In July, UK-based COMPASS Pathways’ share price surged 40% – far outpacing the market’s rebound.
Notable inflection points included the release of positive financial results, conclusion of the patent dispute, the US government’s expectation that COMP360 will be regulated within the next 24 months, and the appointment of a CEO with extensive expertise in drug commercialisation.
Kabir Nath was previously Senior Managing Director of Global Pharmaceuticals at Otsuka, and served as President and CEO of Otsuka’s North America Pharmaceutical Business.
To discuss the company’s transition and his mandate going forward, Nath spoke with PSYCH. With Nath’s decades of experience in big pharma, PSYCH was keen to learn what attracted him to the role of navigating COMPASS through Phase III trials.
‘There are a couple of elements that I’ll talk about,’ said Nath. ‘The first is a personal connection to the prevalence of serious mental illness. I’ve lost close family members and very close friends to suicide, so I’m very well aware of the devastating impact of serious mental illness.
‘The second is that I’ve spent the last six years running one of the leading companies focussed on mental health in the traditional space of antipsychotics – one that was always focussed on the future and what could be in the future.
‘In fact, I was lucky enough to get to know George and Katya nearly four years ago when I was one of the champions for Otsuka’s decision to invest in COMPASS.
‘At Otsuka we had seen that psychedelics had the potential to be part of compelling new treatment options for people with serious mental illness. I’ve never had any doubt that the science would work for certain patients, so I was one of the two people that helped secure approval from Otsuka’s board in Japan to invest in COMPASS.
‘From that time I knew that we were aligned in terms of values and I admired everything the company was doing. That was before the amazing Phase II results and everything that has been over the last three years.
‘When George and the COMPASS board decided it was time to expand the leadership team at COMPASS and bring in somebody with complementary skills, I was thrilled to have those discussions and jumped at the opportunity.
‘However, the fact that I’m here has nothing to do with the relationship between the two companies. Otsuka found out the day COMPASS announced my appointment.’
Although Nath replaces George Goldsmith as COMPASS CEO, Goldsmith will continue to play an integral role as Executive Chairman until the end of 2022 and remain as Chairman thereafter. PSYCH asked the new CEO about the transition.
‘This is about an expansion of leadership capacity at COMPASS. It is an acknowledgement that as we move into Phase III trials, there is the complexity of launching treatments and a need for someone that could complement George’s skills and networks.
‘I have overseen a number of Phase III development stages with CNS drugs and led their commercialisation. While you will see George and I working very closely together, initially I will be focussed on the operational side.
‘We have already grown from two people to over 150 people and I can promise you that we will keep on growing – building in new skill sets for new capabilities.
‘My role will be building out these capabilities and continuing to work with George, Ekaterina and everyone else here to deliver on the broader vision.
‘The drug and psychological support is a very compelling value proposition that goes way beyond one condition. We announced the launch of a Phase II proof-of-concept study in anorexia just last week, and there are lots more potential indications to go for
‘We announced October 12th as the day we will be talking about how we are approaching commercialisation and looking at scalability. We’ll also be discussing the design of the Phase III trials, as there has been so much excitement already.’
Last week COMPASS released its financial results for the previous quarter. The statement showed an enviable cash position of US$207.2 million, which could prove to be a lifeline as recession looms. Drug development is incredibly resource intensive, with the average cost of getting a drug to market well over US$1 billion.
As investment in psychedelic healthcare stalls, companies may run out of capital before getting drugs to market. PSYCH asked Nath whether he could comment on COMPASS’s financial results and the state of the market.
‘We have runway into 2024 and that takes into consideration we’re starting Phase III trials. To your point, there is an emerging sentiment in the psychedelic sector that some companies are in a much better position than others.
‘I’m somewhat hopeful that the bottom has been reached. In the wider biotech sector, we’ve started to see deals being made, but who knows what is going to happen in the next few months?
‘There was clearly good news on the patent opposition, which was important to us, but huge credit goes to George and the management team for creating a credible and compelling proposition.
‘I won’t try and predict what might happen in the market, but I hope investors can see that COMPASS has a unique value proposition. We have the combination of very compelling data around the drug, psychological support that we’ve worked hard to put in place, and an incredibly talented and committed team to move the company forward.
‘I have huge confidence this team can collectively create truly novel care models for people with serious mental illness and get them into the public domain – not only for treatment-resistant depression, but also for other hard-to-treat indications such as PTSD and anorexia. That is why I’m here.’