Q3 2019 Earnings Call
Thank you for standing by this is the conference operator, welcome to the marriage and Therapeutics third quarter 2019 earnings Conference call. As a reminder, all participants are in listen only mode and the conference is being recorded.
After the presentation, there will be an opportunity to ask questions to join the question Q You May Press Star then one on your telephone keypad should you need assistance. During the conference call you May say don't operator by pressing star and zero I.
I would now like to turn the conference over to Dan Ferry managing director of Life Science Advisors.
Please go ahead.
Thank you and good afternoon, everyone.
On the call today, our marriage, and President and Chief Executive Officer Bill Marshall.
Chief Financial Officer, Jason Liberty.
And executive Vice President of research and development Paul Ridzon.
Before we begin.
I'd like to remind everyone that this conference call a webcast will contain forward looking statements about the company.
These statements are subject to risks and uncertainties that could cause actual results to differ.
Please note that these forward looking statements reflect our opinions only as of the date of this call.
We will not undertake an obligation to revise or publicly release the results of any revisions to these forward looking statements in light of new information or feature of that.
Factors that could cause actual results or outcomes to differ materially from those expressed in or implied by such forward looking statements are discussed in greater detail.
Our most recent filings on Form 10-K , and our other periodic reports on forms 10-Q, and 8-K filed with the FCC.
I'd now like to turn the call over to Bill Marshall, President and Chief Executive Officer Amerijet Bill.
Thanks, Dan Good afternoon, everyone and thank you for joining us for our corporate update call for the third quarter 2019.
I'll provide updates for each of our three clinical stage product candidates before turning the call over to adjacent to provide a review of our financial results results for the quarter.
Starting with cold them ourselves.
Which is currently being evaluated in three clinical trials for multiple indications.
Including the solar phase two clinical trial for cutaneous T cell lymphoma or C.T.C.L.
We have opened approximately 70% of the sites currently planned for the solar clinical trial.
The primary endpoint for the solar trial is the objective response rate defined as a 50% or greater improvement in the severity of a patient skin disease over the entire body with no evidence of disease progression in the blood lymph nodes or visceral maintained for at least four consecutive months.
Progression free survival is a secondary endpoint and we plan to use patient reported outcomes as additional secondary endpoints to monitor quality of life improvements.
Based on our discussions with the FDA, we believe that achieving the primary endpoint from the solar trial could allow us to apply for accelerated approval of Copel myerson in CTCL in the United States.
Today, we updated our guidance when we expect to report primary endpoint data from this clinical trial from the first half of 2021 to the second half of 2021.
Our decision to adjust our guidance today was based on longer than anticipated time to activate the number of sites to support our previous patient unprovoked enrollment projections, resulting in slower than anticipated patient enrollment.
Well there no guarantees we believe that as additional sites become active in the United States in Europe , We expect we expect the patient enrollment to increase proportionately.
As a reminder, the solar trial is supported in part by a collaboration with the leukemia and lymphoma society or L.S.
L.S. through one of its affiliates has agreed to provide up to $5 million through the purchase of marriage and common stock to help support the solar trial.
In October 2019. This study achieved one of the enrollment milestones under the agreement and as a result, an affiliate of LLS purchasing additional zero point $5 million of our common stock.
Global Marson is also being evaluated in a phase one clinical trial and three potential expansion indications, where the disease process appears to be correlated with an increase in micro Arnie 155 levels the target of Copel Marissa.
Our initial focus is on treating patients with adult T cell leukemia lymphoma.
The data we released today showed durability of disease stabilization observed in patients with the aggressive sub types of a T. L. L and support our belief that couple myerson, maybe a meaningful potential treatment option for patients with these forms of 80 Ll.
In addition, we believe these clinical observations in a micro Arnie onefifty five elevated tumor type other than CTCL. Further supports the hypothesis. The culberson may have utility in treating other malignancies with elevated micro Arnie and 155 levels.
Turning to Ram Larson and other micro Arnie 29, Minex, we believe our fibrosis per program has the potential to deliver distinct therapies in indications, where pathlogic fibrosis has been implicated providing attractive opportunity for marriage into that all over a promising.
Therapies for patients in need.
Our strategy was to initiate development by demonstrating mechanism of action with Ram Larson in the skin and then expand into other potential indications with Remmele, our son and other Mike Rene 29, minex potentially including diseases, requiring systemic administration, such as long and liver fibrosis.
As we have previously disclosed we're currently conducting a phase two clinical trial assessing the safety tolerability and activity up around Larson and the potential prevention or reduction of key Lloyd formation in subjects with a history of key Lloyd scars a form of pathological.
Scarring.
We expect to report phase two interim data from this clinical trial by the end of this year.
Earlier. This year. We also released data from preclinical Okcular studies exploring the anti fibrotic effects of remorse and in the cornea and retina.
We observed that topically administered Ram Larsen accelerated the healing of corneal injury reduce the expression of multiple fibrosis associated regimes.
And appeared to reduce corneal hazing and scarring.
In addition.
We observed that Intravitreal administered Ram Larsen showed good bio distribution across the retina with contaminant reductions in multiple biomarkers of fibrosis.
Based on this preclinical data and the safety data from our phase one clinical trial, we believe Ram Larson, maybe effective in treating ophthalmic indications, resulting in fibrosis, including the prevention of corneal scarring and hazing following infection or injury.
This is a significant medical need as scarring of the cornea remains a leading cause of blindness worldwide for which no approved pharmacologic treatments exist.
As I mentioned earlier, we've discovered and are developing new micro aren't a 29 mimics. The we believe could have utility for systemic treatment and indications where fibrosis is a bit implicated in the long and liver such as idiopathic pulmonary fibrosis or IP off and.
Non alcoholic, Steve Seattle, hepatitis or Nash.
In May we reported new data demonstrating that systemic administration of MRG to two nine our second generation Microrna 29 mimic product candidate for I.P.S. appeared to effectively efficiently reduce extra cellular matrix that position in a series of preclinical studies.
We believe that these data coupled with previous observations in humans with I.P.F. support the role of Mike running 29, and Pathlogic fibrosis in a lot.
We believe that the data we have generated to date evaluating multiple product candidates in our fibrosis programs supports the continued development of these product candidates future development will require additional financing to financial resources or potential collaborations.
Turning to MRG 110 last month, we announced data from two phase one clinical trials of MRG 110.
In one of the clinical trials administration of MRG 110 was observed to increase and your Genesis in humans as demonstrated by increased perfusion and histological markers of Neil and your Genesis.
The data generated in these studies in these clinical trials is expected to provide clinically translatable biomarkers that may support future clinical trials for the treatment of heart failure and other conditions, such as complicated lacerations in high risk patients.
In both clinical trials MRG 110 was generally safe and well tolerated. We believed that the program is ready to advance the phase two clinical development.
Well, we have not announce future development plans for MRG 110, we may seek a new development collaboration for this product candidate in the future.
As a reminder, MRG 110 represents the third Mike Rite aid targeted product candidate. Our team has developed that has been generally safe and well tolerated and with preliminary proof of mechanism data in humans.
We believe this differentiates marriages technology and demonstrates the capability of our team to develop micronized targeting product candidates.
With that I'll now turn the call over to Chase and Loving County, our Chief Financial Officer to review the financial results, we reported earlier today Jason.
Thank you Bill and good afternoon, everyone.
I appreciate the opportunity to provide a summary of our third quarter 2019 financial results.
Today, we reported approximately 33.8 million in cash cash equivalents in short term investments as of September 32019.
Net cash used in operations was 9.3 million for the third quarter and 28.3 million for the nine months ended September 32019.
We believe that our current resources will be sufficient to fund our operations through the second quarter of 2020.
Revenue was 0.7 million for the third quarter of 2019, this compared to 0.9 million for the third quarter of 2018.
Decrease in revenue was primarily due to decrease in amounts reimbursable to us under license and collaboration agreement with Serbia.
As we've previously disclosed we received notice from survey in August 2019, their termination of our collaboration agreement, which will become effective in February 2020.
Research and development expenses were 9 million for the third quarter of 2019 compared to 7.4 million for the third quarter of 2018.
The increase in research and development expenses is primarily due to increases in clinical trial unrelated manufacturing costs, primarily associated with the solar in prison clinical trials cold tumors.
As well as increased personnel related costs, including share based compensation charges consulting contract labor and restructuring costs.
These increases were partially offset by decreases in technology license fees and other expenses.
Turning to general administrative expenses.
<unk> expenses were 2.9 million for the third quarter of 2019.
This compared to 2.7 million for the third quarter 2018.
The increase in Jane General and administrative expenses was driven primarily by increases in corporate legal and accounting professional fees.
As a result of the cost restructuring program, we announced in August 2019, we incurred approximately 1.1 million in restructuring charges for retention of which zero point Ninemillion was recorded to research and development expenses and 0.2 million recorded in general and administrative expenses in the third.
Order 2019.
The company's net loss was 11.2 million or 0.36 cents per share for the third quarter 2019, compared to 9 million or 0.29 cents per share with a third quarter of 2018.
With that I'll ask the operator to open the call for questions operator.
Thank you we will now begin the question and answer session to join the question Q You May Press Star then one on your telephone keypad, you'll hear a tone acknowledging your request.
If you are using a speakerphone please pick up your hands that before pressing any key.
To withdraw your question. Please press Star then to once again to join the question Q. Please press Star then one now.
Our first question comes from Jonathan Miller of Evercore ISI.
Hey, guys. Thanks, so much for taking my question.
I guess I most want to focus on the push out for solar data to the second half a 21. It seems like LLS support for solar is potentially meaningful that hasn't been accelerating it as much as maybe you would have hoped what can you do to get across the finish line for solar a little faster.
A and then secondly, a on the BD front.
Do you have any updates to give us on partnerships for NRG when 10 with the potential for partnerships with other assets are you, including remarks in or even call them.
Great. Thanks, Jonathan appreciate the question. So you know the data push out LLS has obviously been a very supportive and important partner to us not only for the financial support but also for a patient outreach and Ah you know by identifying additional patients and really promoting the the solar trial.
With that being said that the primary factor that has really affected their ability to recruit effectively has been you know opening the sites up and completing the contracts unnecessary having the sites fully up to speed and capable of recruiting we've spent a lot of time and interactions with.
Treating physicians and and clinical trial sites at meetings, we're expanding certain clinical trial sites to slightly earlier stages in the disease to try to.
Accelerate things and we believe that we'll we'll see.
Some positive results from those efforts as we move forward.
As you know, it's a challenge to really model. When you anticipate studies of this type in a rare leukemia lymphoma or leukemia to be able to report the data and as we looked through our modeling and put in various parameters. We had typically looked at ranges, which.
Time weeks anticipated.
Being able to report topline data as we gain more information over the last quarter, we noticed that one of the ranges you know pushed it beyond the first half and we I think appropriately just updated guidance to reflect that we'll be.
Doing everything we can to accelerate patient recruitment and be able to report as soon as we can.
And then on the beat even the process.
Yeah. So on the BD front, we have what we're really doing on the.
On the energy 110 front, we had you know we had Q seed most of the data we presented that at a recent meeting in October the response to that was quite positive.
We're continuing to follow up on some additional work from the systemic study that was conducted and really putting together comprehensive.
A package of the results that are of that have been obtain as well as the opportunities you know again with MRG 110, what we know now is that the the compound is able to induce you know neo Andrew Genesis in humans, we saw enhance tissue repair.
In humans and this all really followed very nicely from our preclinical studies.
That that this obviously has implications across a rather broad swath of diseases. We were interested in heart failure or things like peripheral artery disease as well has you know the ability to enhance the the healing of certain wounds and in that regard where we're looking at really looking at multiple.
Ultra outreach efforts.
To be able to identify potential partners and again you know we benefit from the fact that that's a phase two ready asset then survey will continue to support the activities necessary through February 2020, the up the the results generated with run Larsen both the ocular results and then.
We anticipate the upcoming results in the key Lloyd trial, and I think very importantly, and our next generation compounds, where we've seen some very impressive activity in models of both pulmonary fibrosis as well as a paddick fibrosis have also prompted a fair amount of interest in.
Discussions so we're very active across the board in exploring opportunities with where the real intense focus for obviously, MRG 110, and I'm, Mike Rene 29 mimics including around Larson.
Okay, great. Thank you very much.
Thanks, Jonathan.
Our next question comes from Leland Gershell of Oppenheimer.
Hey, good afternoon, Bill Thanks for taking my questions I'm just a quick question on on remorse and I'm presuming, we see a supportive data from the phase two.
I know it will be kind of interim and then when would we expect to have the final from that and then how should we think about kind of next steps presumably into phase two meeting thoughts of what we would see for you know registration program. Thanks.
Sure. So the thankfully and appreciate the question. So you know on the Ram Larsen front, what are the intensive the the ongoing phase two trial is really to explore in a very efficient intra patient controlled study.
The magnitude of effect that Ram Larsen may have on the re growth.
Of key Lloyd scars, and Keloids scars or a persistent form of hypertrophic scarring. The interim data one of the yeah. We had completed dosing in the study we're collecting data.
One of the important definitions of a key Lloyd is a hypertrophic scar that stable for at least six months. So the interim results that will report out are the six months interim point, we'll continue to.
Monitor patients depending upon the data read out for a an additional period of time up to one year and then we will.
Give guidance on the the the activities moving forward. After we report the interim data.
Our goal here is really to understand the effect size one of the challenges in treating this type of scarring has been.
Heterogeneity in the sample set a that has been explored which leads to requirements for rather large phase three powering a this intra patient controlled study should give us good feel for that and with that really understanding the the powering necessary to run a phase three which would drive to soon.
Conns around potentially attempting to move that forward ourselves or with a development partner.
Okay. That's very helpful. Thanks for taking the question.
Thanks Leon.
Our next question comes from Madu Kumar of R.W. Baird.
Hey, everyone. Thanks for taking our question. So what we expect kind of better timing on a penny Dave.
The trial and or regular that regulatory visibility from that.
Yeah. Thanks to do appreciate the question so.
T. L. L is you know our our primary focus and the expansion indications right now.
We just did a you know an update at the D.A.J.F.D.A. meeting I'm on the results. There what we've seen is pretty impressive durability of you know stabilization that disease in patients that have the.
Aggressive leukemia, and lymphoma does form of the disease.
What we're doing now is you know treating patients.
And one of a couple paradigms one is patients with more acute disease, where the tumor burden as higher to assess the ability of where I'm larsen to reduce that tumor burden, which would drive a a clinicals the design of one type.
The other is the observations in patients with residual disease, a public chemotherapy, where we've seen results with the most patients and again some pretty impressive stabilization then and longevity in what is otherwise a very morbid disease.
So we anticipate that you know what will give us some further.
Guidance on this in terms of when the next.
You know updates will occur and we are.
Based on the observations that we have.
The two clinical trial designs.
Are you know, we will satellite and one of them and our plan would be then to pursue discussions with FDA under a reasonably near term, but we will have better guidance on that in in early 2020.
So how many patients have been treated with two different approaches it kind of like grows tumor burden versus the residual disease, but how many patients treated separately.
So I believe that we have disclosed a the treatment of Ah I think it's up to 10 10 or so patients. The this the we have we have looked at patients.
Both you know with the residual disease post chemotherapy.
There is another form of the disease called chronic unfavorable that's much less common we've looked at that and then weve explored this in a couple of patients with acute disease.
The biggest dataset, we have is in a sort of.
Residual disease post chemotherapy.
Okay, and then for Jason in terms of the cash runway you remind me what does your cash runway and what are the assumptions for ongoing clinical programs that underpin that runway assumption.
Sure. Thanks, So our runway we updated today is in Oh, sorry from into the second quarter of 2022 through the second quarter of 2020.
The primary assumptions that we we've used in our forecast our really it with a heavy allocation to the co development of Coke worsen.
The three ongoing trials like Bill mentioned with the 80 Ll phase one trial.
As well as a solar and prism trials. Those are the primary those are the primary med surg direction of capital that we've done to this point.
Does it assume any more spend beyond the ongoing phase two trial her Emerson.
And assumes or us wrapping up the phase two trial with Ram Larsen as well as continuing some of the preclinical work that we have with RPF under our existing grant.
Okay, great. Thank you so much guys.
Thanks.
Our next question comes from Leanna, most stuff of Wedbush Securities.
Thank you for taking my questions.
Do you think in 2020, we'll see any more kobo expansion Hcl l. or maybe from the other two expansion indications that we see some data from the that and what are the next steps are MRG teaching on.
So highly out on thanks for the thing sort of question. So yes, we most definitely anticipate providing additional data on 80, Ll as well as any additional observations that we see in the other expansion indications.
That you know again, we'll guide in the not too distant future on when some of the from dates are around that those particular events occurring but you know it's an important part as we.
Continue to work through the CTCL study.
We anticipate a peasant as we've said in guided that there will be a a futility analysis at some point, which we would anticipate being able to provide further guidance on in the not too distant future, but the results in you know 80 Ll and.
The other expansion indications are an important part of our strategy for continued updates on Kobal marson throughout 2020.
And then in this setting of the MRG to two nine you know MRG to two nine we have recently.
Put out new data both at the American Thoracic Society, and then more recently at the IPO have some AD and a D.A. FDIC meeting.
Where we are beginning to show.
Show more data on a bio distribution the ability to dose through various routes of administration.
The the activity in biomarker reductions as well as a work in an important translational model and precision cut human lung slices.
We're continuing to advance that work and will.
Will be moving into additional studies that would support preliminary toxicology for the compound that would then guide our efforts to continue to move that forward and most recently we've presented.
Preliminary data with a NRG to nine as well as another derivative.
Another second generation Micronized 29, mimic with systemic administration in that setting of hepatic fibrosis. Our intention is to do some additional studies there that would support the foundation for moving.
Compounds, such as MRG to two nine or an analog there of into studies in the setting of.
Hepatic fibrosis as well and we'll continue to report on progress.
Scientific meetings as we move that forward.
Thank you very much.
Thanks.
This concludes the question and answer session I would like to turn the conference back over to Bill Marshall for any closing remarks.
Great we want to thank everyone for taking the time. This afternoon for an update on marriage and and for your support as we work to bring life changing medicines to patients needs.
Thank you very much bye bye.
This concludes today's conference call you may disconnect your lines, thanks for participating and have a pleasant day.
[noise].
Yeah.
[noise] [noise] HM.
Okay.