Q3 2019 Earnings Call
From those projected a description of these risk factors can be found in our most recent 10-Q filed with the SEC any forward looking statements speak only as of today's date and we assume no obligation to update any forward looking statements made on today's call with that I would now like to turn the call over to Roger.
They could you have seen good morning.
And 29 to achieve we've accomplished important progress in our pipeline strong results generated with both our proprietary candidates CTP 543 for moderate severe alopecia Areata and CGP 692, four adjunctive treatment of schizophrenia.
We've been actively presenting both of these clinical programs at scientific and medical meetings. This year, we're very pleased with the enthusiasm show for both candidates results and their potential to address important unmet needs for chronic diseases.
For CTP 543, we believe the phase two results has set a new benchmark for clinical efficacy in the treatment developing Sherry auto.
In a moment, Jim will recap the results presented EGD last month.
With our phase two results we've identified two doses of CTP 543, with promising efficacy and Tolerability profiles, both of which may be suitable for assessment to future trials.
We also see some advantages of the higher dose, including faster onset and greater magnitude of effect.
The program is progressing nicely and we expect to events CTP 543 into phase III testing in 2020.
As a reminder were also conducting two dose regiments studies evaluating twice daily versus once daily dosing.
Both of these studies are fully enrolled increasing our patient database in helping us to define the characteristics of these doses and dose regiments CTP 543.
These data will be very helpful. As we meet with FDA and an end of phase two meetings next year.
As a reminder, we filed a notice of appeal with Federal Circuit Court challenging the Pitots decision on the Patentability of our CTP 543 composition of matter patent.
In addition, we are actively pursuing other IP protection for CTP 543, including a pending application that supported by an impressive phase two results in several more applications in preparation.
Okay have more to say on this topic in 2020.
Now turning to CTP 692, our drug candidate that has a deuterated form of de Sherry.
We're excited about the prospect of CTP 692, because it offers patients the scientifically well supported potential new mechanism affection to treat schizophrenia, which is a disease that continues to have substantial unmet medical need.
The activity of GCE hearing in schizophrenia is supported by positive clinical results with non Deuterated T series, which however is limited by renal toxicity concerns.
We will move CTP 692 into phase two later this year with confidence that might be too has the potential for a much safer product profile than that of non Deuterated D series.
In addition to our proprietary drug candidates, having their reported in September a topline results from the second phase three trial for MVP 76, which is a compound concert license to have an area back in 2012.
While we're disappointed that trial did not meet its primary and secondary key secondary endpoints. It's important to note that under the structure of our license agreement all development costs and activities for ATP 76 for the responsibility of up there.
Having air and its parent Otsuka has stated that they will catalyze the full set of data from the first two studies explore the best path forward I.
I will note that our agreement with Avenue was not specific to indication and there are number of ongoing trials evaluating ATP 76, multiple neuro psychiatric indications.
Let me conclude by emphasizing our optimism for concerts pipeline with strong data. We've developed this year with our proprietary compounds, we have multiple possibilities to create significant near term and long term value concert.
I'd like to pause here and as Jim to discuss our clinical progress and then Mark will review, our third quarter financial results before we open the call to questions.
Thank you Roger.
We've made excellent progress on the clinical development front across both our proprietary programs. This year and we're well positioned to continue advancing CTP, Mike 43 for Alipay Shariati as CTP 692 for schizophrenia into their next phases of development.
Beginning with CTP 543.
We were delighted to have had the opportunity to present, our phase two data during the late breaking new session at the TV Congress last month.
The meeting provided a great platform to showcase our program to the international medical Dermatology community and clinicians who specialize in treating LP shariati in both Europe and the use.
Let me briefly review the topline results from the phase two dose ranging trial with CTP 543.
As a reminder, the primary endpoint analysis and the phase two trial compares the proportion of responders between placebo and each of the active CTP 543 dose groups at week 24.
A responder is defined as a patient achieving at least a 50% relative reduction in salt score compared to their baseline.
The phase two results demonstrated very clear dose related response and the primary endpoint was was met with statistical significance for both the eight milligrams twice daily and 12 milligrams twice daily doses.
For ease of discussion I will refer to the eight milligrams twice daily and 12 milligrams twice daily dose groups as the eight and 12 milligram cohorts respectively.
58% of patients in the 12 milligram cohort and 47% of patients in the eight milligram cohort where responders at week 24.
Milligram and 12 milligram cohort each showed significant improvement from the 9% placebo response.
The four milligrams twice daily cohort had a 21% response rate, which was not statistically significant from placebo. They will not be a dose carry forward into later stage development.
Let me also note that further improvement was observed with a 12 milligram cohort at response levels beyond that 50% improvement in Salt Lake.
The 12 milligram cohort was significantly different from the CFO with 42% of the group achieving at least 75% improvement in salt and 36% achieving at least a 90% salt change.
For the 90% threshold, we see not only a statistical separation for the 12 milligram dose group from placebo starting at week 20, but we also find a significant separation from the eight milligram dose cohort.
So at this higher response threshold. The 12 milligram dose appears to provide an additional benefit over the eight milligram dose.
In addition to hair loss analysis using Sol. We also asked patients the rate there were sense of improvement in their Alipay Shariati. After 24, we.
We believe that CTP 543 has a compelling and potentially best in class product profile as a treatment for Alipay shariati.
We are highly encouraged by the phase two efficacy and Tolerability data for the eight milligram and 12 milligrams twice daily doses, we look forward to advancing this product candidate into phase three and moving it further on its path towards offering a new treatment option for patients with LP Shariati.
Our community that suffers with no FDA approved treatment options today.
Now turning to CTP 692.
Deuterated for these hearing that we are initially developing as an adjunctive treatment for schizophrenia.
The phase one results give us confidence that our new tearing modification has the potential for a much safer product profile than that of non deuterated disappearing.
CTP 692 has demonstrated multiple advantages compared to non jewelry. These hearing in our non clinical program.
In addition to a dramatically improved renal safety profile, we saw much higher.
The brain exposure in rats, with CTP 692 compared to de searing.
In our phase one clinical trial, CTP 692 display favorable pharmacokinetics with significantly lower inter subject variability than has been reported for disappearing.
The safety assessments in the single and multiple ascending dose trial showed that CTP 692 was well tolerated over dose range tested which included the doses to be evaluated in phase two testing.
Importantly, consistent with our Nonclinical data keep blood and urine markers of kidney function does not indicate any signs of renal impairment.
The phase one clinical trial for CTP 692 was presented in early September at the European College of narrow Psychopharmacology conference in Copenhagen.
The poster presentation was very well received and there is high enthusiasm from a broad psychiatry community for a new mechanisms to treat schizophrenia.
Taken together our data suggest that we will be able to explore a sufficient dose range in our phase two trial to evaluate the therapeutic efficacy and safety CTP 692.
The phase two trial will be a robust study evaluating one two and four grams as CTP 692, once daily versus placebo over 12 week treatment period.
We intend to randomize approximately 300 patients who are stable on their existing anti psychotic medication.
The primary endpoint will be the change in pans total score a commonly use rating scale for schizophrenia studies, we expect to have data by year end 2020.
Looking ahead, we're very happy to be hosting a webcast event next week with Dr., Joe coil, who currently serves as director of the laboratory for psychiatric and molecular Neuroscience Maclean Hospital is a professor of psychiatry at Harvard Medical School isn't esteemed thought leader in the field psychiatry and schizophrenia.
Dr. Coils lab is focused on understanding the neurobiology of series mental illness, and his work has been very influential in developing more effective narrow psychiatric treatments, including for schizophrenia.
At next week's webcast event Dr. coil will further discuss the opportunity for CTP 692, including the NMT a mechanism and the utility of these hearing for schizophrenia. We look forward to an informative discussion with Dr. coil and hope that you will have the opportunity to join US Let me pause here and ask Mark.
Through now review the financial results.
Thank you Jim as I review, our third quarter financial results. Please reference the financial tables found in today's press release research and development expenses were 13.5 million in the third quarter of 2019 compared to 11 million in the third quarter 2018, an increase of 2.5 million the.
Increase in research and development expenses relates primarily to the clinical development of CTP 543, including multiple ongoing clinical trials as well as increased expenses associated with the manufacturing of CTP 692 to support ongoing clinical development.
As a reminder, our financial resources are dedicated to these proprietary candidates for our partnered programs, including ABTS 70, 86, all development costs are the responsibility of our collaborators.
General and administrative expenses were 4.7 million from the third.
Quarter 2019, compared to 6.3 million for the same period in 2018, the decrease of 1.6 million.
He is primarily attributable to decreases in legal and employee related expenses.
Our net loss for the third quarter, 2019 was 17.2 million or 772 cents per share compared to a net loss of 17.4 million were 74 cents per share in the third quarter 2018.
Finally, we ended the third quarter of 2019 with $121.5 million in cash cash equivalents and investments we expect our cash burn for the year to be approximately 59 million, which is net of $16 million in escrow proceeds received from vertex in the first quarter.
Under our current operating plan, including the planned advancement of CTP 543 into Phase III development next year, we believe our cash position is sufficient to fund the company through 2020.
This concludes our prepared remarks, and we would be happy to answer any questions.
We will now open the line to question. If you have a question at this time. Please press the star and then the number one key on your Touchtunes Alison. If your question has been answered all you wish to remove yourself from the Q leased from.
Your first question comes from Adam Walsh.
Michael Your line is now open.
Hi, This is Adam and down on Pall item on todays call taking the questions.
My first question on pipeline beyond 5.369 to one of the next potential clinical program.
Surgeon Fundo pipeline.
I have a falloff.
Yes, well, thanks very much for the question and structure. So we certainly have an ongoing effort in of preclinical pipeline compounds in heaven, a number of exciting entities that that potentially could come forward, but as we communicated previously we think that the most effective use law.
Our.
Assets right now is to conduct pipeline extension by looking at additional indications for.
Existing clinical compounds in particular for 692, we believe that there are multiple nor psychiatric indications that are potentially treated by that.
Of that neurotransmitter.
Okay.
We know you have named a new chief legal officer related to this appointment is there any new strategic seats on the comment on key pieces and also can you remind us the legal milestone in the coming among thank you.
Well in terms of legal milestones.
As you may be where we have filed as I discussed a a challenge.
To the of the teach out ruling.
And intend to vigorously dispute that going forward.
In terms of the of the appointment to the new Chief Legal officer, that's really just strengthen our our executive team.
To oversee the legal function as a whole and to.
Give us so.
Strength as we move forward in our legal endeavors.
Okay. Thank you.
Thank you. Your next question comes from the sale of Mizuho. Your line is now open.
Hey, Good morning, guys. This is Alex on for the same thank you for taking the questions.
First one on CTP 5.3 could you remind us the considerations that went into testing both Q Dnbi I'd dosing and then for the phase three.
Expect to test both dosing regimens or just one assuming the QD.
Trial showed similar efficacy and safety.
Yeah. Thanks for the question, Alex So as Weve indicated.
With 60 543. This is a compound in a mechanism. That's never really been studied in terms of association in the context of LT Sherry auto and primarily our hope is to better understand the pharmacokinetic pharmacodynamic relationship and to assess.
If there are opportunities to simplify the dose regimen or otherwise to discover how best to administer the compound for treating the disease.
In addition to that it has the benefit of increasing the number of patients who have been exposed to the compound and decreasing the burden on patients who are going to be into phase three study.
So in terms of what we expect to do going forward into phase three.
We are currently assessing that we won't really be able to answer the question until weve spoken with the FDA. We do think that both eight milligram and 12 milligrams twice daily doses and of course, depending upon what we see with dose regiments studies on the.
16 in 24, maybe appropriate for the.
For the phase three studies of however, I will note that as we've stated we have seen some.
Some better results, particularly at the higher dose response.
With the 12 milligram than with the milligram doses. So this is something that we're actively assessing and we'll be talking about with the agency.
Okay, Great and then just switching.
The 692 and the phase two trial design.
Do you expect sixninety due to have efficacy on the positive center.
Homes, and then maybe remind us to rationale for measuring.
Comes on both positive and negative symptoms.
Yes, Hi, this is Jim so yet so we know literature tells us that disappearing.
It is very special in many ways in that it does support improvement on both positive and negative symptoms as well as and cognitive function. So so our rationale for looking at the total Pan score, which is the primary endpoint encompasses all of all of those domains. So so are there.
Primary endpoint will be looking at total score, which which covers a positive negative and sort of general psychopathology. So that's our primary endpoints for forward looking at the the the sub types of positive symptoms and negative symptoms, we will be able to pull out those domains and secondary analyses.
As we go forward, but the literature does tell us that we can move positive symptoms and negative symptoms as well as improved cognitive functioning. So so we're really looking at the phase two trial as a way to really gauge the effects on the overall improvement in the patients as well as looking at the individual domains of their other symptomatology.
Okay, Great and just just one last quick one if I may.
Anything could you share what would be a clinically meaningful improvement in the positive versus the negative symptoms there on the on the Pan score.
[noise] again were powered before looking at the total change score in the Pan So so.
The powering is designed to show that we will have at least to five point improvement over placebo.
And the total score and that's how we've designed to trial to look at the overall total score. So five point difference versus placebo is is is the powering and also believed to be clinically meaningful.
Okay, great. Thank you very much.
Thank you again, if you would like to ask a question the spread far then the number one on the Touchstone telephone. Your next question comes from Ester Hall of Janney. Your line is now open.
Hi, Thanks for taking my questions. So on CTP six nine too.
So there have been Tom.
Hi, good or sponsored studies a non degree be hearing how can you provide any additional background on those studies the outcome and if you know how flat how does that.
Look at.
Primary endpoints.
Did that use the pan score any sort of background information on that God Deuterated, Sir Thanks sure absolutely yes. There. Thanks for that question. It's a great question. Because these hearing you know has a long history actually the NMD hypothesis, the Hypofunction I bought cisco's back over 20 years.
And this has been an area of interest for long time, there have been probably around a dozen studies that have looked at D series in the clinic and good portion of those studies have been positive to answer your question specifically about some of the details you know they do use cans is commonly.
Used on people have looked at the total score like we're doing and the cases, where they've been positive results reported it do see movement and the total pans and when you look specifically at the subscales you can see movement on the positive symptoms and on the negative symptoms and I think though didnt movement on the negative symptoms is.
Special hallmarks of of the DC hearing literature, I think when we looked at all the papers that have been published previously we looked at the one that have been positive new ones have been negative in showing clinical benefit there are some differences between those studies in some of those studies.
Where there has been positive results have been very educational for us in designing our trial, but we also look at the studies that haven't shown positive results to see what we can glean from those studies as well and whether they looked at the drug on top of a drug like on the piano they've looked at in patients or looked at different varieties of patients. We also.
Learn from that in our inclusion exclusion criteria. So basically we've we've talked with the cable wells that have been involved with these would be sharing for long time looked at those studies and we really have designed our phase two program and looking forward for our phase three to be optimally designed to really pull the best benefit and.
Roger Yes so.
Thanks, Jim a couple of other comments in general about the clinical studies with de sharing and how they inform CTP 692.
One of them is that these studies, which have shown more mixed results were were conducted a lower dose level. So that was at the 30 milligram per kilogram dose level or roughly two grams per patient per Boe per day.
End of as.
You look at the studies that were conducted at higher doses of those appeared to uniformly positive.
So thats one of the things in terms of thinking about the PK PD relationships.
Has so has let us think about the dose that we're going to use.
As Jim noted, we see a substantially higher exposure in the brain.
Preclinical models with CTP 692 than we do disappearing and so we expect that the doses that we are assessing in the phase two study going up to four grams per day per person.
Adequately cover is a dose range, that's going to give us a very good readout on the properties of 692 as a drug to treat for schizophrenia and finally, one of the things that we pointed out in prior discussions for the 692 is that it has in our studies.
With low inter person variability in the PK work that we did in both single and multiple ascending dose.
Settlements and that's in contrast to whats been reported for D series, which has been stated has a high level of variability clinically relevant doses. So I think all of those points to a favorable portfolio as well as of course the improves.
Yes.
Well as Weve indicated previously CTP 692 is.
As a deuterium modified version of a native a human endogenous neurotransmitter.
Which is which altered certainly in schizophrenia and there is evidence of alterations in the number of others are psychiatric indications as well.
We think that.
This is that Theres a lot of overlap in there as psychiatric disease and.
If we see.
Movement in schizophrenia that that's certainly going to be Dave positive indicator for its potential in the.
Sure to disease States, we haven't made any decisions yet as to whether we're going to move forward in additional indications prior to the readout of the phase two study, but thats something that we're actively assessing.
As far as the specific indications.
There are multiple.
Multiple disease states of which there is some indication may be susceptible for treatment with.
Six nine Schubel, we're not ready to identify specific one at this time.
Okay. Thanks.
Thank you.
Thank you. Your last question comes from robbing Garner off my say capital. Your line is now open.