Q1 2020 Earnings Call
First quarter 2020 earnings conference call will begin momentarily.
Once again Strongbridge Biopharmas first quarter 2020 earnings conference call will begin momentarily. Please remain on your lines. Thank you.
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Ladies and gentlemen, please remain on your lines. The strong bridge Biopharmas first quarter 2020 earnings conference call will begin momentarily. Once again. These strong bridge Biopharmas first quarter 2020 earnings conference call will begin momentarily. Please remain on your lines. Thank you.
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Farmers first quarter 2020 earnings conference call.
This time all participants are in listen only mode. Later, we'll conduct a question and answer session and instructions on how to participate will be given at that time.
If anyone requires operator assistance during today's call. Please press star zero on your telephone.
As a reminder, today's conference call is being recorded.
Now I would like to turn the conference over to your host Lindsay Rocco I'd be elixir health public relations.
Thank you and good morning, everyone. We're pleased that you could join US for strong bridge Biopharmas first quarter 2020 earnings conference call joining.
Joining me from strong bridge. This morning are John Johnson Executive Chairman Dr., Fred Cohen, Chief Medical Officer, and Rob Lux, Chief Financial Officer.
Before we begin I would like to remind you that during this call. The company will be making forward looking statements that are subject to risks and uncertainties that may cause actual results to differ from the results discussed in the forward looking statements reference to these risks and uncertainties are made in today's press release and disclosed in detail in the company's pure.
Three Arctic and current event filings with the U.S. Securities and Exchange Commission I will now turn the call over to John Johnson.
Thanks, Lindsay good morning, everyone and thank you for joining us today.
To begin I would like to extend our organizations gratitude to the health care professionals on first responders.
Bravely serving on the front lines at such an unprecedented in challenging times.
Our collective thoughts are also with the individuals under loved ones, who have been directly impacted by the kilobit 19 global pandemic.
This pandemic has also poses many challenges and ensuring that continuum of care for many people living with chronic conditions, including rare disease.
Our team has been working tirelessly over the last several weeks to ensure a minimal disruption for the patient and physician community that we serve.
Importantly, we are pleased to happen on effective supply chain of arm medicines, and we do not anticipate any shortages due to the global pandemic.
The teams dedicated efforts gone to buy the impressive leadership of Fred Thompson, Our Chief Medical Officer.
Most notably Senza supporting our phase three lots of studies, which has continued to progress on track despite having site in highly affected areas.
This is a large part due to the ingenuity and commitment.
The many stakeholders involved.
Today, we were delighted to announce at 41 42 targeted study participants have completed the randomized withdrawal phase of the phase three logic study.
There's one additional patient currently in the randomized withdrawal phase and one other patient scheduled to be randomized imminently.
Enrollment will close on or before may 14th.
We are incredibly pleased to reach this important milestone in our clinical development program for recorded.
Hey, therapeutic candidate, which if approved we believe has the potential to play an important role in the treatment of endogenous Cushings syndrome, given that the unmet medical needs remain very high for this rare and orphan disorder.
The company continues where anticipate reporting topline results from logic during the third quarter of 2020.
Barring any on anticipated ambac impact due to the told at night.
Shortly Fred will speak to the T. actions, we have undertaken to maintain this timeline.
Turning to convey yes, we had an excellent starkey this year for the first for the company achieved revenue of 6.7 million, Hey, 54% increase compared to 4.3 million during the first quarter of 2019.
The strong revenue results can be attributed to a steady flow of new patients start until the impact of told at 19 started and to improve patient retention and adherence rates, which continued into the pandemic.
In fact, the number of patients taking conveyance was at an all time high end of March.
And the strong performance for conveyance revenue continued for April during which we achieved the highest month of revenue into various history.
It is worth noting that the revenue performance off your base through April 2020 does not appear to be due to patients refilling prescriptions early or to increase in patients. They feel supply optibase due to concerns regarding cobot 19.
But rather due to the aforementioned to improve patient retention and the Terrence rates.
However, during the past six eight weeks since the staying at home orders implemented in most states.
We have been experiencing a reduction in new patient starts, which we believe can be attributed to the limitation in our field teams ability to me in person with prescribers.
Auction and patient visits with doctors and patient reluctance to try new medicines.
The company Philbin came as currently working from their homes and employing virtual toxic interact with the medical community. We do not leave us interim solution for interactions with our customers will be as effective as in person contact for generating new patient starts and we cannot predict with certainty when field base.
Activity and person patient dr. interactions will resume.
That's my ultimately affect ourselves in the future.
Usually uncertainties surrounding the duration of potential business.
The impact of co that 19 today, we announced that we are adjusting to various revenue guidance from 26 to 27 million to 22 to 26 million.
We believe the strong sales performance through April highlights the resiliency of our business even during the most difficult operational conditions.
Resiliency combined with offsetting expense reductions will allow us to sustain our cash runway and our ability to fund operations through the third quarter of 2021.
Rob will review details related to the call. These financial position later on in the call.
Before I turn the call over to Fred I would like to thank the strong bridge team for their continued work during these challenging times as we planned for and execute upon a number of important milestones this year.
And with that I'll now turn the call over to Fred.
Thank you John.
Before turning to the specifics related to the progress of RV core lab clinical development program I would like to thank all the stakeholders, who appear integral and our ability to keep the phase three logic said optic studies going despite the growing pandemic.
Our employees the study participants in research staff our contract research organizations in our vendor partners have been working together during this global health crisis to mitigate the impact to our research and development efforts.
Well many other organizations have had to delay or stop their clinical programs altogether, we have been fortunate.
Innovative measures have allowed us to continue to make progress no logics trial.
Specifically in partnership with our clinical trial sites measures such as home health visits special transportation arrangements telemedicine direct to patient drug supply deliveries and regulatory authority sanctioned protocol and monitoring flexibility are proving to be instrumental in.
Helping investigators and study participants safely complete the required visits for the study.
As John mentioned, we're excited to be closing enrollment in the phase three logic study on or before may 14th.
Please recall that logic says a double blind placebo controlled randomized withdrawal study comprised of four phases.
Screening titration maintenance randomized withdrawal and restoration.
The primary endpoint comes at the end of the randomized withdrawal fees.
Our top line results will consist of data through the end of this phase.
As of today. The logic study has 41 42 study participants who have completed the primary endpoint.
There is one additional patient currently in the randomized withdrawal face progressing towards completion and one other patient scheduled to be randomized imminently.
In the event that the final patient awaiting randomization is not able to be randomized on or before may 14th.
Due to logistical or other issues enrollment will close by that date.
Recall that the logic protocol allows for a range in the targeted participant sample size for enrollment.
This range is dependent on the observe rate of Discontinuations in randomized withdrawal, which determines the number of primary endpoint completers.
The protocol targets approximately 42 primary endpoint completers, providing approximately 99% power to detect a loss of therapeutic response rate of 17% in the LIFO credit card as arm and 78% in the placebo arm persistent all hypothesis.
Dropout rates in the randomized withdrawal fees have been much lower than originally expected.
Therefore, while we have been targeting approximately 46 to up to 54 subjects for a moment to achieve at least 42 completers as of today, we have enrolled 43 subjects and already have 41 completers.
If I mentioned earlier, we have one patient in the titration maintenance phase two we anticipate randomizing imminently as such let me close a moment on or before May 14th we expect to have as many as 44 subjects enrolled and up to 43 Completers. It's neither of the patients discontinued prior to reaching.
There are primary endpoint visit.
[noise] barring any other anticipated impact due to the Coca 19 pandemic. The company continues to anticipate reporting topline results from the logic study during the third quarter of 2020.
As it relates to an end D.A. submission. We continue to believe that we can submit an anti approximately six months after receiving topline logics results and reporting though.
As stated previously we believe that if our India is accepted for review, we can expect to review cycle of 10 months from the date of submission, which is the standard produce a cycle time for review of a new active substance via the fiber five C and D pathway.
Barring any unanticipated F.D.A. modifications due to the called at 19 pandemic.
In closing I'd like to thank the meeting organizers at the society for and their chronology. The American Association Association of critical Endocrinologists, and the European Congress with endocrinology for their commitments to funding virtual solutions to enable important scientific exchanges absent their annual Congress is.
Strawbridge has had three submissions accepted it these upcoming meetings first.
Logic study design methodology poster will be publish in April may supplemental issue of the journal of the Nixon's Society in lieu of it in person Endo and you want me either.
Second results from the extensive evaluation phase of the phase three Sonic study.
Delivered as an oral presentation by Dr. Maria for Sarah you will be recorded in published on Ace is learning management system in May and finally, and additional presentation of the extensive evaluation phase results from Sonics was accepted by the E for publication in Endocrinologists trucks 2020.
And for virtual presentation at a to be determined date later in the year.
And with that I'll turn the call over to Rob lots, our CFO, who will review financial highlights from the first quarter before we open the call up two questions Rob.
Thank you Fred.
Our press release contains details of our financial results from the first quarter of 20 Twond.
Rather than read through all of these details my comments today will provide some context on our cash spend and runway.
Despite the reduction in guidance for convenience revenue. The company continues to expect that can fund operations through the third quarter 2021.
Or at least one year following anticipated receipt of logics topline results.
The reduction in force, we implemented during Q4 2019.
During the current and future spending discipline enable us to maintain financial flexibility to meet our runway goal.
Strongbridge had approximately $63 million in cash cash equivalents and marketable securities and no debt outstanding as of March 31, 20 Twond.
Our cash burn in Q1, 2020, a $50 million was higher than a $2 million burn we had in Q4 2090.
The increase was primarily due to cash outflows in Q1 2020 for severance payments and growth in working capital.
Also in Q4 2019, we benefited from the 6 billion dollar cash settlement with noble nor does we produced Arbor.
As we've indicated cash burn can be uneven.
Going forward, especially we expect cash burn per quarter to be slightly higher.
One of our last two quarters initially and to generally moderate throughout 2020 2021, as we complete biologics trial.
And operator with that we are ready for questions.
Thank you.
Ladies and gentlemen, if you'd have a question at this time. Please press Star then one on your telephone. If your question has been answered you wish to move yourself from the Q. Please press the pound key.
Please standby, while we compiled the culinary roster.
And our first question comes from the line of Justin Kim with Oppenheimer.
Hi, good morning.
Congrats on the quarterly progress and thanks for taking the questions I'm just a few from me on the update for conveying guidance due to covert 19 could you share any thoughts on seasonality or color around that guidance you back those uncertainties on impact to be more strongly felt into Q rather than other period.
Yeah, I think that's for the question.
First off let me say, we were really pleased with the exceptional performance of the team in the first quarter earnings.
And in particular, the 54% year over year growth.
Our adherence rates have been really strong discontinue rate very very strong.
And you know we feel really good about our business overall.
What is important to remember about because there.
Is that you know a lot of those patients are treated locally most patients in fact, and there's not a center of excellence that they tend to go too and so it. It requires you know reach out to a lot more physicians to familiarize them you know as each patients.
You know begin to.
Get enrolled.
And so for US we've seen a drop in the new patient starts due to the face to face interactions.
So it's not so much seasonality in fact, I you know, we would be having probably a different kind of discussion around guidance, but for co. Good night team.
We've taken a conservative view here, we're not sure when the field team will be back in a that roll out we would expect would be geographic.
On a state and local regulations, along with when physicians in a given region might be open to see reps.
So the good news is you know our core business is strong or our patient adherence and discontinue rates are very very strong best we've ever seen.
And you know so for US you know we're fortunate to have that there will be caught positive contribution margin from competitors. This year. So we will be making money on on just those aspects that we invest in as it relates to convey us.
Even with our adjusted guidance, we expect year over year growth. It's it's very hard for us to predict how the new patient starts may come in which is why you have a wider range and why we chose to be a little bit more conservative at this point and a and lower guidance.
Okay got it that makes sense.
Maybe than on a on logics, Brad I'm, just wondering if you had any discussions with regulators on some of the and secondary endpoint benefits observed in line and Sonic and how the design of logics might be able to you are not be able to explore those point.
Yeah. So.
So I'm not going to get into specifics of our ft interactions, what I will say as a couple things number one if you look at some recent ft any approvals by this division, particularly couple of looked at the is to reduce the label.
Which is the latest approval in Cushing syndrome, you'll see some mention or secondary endpoints in the clinical studies section.
And.
And that has been seen with some prior labels as well so I'll leave that I'll leave you to interpret what what that might mean I will say that in the logic study and this will be detailed in our in our poster.
For Endo I'm. We are we are studying secondary endpoints that we thought it could could react in a timeframe consistent with the Lance OCA randomized withdrawal phase of the logic study, which is to double blind placebo controlled portion, which as you may recall is nominally eight weeks long.
And so you're looking for sure a fast reacting endpoint things like glucose body weight to some extent and so we're looking at those secondary endpoints and some certainly if they can hit within that eight week timeframe to show a reversal when switching to placebo that would be a nice confirmation.
Of those benefits that we saw in the open label Sonic study.
So we will be reporting put to topline results all in some of those key secondary endpoints as well.
Okay, Great and just maybe just a last point on some of the pair work that's being done.
You know do you have any color around what constitutes sort of failure and tolerance in some of the stuff that that are better placed on the currently available branded products and how that may or may not change with injuries the commercialization.
Fred do you want to take that.
Step edits that in terms of thought histories.
Well at this point I don't think we have enough color into what the step edits you're going to look like for access is three is a could because it hasn't been small been launched yet in the United States I think and maybe Rob can speak to this more but in terms of what we've seen for the other commercial production yeah.
In the United States.
For the most part stepped out its or are not a major feature of accessing those commercial products typically what's needed is that substation that you know another product custom tried and failed in some cases in some cases, there's no such attestation needed.
So we'll have to see what histories is a step edits look like once that gets established for me a smarter Rob I didn't know if you had any I think to add on to that.
Now well set from I think that covers it.
Okay, great the but really it for me and I'll hop back in the queue. Thanks.
Thank you.
Next question comes from the line of Roger song with Jefferies.
Hey, good morning, guys. Congrats on that strong Q4 could there and closing Roman close to the year old on completion for.
Logic, So maybe just a few quick ones from me.
So well first I think a Fred you mentioned seems to dropout rates and lower than expected I'm. Just curious on do you have any color onto what my drive this lower kinda dropout rates like I know youre et cetera.
Sure. So so just as a reminder, you know we took a pretty conservative approach when determining the expected dropout rate and the sample size targets to ensure that we would have enough flexibility to enroll more patients if we needed to because we definitely want it to make sure that we had adequate number of Completers Uh huh.
Having target of 42 Completers. So the fact that we didn't need to enroll friendly very many more patients above the target a complete a number is very welcome news.
Probably the most important factor that led to the low dropout rate at least lower than expected with our decision to provide for early rescue therapy.
In randomized withdrawal as soon as it was considered to be needed and confirmed to be needed biochemical markers.
And other markers of physical signs and symptoms of the disease return.
So the use of that rescue therapy provided some reinsurances to patients and the physician investigator short caring for them.
Got it would not be necessary to lead the study should the disease signs and symptoms recurred during the treatment in the in the blinded randomized withdrawal face.
The other the other key factor I think is that all the subjects who entered into the randomized withdrawal fees had already experienced at least 14 weeks of therapy and they all had achieved to tolerate a therapeutic dose and so now looking back on the Sonics results. We know that once you've achieved to therapeutic dose and have been on the drug for some time such as.
You know three to four months that the incidence of adverse events that lead to discontinuation.
Finishes over time, so I.
I think if we had wanted to be less conservative we could have park and for lower dropout rate, but as it was we were very pleased with what we saw.
That's very helpful. Thank you and maybe just quick follow on.
Question for that so regarding the only used to rescue Matt.
So just can you kind of remind us how you're going to kinda accommodate chew that prime endpoint analysis on those kind of patient use the let's go Matt.
Yes, so anyone who takes a rescue medication by virtue of having met the criteria for early rescue is considered having lost response in the primary endpoint. So there will be counted in the column of loss of response now what that means that we will have some patients who are on active therapy loosen response, and we did account for that in our in our.
Study power.
In other words, losing response, even if it's maybe just a tranches.
And then we do expect are very high proportion of the placebo all switch patients to this response and need early rescue [noise].
Got it yeah. So many many of those patients are found that people are okay got it okay.
Okay, and then that so for so for the India submission your guide at a six month after the topline data and that you just can you kind of minus what else done.
Besides biologics data.
I can see and so I think what weve.
I think what we said before is that the logic study is really the rate limiting step.
For the NDA submission so preparing the logic study results in a format suitable for submission and to some extent integrating those results with results from prior studies.
Is gonna be is going to be the really the rate limiting step to.
Finally, the submission.
Got it great and the maybe just the last quick one so we know you have contemplated.
Lifecycle management strategy for conveyors, so I'm, just any kind of get bombing thinking around I know when we cannot.
Kinda back come up.
Yes, so I think what we talked about on the last call is that you know we have filed 14 patent applications in the United States around.
Today us and as well as three P.C.T.
Global patent applications.
All the two of those below Q4 primary families of patents and all of these relate to the current product labeling for convey s. So we continue to prosecute ended fancies patent applications with the respective offices.
And we expect to give an update in the second half of this year on our progress there.
In addition, we've continued to advance.
The the.
The modified release formulation case that we talked about in our last call.
We're not prepared today to discuss any results from that but we're pleased with progress.
Great. Thank you I think of what are the color. Thank you that's up I mean, you're welcome.
Thank you.
A reminder, ladies and gentlemen, if you have a question. Please press star one on your telephone.
Our next question comes from the line of Lisa Bayko JMP Securities.
Hi, guys. This is John on for Lisa Thanks for taking the questions.
I'm just wondering kind of your market research are you, including is to reuse as profile. When you kinda talk the dogs and payers and I guess can you kind of.
Give us your thoughts on how Oliver Corlett is shaping up compared to is Theresa.
Sure. Yeah. We did include their profile in the market research. We did so all the data that that Scott discussed.
On the last call was in fact.
Included when we did the market research with physicians and so.
You know, we're not going to get into specifics about how we stack up or or our strategy.
But to say that we're very comfortable with.
The fact that there will be good acceptance for record load. It certainly has a place.
And I think the important thing to keep in mind is that of the 8000 patients that are treated today bye.
You know the use of of these medicines five prescription about 3800 are not well satisfied and not well controlled and so you know there remains strong unmet need we believe that we'll continue to see that when a corollary if approved kits the market, but the director.
Answer your questions, Yes, and all of our market research we include their profile.
Great and Fred can you remind us how often patients are being measured per.
Urinary free cores all during the randomized withdrawal and I heard you talk about kind of your expectations for last response can you just go to that one more time.
Yes, So I think what I mentioned in the call script was that the original.
Power powering assumptions for the study and just to remind me what those where that we were targeting approximately 42 primary endpoint completers, which would provide approximately 99% power to detect a loss of therapeutic response rate of 17% and they'll leave acute economists arm and 78% in the placebo arm.
This is the NOL hypothesis.
We are we are looking frequently at both U.S.C. as well as late night celebrate cortisol U.S.C. is the primary determinant of the loss of response in the for the primary endpoint.
And the interval is approximately 10 days.
Every 10 days storing the.
Got it must be trajectory.
And just one less bookkeeping, what with growth net for the quarter for conveyors and then what are your expectations for the year and thanks again.
Drives is run up.
Yes, so the the gross to net was in the 25% range for the quarter.
And that Q1 gross and that is usually higher.
Then.
And the rest of the year.
So we always that's a moderation in Q1, we see no patients no starting up again with their insurance plans. So you can be at higher deductibles and co pays and the things that affect some of our gross to nets.
And so we typically see higher and.
So with respect to moderate down back, we'll usual which is more like.
No low low Twentys, if you will.
Great. Thanks, again for taking the questions.
Thank you I would now like to turn the call back over to executive Chairman, John Johnson for closing remarks.
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In closing on behalf of the organization I would also like to thank the biotech and pharmaceutical companies working towards developing cobot 19 vaccine.
And treatments for their efforts in responding to this global health emergency.
This is a unique opportunity for our industry to demonstrate the incredible value that scientific rigor and talent and create for the global health community.
Through transparency collaboration and compassion I believe that we can mitigate the impact of this virus poses in the near term and ultimately eliminate threat in the future.
In the meantime, that's the situation continues to fall our primary focus room will remain on the health and safety of our employees and the patient and physician community that we serve.
This is a challenging time in so many ways, but I've been truly humbled by the spirit in which our nation and communities have come together to support one another.
Strong Brent has committed to supporting National Cobot, 19 relief efforts, including making a charitable contribution to the American Nurses Association Terabit 19 response fun.
We know there's a long road ahead, we will continue to evaluate ways that we can help one another during this unprecedented time.
Thank you again for joining todays call and for your continued support as we prepare for a number of key milestones in the coming months.
Thank you.
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