Q1 2020 Earnings Call
[music].
Good morning, My name is Jake it'll be your conference operator today at this time episode of calls first quarter 2020 earnings teleconference call.
Placed on mute to prevent any background.
Noise after the leaders remark instructions will follow at that time.
At this time I would like to turn the call over to our first hosts to Patty Eisenhaur ma'am the floor is yours.
Thank you Jake and good morning, everyone and thank you.
Competent discuss financial results and operational highlights for the first quarter 2020, today's call is being webcast and will be available for replay on the Investor said, she never website and I meant to pharma.
Dot com.
Joining me on the call my prepared remarks, or Craig Wheeler, President and Chief Executive off.
<unk> financial and business topic there.
Also available for the Q and a portion of the call I Santiago.
Tony Manning, our chief scientific.
Oh officer.
Following our.
Marks we will open the call to question.
Before we begin I'd like to mention that our call well containerboard business plan dense another piece.
Sure events in development.
Sorry filings regulatory approval.
But it and product and market Patel.
So in reception of our product to end.
Titian and revenues for our product candidate.
Product development strategy, well, none of our product candidates, including.
Calls.
Following my update young Quan, our chief financial in business Officer, we'll discuss our first quarter Twentytwenty financial results.
After which I'll close with some final comments and then we'll open the call to your questions.
Had momenta as most of you who are familiar with US no. We are focused on developing novel biologics to treat rare auto immune related diseases.
Our court capabilities include a deep understanding of immune biology, coupled with our long term expertise in antibody engineering.
We currently have three molecules in the clinic, each targeting different aspects of F.C. biology.
Based on animal and clinical data to date, we believe all these candidates possessed best in class properties.
And franchise potential with a clickability across a range of immune mediated diseases.
Behind these candidates we are researching a series of novel agents utilizing drug discovery platforms derived from our existing clinical programs.
These include R.F.C., multi <unk> and <unk> technology platforms.
Which will continue to fuel the pipeline as our lead programs advance towards the market.
This is an exciting time for our company. Despite the challenges up cope with 19, we are pleased to reconfirmed that we're on track for key catalysts coming up in the next few months.
Including proof of concept results from our to lead programs.
Both expected by the end of the third quarter.
Let me give you some details on these programs.
I'll start today would never locale about R.S.C.R.N. candidate, which will be the first of these programs to read out.
By now I'm sure you're familiar with the rationale for targeting F.C.R.N., So I'll skip the biology and focus on the program.
Mm.
F.C. I ran as a competitive field ultimately we believe success will come down to the attributes of the molecule.
It's advocacy, it's safety and it's dosing and the development strategy use indications presentations and populations.
The combined could create a best in class profile versus other competing agent.
We believe <unk> is well positioned to capture this opportunity.
Data from existing therapies, such as ideology and plasma apheresis have shown that there is a correlation between the lowering the bottle antibodies or I.G.G.'s.
And enhanced efficacy.
We believe the same correlation will hold for S.C.R.N. therapies.
In our face one study yep account apples shown to be the most potent agent for lowering I.G.G.'s. The maximum reduction of around 85%. Following a single 60 milligram per kilogram dos.
To date nipple count on that has shown a strong predictable dose response with good tolerability.
And the ability to achieve full receptor occupancy with a single dose.
Are phase one data also has shown that we can maintain a significant I.G.G. reduction from baseline for over one month with one infusion.
Are multidose phase one cohorts have demonstrated that we can maintain 100 per cent receptor occupancy and maximally lowered I did you use for sustained periods.
And our infusion study has shown that we can safely intolerably administer are 30 milligrams per kilogram dose to patients in as few as 7.5 minutes.
Taken together these attributes point to a potential best in class profile.
We are developing nipple Callum apt to capture multi disease franchise opportunities in two areas of medicine auto immune disease and feed on maternal disorders.
We are developing both infusion and subcue options for stations.
This strategy supported by the clinical data, we have to date and that we expect to generate from our ongoing trials.
Will support a broad label for this program.
Our ultimate goal is to become the preferred agent for physicians to use across populations and medical specialties.
In auto immune disease.
G.G. has been shown to drive the pathology of many rare diseases treated by different classes of specialists.
Neurology, hematology dermatology nephrology et cetera.
Each of which treats more than one disease for which this drug could be effective.
Currently we are evaluating nip account map into auto immune indications my senior grab it and neurology disorder, and warm auto immune hemolytic anemia haematological disorder.
We would expect to expand to other disease and specialty areas in the future as we continue to explore opportunities for <unk>.
The first of our auto immune studies to read out will be but I've asked city M.G.
Are 60 patients pays to clinical study in my senior year Gratis.
This is a five arm blinded trial with treatment in forearms, and a placebo arm.
Is this trial is designed to allow us to understand the performance of the drug across the full range of possible doses.
And to provide a large safety database, which should allow us to run a smaller more focused based three trial in M.G.
As you know we expect to release date him. This trial soon so I want to take a moment today to highlight it's designed and discuss the information we expect we'll be able to extract from the interim analysis once we see the data.
The 16 weeks trial.
<unk> trials five arms consist of a placebo arm.
A five Meg per Kid monthly arm.
30 make per keurig monthly arm.
A. 16 make per keurig every two week arm.
To 60, Meg <unk> single dose.
Patients are dose for eight weeks.
And then followed for an additional eight weeks.
The unique design of this trial will give us information in numerous areas.
First.
It will give us information on how lower I.G.G. levels may correlate to better advocacy indicators in M.G.
We anticipate that some of the doses based on our phase one day.
Yeah, we'll drive lower I.G.G. levels than competing agents have explored in M.G.
Second.
It will provide an extensive data set to understand tolerability and safety of nipple <unk> at various multiple dose levels.
Third.
It will give us information on dosing interval, possibly <unk>, allowing dozing once every port to eight week.
If we can demonstrate that dosing with these intervals is efficacious would support never Callum as best in class Dozing potential.
Fourth.
If I G.G. reduction is shown to relate to advocacy it will help us to optimize the dose we carry forward into our phase three program.
And provide the possibility to individualize treatment in patients with M.G. through clinically meaningful dozing information to physicians.
And finally.
I will give us the information we need to develop an optimal dose subcue regimen for the product.
This will allow us to bridge, the sub q. and I'd be doses and have both formulations ready in time for R.M.G. launch.
This phase two trial achieved target enrollment in February 2020.
And while the covert 19 crisis has created some challenges we remain on track to report top line data from this study.
We plan to provide results of our in terminology is in the late second quarter or third quarter of this year.
As up today, all patients have completed their eight week dosing period, and we are now in the process of data source verification and working to lock the database to allow us to conduct are in term analysis.
To be clear.
This look will contain data from patients during the eight week active dozing phase of this protocol and allow assessment of the eight week primary advocacy endpoint, which is activities of daily living or radio.
So it will be a robust view of the data.
Which we expect to inform our phase three planning and the subsequent regulatory interactions.
The final day that will be available later in the year once all patients finish their eight week observational period, all data source verified and all fine or queries fine Aquarius resolved.
As with all trials during this covert 19 crisis, we do expect minor gaps in our data say due to the inability of patients to physically meet with their doctors.
We've also moved to remote monitoring of sites when necessary and possible, which means not all customary onsite verifications will occur and the time needed to source verify the data is necessarily longer.
This is why we cannot be more specific on exact timing today.
Once we have the data and finalize the trial. Our next task will be to get our phase three M.G. trial up and running.
Our team is working very hard to adapt our plans to include innovative approaches like remote physician visits home infusions and systematic remote monitoring to determine if we can implement them and our phase three protocol.
As we are all seeing changes of this type are being supported by both Gimme a and F.D. <unk> regulators.
It has our hope that these challenges changes will allow us to start phase three M.G. trial and early 2021.
For the energy study or adaptive phase two or three clinical study of nipple <unk> hemolytic anemia, we continue to activate clinical sites in both of the United States and the European Union.
As we announced in April we have temporarily suspended patient enrollment and are actively working to amend the study protocol to facilitate remotes study conduct where possible.
It is our intent if possible to accelerate the restarted this study.
As a reminder, this as a large adaptive phase two three study with over 100 patients.
Notably nipple <unk> is the lead F.C.R. and inhibitor targeting the syndication.
Which we have been granted fasttrack, an orphan drug designations by the F.D.A.
Shifting from auto immune to feed him maternal medicine.
Highlight progress for our unity study.
This is like global multicenter face to clinical study of <unk> in hemolytic disease of the fetus a newborn.
It is the first clinical application of S.C., Iran inefficient in fetal maternal disorders, and our antibodies ability to maintain full receptor occupancy should enable total blockage of pathogenic auto and aloe antibodies from passing through the placenta from the mother to the fetus.
We continue treating patients currently enrolled and due to the life threatening nature of H.D.F.N. This study continues to enroll new patients at sites, where they can be safely accommodated.
However, due to cope with certain sites every allocating resources to the pandemic and are not enrolling new patients at the present time.
We believe proof of concept in this syndication could not only transfer transform the treatment of landscape in H.T.S.N., but would also validate our approach can feed on maternal disorders more broadly.
Morever, we believe our ability to block to transfer of an antibody across the placenta shouldn't change depending on the antibody.
Therefore, this agent could also block moms auto antibodies from crossing the placenta and attacking the fetus.
Which could possibly open therapeutic options for women of childbearing age with auto immune disease, who wish to become pregnant.
This is another pillar in our abroad labels strategy for <unk> to become the preferred agent for physicians to use across populations and medical specialties.
We are hopeful we can avoid lengthy enrollment delays and this trial. So we can get this drug to the women who needed as quickly as possible.
Once we better understand the cold delays, we will update you on are expected timeline to trial completion.
We are working to build a winning F.C.R. and franchise with <unk> and believe there is enormous commercial opportunity here.
I look forward to updating you on the results are in term analysis from above acid M.G. trout in the near future.
Now I'll move on to M., two five for our hyper <unk> G. program.
As a reminder, m. two five poor is a novel agent and your faction from I.B.I.G.
We enzymatically modify I.V.I.G. to change the structure of the gleich hands on constituents I.D.G. by extending the f. seek like hands and terminating them with <unk>.
Our goal in developing M. 254 was to establish a high potency agent that could versus I.B.I.G., while maintaining ideologies advocacy.
Ideology is a difficult to use agent requiring long, sometimes multi day administrations have very high volumes that give most versus events.
Despite this it generates approximately $6 billion a year in auto immune sales globally.
If our agent delivers on its promise it could have significant benefits over I.B.M.G. in terms of safety and patient convenience.
And require less plasma to produce thereby expanding the market opportunity.
We are currently conducting a multi part phase one to clinical trial, idiopathic thrombocytopenic purpura or I.T.P.
We are in part B. of this for part trial, which is composed of a single ascending dose cohort I.T.P. patients each followed by the standard 1000 make brocade dose of I.B.I.G.
Early data we shared in January from part B. showed a dose response similar to I.B.I.G.'s.
Based on the data we shared in January we made the decision to expand part b. to explore lower dose cohorts and testicle words to better understand if we could detect a dose response in this highly variable population.
As a reminder, the primary endpoint for advocacy is achieving platelet levels of over 50000 per microliter and arise from baseline.
Least 20000 <unk>.
Well enrollment has slowed do they need to recruit patients at sites that remain open.
Due to.
Results from puppy sometime in the third quarter of 2020.
Part C.N.D. will be delayed as we need results from part B., but we do expect to get part C. underway. This year.
We look forward to sharing complete part B. results with you and are targeting to do so in the third quarter.
Notably these fey two days to delays will also delay the start of the M. two five for trial in chronic inflammatory de Maya waiting polyneuropathy or C.I.D.P.
Parts CND <unk>, well respectable you evaluate single and multiple doses of M. 254, and a crossover design.
To establish their heirs sensitivity to which product is administered first.
<unk> data on M. 254 in a multidose setting.
The state it will be important as we plan for C.I.D.P., which was that chronic indication.
We now expect to indicate initiate the C.I.D.P. study in 2021.
Well now touch on our earliest clinical program M. 230. This program his partner with the C.S.L., which is currently running a phase one clinical program to evaluate the safety intolerability them 230 in healthy volunteers.
Because many auto immune conditions are chronic and require lifelong treatment C.S.L. those plans and good to introduce a subcutaneous formulation into the phase one program in the second half of 2020 subject to any covert related delays.
Subcutaneous formulation will offer additional convenience benefits to patients, including self and home administration.
Finally in January we nominated him to 67 Sift body development candidate targeting C.D. 38, as an early development Canada.
Preclinical data suggest M. 267 has the potential to be a best in class therapeutic for the management of plasma site mediated diseases, such as multiple myeloma, l. amyloidosis and rare auto antibody mediated diseases.
So we believe this program has significant opportunity to be another high value program with the franchise potential.
We have initiated Diane D., enabling studies for this program and notably covert as not slowed down our research team and this program is on track for the clinic and 2021.
As I hope you can tell from this update well we are seeing delays would cope with our company is operating at full capacity and we are doing everything we can to minimize timing delays for our programs.
With that on now turn the call over too young to review, our first quarter Twentytwenty financial results young.
Thanks, very much Greg good morning, everyone.
With regard to the company's financials I would like to start by mentioning that while we have had to adjust some of our critical plans and twentytwenty due to the Kobe 19 situation. We believe we have sufficient capital to plant operations through at least a third quarter 2021.
In the first quarter of 2020, we recorded a net loss of 39.6 million compared to a net loss 44.8 million for the same quarter last year.
The decrease was primarily due to lower G.N.A. costs offset by increased manufacturing and clinical development expense.
Product revenue for the first quarter total 8.7 million compared with 2.4 million for the same period in 2000 and I do.
The increase was primarily due to higher net sales of cultural by by a partner Sandose driven by volume increased.
R. and D. revenue for the first quarter total 0.2 million compared to 1.8 million for the same period in 2000 Nike.
The decrease was primarily due to lower reimbursement revenue local topaz expenses.
Lower revenue recognize from my land upfront payment associated with the Biosimilar collaboration.
First quarter total gap operating expenses were 49.6 million compared to 52.2 million for the same period in 2000.
First quarter aren't the expense increased the through 34.2 million compared to 28 million in the same period in 2009 too.
This was primarily due to an increase in manufacturing and clinical trial costs.
And to five four and increased spending on 710.
First quarter G.N.A. expands decreased to 14.6 million.
Here to 24.2 million in the state Court period.
Thousand or 19.
This is primarily due to lower depreciation right cost associated with the modification <unk> and lower legal costs.
For the first quarter of 2020 are non gap operating expense was 44.7 million.
As a reminder, Oh nongaap operating expense is defined as total operating expenses last stock based compensation less restructuring cloth.
Less collaborative reimbursement revenues.
Finally, we ended the first quarter with 487.9 million in cash cash equivalent marketable securities compared to 545.1 million started here.
Turning out to our guidance for 2020.
Due to lower clinical trial enrollment trends as a result of the Kobe 19 pandemic, we expect our full year Nongaap operating expenses will be lower than 222 240 million as previously guided for 2020.
We anticipate providing an update on expected nongaap awkward expands 2020 with our second quarter 2020 financial results.
What that altering the call back over to Craig for closing remarks.
Thanks, Yeah.
As you've heard we remain and a strong corporate position with cash to fund operations through the third quarter of 2021, and two near term proof of concept read out some becoming months.
Overall I'm very pleased with the progress our team is making during this difficult period.
They have put patients first and are showing their metal as as they work to adjust to very difficult working conditions to keep our programs moving.
It's my hope.
Momenta teams determination, we will emerge from covert crisis within intact and advanced portfolio and even stronger organization.
I look forward to keeping you all updated on our progress stay safe and help where you can as we worked and a covert crisis and deal with its aftermath.
Thank you again for joining us and I'll turn to call back over to Patty to get the Cuban a underway.
Thank you and say he can open up the q. in a.
Thank you at this time, if anyone has a phone question pressed or one now on your telephone keypad again press store, one now for any questions or comments.
The first question comes from Derek or children would Stein.
Oh.
I'm sorry.
Oh, great. The morning, guys and that are taking the question you got that all the progress. So just a couple from us.
Maybe first.
Yeah, you had a competitor yesterday's talk about transitioning their program from I eat it sucks you just want to like how they get it that the you know how you guys are thinking about you know I V. Antiseptic presentation at 80 to the the advantages of having bowls and then maybe a session for Tony in terms of like <unk>.
How are you thinking about the yes. The response that you could see with <unk> N.N.G. and how that potentially could translate the durability and should we be thinking about the differences between a competitive binder like S.R. take them odd versus the full you know blocking model photo like the Italian mob of some of the other.
Out there thanks.
Mm.
Derek Thanks, I'll take the first one is you suggested that I'll, let Tony and address the second one in Santiago can feel free to add there if he likes.
On the competition, Yeah, we do see people looking at Subcue and and the I.V. I think you know our view has not changed from you know the start of our program. We believe that both presentations are gonna be important here.
Subcue because of the bride wide range of diseases and patient preferences is gonna be preferred by some patients and we therefore had been for quite some time actually working on a a very what we think is going to be a very good strong potentially industry meetings up your presentation.
However, we made the determination that until we understood the best way to Dos we didn't want to actually introduce subcue, because we felt that using our infusion was a better way to understand the drug and then bridging to the right. So q. doses and so we'll have it ready for launch and we think it's an important component of the offering for these products because of the nature of the diseases.
That being said.
We think I.V. will be and we'll be continued to be used in a large portion of the population as well. These patients are seen quite frequently.
And depending on the disease, some more than others in their physician offices.
And what we've seen so far.
Or is that with our agent at least we can have very rapid and safe confusions. So if you think about you know the ability to do an infusion once per month or maybe once per every two months. If we're fortunate with the data from our our phase two trial versus we're going to be.
Painful and relatively high volume self injections I think of a fair number of patients will continue to want the the infusions and so we actually think both presentations are gonna be.
A part of the of the playbook for the leading agents in in in this.
Indications so are we that'll turn it over to Tony and he can at talk a little bit about the comparative mechanisms here.
Yeah different things for the for the question you know they the durability of the clinical response will we believe the related to the kinetics of the I.D.G. reduction and and clearly kill him and his some great advantages and.
Being able to drive down and.
Maintain that low light G.G. levels, but actually liking for the sort of clinical relevance of all of that I think I'd probably passes over to Santiago to describe a little more you know his thinking about how the kinetics of I.D.G. reduction relate to the durability of the clinical response Santiago with you on.
Take it from here.
Sure. There there has been suggested goes the the the you race for.
These.
Actually drive you have because he did he said just don't seem to literature from the plus my first season, maybe I'd literature.
Yes, or no so from someone over the compared to those that though so we are really very interested in understanding <unk>. Other because you know that's all we power to study.
That's.
Oh Oh.
Hopefully, we'll be able to understand much of it there.
Early on.
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Excellent that that we're taking the questions and look at words of the data they say.
Thank you My next question comes and Joseph.
Oh, how good morning, if you're going to question.
I guess just a a couple on you but for for me looking to the data in I.C.P. Diddy Resenting third quarter, just hoping to levels that expectation sort of the Haitian numbers and the total number of cohorts that we should expect.
<unk> should we expect I guess data from the the the lower those cohort that you guys have initiated.
You know what'd you for the visibility on those.
Thoughts a a minimally though.
<unk>.
Shade to add lower dose cohorts was because we actually sorry, I pick a few down to our lowest those.
And the decision to expand the number patients in a cohort was because we saw wide variability in a in how patients respond.
And therefore, we were unsure with low number of patients in each cohort if we could actually effectively see a dose response and so we needed to see more patients and a cohort and to to support that we actually shared with you in in January the variability that I.B.I.G. is always seen and Miss population.
And so what what you will see is more patients per cohort and then lower cohorts, we haven't specifically talked about numbers because we have given the clinical team a fair amount of flexibility to add doses to to be able to understand that dose response as well as to add patients to understand.
What.
What's necessary for for being able to having a dose response.
So we haven't really given any specific guidance, but but you can't expect that there will be significantly more patients that we will bring forward and we're in the middle of that now Sunday I do you want to add anything to that.
Oh no no if you know stuff.
<unk>.
<unk>. Okay. That's helpful. You just one follow up I know that one of the motivation to be able to explore lower doses to allow for some huge formulation potential with a two by four do you do you have it <unk>.
We sort of what.
I don't either drug would be a <unk> you formulation.
Actually be in that range already got 60 milligrams you do it.
<unk>, Yeah, you could see about those it's.
And they will that some q. optionality.
Yeah. Thanks, well you know that they the the answer that question is a little tricky because as you. If you look at the I.B.I.G. class. They have dramatically expanded what are we think about us.
Q, so they're giving mask.
Oh, there's a lot of other benefits besides some cute and going lower in terms of amount of class. Many the cost of goods all of those types of things. So so lowers better in every every dimension. If we can get there but in terms of what's effective for a sub cute.
So if you even at 60 milligram, if you compare it to you know the high volumes that are being given today with I.B.I.G. subcue would be much improved but we'd love to get you know into the kind of range like we're thinking about with the for example in the S.N. agents, which would make a very convenient sub too, but it's too early to tell if we can get there yet but subcue. Your ideology is a really.
Interesting it's different than every other space because of the way somebody of energy suppliers of introduce a few products.
God, maybe just a one last question on <unk> I guess when it comes to be three planting M.G. is is the the idea to invest in single those regimen here or the <unk> kind of multiple regiment, depending on how the but as the data.
Outlook.
Yeah, Santiago why don't you take that one.
Yeah. We you know we haven't really is that the to decide to see the proto because <unk> truly.
Onto the social defaced cool so what we have these missiles, which will be very soon we'll be able to stuff to put together a place to grow them.
Because it was saying we are aiming to stands up space sleep wrote I'm pretty soon hopefully other you know the year to begin end of next year.
<unk>, they're still going to questions.
Thank you.
Question comes from Greg lived Goldman's.
Right.
Hi team. This is on fire <unk>. Thank you for taking on questions. I've. Just ask you questions on M. 254 can you comment on the channels very them.
Already observed in patient responses to classic I.V.A.T. and watched I've read through two and two faithful or is there anything we can look flash that's unique to specific I didn't mean indications that could mediate the patient response variability bake.
Sure <unk>, maybe Tony you can you can talk a little bit about some of the data we've seen at I.B.O.G. and then sent to how can you can talk about a little bit about how we're thinking about the dozing there.
Yeah, So and we have looked at all of the available phase three results for three I.D.I.G. approvals and is in a way to share that with you guys at J.P. Morgan.
There's there's a lot of variation by individual in the response to I.D.A.G. administration thing, there's really not a strong understanding as to what drives those the variable response.
But it's clear that I need a g. is very effective.
Boosting patient platelet numbers above some of those critical labels that you would need to to maintain their their health status and so that's why with really loved that they they clinical response and the rates of clinical a response and then I think there what we see.
He is you know quite a a consistent story the that even to find for can boost played a little labels and achieve those clinical responses pretty consistently is with a is we've shared with you.
So I think it you know the there's not a good understanding of the variability of responds to I.D.A.G. and so anything that is one of the <unk>.
<unk> clinical responses.
Yeah me from the beginning because we analyzed previews that that the from other companies.
Cleared a little bit, but it really be was going to be an issue to to get a week in the in the trial. That's why we decided that they only need to bugs I mean, but.
But as.
I was out quite a V.C.
Barbie.
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Tried to get done under study in <unk>, what are the doses of May work policies and expose young <unk> you know fault machine, one or two doses in which would really want to include many more phases, we'll be able to understand fully.
You see on that that those is that right <unk> three.
So we are no reply to be.
<unk>.
Number of pages, we've had a local flexibility in order to study decided to do that we had exploring different doses from very little doses to Mulder, it's a though system, but I do understand what is clear is that.
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Basically.
Low doses into play for leads to address phone that rate that'd be similar to the respond to radio Cosby and seeing with I.B.I.D.. So that's where we are them. That's a good place to be I know again.
I'd be a then.
<unk> it would be clarified which those will doses she'll be cool pretty strict.
Yeah.
Okay, I want a phone I'm, an AD sorry <unk>.
We are increase.