Unveiling the Potential of DMT in Psychedelic Therapies – An Exclusive Interview with Doug Drysdale

MedicalGold

It’s great to speak with you again, Doug. In our last conversation you mentioned that you could envision DMT becoming the "gold standard", please tell us about your results so far with DMT.

Doug Drysdale

Yeah, in our DMT program, we've run five studies at this point. So we got a lot of data, including efficacy data on regular DMT. So we know an awful lot about the PK/PD of both regular and deuterated analogues of DMT. And we've also managed to create an intramuscular formulation, which means we can move away from an iv infusion pump and simple injection in the arm. Really easy to give, just like giving a flu. We're running those studies in Europe, they've been in the UK and Netherlands. And now this phase two study just got cleared by the FDA, so we can move the program to the US and start recruiting in that generalized anxiety disorder study by the end of the quarter.

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MedicalGold

That's great. So with CYB004, it can either be IV or IM. What is the difference between the IM shot and the iv version?

Doug Drysdale

Yeah, the DMT IV that we've been testing is an infusion. So that requires an IV infusion pump, which is a device that you program and it delivers a certain amount of drug at a certain rate over a certain amount of time. So it's in a piece of equipment that needs a technician to manage it. And generally psychiatrists don't have that kind of equipment in their offices, so we've wanted to move away from that to something more convenient. And the deuteration makes the DMT more bioavailable. So because of the deuteration, we're able to create an intramuscular injection formulation. So it'd be a simple syringe, a simple small needle, quick shot of the arm and off you go. You'll be quite quickly in the DMT space. And the deuteration extends the experience. And so we're seeing about a 90 minutes experience from a single injection.

MedicalGold

That’s very interesting. So you give the injection, the journey starts, it peaks somewhere about a half hour or so into it, and then it slowly tapers off. Is that how it works?

Doug Drysdale

Yeah, I mean, you get a nice peak. Patients get up there fairly quickly. You want people to get up into space pretty quickly to avoid a long period of anxiety. And then this has a. After the intensity of the peak, it has a nice tail that resolves by about 90 minutes. And from feedback we've had from our phase one studies, it's that tail after the peak where the psychological work rehab.

MedicalGold

So you think CYB004 and the SPL026 and 028 could set sort of the gold standard for the treatment of anxiety, maybe other mental health ailments. The length of time, the experience being under 2 hours, obviously that's an advantage. What else are you seeing that has you so excited about it?

Doug Drysdale

Yeah, obviously the scalability of it because the duration is good. I think the other difference with DMT compared to psilocybin is that it's a highly immersive and more intense experience. Pretty much everyone gets into that DMT space with psilocybin. What we see is it's a bit more of a wavy, kind of emotive, mystical type experience. And not everyone gets there or doesn't get there fully. We see with psilocybin that a second dose is more effective because patients have already had a dose, they know what to expect, and sometimes in the first treatment they're a little resistant, or maybe they're a bit anxious, or they're just not letting themselves go fully into the space. And whether that's conscious or unconscious, it's hard to say. But we feel like you need that second dose to really boost efficacy.

And we see that with our CYB003 asset and that we saw 20% remission from the first dose and 80% remission from the second dose, which is just remarkable. What we might see with DMT, based upon deuterated DMT, based on what we saw with regular DMT, is that there may be less of a need for two doses. It may be just getting there on the first dose. We did an MDD study with regular DMT and there didn't seem to be much difference between one dose and two doses. So it could be a 90 minutes treatment, one and done for quite a while. So that makes it pretty scalable.

MedicalGold

Yeah, that's great. What can you tell me about the largest shareholders with the company today? I know you guys had that big financing back in November. You said something like back in our conversation at that time, that those people would eventually be made public. Is that public knowledge now? Or is that something we still can't quite talk about?

Doug Drysdale

Yeah, the deadline hasn't passed for them to file just yet. I think it's sometime in February that the deadline is. So those filings all haven't come out. I mean, you know, from past discussion, that largest shareholder at the moment is Point72. Steve Cohen's fund. Obviously, Steve and his wife Alexandra have donated philanthropically 50 or $60 million to mental health causes. But with Cybin, they made an investment for profit through the fund. So that they're obviously meaningful and that's great validation from them. But the other funds that came in November are all well known funds that you would know.

MedicalGold

And so you attended the JP Morgan biotech conference a couple of weeks ago. Can you tell me anything about that? Like some conversations that were notable for you or some things that really stood.

Doug Drysdale

I'd say it was the best JP Morgan conference in a number of years because last year there was just very negative sentiment and before that of course, we had a few years of COVID and virtual and it was not great. So this year was a really good one. Lots of positive sentiment around biotech in general. We finished last year with a little bit of M&A and a bit more M&A to start this year. There's been a few small public offerings. Interest rates are coming down. So that's always good for pre revenue companies that have their valuation based on dcfs. So yeah, overall I think sentiment was good and I think we'll continue to see some more deals get done. Lots of meetings with pharma companies, of course, as you'd expect.

And we continue to see increasing interest. From my perspective, every pharma company that's in CNS or psychiatry is taking a look at this space. And as time goes by, the sector is maturing. We're getting more data sets, larger data sets, later stage information, and it's just adding additional credibility to the sector, but also to these treatments. I think it's very clear now that psychedelics work in various mental health disorders. I don't think that's really up for debate now. It's a case of executing on larger trials and then big pharma trying to figure out how the commercial model for these treatments fits into their business model.

This is likely to be a controlled distribution, specialty pharmacy, rems type of situation, which some companies I think are well suited for mid cap companies, and some companies may be less suited for some of the larger, very large cap companies that really rely on a kind of boots on the ground. So lots and lots of interest, particularly in the data that we've been sharing as the data is obviously very compelling with our remission rates in depression. So I wouldn't be surprised if we saw a strategic pharma transaction in medical psychedelics this year. It wouldn't surprise me at all.

MedicalGold

Yeah, that was my next question. I guess with Compass Pathways, they're a little bit a step ahead of companies like Cybin because they're already into their phase three and they have the biggest market cap. Do you think that Compass would be the first company that a large pharma might go after, or do you think that they would maybe be interested in Cybin?

Doug Drysdale

Yeah, I couldn't say who would be first or I couldn't tell you what compass is thinking in terms of their partnering. Now we keep all options open, our plan always is to make sure we're set up to go all the way on our own. But there's a lot of value in a potential partnership, both from potential funding, but also credibility and additional resources. So obviously we have to keep an open mind about those opportunities.

MedicalGold

Okay, so the recent share price weakness, CYBN shares have been basically, essentially flat for the last month. They tried to break out above $.45 for a day or two and then fell back down. Some other companies in the sector have had some pretty good runs, though, so far in January, including Compass. What would you attribute the weakness in Cybin in the last month to?

Doug Drysdale

It's a good question. We've had a fair amount of decent news and we've consistently executed and delivered on what we said we would do. So it's obviously frustrating for the team and obviously for shareholders when the stock price is going to get stuck. I think there's been a bit of, towards the end of last year, we always have tax loss selling at the end of the year. I think we obviously had a good number of shares issued as part of the small farmer transaction. There may be historic small farmer shareholders trading out, but I also think that this habit, because of the way the economy has been and the market has been over the last couple of years, this habit of selling into the news.

I'm hoping, as I hear from folks at Morgan, I'm hoping that we're shifting away from that a bit more now. And it seems to be that news is making a difference more. It seems to be that there's a focus on catalysts and that's what we're continuing to do, focus on where we can deliver value. This quarter, we have our end of phase two meeting with the FDA to sign off on the phase three program. For CYB003, we'll have three month efficacy data, which is, I think, important for pharma partners. It's important for payers. The six week data we shared was really impressive, but you really want these effects to last longer than that. So the three month threshold is important from an ROI point of view for payers. So that's coming up. And of course, we'll start the anxiety disorder study as well.

So we're just heads down trying to continue to execute, and we hope that the stock price starts to reflect that as the year progresses.

MedicalGold

This will be a multi-part question. Can you break down a little bit the trials, phase two, phase three that you'll be carrying out throughout 2024. What's the timing of those? How long will they take? And how much have you budgeted for each one?

Doug Drysdale

Yeah, we haven't laid out those budgets publicly, but I can certainly walk you through the studies. So for cyb three, we're waiting for this end of phase two meeting with the FDA this quarter where we expect to get agreement on the phase three plan. The phase three study should beginning quarter two, and that is expected to be a study in patients with moderate to severe depression who are not controlled on ssris or snris. So an adjunctive therapy, and I think that's important. And a couple of hundred patients and that study will take 18 to 24 months beginning in quarter two. And at the same time, by the end of this quarter, we expect to kick off a generalized anxiety disorder. Phase two study for CYB004, that's going to be a smaller proof of concept study.

We've got plenty of safety data, plenty of PKPD data. We actually got some proof of concept efficacy data with regular DMT from our depression study, where we also took anxiety scores and we saw patients' anxiety scores improving. So we only need a small proof of concept study in order to bridge us to phase three. So that phase two study should be read out by year end. So quite a bit going on in 2024.

MedicalGold

Yeah, there's a lot going on. So phase three, it's going to take two years, just simply because you have to roll it out in several countries and you're going to follow these patients for a much longer period of time, is that right?

Doug Drysdale

Yeah, exactly. So it'll be multiple sites, multiple countries with a large focus on us, but we'll have some sites in Europe as well, and just a larger number of patients. I mean, the last study, we had 48 total participants and this study will be 220. So I'm optimistic we can run it efficiently. And obviously, we're targeting the 18 month end of that time frame, not 24. But you never know the way with how recruitment will go and getting sites up and running. I will say that in our phase two study for Cyb three, we had recruitment rates that were many times faster, greater than the projections from the CROs. So there are a lot of patients out there, unfortunately, that need help and want to get into these studies.

One of the benefits also of testing here in MTD is it's a larger population than, say, TRD. More patients to find for recruiting and positioning as an adjunctive therapy means that patients don't have to titrate off their existing treatments, which obviously is a big hurdle and not particularly attractive to a lot of people who might end up getting a placebo. So that means that recruiting is easier as well because of those couple of things.

MedicalGold

Okay, a couple other questions just popped into my head. Do you have any insight into the FDA approval of MDMA? The timing of that, or are you hearing know? Everything I've read is like May or June. Do you think that's still accurate or you think it's going to take a little longer?

Doug Drysdale

Oh, I think that may be a little aggressive in terms of timing. I don't have the exact date, but MAPS submitted in December. Right. Their NDA. That's great. It has to be accepted first. So we'll know soon whether the FDA accepted the NDA. I am assuming because MAPS has special access protocol and great dialogue with the FDA. I'm sure because of that, I'm sure they're highly confident that it'll get accepted. Typical approval is maybe ten months or so. But of course they do have breakthrough therapy designation. They do have this special access protocol. It may be less time because of those things, but I think it's going to be likely the second half of the year, maybe towards the end of the year, but fingers crossed, it's obviously going to be great for patients.

MedicalGold

Yeah, I feel like that'll be a big breakthrough for the whole sector and people will start to take this a lot more seriously. Final question, how much cash does Simon have today and what are your cash needs for 2024?

Doug Drysdale

Yeah, last reported we had $55 million on the balance sheet and we've historically been burning around 10 million a quarter. So that's where the current situation is. We do still have access to an ATM. We have refreshed our shelf, so we're also ready and able to raise funds even when we need it and taking advantage of market conditions as they hopefully will improve throughout the year.

MedicalGold

All right, great, Doug, thanks for the update call and I look forward to more positive progress with CYB003 and CYB004 in February!

Disclosure

Author owns shares of Cybin Inc. at the time of publishing and may choose to buy or sell at any time without notice.