Q3 2019 Earnings Call

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Ladies and gentlemen, thank you for standing by and welcome to the Q3 2019, Catabasis Pharmaceuticals Inc. earnings Conference call at this time, all participants' lines winner listen only mode.

The speakers presentation there'll be a question and answer session and to ask the question. During the session you need to press star one.

If you acquire any further assistance please press star Zero I.

I would now like to hand, the conference over to your Speaker, India Matthews Vice President of corporate if there. Thank you. Please go ahead Madam.

Thank you Justin welcome to the Catabasis Pharmaceuticals Conference call, where we will provide a corporate update and briefly review our third quarter 2019 financial results with me today, Our Jo Mill, Chief Executive Officer, Joanne Donovan, Chief Medical Officer, Andrew come Yadier, Chief Commercial Officer, Andrew Nicola Chief Scientific Officer and.

No what cleanser Vice president of funding.

We issued a press release this morning, summarizing our corporate update in our Q3 2019 financial results because the reference on today's call is available on our website.

I would like to note that during today's call will make statements related to our business based on current and future expectations that maybe considered forward looking statements under federal Securities laws.

Actual results may differ materially from this indicated by these statements are the result of a variety of risks and uncertainties, including those discussed in our most recent quarterly report on Form 10-Q , which we filed this morning with the FCC and is available on our website such statements represent our judgment as of today and Catabasis undertakes no obligation to publicly update any forward looking statements except.

As required by law with that let me pass the call over to Joe who will provide our corporate update Joanne will provide an update on our clinical trials with you just saw Nexsan and Andrew will speak to the potential commercial opportunity for you just saw nexsan insertion.

Andy will provide or overview of our collaboration with the Jane Foundation and know what we'll wrap things up at the financial update Joe.

Thank you Andrea good morning, everyone and thank you for joining us for today's call I'm very happy to share the great clinical progress. The company is made over the past three months, we believed that our drug candidate you just saw an accent will be a foundational therapy for all patients affected by just one muscular dystrophy, where there was on the call who are less familiar with the disease process and our program.

I will give a quick overview I.

I Catabasis, we're taking a different approach to treating Duchenne you just saw an accent was designed to inhibit Nf Kappa b in mechanism with the potential to benefit all patients and therefore is not limited to patients with specific mutations. It is important to remember that in duchenne the absence of the protein dystrophin isn't.

Necessary, but not sufficient to drive disease progression typically young boys with Duchenne are not symptomatic in their first couple of years, however, without dystrophin mechanical stress from everyday activities like running chronically activates Nf Kappa b, which leads to progressive deterioration of skeletal.

So importantly, the chronic activation of Nf Kappa B is also a critical component of cardiac disease and a factor in bone health and Duchenne.

By inhibiting Nf Kappa B. We believe you just saw Nexsan can benefit all duchenne patients regardless of mutation both as monotherapy as well as in combination with just strokes and targeted therapies based on our clinical data and the mechanism of action inhibiting Nf Kappa B you just saw Nexsan has the potential to benefit skeletal muscle.

So, including the diaphragm cardiac function and also bone health.

In September we announced that enrollment was completed for our phase three Polaris DMD trial for boys affected by Duchenne I want to point out that target enrollment was exceeded which I believe is the result of provider in Duchenne family excitement about you sold an excellent Joanne will talk more about the shortly now that enrollment is completed.

We have refined our timeline and we expect to have topline results from this pivotal study in the fourth quarter of 2020, the clinical data along with our ongoing efforts in CMC and Nonclinical activities are intended to support an application for commercial registration of EDA saw Nexsan and 2021.

As we've seen in the past several months the regulatory and development landscape for Duchenne continues to evolve we feel confident in the mechanism of action of Itas all in X and the data we have generated to date and the design of our phase three trial to ultimately support global regulatory filings for a full approval.

Our placebo controlled phase three trial uses the Northstar ambulatory assessment as the primary endpoint the North Star is a functional endpoints appropriate for a pivotal trial per F.D.A. guidance.

Changes in the North star reflect clinically meaningful changes in activities of daily life.

As I've previously mentioned, while we progress our clinical activities. We are also laying a strong foundation for the next stage of the company. We have strengthened our team with the addition of Andrew comedy as our Chief commercial officer as we prepare for the commercialization of EDA solid accident subject to regulatory approval he will share his.

Initial impressions of the commercial opportunity for you just saw onex and for the treatment of Duchenne.

You just saw onex and has the potential to provide benefit and other forms of muscular dystrophy, where activated Nf Kappa B plays a key role in disease progression. We recently entered into a preclinical collaboration with the Jane Foundation to study you to solid Nexans in disc Furlan occupancy, which includes both limb girdle.

Muscular dystrophy type to be and me Oshie My occupancy we expect these preclinical results from this collaboration in the first half of 2020, Andy will provide more details on this work now all that our CMO Joanne provide an update on our clinical trials Joanne.

Thank you Joe and good morning, everyone.

I am thrilled that we have completed enrollment in our phase three Polaris DMD trial of EDA saw an excellent in boys affected by do Shane.

Our enrollment target was 125 boys, aged four to seven and we enrolled 131 boys with any year due to strong interest from physicians and Dushane families as well as support from patient advocacy organization.

Thank you to everyone who's making this phase three trial possible, including all of the site staff and participating families.

We opened.

40 clinical trial sites across eight countries for our phase three trial and we're very pleased that patients were enrolled in all eight countries and it nearly all of the clinical trial sites.

A majority of the sites are located in the United States and correspondingly close to two thirds of the boys are enrolled in the U.S.

Europe in Israel enrolled a quarter of the boys in our phase three trial and 8% enrolled in Canada with 4% in Australia. We're in the process of analyzing the baseline information from the patients in the phase three trial and look forward to sharing more information in the coming months.

As you likely recall the phase three pull our as DMD trial is a randomized double blind placebo controlled trial with two to one randomization.

The primary efficacy endpoint is the change in the North Star ambulatory assessments score after 12 months of treatment with the dasa compared to placebo.

North Star was chosen as the primary endpoint with support from regulatory authorities.

Key secondary endpoints include the time to function test 10 meter walk run time to stand and for stair climb and additional assessments include growth cardiac and bone measures as well as patient reported outcome.

Our open label extension trial Galaxy, DMD and bodies are ongoing commitment to the Duchenne community.

13 boys enrolled in the Galaxy DMD trial 11 from the completed move DMD trial in two of their eligible Sibley.

We were urged by families with sons and the move DMD trial to also provide itas all the next and for their other SUNS affected by do Shane and are glad that we're able to enroll eligible brothers have moved DMD patients.

Our primary objective with Galaxy DMD is to collect long term safety data and we're also monitoring assessments of muscle function as well as bone health.

When boys completes the 12 month placebo controlled phase three Polaris DMD trial, they as well as they're eligible siblings will have the option to participate in the Galaxy DMD extension trial and receive open label EDA saw an accent.

Dr., Richard Finkel Chief of the Division of Neurology and the department of Pediatrics at Nemours Children's Health system, and a principal investigator for the move DMD and Polaris DMD trial gave two presentations of the clinical findings from the due from the move DMD trial last month.

The first was at the 24th International Congress of the World Muscle Society in Copenhagen, and the second was at the child Neurology Society 40, Eightth annual meeting in Charlotte.

As we reported previously in the moved DMD trial, and the open label extension Itas Onyx in preserved muscle function and substantially slow disease progression compared to rates of change in the off treatment control period.

It significantly improved biomarkers of muscle health and inflammation and was well tolerated without any safety signals.

In more than 60 years of cumulative patient exposure in the completed trial. The majority of adverse events were mild in nature and the most common treatment related adverse event with diarrhea generally mild in transient there were no serious adverse events observed on treatment and no adverse trends in chemistry hematology.

Hi measures of adrenal function, which are suppressed with steroids and steroid analog.

You just saw an accent is not a steroid and has not shown the known side effects of steroids.

At this point some boys have received either saw nexsan for more than three and a half years, the boys and now an average of non and a half with some as old his 11 years old.

We see this overall profile of efficacy and Tolerability to date as being very supportive the potential for you to fall in x. and to be a foundational therapy for the treatment of two Shane.

Im now pleased to introduce our new team member Andrew Community, who recently joined as our Chief Commercial Officer Andrew.

Thank you Joanne I'm excited to be a part of the catabasis team at such a pivotal time with our phase three Polaris DMD trial fully enrolled and preparations are underway to bring you to solemn exit to market subject to regulatory approval.

I'm very glad to have the opportunity to bring my rare disease commercial experience to catabasis and to the Duchenne community.

I'd like to share today, my initial thoughts on the Duchenne muscular dystrophy market and the commercial opportunity for either saw an exit.

Although duchenne is a rare disease, it's been very well characterized and patient segments are clearly defined.

The disease is typically diagnosed when boys fail to meet developmental milestones usually by the age of five.

Treating patients in the early ambulatory phase those age forward is 47 years has the greatest opportunity for long term benefit on skeletal and cardiac muscle disease progression.

However, you saw next it has the potential to provide clinical benefit broadly to all duchenne patients from the time of diagnosis onward, and is not limited to patients with specific mutations.

Duchenne is an excellent diseased with a devastating diagnosis due to the lack of a cure and its relentless progression.

It is estimated at about 15000 boys in men are living with Duchenne in the us today and approximately 19000 in Europe .

In the U.S. the majority of patients are treated.

A small number of centers.

In an effort to better understand the substantial unmet need in Duchenne, we conducted primary blinded market research.

With us Duchenne physician experts payors and members of the Duchenne community.

There was support for either saw an exit across all of these key stakeholders.

The most encouraging signals that 80% of the physicians indicated a strong interest in using you saw him exit based on the efficacy and safety profile available at the time of the research.

Payers interviewed agreed that you saw next its potential clinical benefit would justify coverage for duchenne patients.

Not surprisingly patient advocates parents and caregivers, we're extremely enthusiastic about the prospect of you saw in Mexico, and the Duchenne treatment armamentarium.

They viewed the efficacy data to date is compelling.

Given the priority preserved month muscle function.

This group really wants a safe and Tal safe tolerable therapies that are applicable for all duchenne patients.

Potential profile of enabling age appropriate development and participation in activities with peers resonated very strongly with parents of boys affected by Duchenne.

These market research results are very consistent with what we've seen in action in the clinic.

I believe that we're able to full well that we were able to fully enroll our phase three trial. So quickly because of the compelling profile of you saw in Mexico, which led many families to select our phase three trial rather than role in another clinical trial or start steroid treatment.

The Duchenne community is eager to embrace it you saw next it should it be approved by regular regulators and we look forward to working with the entire community as we prepare for the commencement potential commercialization vdsl an accident.

Now Andy Nichols will discuss our new research collaboration and then and an additional possible indication for either Somaxon Eddie.

Inhibiting Nf Kappa B with either Selinexor has the potential to slow disease progression and preserve muscle function and other fools as muscular dystrophy beyond to ship.

We recently announced a preclinical collaboration with the Jane Foundation, the study either Selinexor does Philadelphia.

This fill it up at the includes both limb girdle muscular dystrophy type to be and leadership by healthy and is thought to be the second most common full of limb girdle muscular dystrophy.

This Philadelphia see as a serious rare disease the causes progressive muscle weakness, which there are currently no approved treatment options.

Steroids and not helpful for these patients.

Clinical studies have shown that steroids had a detrimental effective patients.

The Jane Foundation is a nonprofit foundation, whose mission is to kill muscular dystrophies caused by disposal in protein deficiency.

The Jane Foundation has established a global patient registry of genetically confirmed disposal and obviously patients. They also leaving enough it to collect disease natural history data focused on potential clinical endpoints that could ultimately support regulatory approval.

These patients experienced a progressive and debilitating decline in muscle function that significantly impacts their lives.

That muscles left to Switzerland, Nf Kappa B is chronically activated.

Peter Selinexor inhibits Nf Kappa B and has the potential to slow disease progression and disposal in deficient populations.

Under this collaboration together with a joke Jane Foundation.

We are conducting a preclinical study to evaluate either solar next month as a therapeutic intervention, but this filling up the fee by measuring disease progression and disciplined deficient mice treated with me This Olympics.

We look forward to learning more about the potential of either selinexor and disposal and obviously the both the natural history of the disorder and potential clinical endpoints.

Lower Kloza, Vice President Finance will share a financial updates before we open up for questions Noah Thanks, Jamie.

Turning to our financials, our third quarter 2019 press release and 10-Q provide the details. So I will just highlight some key items here as of September 32019, we had $40.6 million of cash cash equivalents and short term investments based on our current operating plan. We expect that we have sufficient capital to fund operations.

Beyond announcement of the topline results from the phase three Polaris DMD trial and through 2020.

In the third quarter of 29 team our net cash used in operating activity was $6.5 million.

Our R&D expense was $4.7 million in Q3, 2019 compared to $3.9 million in Q3 2018.

Our DNA expense was $2 million in the third quarter of 2019 compared to $2.1 million in the third quarter 2018.

Our operating loss was $6.7 million in Q3, 2019 compared to $6 million in Q3 2018, our net loss was $6.5 million or 56 cents per share in Q3 I.

I will now I'll turn the call over to Justin open for questions.

Thank you as a reminder to ask a question you need to press star one on your telephone so John a question press the pound Ji. Please stand by we compile the Q and a roster.

And again, ladies and gentlemen that is star one.

And our first question is going to come from Joel Beatty from Citi. Your line is now.

Okay.

Hi, Thanks for taking my question.

With enrollment complete for the phase three Polaris study could you talk a little bit about the patient retention that you're seeing through that and Oh the completion rate.

And then also an enrollment into the extension study.

Oh sure Joe Thanks for the question I'm going to handed to Joanne to address that.

So we enrolled that the study over a period of less than a year. So we actually don't have kids yet enrolled any extension study.

But overall.

Retention has been excellent and we're very pleased with how the study is going.

Great and then I guess really to talk a little bit more about maybe the results that you expect between.

From the agreement with Jane Foundation.

Between now and the results of the Phase three study.

Yeah sure Joel that that's a good question, we're very excited about our work with Jane Foundation, and I'll, let Andy answer that yes. So we are studying the effects of either selinexor and disciplined deficient mice, and we will primarily be using magnetic resonance techniques, including MRI and.

And our risk to measure muscle volume fat accumulation and other changes.

Other than the muscles in these mice, particularly in the the girdle region around the hips. So these my section is demonstrate a phenotype.

Quite similar to that scene and limb girdle.

Muscular dystrophy patients.

Great. Thanks for the up there.

Thank you.

Our next question comes from Hardie Singh from Oppenheimer and company. Your line is now open.

Hi, This is Chuck.

Thanks.

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See from baseline.

Flowers DFI patients.

Thanks.

Sure. So Jackie we expect to report the baseline characteristics from the Polaris DMD trial sometime the in the coming months.

Got it and so what are some gating factors we should be.

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From a successful flowers.

Yes.

You said gating factors between Aclaris readout and yes. So we expect the Polaris DMD trial to read out in the fourth quarter of 2020 and expect to be on with positive data from that trial, we expect to file in India in 2021.

Oh and last question.

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And the age.

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Sure. So OLED Joanne address that but we have boys from the moves DMD trial, who have now been on drugs for several years. So Joanne.

So the age range a in the trials will ranges from literally their fourth birthday up till age 11.

The studies now.

So we can will continue to follow the boys in terms of today are.

Oh in terms of safety and we think it's an important another important component of collecting data. So that will have an integrated package for registration.

Filings.

That's very helpful. Thanks very much.

Thank you and I would now like turn the call back over to Jill Milne Chief Executive Executive Officer.

Thank you Justin Thank you all for joining our call. This morning, and thank you for your continued support of Catabasis, We will keep you updated as we execute on our you just saw Nexsan program and share areas of progress. We look forward to speaking with you again soon Andrea.

That concludes today's call a webcast replay will be available for 90 days see any investor Investor Relations page on our website at www that catabasis dotcom. Thank you.

Ladies and gentlemen. This concludes today's conference. Thank you participating you may now disconnect.