from the prefrontal cortex. And then finally, I'm not going to go into too much depth in this, but we look at negative symptom models. This would also be the holy grail. This is a hard area to show movement in. And across many animal models, more than what we can share today, we've seen essentially a rescue of the negative symptoms when we do that. And most excitingly of all, we're seeing a major impact on cognition. And we see this when we run our drug basically against reference drugs, like in this case, risperidone or cobenfi in the middle. And what we've in both genetic models but also stimulant models, we see that our direct activators are improving essentially working memory and task switching in a way that is either matching or outperforming really good reference drugs, including at times drugs like clozapine, the gold standard, and schizophrenia. So we're very excited about this program and believe KCC2 activators are now really here. But why don't I pause, Matthew, and we'll cover some questions. I guess my first question is, it's interesting because KCC1, chloride channels, GABA, my first instinct is epilepsy. And you did say there could be, you know, potential in epilepsy and RET. I guess why schizophrenia first? And does, you know, positive or negative results in schizophrenia have any bearing in your ability to go into epilepsy and those other indications? So if we're successful, my hope is that Ovid will be known as the company that truly realized the value and the therapeutic potential of KCC2 in the next two years. And I say that because there's a lot of different therapeutic directions we may be able to walk down. And we've also made major advancements in understanding the structure-activity relationship of our chemistry to therapeutic opportunities. But why schizophrenia? I think, you know, we just had a new mechanism come to the fore with co-BENFI, and congratulations to the team at, you now, Corona and BMS. I think there's the potential that OV471 could be a co-benefit times five or six. And the reason why schizophrenia first, it's a good sort of gateway indication to broader forms of psychosis, which we think OB-471 may be able to address. So like bipolar mania and those kinds of things? Potentially. Like ADP? Potentially, but I think starting with a little bit more like an Alzheimer's psychosis and delusions, Alzheimer's agitation, Parkinson's disease psychosis. But the reason why schizophrenia versus epilepsy from a scientific perspective, which is how we make decisions, right, as drug developers and certainly at Ovid, is that the data supporting the antipsychotic effects of OB-471 are so undeniable. It took me a while to get there because we came from a background in epilepsy, but we have so many studies at this point, genetic models, stimulant models, behavioral models that have been reproduced sometimes tenfold over by different CROs. And the data is so wildly consistent at the same dose that it's such a strong signal, it's very hard to look away from, which, candidly, we didn't open this portfolio to start there. So it had to take a very robust armamentarium of evidence for us to feel comfortable walking down this path. Now I feel it would be irresponsible if we didn'T pursue it. Okay. And then for your upcoming clinical data, including the ketamine challenge, I guess? With the ketamine, like what does that, what do positive results look like and what does that establish? Is it establishing that you're hitting KCC2 or does that kind of de-risk like clinical efficacy in like reducing psychosis symptoms itself? Does that make sense? Yeah, potentially both. So at Avid, the strategy we like to take is ask as many questions and learn as much as we can early to make better decisions as we go. So what good looks like coming out of the ketamine challenge is a couple of factors. one is, are we getting into the brain, right? And are we neuroactive? That's some of the basics, but important. It's first in human biology. Two, you know, are мы moving electrophysiological biomarkers that are consistent with the mechanism? Do those biomarkERS match the translational biomarkERs that we've established in animals? And then really the exciting part for us is essentially by using the battery of biomarkers that we're using, and these are well-codified biomarkERS, by the way. These are things that the field has known for a long time. What we can do is essentially get early insights into predictive clinical effect. And that's really the cherry on top. That's not an easy thing to get out of a phase one program. And this is basically making almost a healthy volunteer more like a patient before we can get to patients. and you know we know with ketamine we can make the target less functional right so that's an important piece of this and essentially in humans we can replicate the types of pd models that we do in animals but you know the beauty with humans is we've got really good data and the field at this point of the signature of how you knowthe brain acts as someone who you know has schizophrenia at rest. And we know what that means relative to things like synaptic plasticity and cognitive ability, and we have connections of how that plays out into symptoms in the real world. So with this broad battery, we can ask these questions, and we can learn more to, again, try to tick and tie it, so to speak, with what we have been able to learn in animals. But it can help us feel more or less comfortable looking at certain symptom domains relative to psychosis and also in the future endpoint design but the bottom line is it's a good signal that it's working as it should and the directions that we're moving in from a therapeutic development perspective are the right ones okay and then in terms of the safety you mentioned it's hard to like over activate this kcc2 i guess maybe can you talk about why what's the mechanism that's like kind of breaking the break here? Yeah. So essentially, so I mentioned before with KCC2, it balances these two really important ions, potassium and chloride. And KCC1's job is to pump out enough chloride that enables GABA to be hyperpolarizing. So basically pushing it out into the synaptic region. But essentially what's happening is that it's a self-limiting mechanism. energetically you can't get this transporter to pump out too much chloride before it absorbs it back in so it's just it's one of these things where with so many other things in the brain where we're operating on neurotransmitters you can overdo it or you can underdo it this is self-limiting in that sense so um it's it's more precise precisely and we believe more optimally tuning gaba and it appears we still have more work to do because obviously it's early innings But it appears that our activators are either working in conditions where KCC2 has reduced expression, like schizophrenia, for example, where the transporter is less functional, and potentially in indications where, you know, the existing local GABA that you have on board is not doing the job. You know, it's enhancing it. So, hence, leading to potentially the very broad therapeutic uses of OV471. Okay. Okay. That's helpful. I guess I want to make sure we have enough time to go through your other program, if you want to give a background on that one. Sure, I will. And everyone bear with me because it's the lead clinical program, so it's at the top of the deck, so we're going to back it up. But so KCC2 is potentially, I believe, a transformative target for the brain. With OV329, which is our epilepsy program, This is more linear, and I would say more de-risked in development, but also a huge potential opportunity. So we've known about epilepsy literally for millennia, and we still don't have drugs that do three or four very basic things that work really well, that don't make you feel bad, that work well with other drugs. And that sounds simple. Oh, also that have any novelty to them. And that's really been the challenge with epilepsy. We've gone after targets with mechanisms we know. And our colleagues in the field, I think, have some really good medicines coming along, right? They've improved pharmacology, more sophisticated chemistry. But the tolerability, combinability, still a big problem today. And OV329 may be stacking up to be a drug that actually solves this great unmet need in epilepsy this holy grail that hasn't been addressed yet, which is it is essentially a new mechanism for epilepsy because the first-generation drug that a company called Lundbeck pioneered unfortunately had a compound-specific toxicity, so it's basically not used. So this is essentially coming to the field with...and no one else has a GABA aminotransferase inhibitor. It should work if we're at the right dose. It's a validated mechanism, and it has very effective results to profound results across a number of different adult and pediatric epilepsies. So encouraging. If we're at the right dose, it should work. From a tolerability and safety perspective, OV329 after being treated in 100 humans looks better tolerated than any marketed or seizure drug in development. And it should be easy to use. Like it's once daily, doesn't require titration, doesn' interact with other drugs. So while that sounds very simple, that's actually quite a winning quadfecta in epilepsy. So that's where we are. And it's built off of solving this problem that we know from the first-generation drug that I mentioned. We're trying to replace a medicine that's called Vigabatrin, although I think actually 329 is going to be much more than Vigabetrin, with potentially, certainly better safety and tolerability, but potentially better efficacy as well. And that would be good because we know this was a drug that worked in focal onset seizures. It had effective seizure reduction. And in some of the pediatric epilepsies that we're approaching, namely tuberous sclerosis complex seizures and infantile spasms, the results were not only very profound at the time but, you know, there's just really nothing out there for these kids. Like other DEs, there's more drugs in development, there are more drugs that are available. In some of these developmental epileptic encephalopathies, other mechanisms just don't really work very well. But this one does. The problem is it's not used because vigabatrin wasn't safe. It basically accumulated in the eye and it had a form of secondary pharmacology that caused essentially irreversible vision loss or retinal degeneration. So we designed OV329 with the guy who actually discovered Lyrica very intentionally and rationally to reduce the liabilities of Vigabatrin, but also to elevate the potential attributes of OV329. Did you have a question, Matthew? So I guess, yeah, with the Vigabetrin safety issue, how much do we understand it right now that it's, is it like the dimerization accumulation in the eye? Is that what's leading to it? Dimerization, I think, is a little bit more of the xenon factor. But there's two things that the field has been able to show and what we have had to prove. Because when we went about doing this, we never thought it was an on-mechanism toxicity because there's humans who have this enzyme that we inhibit 100% depleted in their bodies. And that's not a good idea. That's not our strategy. We try to inhibit this enzyme by about 60%. But when we looked at these humans and their parents, they didn't have any of the signature retinal changes that happen with this drug. So that was sort of our first aha moment. but we had to go prove what was the toxicity after 30 years of all kinds of theories around the field. So that became a fun secondary project, not so much, but we did. And what we learned was two things. One is we were able to validate independent research that shows vigabatrin accumulates and very specifically partitions in the retina. And we've done the killer experiments where we ran our drug head-to-head, controlled for exposure, to really try to demonstrate that, in addition to many very rigorous toxicology studies that were very focused on ophthalmology specifically. But that was one piece. But the second piece was, and this was the rational part, vigabatrin has secondary pharmacology where it hits an enzyme called ornithine aminotransferase, which is a mouthful. We say oat. But it was very much designed to, 329 was, to not have the same degree of selectivity for OAT compared to Vigabatrin. And why I say that is that also has been linked to essentially ocular degeneration. So between the factors of the localization and the partitioning coupled with the secondary pharmacology, we believe, and this is based on building on lots of other research work out there, that those are the two primary driving factors, both of which, you know, OV329 is completely differentiated from. Okay. And I understand you have some phase one data. I guess you probably get this question often, but do you think you have long enough safety follow-up to fully kind of rule out this retinol side effect? Yeah. So I think two things. We worked very hard to differentiate and de-risk the ocular differences in the preclinic, right? I mean, literally pretty much tried to run every killer experiment that we could. Because that was going to be important. If we didn't have that, we didn'T have a drug, right? That's one thing that absolutely had to be true. Now I think we actually have much more than that. But the phase one study was never designed to be like the long term safety definitively risking. We've tested OV329 in about 100 humans at this point. And I pulled up the safety data because you can see it's an incredibly clean and well-tolerated drug, though we know it's also delivering potentially therapeutic levels of inhibition in the brain. So it's getting into the brain, and it's doing its job, and it's safe. But to get to long-term safety, I think the most clinically de-risking thing we can do is what we're doing right now, Matthew. And that is the 12-week registrational quality phase two study that we're actively running around the world. And then in epilepsy, the right thing to do in the standard of care is to run open-label extension studies after you run your core studies, right, the registritional studies. So we will do that. And we will continue to have open label extensions really run in perpetuity through registration. And that's not because, one, I think for people who, you know, for maybe the 10 or 20 percent of the world don't feel confident of the de-risk profile from the preclinical work and the phase one work that we've shown, I think that will help the field because, you know, that will start to build a year and more's worth of data over time. But it's important to us as drug developers because when we go to regulators, the one thing we absolutely don't want is a label that's anything remotely close to bigabatrins. And the best way to address that is a really good, you know, robust database of patient safety. And, you know—and we don't hide from this. Like, we use basically the most sophisticated methodology to look at the eye and to also look at back of the eye. So if there's even something happening subclinically, we would know it. Okay. I guess in the last minute, do you want to remind the audience key catalysts for both programs and cash runway? Yeah, I do. So we have cash to 2029 and we are in the playoffs. I'm going to the milestone slide because we got a lot cooking. In the next 12 months, we should have four to five major card turnovers. So starting with the program I was just on, the epilepsy program, we have the photosensitivity study that we're running, reading out. Sorry, I got a little bit of myself. There we are. So this is the next two years for Ovid. We have a photosensitivity study reading out, which I think just will further validate the dose that we're taking into the clinic for 329 and focal epilepsies. We Have a phase two study, as I mentioned, that's running in focal epilepsy. That'll read out in the second half of next year. We are starting our program in the first pediatric epilepsy this year, which is tuberous sclerosis complex. That's an open-label study. So if we get good findings, we could share data as we go. It's a signal finding and safety study. And then, as I said before, we want to be the KCC2 company and known for that in the next two years. So we expect in the first quarter of next year, we'll be reading out our phase one study, where we also have exploratory electrophysiology. So, we might see some interesting signs of signal there and the ketamine challenge that you heard me talk about. So, there's more going on than that, but that's really the span of the next 12 months of readouts for us and setting up hopefully what will be a very exciting pipeline beyond. Yeah. Thank you so much for joining us. Looking forward to seeing this data. Thank you, Matthew.