COMPASS Pathways plc (CMPS) Earnings Call Transcript
September 3, 2025
Earnings Call Speaker Segments
All right. Welcome, everyone. We're going to get started. I'm Josh Schimmer from the Cantor Biotech Equity Research team. Very pleased to introduce from the COMPASS Pathways, we have the management team, Kabir Nath, Chief Executive Officer; Guy Goodwin, Chief Medical Officer; and Steve Levine, Chief Patient Officer. And I just have to say like a wonderful team to be leading this field of psychedelics that started very fringe and is now going mainstream. And I think now requires a very different approach to communicating, thinking about the power of psychedelics. And why don't we start there as COMPASS, and Kabir just give us a quick overview of the company. And should we be continuing to use the word psychedelic? Or do you want us to maybe move away into some other terminology?
Thanks, Josh, and thanks for the invitation. And just a reminder, we will be making forward-looking statements and refer you to the risk factors in our many SEC filings. So COMPASS is a company in Phase III for treatment-resistant depression. We have 2 ongoing Phase III studies. We put out the primary endpoint of the first of those at the end of June, which showed a highly statistically significant result, a MADRS difference between baseline -- change from baseline, a MADRS difference of 3.6, which is clinically and commercially relevant. But clearly, as a highly statistically significant study that discharged regulatory risk, comes on top of our Phase IIb study that was published now 3 years ago. So we are 242 in treatment-resistant depression, which we believe is unique, but we're set up for using the word remarkable. Our second Phase III study, 006, we are guiding to the 26-week data from that study in the second half of next year. And these 2 studies taken together are very consistent with the FDA's draft guidance around psychedelics that was published in June 2023. So we're confident both in the execution of those and in the fact that taken together, those 2 supported by a very strong Phase IIb together constitute, we believe, a really robust package of evidence for a filing, and we will talk about how we might try and accelerate that given some of what we're hearing from the administration and so on as well. I think on your second part of the question, I mean, I'll start, but clearly, Guy and Steve should weigh in. I think for now, we are clearly leaning into the subjective experience for psilocybin because what we have demonstrated is actually certain elements of that appear to be needed to achieve the impact we're seeing in treatment-resistant depression. So with that said, I don't think we should run away from psychedelics, but where that goes over the longer term is interesting. But Guy, Steve?
Yes. I think the only thing I would add is that the use of the term psychedelic has often gone along with the term assisted psychotherapy. And I think that has been unhelpful because it's distracted attention to the psychotherapy that particularly it was used with MDMA and which is actually unnecessary for the actions of psilocybin. Psilocybin works essentially through an inward process. People are their own treatment therapist, if you like. They don't need external help. And during the actual experience, people are silent and contemplative. So I think the psychedelic psychotherapy nomenclature has been unhelpful, but I don't think we can leave behind the psychedelic experience because that does seem to be core, whether you think of it as a mental state or a brain state, it seems to be core to the efficacy of these drugs.
Okay. So maybe you can go to the 005 study. You gave us a little snapshot of the data, right? The 6-week time cut, and there's so much more to learn about the data set that hopefully is going to better frame what patients might experience. One important consideration is you looked at 6 weeks, which is pretty far out as far as depression studies go. And typically, the sooner you measure, the larger the treatment effect. So the other relevant component to this is as the treatment effect gets lost over time, is it because the placebo arm is doing better or because the patients are doing worse? As you think about kind of completing the data set, what are you hoping to see based on the data you've already generated?
Guy, you want to take that?
I mean, as you know, we do not yet know what the data will show us. So it's pure speculation for us. I mean what you outlined is possible that it may be that the placebo arm starts to do better after a few weeks that is seen in other studies as well, and that's possibly why the difference wasn't as great. But there are a number of ways in which we're going to look at this data over the full 26 weeks that we have blinded information. And of course, these patients were eligible for retreatment if they didn't respond. So we're going to get a sense of what a second treatment can do if the first one doesn't achieve the full effect. And I think that's going to be very informative.
And you also haven't adjusted for rescue therapy in this trial. How do you think rescue therapy might distort the treatment effect?
Well, just judging from the 001 data, the way in which we analyzed that was allowed for the treatment effect on the one hand -- in one of the versions of the analysis and it didn't in another. The effect sizes actually were unchanged. So we don't think it makes a great deal of difference.
As we think about then the 006 trial and the questions that you're going to address with that, 2 important considerations. One is your primary endpoints at 3 weeks and the other is that you have a second dose. There's not much literature to guide certainly on the second dose dynamics, but relative kind of to the 005, at least top line data, what do you think directionally we're likely to see in 006 with those adjustments?
Well, I think our hypothesis is the effect will be larger. That's based on our own analysis of data that was available from the IMPERIAL study that compared 2 doses of 25 milligrams COMP360 with escitalopram. And in addition, there's sort of anecdotal data from other studies that suggest a second treatment may be effective in adding to the treatment benefit of the first. So we have a strong hypothesis that it's going to be a better overall treatment package to get to rather than one, but time will tell.
And we have a new FDA and HHS administration who I think are very vocally supportive of psychedelics. So as we think about your articulated time lines for data disclosure and unblinding, et cetera, is that still congruent with what might be a very accelerated path for you, particularly as you filed for a commissioner's voucher and you're trying to do what you can to maybe lean into the receptivity of the administration for these therapies.
Yes. So the first thing to say is the first and most important thing is to get the studies done as quickly as possible. So our first internal priority is to continue to do everything we can to accelerate 006, but I can confirm we are absolutely on track for the guidance we already have. The data from 26 weeks of that in the second half of '26. So to break down your question a little, absolutely, we are encouraged by what we hear from senior figures in the administration. We seem to share with them the view that psychedelics have significant potential and that appropriate ways to try to get them to patients more quickly are worth seeking. So yes, in dialogue with the agency, that's about the potential for some regulatory flexibility. I mean the data timings I've given you are the data timing, yes. I mean that is when we will have the readouts and so on. The question is whether given a very robust Phase IIb that is highly consistent in its findings with the first Phase III, what combination of those and the emerging data still to come from 005 and 006. Can we take together? Is there the potential for something that you might is familiar from other divisions, shall we say, a rolling submission, a rolling review, which has typically not been done in psychiatry. So that's the type of dialogue we're looking to have. I think that what's really important is no psychedelic exceptionalism. We're not asking for a different set of standards. And a key part of all our dialogue is that COMPASS is the closest to a potential regulatory approval. And the reason for that is we've actually invested more time to run really well-designed, robust large-scale clinical studies than anyone else yet in psychedelics.
Have you noticed the tenor of the conversations with the FDA has changed? And who are you able to dialogue either within the FDA or HHS, recognizing that you do have a number of allies out there now?
So profession. First, nothing has changed within the psych division or the professional staff with the FDA since January. So we continue to have very good engagement. We have breakthrough designation, which allows for a regular engagement. Within HHS, we have a number of different contacts. We have people we're talking to. Again, let's just say that translating rhetoric into action in what is a complicated administration is an interesting new challenge that we're working through.
Okay. Any sense in terms of the regulatory dialogue time lines as to when you might have clarity in terms of what the FDA really now requires between 005 and 006, if you do need anything from 006?
So I will disclose that we have just met with the FDA and just means in the last hour. And people on this platform were not all part of that meeting. So I cannot tell you what happened in the meeting. So we're not in a position to announce that until the meeting had taken place. So look, we will look for the minutes of that. Again, our going-in position was absolutely around is there flexibility? What might be the elements of that is? We're not in a position to say what came out.
Do you feel like commercially alone, you need some additional time to prepare, right, for what is a somewhat complex now delivery product profile, right? We had talked about this before, like if your regulatory time lines compress too much, are you -- have you not had enough time to get ready commercially? But I know you've been doing a lot of work commercially leading up to this.
So the easy answer is Lori and Steve will be ready whatever the time line is, but Steve?
Well, I was going to say because Lori isn't on the stage right now, I'm happy to say that we will be ready. But kidding aside, whatever the compressed time line is, and of course, we've prepared for various scenarios, we'll be ready.
All right. Excellent. So I think we've talked about a little over 6,000 centers that are equipped to administer Spravato. You can multiply that by the number of days they can administer Spravato, the number of times per day they can administer Spravato. And there's actually a fair amount of capacity in the system, at least for Spravato. It also, I think, implies there may be like 15,000 to 20,000 psychiatry practices that don't have the capability to administer Spravato. So as you kind of think about this evolving landscape that you're going to be launching into, how are you thinking about the bandwidth considerations at the practices and how you can help drive that momentum, not just to 6,000 but to 12,000 and 18,000 practices?
So as you said, Spravato today is being delivered in 6,000-plus sites. And as you mentioned, within those sites, there currently is slack, there is capacity. And because a Spravato room looks like what's needed for COMP360, that means there's capacity for COMP360 today. Without us doing anything else, that capacity will increase. That is the trend right now in the building of psychiatry infrastructure. It's in the direction of interventional psychiatry capacity. We've seen this since 2019. At the time prior to Spravato's launch, there really were no interventional psychiatry practices. There were very few rooms available. That has really taken a hockey stick like trajectory, roughly doubling each year since that time. And there's no signs of that slowing down given that it's not only been good for patients with good outcomes and reaching those sooner who are living with treatment-resistant depression-related conditions, but most of these practices are built in a treatment-agnostic way to capacitate new treatments as they come online. And so they will continue to build because it's their business.
Are these the ketamine clinics because there was a time when the ketamine clinics as we had talked about starting to decline because the business model wasn't working, but this is now a new business model that likely should work. So to what extent as we're talking about these 6,000 Spravato centers, are we talking about ketamine clinics or not?
The way I would differentiate ketamine clinic from a site delivering Spravato today is that ketamine clinics typically are single service line focused on delivering ketamine, typically not contracted with payers and being paid out of pocket by patients at the point of service for an off-label treatment. That is a very difficult business model to scale because it's not a true health care business as opposed to the interventional psychiatry practices, which by taking a more agnostic approach by contracting broadly with commercial and government payers, delivering a range of treatments and not being wedded to just delivering a single treatment, but rather delivering the appropriate treatment to the appropriate patient at the right time, that is a healthy, scalable business. And so for us, as we look ahead to a commercialization along any time line, the existing Spravato infrastructure is already there. That type of infrastructure is scaling. But with the work that we're doing with our strategic collaborations, which spans not just interventional psychiatry but also hospital systems and integrated delivery networks, community behavioral health, decentralized models, really the gamut of where patients living with treatment-resistant depression receive their care today, we are learning a lot every day about what it will take to implement a treatment like COMP360 and those types of sites of care as well.
I just wanted to come back to something you said earlier because one thing we clearly don't know is what the ultimate path or maximum number of treatment centers delivering treatment will be. But one thing that's clear is we're going to have to do a significant education work with that large pool of psychiatrists who will never be able to offer the treatment themselves because we can argue about why Spravato's penetration is so low. But one of the key reasons is that psychiatrists are not referring to interventional psychiatry. They're not understanding it's there. And so that's why we have a field medical team already, and that piece, again, of our commercial prep is fundamentally important because we have to get to those referring psychiatrists and really break out of the current paradigm that refers to interventional psychiatry only very late in the disease progression.
Can you talk more about the scalability dynamic? Because intuitively, it doesn't seem as easily scalable in the sense of if you want to add more capacity, you need to find more rooms, but you rent it out your office space and you're using it presumably efficiency. So where does that -- how do you scale that up? Do you have to open up new sites? How do you staff those new sites? Where do you find the extra rooms to handle what eventually may be millions and millions of patients of demand?
Yes. I mean, first, starting with interventional psychiatry practices. The typical footprint of one of these centers is the relatively large for psychiatry. They have multiple rooms. Typically, multiple rooms will be treating patients with Spravato simultaneously, maybe one or more rooms also for some kind of neuromodulation like TMS. Sad reality, along with the tremendous unmet needs for this population is that these ultimately are patients with chronic remitting depression, relapsing remitting depression. And they will likely need multiple treatments over time. This is the management of a chronic illness. In cold business sense, that means that they have a high lifetime value if you can continue to meet their needs. There's also a relatively low cost to acquire these patients. And it is a relatively low cost to build one of these centers or to add space in one of these centers and to operate them on a monthly basis. So the economics -- and again, I don't like to talk about treatment-resistant depression in this way, but the economics favor building additional capacity if you are reaching capacity. Today, there's a lot of slack anyway. Now these are the larger, more organized, oftentimes public or venture capital or private equity-backed businesses. There are today many smaller psychiatry practices, the more traditional chair desk phone, single psychiatrist or small group, recognizing the need to build additional capacity for the new treatments coming. There also are a number of companies now that are focusing on building the back end to support smaller practices to be able to deliver treatments like COMP360.
It gets so nuanced and fascinating too, right? Like does the psychiatrists need to be there on site? Or if you're a pioneering psychiatrist, can you have satellite offices administrating? Like again, because this is really getting to that question of how do you scale? Steve, you said it's easy to add rooms, but how is it easy to add rooms when you rented out your little office space and now have to wait for another segment of the building to open up to lease?
Yes, you're waiting for spacing your building to open up perhaps or within the same city, perhaps you're building a new site. Depending upon the size of the city, there's potentially room to have multiple centers within a single city if there is that demand. As far as the staffing, going back to the structure I was describing before of these being platforms that deliver multiple treatments, I think you want to think about this not just in terms of delivering COMP360 or having the capacity to deliver multiple COMP360 treatments, but how these centers need to be staffed to deliver a range of treatments. And today, what they typically look like is one prescriber, either psychiatrist or a psychiatric nurse practitioner on site with a multidisciplinary team supporting them that can include technicians and nurses and other health care providers.
So we haven't really focused on the psychiatric nurse practitioner component, right? Because, again, for a psychiatrist to open up multiple sites, he can only be on one. But if he's got a team of nurse practitioners, that can actually extend the reach and again, help with the scaling process. So how many psychiatric nurse practitioners are there? What's the growth rate of even the treating physician and nurse practitioner demographics here?
There are the numbers today, and then there's the reality that the numbers are actually growing pretty rapidly. There's an increasing popularity of psychiatry as a choice of residency amongst graduating physicians. There is an increasing number of psychiatric nurse practitioners entering the workforce and also physician assistants who are at a similar level to nurse practitioners, although historically, they focused on surgical subspecialties or primary care. We're seeing a tremendous trend towards physician assistants now being trained specifically to deliver psychiatric treatment. So today, those numbers look something like 35,000 to 40,000 psychiatrists. There are 6 figures plus of nurse practitioners, probably about 20,000 or so of them specifically focused on psychiatry. And then again, a rapidly growing number of physicians assistants and a rapidly growing number of psychiatrists in training now who will soon enter the workforce.
So in terms of the increase in training, are centers or academic institutions now expanding their residency programs with this in mind? Or has it just become a more popular specialty, as you point out. And so now the available slots are being filled more consistently?
It's both. Available slots are being filled more consistently, but also [ ACGME ] over the past several years has approved more psychiatry residency slots, and those are being filled too. And yes, perhaps that is in part because of excitement around psychedelic treatments to come.
Okay. Got it. Maybe talk a little bit about pricing considerations, what the pricing benchmark products that you're looking at might be?
So it's premature to speculate on that because until we complete the Phase III, understand durability and so on better, we need that to do that. But clearly, we know what Spravato is and in Spravato, net is going to be depending on the number of administrations somewhere between $25,000 and $45,000 a year in that range. So you can clearly see that as a benchmark. But again, much will depend on the actual profile, what we see for durability, need for repeat doses and so on.
So now and assuming approval relatively imminently, which whatever that actually means, Lori is ready to go from day 1. If you got approved tomorrow, in theory, how do we think about that early rollout? Like what are the steps that need to happen post approval to the first patient being actually treated in the clinic? What there might be DEA scheduling considerations to address. There might be counseling considerations, preparatory sessions. Maybe give us a sense of what that entail.
So I'll just start with kind of the big budget regulatory and so on and then Steve and Guy weigh in. And so first, there would need to be rescheduling. So federal rescheduling, the DEA has 90 days after an approval. As an industry, we are working to actually bring that in parallel with the final stage of FDA review because there is no reason for that to have to be a sequential 90-day. So the industry association has made that one of their key asks. But there's federal rescheduling, there's then state level rescheduling, which we've talked about before. 50% of states have an automatic trigger with federal rescheduling. The other half don't. And so we have already now for nearly 2 years, been working to ensure that we can enable whatever legislative needs are at those states so that, that can happen as well. But you need that state level rescheduling before you can deliver product. So that's kind of the formal piece. I'll ask Steve and Guy to talk about some of the things on the education and how to get ready side that will need to be in place. Also, we have to assume we will have a REMS. So an approval will come with a REMS and rolling out a REMS is a nontrivial exercise as well as part of this.
Yes. Certainly, as you would expect, we'll have some traditional commercialization efforts that we'll have to prepare as well as far as the sales force and increasing the size of our medical science liaison team, the other things that will be part of any commercial launch. But specifically to the point about preparing sites, getting them ready for compliance with the REMS or understanding the training that they may require, et cetera. This is part of the learnings that we get right now from our work with our strategic collaborations because part of what they're sharing with us would be what is their current staffing, who's involved in the care of their patients, what kind of training do they already receive? How do they handle additional trainings if they do need training beyond whatever it is that they are already using to care for their patients, how they would handle things like preparatory sessions, would they do those one-on-one, would they do them remotely or face-to-face, would they do them in groups, et cetera. So these are a number of the things that we're working through. And of course, this would apply not only to the specific collaboration group that we're working with, but because they're representative of broader phenotypes, it's allowing us to build templates to get ready to understand how to educate and support these sites at that moment of launch.
It's interesting, right, because for the clinical trial program, the centers had to go through a fairly rigorous training period. Is that -- how do you see that evolving in the commercial phase? Are they going to have to go through the same kind of protocol training to be able to prescribe in which case, it may be kind of center of excellence type delivery, but that seems to be a very limited paradigm relative to the unmet need that needs to be addressed.
Much of -- and Guy please weigh in here, too, but much of the need for the training that we provide in our clinical trials is just consistent with the rigor with which we approach every other facet of running these trials. It's to ensure that there's consistency site to site, that there's compliance with our protocol that the people involved in supporting these patients aren't doing more than they should do in this trial and introducing additional variables. If it's a therapist who's part of the study team, we don't want them doing therapy during these studies because that's not part of this protocol. Once we enter the real world, much of that becomes less important to real-world care delivery, where there's less of a requirement to have that high level of standardization site to site. So there will be basic principles that these sites will need to understand. Much of that can be incorporated within the training that's part of a REMS. We are working out what other third parties might be involved to help these sites understand the minimum training requirements and core competencies and so forth, but we don't anticipate a rigorous many hour training like we've had.
Yes. And I think I would just add, Josh, that what -- the feedback we get from PIs is that they get this training, which in some ways they find rather scary. And when they actually come to deliver the treatment, it's actually kind of easier than they expected. And so there is that sort of element to it, which is quite reassuring to us that we set very high standards and it's sort of make it difficult for people. When they actually do it, they do find that the experience the patient has is pretty gentle, it's pretty manageable. And for the staff running the place, it's not a big strain. And that may not be true of all the psychedelic treatments that get developed.
So there's another important leg to the stool that's starting to spread in the PTSD indication. I think you just published some of the Phase II data. When are we likely to hear a little bit more about that program? And what are the gating steps to advancing?
Yes. So we are in the final stages of designing a late-stage study for that. We did get some agency feedback on that, which we're incorporating into that. So I mean, I would hope that in relatively short order, we'll be in a position to announce how we're taking that forward.
Right. Excellent. And then maybe in the final seconds here, over the next 12 to 18 months, just kind of frame for us some of the milestones we should be looking for.
So we will, in due course, announce the completion of enrollment in 006, and that's going to be important both to demonstrate that we are sticking on time with that and delivering on our commitment for that time line. But also that will then clearly allow us -- require us to tighten the guidance both for the 26-week data of 006, but also for the 26-week data of 005, which is going to be, as I said, hooked to -- based on the timing for the 9 weeks of that. So that's one. Then we do expect that 26-week data from 005 realistically early next year and then the second half of next year, the 26-week data from 006. And somewhere in this relatively short time frame, we will also announce the PTSD design.
And then at some point, some regulatory update on the requirements. I think we're out of time. Thank you so much the COMPASS Pathways team for joining. I think we also have -- we recently did a webinar together under our let's do some psychedelics framework. And I think we're going to come back after we get some more color on PTSD and dive in there because there is a huge unmet medical need that is so poorly served currently. So all right, thanks, everyone, for joining.
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