EndeavorRx making progress on all fronts, CEO reports

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Akili Inc. Reports Financial Results and Provides Business Update

BOSTON–(BUSINESS WIRE)– The market leader in digital medicine, Akili, Inc. (Nasdaq: AKLI), has just announced its financial results and provided an update on the company’s business for the quarter that will end on September 30, 2022.

“This quarter, we reached two important milestones on our way to making digital treatments a standard part of medicine,” Eddie Martucci, the CEO of Akili, said in a statement at the end of the fiscal year. These landmarks include the transition by the company from the pre-launch stage to the launch stage of EndeavorRx as well as the beginning of trading on the Nasdaq.

Both of these things will contribute to the financing of the company’s first product launch and will help advance Akili’s pipeline.

Akili is “well-positioned to help us reach our goal of making EndeavorRx a standard part of the medical care for children with ADHD” due to the company’s “solid foundation” and “experienced team.” (Scroll down for a full list of how EndeavorRx can be used and what possible side effects it could have.)

According to the chief executive officer and president of Akili, “Prescriptions for EndeavorRx have been written in all 50 states, and the market continues to grow.”

We have finished the first step of the commercial launch of EndeavorRx, which is to say that we have hired, trained, and dispatched our first sales team into key territories. This will allow us to speed up adoption.

Recent reports and developments regarding commercial endeavors

The first members of Akili’s EndeavorRx go-to-market sales force began making cold calls to integrated behavioral health centers and pediatric providers in 14 priority territories across the United States during the third quarter of 2022.

Within the next two years and eight months, Akili plans to expand into new domains.

More than 1,300 prescriptions were written for EndeavorRx during the third quarter of the fiscal year. This represents a 71% increase compared to the previous quarter and a 146% increase compared to the previous quarter in 2021’s third year.

At the end of the third quarter of 2022, 789 doctors had prescribed EndeavorRx, and more than 500 of those doctors were new prescribers. This meant that there were 91% more new prescribers than there were in the second quarter of 2022, and there were 110% more new prescribers than there were in the third quarter of 2021.

New Study Shows Akilis SDT001 Product Candidate May Improve Real-World Evidence Base

Over 2,000 medical professionals in every state have already prescribed EndeavorRx to their patients since the FDA gave the go-ahead for the product in the third quarter of 2022.

The EndeavorRx Expedition product registry was created by Akili in order to gather information regarding how people obtain and make use of the digital therapeutic.

Researchers have the opportunity to learn more about their patients’ demographics, medication habits, and other important factors with the assistance of this registry, which is sent directly to the patients. All patients who have been prescribed EndeavorRx are eligible to participate.

The company will use the data to improve the real-world evidence base it keeps and share it with doctors, insurance companies, and other health care providers.

In Japan, Akili’s SDT-001 product candidate is participating in a study that is both randomized and controlled. Shionogi & Co. Ltd., a multinational pharmaceutical company that collaborates with Akili, is the one carrying out the study at the moment. The goal of the research is to help kids who have been diagnosed with ADHD pay more attention.

The completion of Akili’s merger with Social Capital Suvretta Holdings Corp. occurred during the month of August, and the company started trading on The Nasdaq Capital Market (also known as “Nasdaq”) under the new ticker symbol “AKLI.”

Akili’s public company got a new board of directors, and the company was able to raise more than 164 million dollars in capital without having to pay any extra fees for the deal or the consulting.

The most crucial aspects of the company’s finances during the third quarter of 2022

Akili’s Cash and Investments Grow Significantly, Despite Quarterly Loss

As of the 30th of September 2022, Akili had a total of $156.4 million in cash, cash equivalents, and short-term investments in their possession. This was an increase from the previous figure of $45.6 million as of June 30, 2022.

It is anticipated that the available cash will be sufficient to cover operating costs as well as capital expenses until approximately the middle of the year 2024.

Earnings for EndeavorRx increased to $82 thousand in the third quarter of 2022 from $64 thousand in the previous quarter.
According to generally accepted accounting principles (GAAP), the total operating costs for the third quarter were $24.5 million.

This figure represents an increase from the second quarter’s $22.3 million total, when the total operating costs were $22.3 million.

The timing of marketing costs associated with putting EndeavorRx on the market helped to partially mitigate the negative impact on growth that was caused by transaction-related costs being allocated to earnout shares and stock-based compensation expenses.

The total operating expenses for the third quarter of 2022 came in at $18.3 million, which is lower than the $20.3 million that were incurred during the second quarter. The decrease can be attributed to the fact that discretionary marketing costs associated with putting EndeavorRx on the market were planned earlier as well as the lower costs associated with clinical trials.

In accordance with generally accepted accounting principles, the costs of research and development for the period of time ending on June 30, 2022, amounted to $7.6 million.

This is a significant increase from the previous quarter’s reported total of $7.4 million (GAAP). The price of stock-based compensation was a significant contributor to the increase.

Research and development expenses for the company were $6.2 million during the third quarter, which is a decrease from the $6.5 million that were incurred during the second quarter and the $6.6 million that were incurred during the same quarter of the previous year.

Cost savings have been made possible in large part by the fact that spending has gone down because of clinical trials.

During the three months that ended on June 30, 2022, selling, general, and administrative expenses increased to $16.9 million from a previous total of $14.9 million.

The timing of marketing costs associated with putting EndeavorRx on the market helped to partially mitigate the negative impact on growth that was caused by transaction-related costs being allocated to earnout shares and stock-based compensation expenses.

The total amount spent by the company on selling, general, and administrative expenses during the three months that ended on June 30, 2022, was $13.8 million.

This number decreased to $12.0 million for the third quarter (using non-GAAP accounting). The required marketing costs for putting EndeavorRx on the market were put off, which led to the price drop.

The net loss for the three months that ended on June 30, 2022, was $22.5 million when using GAAP accounting standards, while the net profit was $53.2 million. The decrease in the amount that the company owed for earnout shares contributed to an increase in the amount of money that the company made.

The loss that the company incurred during the third quarter was $18.5 million, which is lower than the loss of $20.5 million that it incurred during the same time period in 2022.

These are the non-GAAP financial measures that are included in this press release:

non-GAAP total operating expenses on a historical basis

  • non-GAAP research and development expenses on a historical basis
  • non-GAAP selling, general, and administrative expenses on a historical basis
  •  non-GAAP net loss on a historical basis. Akili arrives at these non-GAAP financial measures by first determining the GAAP financial measure that is most comparable to the one she is interested in and then removing the impact of certain expenses and other factors.

Stock-based compensation expense and transaction costs allocated to earnout shares are not included in non-GAAP total operating expenses, non-GAAP research and development expenses, or non-GAAP selling, general, and administrative expenses.

These expenses are excluded because they are not required by GAAP accounting standards. They are also not included in the net loss calculated according to non-GAAP accounting standards, which does not take into account variations in the estimated fair value of earn-out liabilities.

The individuals in charge of Akili came to the conclusion that making these metrics public would be beneficial for both internal and external comparisons of the ongoing business and operating performance of the company.

As a result, they made the decision to make them public.

The management presents these non-GAAP-based financial measures not as a replacement for the results that are based on GAAP but rather as an addition to the results that are based on GAAP.

These non-GAAP financial measures may or may not be the same as those utilized by other businesses, despite the fact that their names are identical.

Before EndeavorRx, the Food and Drug Administration (FDA) had never approved a treatment that was delivered in the form of a video game. Computer tests have shown that the ADHD medication EndeavorRx can help children between the ages of 8 and 12 who suffer from inattentive or combined type ADHD pay more attention when it is administered to them.

Patients who take part in EndeavorRx show improvements on the measures of sustained and selective attention measured by the Test of Variables of Attention (TOVA®), but it is possible that they do not show improvements on more typical behavioral symptoms such as hyperactivity.

In addition to the use of EndeavorRx, a treatment plan for the symptoms of the disorder may also include clinically guided therapy, medication, and/or educational programs.

You need a prescription from your attending physician in order to purchase EndeavorRx. It is not appropriate to substitute this for a child’s regularly scheduled medication. During the course of EndeavorRx’s clinical trials, the most common negative side effect observed in the majority of children was frustration.

The use of this product was not associated with any significant adverse effects. It is recommended that children use EndeavorRx for a total of 25 minutes, five days per week, for a period of at least four weeks in a row, or as directed by their pediatrician.

Some Akili-Related Information

Because it makes use of various new technologies, Akili is currently in a leading position in the race to develop effective treatments for various cognitive disorders.

Akili creates a new class of medicinal substance by utilizing neurotechnologies. However, despite being subjected to clinical trials in the same way that a drug or medical device would be, this type of medicine is more akin to a form of entertainment.

The Akili platform is built on the foundation of years of research and extensive clinical testing of the company’s own therapeutic engines. These engines were developed to treat cognitive impairment in the brain directly.

Because Akili was founded on the principle that medicine can be both efficient and enjoyable, its products are distributed in the form of adrenaline-pumping, action-packed video games.

A word of caution regarding what could take place in the future

This press release contains forward-looking statements, which means that it falls under the purview of the Private Securities Litigation Reform Act of 1995 in its amended form.

Words such as “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “will be,” “will continue,” “will likely result,” and other words of a similar nature are frequently used to identify forward-looking statements.

Statements about the future that are made on the basis of current expectations and assumptions are considered to be forward-looking statements.

Given that they are based on the expectations and assumptions that are currently held, they are susceptible to risks and uncertainties.

Forward-looking statements include, but are not limited to, statements about our vision for EndeavorRx, the commercial launch of EndeavorRx, and our plans to scale our commercialization efforts and personnel, the anticipated speeding up of market uptake and insurance coverage of EndeavorRx, and the development and advancement of our pipeline of digital therapeutics product candidates for other patient populations.

These statements are not guarantees of future performance and are subject to a number of risks and uncertainties. The current expectations and beliefs of management have been used as the basis for these forward-looking statements.

They are also subject to a number of risks, uncertainties, and important factors that could cause actual events or results to be materially different from those expressed or implied in any forward-looking statements in this press release.

These risks and uncertainties include, but are not limited to, risks and uncertainties related to our ability to successfully commercialize EndeavorRx; risks and uncertainties related to our ability to successfully develop new products; and risks and uncertainties related to our ability to successfully raise capital (SEC).

Please keep in mind that any statements made here that are considered to be forward-looking are only accurate as of the date that this document was created. You shouldn’t rely on them to determine what the company believes at a later time because it won’t be accurate.

If our expectations or the events, conditions, or circumstances on which any of these statements may be based change in a way that makes it more likely that actual results will be different from those in the forward-looking statements, we are not required to update or change any of these statements in public to reflect that change. Instead, we may choose to do so.