Q1 2020 Earnings Call
Ladies and gentlemen. This is your operator today's conference is scheduled to begin momentarily.
All that time your line will again be placed on musicals. Thank you for your patience.
[music].
Actual results conference call.
Speaker's remarks, there will be a question and answer session.
Good question at this time, please press star one on your telephone keypad withdraw your question. Please press the pound cake.
Time, I would like to turn the call over to Mr., Josh well read the company's Chief Financial Officer. Please go ahead Sir.
[music], Thank you and good morning, everyone.
On the call with me are Dr., Todd Brady out there as President and Chief Executive Officer, and David Mcmahon, Our Chief commercial officer.
I will begin with an overview of our recent highlights and upcoming clinical milestones I.
I will discuss our first quarter financial result.
We'll make some concluding comment and then we'll take your question.
Please note that this morning's conference call contain forward looking statements regarding future events and the future performance of Aldeyra.
Forward looking statements include statements regarding the timing of planned clinical trial initiation out there as possible or assumed future results of operations.
<unk> expenses and financial position business strategies, and plans research development, and commercial plans or expectations trends market sizing competitive position industry environment and potential growth opportunities among other things.
These statements are based upon the information available to the company today.
As a result of the cobot 19 pandemic clinical site availability staffing and patient recruitment have been negatively affected and the timelines to complete our clinical trials may be delayed.
Well there assumes no obligation to update these statements as circumstances change future events, an actual result results could differ materially from those projected in the company's forward looking statements, including the current and potential future impact of the cobot 19 pandemic on our business results of operation Anthony.
Antrel position.
Additional information concerning factors that could cause results to differ materially from our forward looking statements are described in greater detail and the company's press release issued this morning containing financial results for the quarter ended March 31, Twentytwenty and the company's filings with the FCC.
And with that I'll turn the call over to Todd.
Okay.
Thank you Josh good morning, everyone and thank you for joining us today.
And just a few short weeks Kobe 19 has affected.
Virtually every aspect of our lives.
On behalf of everyone at Aldeyra I want to extend our thoughts to those that that Antosh Midas.
Devastating illness.
Over the past two months, it's been inspiring to see the selfless commitment of doctors.
Nurses and other health care professionals working around the clock to extinguish the virus.
And it's also been encouraging to witness the collaboration of companies across our industry.
As they attempt to solve this global health care crisis.
Along these lines I want to think our own employees for their tireless efforts over the past months.
Regarding our initiatives to treat covert 19 infection, which I'll discuss later in this call.
From Aldeyras perspective, although the stay at home orders another government mandated measures have affected certain of our clinical enrollment timelines.
We believe we remain well positioned to execute on our strategic objectives.
As noted in this mornings press release.
We concluded the first quarter with $61.4 million in cash cash equivalents in marketable securities.
And our updating our guidance to extend our projected cash runway into 2022.
On our fourth quarter call, we discussed the strategic prioritization of our late stage ocular disease programs, including our trials in dry eye disease, allergic conjunctivitis and proliferative Vitreoretinal empathy.
Since our fourth quarter call two events have prompted us to accelerate the development of our systemic disease programs with Adx six to nine he first in class orally available and irreversible cool valence inhibitor, a pro inflammatory Ross.
First was the potential applicability of Adx six to nine to mitigate respiratory compromise.
In patients infected with Covidien 19.
In preclinical models Adx six to nine and structural analog reprice Hello.
I have demonstrated activity and cytokine release syndrome, which is thought to lead to acute respiratory distress and other forms of respiratory compromise that require mechanical intubation encoded 19 infected patients.
Second in April we reported positive topline results from our phase one clinical trial of Adx six to nine.
To summarize those findings adx six to nine was well tolerated and no treatment adverse events were recorded.
And the trial at any of the doses tested.
Clinically relevant plasma concentrations exceeding known levels of RASK were observed suggesting that near total Raskin addition is theoretically possible in plasma.
And relative to subjects treated with placebo reduction in the commonly described pro inflammatory Eros now and I aldehyde was observed in drug treated subjects.
Confirming target engagement.
With the success of Adx six to nine phase one we now plan to embark on a comprehensive systemic disease initiative to assess the activity of six to nine in three types of severe inflammation.
Cytokine release syndrome auto immune disease and allergy.
Our positive phase one data as mentioned above is supported by strong preclinical evidence.
Demonstrating that adx six to nine reduced levels of T.H., one teach two and th 17 related cytokine.
Suggesting potential activity across a broad array of inflammatory diseases.
Contingent on up the a review in the third quarter, we plan to initiate a phase two clinical trial of Adx six to nine in subjects with cool that 19 associated respiratory compromise.
Adx six to nine either as a single agent or as an adjunct to other therapies has the potential to reduce levels. The broad array of lavatory cytokine, thereby mitigating risk respiratory compromise and potentially improving patient outcomes.
We're also targeting two phase two a clinical trials of Adx six to nine for the second half of this here to test Adx six to nine activity in autoimmune and allergic diseases.
First of these planned trials in patients with psoriasis.
And auto immune condition associated with T.H. one cytokine.
The other planned trials in patients with a topic asthma.
Logic inflammatory disease associated with teach to cytokine.
Regarding our ocular disease franchise were proxy to lap continues to advance toward indeed filing it allergic conjunctivitis and dry eye disease.
In dry eye disease at mid year, we haven't type C meeting scheduled with the FDA to review the remaining India requirements for Approx allowed.
Dry eye disease that affects approximately 34 million people in the United States and remains in adequately addressed by current therapies.
Results from our trials with her Prox hilltop, which include clinically relevant change from baseline into well controlled trials.
Suggest potentially best in class rapid onset and broad symptomatic improvement.
We plan to update on our clinical development plans in dry eye disease, following receipt and review.
The FDA feedback.
For allergic conjunctivitis, we now expect results from our phase three invigorate trial in the first half of 2021.
Timing of trial completion is later than initially planned primarily due to delays associated with an extended allergy season.
As many of you know Allergan chamber trials like invigorated are conducted outside of allergy seasons.
To avoid the confounding effects of pollen and the environment.
Based on the successful phase three alleviate trial announced last year.
Assuming continued clinical success and positive regulatory review proxy lap has the potential to be the first new mechanistic approach in decades for the treatment of allergic conjunctivitis, which affects 66 million patients in the United States and importantly is often associated.
With dry eye disease.
As with dry eye disease, we think we're products allow could fill is significant gap in treatment.
The current therapeutic landscape of allergic conjunctivitis is generally restricted to and it has to means and corticosteroids. The studies have shown that and it has to means our unsatisfied factory for as many as one third of patients.
Well chronic use of corticosteroids may lead to potentially serious adverse events.
Lack of clinical site availability and staffing due to covert 19 has delayed it patient enrollment in our phase three guard trial of Adx 21, 91 for the prevention of proliferative Vitreoretinal sympathy.
We plan to update the enrollment and completion time lines by year end.
At same time, we're exploring additional indications for Adx 21, 91, including primary intraocular lymphoma.
Rare, but serious okcular cancer.
With that I'll hand, it back over to Josh who will cover our financial results in detail.
Thank you Todd.
For the three months ended March 31, Twentytwenty, we reported a net loss of $9.9 million compared with a net loss of $15.6 million for the quarter ended March 31 2019.
Net loss per share was 34 cents for the quarter ended March 31, Twentytwenty compared with 58 cents for the same period last year.
Losses have resulted from the cost of out there the clinical trials and research and development program as well as from general and administrative expenses.
Research and development expenses were $6.6 million for the quarter ended March 31, twentytwenty compared with $7.8 million for the same period and 2019.
The decrease of $1.2 million is primarily related to the decreases and clinical and preclinical development and manufacturing costs.
Expenses for the 2019 period also included $6.6 million up in process research and development expenses incurred in connection with the acquisition of Helio vision.
General and administrative expenses were flat at $3 million for the quarter ended March 31, Twentytwenty compared to March 31 2019.
Increases in personnel related costs, including stock based compensation were offset by decrease in legal and other miscellaneous administrative costs.
In Q1 of Twentytwenty total operating expenses were $9.6 million compared with total operating expenses of $70.4 million for the same period in 2019.
As Tom noted cash cash equivalents and marketable securities were $61.4 million as of March 31 Twentytwenty.
Based on current operating plan, we believe that our cash cash equivalents and marketable securities at March 31 will be sufficient to fund currently anticipated operating expenses into twentytwenty to including completion of the feed the reinvigorate trial for proximal app.
Completion of the phase two clinical trials of 86 to nine and cobot 19 associated respiratory compromise.
Topic asthma and psoriasis.
The commencement of one or more additional clinical trials in dry eye disease subject to the outcome of the FDA meeting scheduled for mid year Twentytwenty.
And the continuation of part one of the adaptive phase three clinical trial and proliferative vitreoretinal empathy contingent on patient enrollment.
Before concluding I want to what you know that next month, we will be presenting and hosting one on one meetings at the Jefferies Virtual health care conference.
Details will be posted on the investors and media section of our website.
For those investors, who are participating we look forward to meeting with you.
Now I'll hand, the call back over to Todd for closing comments.
Thank you Josh.
From my perspective, the key takeaway from this morning's call is that we are ramping our systemic inflammatory disease program.
With a new comprehensive clinical initiatives that complements our late stage pipeline.
And Okcular disease, the systemic disease initiative stimulated by the opportunity to potentially address a major morbidity associated with cobot 19 infection.
And bolstered by phase, one data demonstrating safety tolerability and target engagement.
Creates a number of new potential catalysts for aldeyra in the coming quarters, and we're excited about the path forward for Adx six to nine.
As always we remain committed to executing efficiently on our strategic plan and bringing to market novel therapies that improve the lives of patients with serious unmet medical needs with that Josh what David I'll be happy to take your questions operator.
Okay. At this time, if anybody has a question. Please press star one on your telephone keypad again that would be star one on your telephone keypad. Your first question comes from Nigel not your mobile which from Citi. Your line is open.
Hi. This is she methodology is very much tricky question sort of issue can you hear me okay.
Yep unclear.
Okay.
Okay, just wanted to start with the cash one right extension into traditionally.
What cost saving measures implemented factories extension, especially given the announcement that you are actually new Adx 29 studies, starting and she's going to second half of this year.
Okay.
Yeah. Thank you some at the as you might expect yeah, we frequently.
At our capital and were pretty fiscally responsible.
What I would say that you know given some of the trial delays.
We sort of looked at our portfolio.
And and looked at the pace of spend overtime, and so I think that contribute to.
Two to two sort of the extension of the runway. In addition to some changes from an infrastructure standpoint with respect to 86 to nine in development. There I think it's important to understand that the phase two trials are not very expensive at all so this is not a huge capital drain.
Got it that's helpful and then sticking with 69.
What it should weeks, what do you envision a or in terms of patient numbers and duration of treatment for these studies, particularly the auto immune an allergy study and what would you think would be sufficient free and again. This is concepts in those indications.
Great questions about that I.
I think our plan is that as the year progresses to detail those trial designs.
At this point I think it's fair to assume that these would be phase two a like proof of concept studies.
Generally, including 30 patients or less.
And the idea is to demonstrate activity of six to nine not only from a clinical standpoint, but also from a biomarker standpoint.
So for example in a topic asthma sputum analysis for cell count.
Would be an interesting biomarker, hi, yen psoriasis transcription of inflammatory cytokine from biopsies would be an interesting example, and covert 19 infected patients with respiratory compromise.
Not only clinical parameters, including.
Time to mechanical ventilation or time on than a mechanical ventilation, but also levels of Ross.
Plasma and cytokine profiles and plasma. So these are the kinds of studies were envisioning.
The idea is to more or less comprehensively cast adx 69 across those three different kinds of inflammation, which I think will guide us in terms of going forward into larger phase two trials.
Which I hope, we'll be in a position to announce a early next year.
Got it. Thank you that's very helpful. Thanks for taking my question.
Okay.
Your next question will come from Louise Chen from Cantor Your line is open.
Hi, good morning, just as carbon so Louise since your questions here does civil dry odds programs, we have seen what differentiates your assets from the other or what Youre trial design would show the competitive percentages of the product versus others.
How do you think about a slowdown in ophthalmology due to cold that my team using the industry can adapt to told medicine or other ways of treating new and existing patients as things pushed this year.
Lastly, how should we think about Opex and 20 point. Thank you.
Great and.
Why don't I turn the call over to Dave Nick ball and to comment on the competitive advantages and dry and the initial data.
What we're seeing.
Regarding the impact of Tele medicine on ophthalmology procedures and prescribing Dave are you a on the line.
Hi, I mean your Todd.
So which reflects level, we're excited in our development, thus far because we've seen a number of advantages versus existing treatments are part of UBS has shown.
The ability to address symptoms very broadly.
And that's exciting because we know that dry disease is largely a symptom driven disease, that's what motivates the patience to go into the physician.
And talk with the physician.
So on the sign front, we also see abroad improvements in the I wouldn't treat with treatment for park swap.
And signs are important because they help you assess the health of the Guy.
But from a day to day clinical.
Perspective that they don't take is prominent role as the management of the symptoms that they're not the motivating factor that drives the patients into the doctor.
And reports up is also showing a rapid effect on both of those so symptoms and signs and so it's that rapidity.
Improvement as well as the broadness of the effect that we believe will give a partial up an advantage for the treatment of dry eye disease.
In terms of the impact of the current situation on the current.
Patient Dr. dynamic that's something that's obviously evolving.
We do know that if you look at what's happened in the marketplace, which we've been following on a weekly basis.
Initially one of the things that are these chronic treatments habit benefit on is that they can be prescribed and refilled very easily remotely.
And in fact prescriptions on some of these oh and the two existing chronic treatments went up in March when the disruption really started.
Now in April we do see dot coming down, but we have seen also they all come out with some guidance on.
How eye care professionals can address the need to patients through through virtual visits and if you think of dry disease in particular, where the symptomatology is is really that motivating factor those things can be reported by the patient in the telematic medicine setting a very effect.
It really when you get into the signs of the disease, you will need to visit the Doctor and you know have a have a test done and so I would expect that the management of dry disease me focus more on the symptoms.
In the short term as.
The system tries to leverage and utilize a tele medicine.
And then manage the signs in it in a more spread out fashion that would allow for.
Hey.
An appropriate type of approach given given the pandemic.
Yeah.
Thank you, Dave before I turn the call over to the question over to Josh Opex.
When I reiterate a couple of things.
First is.
We as we said in the call continue to believe that the symptom profile.
Of our drug and dry eye disease.
Its best in class.
I think it would be difficult to find another therapeutic agent.
Demonstrates symptom control like that we have detected.
Currently in our corporate deck for example.
The second thing I want to say is <unk>.
We're not a nasal spray I don't think you will find it any.
Rigorous market research that patients are clamoring for nasal sprays, where a topical agent.
Slide four relief of dry syndrome topical ocular and then second thing I would say is that we're not a fairly rocks to lap is not a steroids, which as I mentioned in the call cannot be used chronically.
Due to the risk of potentially.
Very serious side effects. So I think in addition to the the rapid onset of activity.
To what we believe represents a best in class symptomatic profile, which is by the way what the very vast majority of patients and physicians care about.
Plus the novel mechanism of action relative to other late stage assets.
And try to feed positions reprice fill up quite nicely.
Josh Let me turn it over to you to comment on Opex.
Yes, it's regarding OPEC, a slowdown is enrollment will lead to a lower expenses and I'll give us the ability to.
Fund some near term catalyst specifically on those items that we talked about earlier related to 80 I do not.
Okay alright. Thank you so much that's really helpful. Thank you.
Again, if anybody would like to ask a question. Please press star one on your telephone keypad again that would be star one on your telephone keypad. Your next question comes from their Hong Janney. Your line is open.
Hi, good morning, and thanks for taking my questions I'm. So on Adx 69, their multiple potential indications.
I've psoriasis and a topic asked that how will you prioritize much program moves forward.
I mean that the phase two ways our successful their way to streamline the programs and then my second question is on Adx 21, 91 on can you discuss the potential of that four primary intramuscular lymphoma. Thanks.
Thanks Esther.
In terms of yes now.
Psoriasis.
Both of those diseases represent a different flavors of inflammation.
And the and 10 of the program we've initiated.
As to demonstrate activity.
Adx six to nine and more broadly Rasmussen ambition as a novel mechanism.
Those different types of inflammation.
Whether we pursue psoriasis and asthma.
Yes indications I think depends on the strength of the data.
And that there or if there are signals that are generated.
From those clinical trials, then I think the company has considerable optionality in terms of moving forward in those particular diseases or moving forward in diseases.
That are th want or teach to cytokine related or auto immune an allergy related that are different.
From a asthma and psoriasis.
Examples may include.
Diseases, such as chronic costs.
Or alcoholic hepatitis.
Or minimal change disease, which is a rare form of renal inflammation that affects children and adolescence.
There are many kinds of inflammation that relate to teach one and teach to diseases I think.
Most experts would agree that asthma in psoriasis, our super Herb.
Proof of concept syndications to study in phase two trials.
In terms of ultimate indications that we will pursue internally, we're leaving our options open day may include psoriasis and asthma, depending on the strength. The result, as I mentioned, but also may include related diseases.
Matt.
That relate to the mechanisms in which were attempting to demonstrate activity.
[noise] PBR is one of many indications that I think.
Our addressable by Adx 21 91.
Ocular lymphoma, which we mentioned this morning.
He is a rare.
But serious form of cancer that generally effects.
The retina.
Or the Yulia.
And is treated almost exclusively with Nexus methotrexate, which is the active ingredient of Adx 21 91.
There is a very long history of the use of methotrexate for primary intraocular lymphoma.
Unfortunately today.
Cancer is treated by compounding methotrexate.
So pharmacies at hospitals will.
Essentially make up their own formulation.
Oh, the methotrexate for Intravitreal injection into the API, which as you can imagine.
Has many drawbacks.
So the intent would be to investigate our own.
Novel formulation of methotrexate for Intravitreal injection Adx 21 91.
For use in talk here lymphoma and.
One question is.
The extent of clinical data if any.
That aldeyra would need to generate.
For filing and that's something we're exploring over the next several months. So I expect you'll hear more from us regarding Hodgkin lymphoma as an additional indication for Adx 21 91.
Over the next quarter or too.
Great. Thank you.
Thanks.
Your next question comes from Matthew Cross from Jones trading your line is open.
Hey, guys. Good morning, and thanks for fighting the a comprehensive update I'm just wanted to ask a couple of here first off.
Kinda give us an update on what you're hoping to pitch to be up to this at this type C meeting for dry eye and enter new part to I guess is it a little bit discussion of this call I think about there's other competitor in the space, but just submitted in India using October discomfort alone as the primary efficacy measure.
And then hyperemia as a secondary sign endpoint. So do you think that the FDA will insist on the usage of foresee needle staining as a cooperative.
Co primary going forward.
Just focusing on ocular dryness or what other kind of tweaks to the staining time frame assessments dosing schedule et cetera are you thinking right now you'll put forward two tickets suppose clinical result, and potential label.
Matt that's something we've been thinking a great deal about as you can imagine.
Typically the FTC a.
As required.
Symptoms and signs.
TV demonstrated for approval in dry eye disease.
As you know, we have now demonstrated into adequate and well controlled trials.
Clear symptomatic control, we would argue best in class symptomatic control.
But there's always a question mark in any disease.
I can tell you we found the phone with representatives of government agencies this week and.
They are in general predicting that cold it will not go away.
That there will not be a long term shortage of patients.
And we would agree I don't think we have a panacea for cove. It in the pipeline as of yet I think there are always.
There's always room for novel agents with novel mechanisms in any inflammatory disease.
Psoriasis asthma and cool that included.
So we at least based on the pre clinical evidence that we have and have disclosed in the press release in March about broad based side of kind reduction, which by the way seems to lead to respiratory compromise and the requirement for mechanical ventilation and coven.
And the fact that at least for proxy laugh, which is essentially a structural hammer log of X. six to nine.
Shown clear evidence in animal models of acute respiratory distress syndrome of activity.
We're optimistic about the potential for.
86 to nine which because it is orally administered.
Can be administered to patients immediately after a hospital admission.
Could be administered via needs a gastric to to patients that are on ventilators.
Be administered to patients after weaning, often a leaders and even discharge.
So our intent is to enrolled patients add admission.
With evidence of respiratory compromise, which we would define as a hypoxia and pulmonary radiographic involvement.
And treat them.
Through the hospital stay up to about 28 days.
And I think that for agents like that.
There's still plenty of room enrollment is you know Matt is always very difficult to to predict but I don't think anyone that al dear or in terms of the government agencies, we've been in touch with her predicting that Cove is going to go away anytime soon.
Okay, no yeah that that's grip additional ditto on on some of the program in an opportunity there I I tend to agree and I'm looking forward to seeing how all these new programs for us thanks to us.
I have no for that question <unk> I trying to call back to talk to pretty for closing remarks.
Thank you operator, I'd like to thank you all again for joining us today and as always we.
Florida continued update you on our progress thank you.
Thank you everyone that smell conclude today's conference call you may notice.
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