Q3 2020 Aldeyra Therapeutics Inc Earnings Call
After the speaker's presentation, there will be a question and answer session.
If you would like to ask a question during that time. Please press Star then the number one on your telephone keypad.
At this time I would like to turn the call over to Mr., Josh will review the company's Chief Financial Officer. Please go ahead Sir.
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 business Officer.
Dr. Brady will begin with an overview of our recent highlight unexpected upcoming clinical milestones I will discuss our third quarter financial results and then we'll take your questions.
Please note that this morning's conference call contains 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 expenses and financial position business strategies, and plans research development and commercial plans or expectations trends market sizing.
Got it positions 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 COVID-19 pandemic clinical site availability staffing and patient recruitment have been negatively affected and the timeline to complete our clinical trials may be delayed.
There are no obligation to update these statements as circumstances change.
Future events and actual results could differ materially from those projected in the company's forward looking statements, including the current and potential future impact of the COVID-19 pandemic on our business results of operations and financial position.
Additional information concerning factors that could cause results to differ materially from our forward looking statements are described in greater detail in the company's press release issued this morning containing financial results for the quarter ended September Thirtyth 2020, and the company's filings with the SEC.
And with that I'll turn the call over to Dr., Todd Brady, our president and Chief Executive Officer.
Thank you, Josh and good morning, everyone.
This has been an unprecedented here.
One that has demonstrated the incredible resilience of doctors nurses and other healthcare professionals.
On the front lines of the global fight against COVID-19.
The resolve and speed with which the central life saving therapies and vaccines are being developed remind us daily of why we are exceedingly proud.
To be part of the life science industry.
Despite the many external challenges this year, we have made significant progress against our clinical objectives.
In our ocular disease programs, our lead candidate for products allow continued to advance toward India submission in dry eye disease in allergic conjunctivitis.
Two of the world's most common ocular surface conditions.
Affecting more than 100 million patients in the United States alone.
This quarter, we are on track to initiate a randomized double masked parallel group phase three clinical trial to assess the activity of approximately up in an objective fine endpoint of dry eye disease.
Consistent with prior guidance and subject to Finalization of trial design. The 28 day pivotal trial will measure the effective or products to lap on tier RASK levels after single and multiple doses of drug.
The trial will include exposure to a controlled environment chamber to suck the effective acute changes in dryness.
On a range of <unk> of objective signs, including tier rasta level ocular redness.
And Schirmer score.
The purpose of the chambers to exacerbate dry eye disease signs and symptoms with low humidity high airflow enforced visual tasking.
Importantly, we have previously tested the activity of approximately up in an Allergan chamber and went for Approx lap demonstrated acute improvement in ocular itching and redness almost immediately after drug dosing.
The phase three trial will include a 20 patient run in phase with 10 drug treated patients.
And 10 vehicle treated patients that running phase is expected to be completed.
By year end.
To confirm the accuracy and applicability of rapid assay methods. We recently initiated a natural history study in which we collected tier samples from approximately 20 dry disease patients.
In the coming weeks, we plan in vitro analyses of the tier RASK levels at baseline.
And following exposure to drug or vehicle.
First standard in D.A. submission requirements, a separate safety study ever Prox lap and dry disease patients is on schedule to begin next month.
From a safety perspective, or proxy lab has been evaluated in more than 1100 patients with no observed safety concerns.
Overall, we remain on track to file an IND submission in dry eye disease by the end of 2021 and.
Importantly, all of our expected timelines are subject to a number of factors including final.
Finalization of trial design completion of assay development positive clinical results regulatory review potential disruptions due to COVID-19, and other factors that may not be in our control.
[noise] enrollment has restarted into phase three in viguerie trial of approximate lap in patients with allergic conjunctivitis. As a reminder, invigorate is being conducted in an Allergan chamber and trial initiation was paused in the second quarter to avoid the confounding effects of environmental pollen during.
And what was an unusually early and extended allergy season, and the beginning of the year.
Invigorates is a randomized double masked crossover vehicle controlled phase three clinical trial with a planned enrollment of approximately 126 patients.
Consistent with prior allergic conjunctivitis trials, the primary endpoint will be subject reported okcular hitching score.
Topline results are expected in the first half of 2021 and India submission is expected by the end of next year pending positive results and regulatory review.
Over phase two a phase two b and phase three trials repriced Philip has consistently demonstrated a uniquely durable response that likely outlast that of standard of care anti histamine.
In addition to durability. The rapid onset of response will be highlighted in a poster presentation next week at the American Academy of Ophthalmology Twentytwenty virtual annual meeting.
The poster features new data from responder analyses of our fees to Allergan chamber trial, as well as new data on Okcular Tiering and post chamber activity of drug after exposure to Allergan has ceased.
The data further support the clinical utility of approximate up suggesting the possibility of rapid efficacy and reducing redness and itching.
And allergic conjunctivitis for these reasons, we remain particularly excited about the potential of approximate up as the first novel mechanistic approach for late stage allergic conjunctivitis in decades.
Turning to the post carrier segment of our acute disease pipeline, we expect to complete enrollment in part one of the phase three guard at trial of Adx 21, 91 for the prevention of recurrent retinal detachment due to proliferative vitriol retinopathy or PVR by the end of 2021.
[music].
PVR is the leading cause of retinal detachment surgery failure affecting roughly 4000 patients per year in the United States and.
Nearly twice as many in Europe, and Japan combined.
Recruitment for the guard trial is underway at more than 20 clinical sites across the United States.
And as I noted in our Q2 call the pace of enrollment has been slower than anticipated, particularly due to delays caused by cold at 19.
Adx 21, 91 May also have the potential to treat primary vitreoretinal lymphoma, or PV R.L.A. rare aggressive high grade cancer that affects approximately 2900 people in the United States.
With about 600, new cases diagnosed annually there are no approved treatments for this severe type.
Of ocular cancer.
As for our systemic disease programs in September we received a study May proceed letter from the FDA clearing the way to start phase two testing of Adx six to nine our orally available Ras inhibitor for the treatment of adult patients hospitalized for COVID-19, we.
Continue to expect the trial to begin by year end.
This quarter, we also plan to initiate phase two clinical trials of 86 to nine for the treatment of severe inflammation associated with th two type cytokine production represented by a topic asthma and th one type cytokine production represented by psoriasis.
As I noted on our Q2 call testing in an animal model of cytokine storm suggested that RAF inhibitors have the potential to act as immunological switches that may broadly modulate immune systems from pro inflammatory states to anti inflammatory states.
Target engagement of 86 to nine was confirmed in our phase one clinical trial in which reduction in the commonly described pro inflammatory Ras melon dialed, the Hyde was observed and treated subjects.
Adx six to nine was well tolerated and no treatment related adverse events were observed in the trial.
We head into the final two months of the year in excellent financial condition.
Based on current operating plans, we believe we are well capitalized and expect our cash runway to fund operations through 2022.
Including potential India submissions for approximately up in dry eye disease.
And allergic conjunctivitis.
Looming positive clinical trial results and regulatory review.
Now I'll turn the call over to Joshua for the third quarter Financial review.
Thanks, Todd for the quarter ended September 30, Twentytwenty, we reported a net loss of $8.9 million compared with a net loss of $18.7 million for the quarter ended September 32019.
Net loss per share was 23 cents for the quarter ended September 32020, compared with 69 cents for the same period in 2019.
Losses have resulted from the cost of clinical trials and research and development programs as well as from general and administrative expenses.
Research and development expenses were $6.1 million for the quarter ended September 32020, compared with $16.2 million for the same period in 2019.
The decrease of $10.1 million is primarily related to a reduction in clinical research and development expenditures and lower personnel related costs, partially offset by increases in manufacturing and preclinical development costs.
General and administrative expenses were $2.3 million for the quarter ended September 32020, compared with $2.8 million for the same period in 2019.
The decrease of $500000 due to lower personnel related costs and other miscellaneous administrative costs.
For the quarter ended September 32020, total operating expenses were $8.4 million compared with total operating expenses of $19 million for the same period in 2019.
Cash cash equivalents and marketable securities were $86.2 million as of September 32020.
Based on current operating plans, our cash cash equivalents and marketable securities as of September 32020.
Expected to be sufficient to fund operations through the end of Twentytwenty, two including potential and da submissions for profit lap in dry eye disease and allergic conjunctivitis.
Pending clinical trial results regulatory review potential disruptions due to COVID-19, and other factors that may not be in our control.
Use of cash cash equivalents and marketable securities are also expected to include part one the phase III Guard trial in PVR and phase two clinical testing edx six to nine.
An orally administered RAF inhibitor and inflammatory diseases.
Now I will turn the call back to Todd for closing comments.
Thanks, Joshua as.
As you can tell we have a busy several quarters ahead.
Highlighted by significant clinical development milestones beginning this quarter and throughout 2021.
We look forward to keeping you updated on our progress as we execute on our strategic plan to bring forward potential best in class immune modulating therapies that.
That improve the lives of patients with serious unmet medical needs.
This month, we will be participating in the Jefferies Virtual London Healthcare conference and the Alliance Global partners Virtual health care Symposium.
Please check the events and presentations section of our website for details.
In addition, I would encourage you to register for Tomorrow's I celebrate our 2020 virtual conference.
Accelerator is a new partnership between the American Academy of Ophthalmology, and the American Society of cataract and refractive surgery.
I'll Dare is one of a number of companies participating in the event that.
Matt I celebrate or dot com.
With that Josh David I'll be happy to take your questions operator.
Ladies and gentlemen, as a reminder, if he would like to ask a question. Please press star one on your telephone keypad and your first question comes from the line of Eagle know come mostly with Citi. Please go ahead.
Hi, This is Smith on for your call. Thank you very much for taking our question a couple from me.
Thanks for the details on the Ras trial I'm just curious what are the gating factors before you start that trial later this quarter and it seems like you're you're sort of combining both the late chronic setting with a 28 days and the more acute setting just curious if the FDA has a preference on which of those settings as you more.
Important to them or are they equally important.
Good morning, some math and thanks for the question there is no preference.
On that from the FDA as to their Chronicity of dosing in fact, we clarified the agency that single or multiple doses could be used to demonstrate statistically significant changes and.
Fine.
Between.
Drug and and vehicle I don't think there any gating factors in particular.
Regarding the start of the pivotal.
Trial, we do intend as I mentioned in my prepared comments today to complete analysis of the natural history study and dry eye patients, where we extracted tiers from about 20 dry.
Subjects and those peers will be analyzed for RASK levels to confirm the Ras Bassi and confirm parts of the pivotal trial protocol.
However at this point.
We are comfortable with our guidance that not only will the pivotal trial.
Again, this year, but it will be in a position to complete the 20 patient run in phase of that trial.
By year end.
Okay, great and.
You are going to run to rest trials right is it fair to us in that both of them are going to have the same design.
I think the design of the second trial depends on the outcome of the first trial and particularly the outcome of the 20 patient run it off the first trial.
Yes for example.
We were able to demonstrate changes in RASK over two days of dosing it doesn't make sense and the second trial to.
Treat patients for 28 days.
I think there are probably some other protocol design changes that.
We may choose to make depending on the outcome of the first trial. So I think we'll have to wait and see.
For the data to arrive before we can comment in particular on that second protocol design.
Okay got it that makes sense.
And then I remember we had some conversations in the spraying about the Allergan chamber for allergic conjunctivitis, given the context of COVID-19, and now they're using analogs as well a similar chamber design for the Rasta trial <unk> are you implementing testing prior to entering into the into the chamber and how.
Are you thinking about that for both dry eye disease, and I'm allergic conjunctivitis going forward.
Testing is required for entry to either chamber, either the dry eye chamber or the allergy.
Allergan chamber patients must meet certain criteria at baseline.
For example, a history of either dry eye disease or.
Allergic conjunctivitis.
And I think now with COVID-19, Theres a variety of other measures that must be met prior to trial entry. The other thing I would note is that for patients to qualify in either the dry eye disease trial or the allergic conjunctivitis trial.
At baseline.
Certain criteria must be met patients must exacerbate in the chamber into case of dry disease patients must exacerbate after a dose of vehicle and the trial chamber. So we're quite careful about precisely who.
Who we enroll in the trial and.
Obviously, we're attempting to optimize screening criteria such that the differences between truck and vehicle.
Or expanded.
Okay, Great. That's helpful. And then just one last one for me curious if you have any update on where you stand for mdx.
Sure when nine one primary Vitreoretinal lymphoma leave lastly spoke on that you said you were looking to see what data you would need in order to lease by almost the MBS.
Yes.
Any update you have there.
Yeah.
You are absolutely correct Samantha that.
Nothing Treximet is the standard of care for the treatment of hockey.
Ocular lymphoma.
There really is no other therapy, that's routinely used to treat the condition. However, there is no nothing treximet formulation that's approved for Intravitreal injection.
To treat the disease, so to us that there is a tremendous unmet medical need.
Today physicians treat that condition by compounding methotrexate, which has a.
Long series of issues associated with it and including potential infection.
The standardized drug doses and so forth that are very difficult to control with compounding.
This is why our interest in OCC. Your lymphoma is quite strong and you are correct that.
At this stage, we're in the process of discussing how best to advance Adx 21 91.
In ocular lymphoma, with the FDA and we look forward to guiding.
On next steps I hope early next year.
Okay, great. Thanks, very much for taking the questions.
Thanks, Matt.
Thank you and your next question comes from the line of Louise Chen with Cantor Fitzgerald. Please go ahead.
Hi, This is Jennifer Kim on for Louise. Thanks, So much for taking my question. My first question I just wanted to clarify the phase two trial, that's being initiated for talks a lot. This quarter is that the first of the two plan rests trials you've talked about before.
So our topline results for that trial still expected by the end of 2020, and then I was wondering is do.
Do you have any updates on the timing of the second trial.
Hi, Jennifer good morning.
Yes, the first of the trial.
Trials for the objective sign and dry disease. The first of the pivotal trials will begin this year by the end of the year. We will have results from the first 20 patient run which is important for the reasons that I explained.
Earlier in the call and that that 20 patient run in a give us an indication as to how well the Ras fast say, it's working well confirm the protocol for the remainder of the trial. It will confirm the statistical power for the remainder of the trial and it.
We'll probably indicate that the protocol for the second.
Pivotal trial.
Got it and maybe one other question.
Considering that the phase two trials for mdx six to nine.
Starting by the end of 2020, and then have a punctual up. It's also starting by the end of 2020 I'm. Just wondering how should we think about the impact of the timing of those trials on R&D cost for maybe the fourth quarter and going into 2021, and then on a similar note.
She in a cost it's been managed pretty pretty well I'm just wondering how should we think about that as we get it to 2021 as well.
The typical method to measure free levels of analytes is mass spec and the typical method to measure protein bound.
Analytes is a wise, which is an antibody based approach so both of those methods or what we are assessing currently.
With the dry eye disease natural history trial, where we've taken tier samples from dry disease patients. That's an in vitro assessment, that's occurring and will indicate I think the.
The precise method that we use in the pivotal trial.
The topline results of which as I mentioned, we expect that by year end.
Got it thank you and then perhaps for Dave.
As youre contempt enable that Scott.
They describe activity on grass and altered or discounts were score Oh, yes in combination with treatment of energy holdings seem to allow the commercial launch and it was features will drive adoption of reprocessing and Uh huh.
Yeah. Thanks.
Thanks for that question, it's a great one.
We when I when I think about several projects will happen our target product profile, you're right. There is a lot of different legs of differentiation.
At the core of the profile is differentiation on the dry eye disease front and in the marketplace and these this is a symptom driven disease and so the aspects of approximate that are really exciting or are there early in broad improvement in symptoms.
We think it's a remarkable what we've seen with approximate where with a product that can treat the chronic inflammation. You can also see improvement in symptoms at one week.
So you you. If we're successful you have for the first time, a safe and effective anti inflammatory addressing the core of the disease that you're able to use to treat the condition chronically, but they can also benefit the patient.
Very rapidly.
In addition, we see in our profile the ability to reduce or improve the symptom.
Symptoms that the patients are experiencing across the spectrum and.
So that broad advocacy, we believe is indicative of how it will translate into more patients and more Dr is having a positive experience with the product itself.
Those are two things that we know that the market is looking for.
The current solutions aren't a great fit and they don't meet those needs and so they are unmet currently in.
In addition, dr. diseases and ocular surface disease, it's not the only one in so one of the three big ones.
The biggest one is one of the biggest ones is allergic conjunctivitis.
And allergic conjunctivitis and dry disease overlap tremendously.
And all you have to do with some market research to learn to learn and see how these two conditions overlapping can make the tree the effective treatment of these patients difficult for physicians and can make it very frustrating for patients.
What's currently available is not a great fit for that overlap and here with repricing that we havent again it unique solution.
We've seen the ability of this drug not only to address the signs and symptoms of dry eye disease, but also allergic conjunctivitis.
And so we are seeing the future where you would have one product that simplifies a lot of things for the doctors.
And for the patients.
And while the profile of the marketplace is different for dry eye disease in allergic conjunctivitis, we are developing Approx lab with our first focus on dry eye disease, and then allergic conjunctivitis as an added differentiator to that profile.
Our development programs are such that we as announced today, we anticipate that we will.
Able to submit a concurrent NDS for both indications.
Great Great. This is super helpful. Maybe if I may my last question just.
Given a resurgence recently seen in coli 19 cases.
I will talk about specific criteria or conditions that make sites initiation or program initiation and again, thanks for all the questions.
We have not heard from our CRM shows is that.
Coal that is going to dramatically impact enrollment at this point.
As you mentioned the caseload around the world is increasing.
And it is certainly possible that coal, but 19 infections could.
Impair enrollment, but at this point, we have not heard from CRM shows that.
COVID-19 will dramatically impact.
Either the run rate the rate of enrollment towards the ultimate number of patients.
I will say that many sites, including sites, we're working with our testing for a couple of it.
This has been viewed as a benefit in some cases a.
By potential subjects and clinical trials, because the covert test is essentially free and that is required for entry to the trial I expect that.
Kind of testing to continue.
And our hope is that as even as cases arise.
Around the country in and around the world that enrollment continues.
Per plant.
Got it thank you.
Thank you and your next question comes from the line of Matthew crossed with Alliance. Please go ahead.
And Mr. Cross your line maybe muted.
Paul just thank you hey, guys. Thanks for the progress update and looking forward to seeing you. The conference later this month I'm just had a couple of quick questions.
Effect on redness.
Those data we have released from allergen Chamber studies for quite a while now you will see more redness data at the American Academy of Ophthalmology.
Poster shortly.
That is one reason, we're testing at least redness and dry eye disease. After acute dosing and then as you recall hour Shermer test results were very good in our face to be trial.
Released back in 2018.
And dry disease. Those are the reasons, we're looking at a variety of additional signs, particularly because I think the breath of activity Approx slap is a major differentiator for this drug within the dry disease landscape.
Yeah, No I wholeheartedly agree and then that makes complete sense. Thanks for the clarity there.
And then just another one around the.
It looks at this.
Path forward as dry as adaptive and a number of different ways I guess, one starting with this this kind of running portion.
The natural history study analysis prior to the actual full second trial I guess I just wanted to get a little bit of an understanding of.
Whether post running by the end of this year.
It's at that point, even in the first of these Rasped trials you may take a second to adjust some of these parameters I know we've discussed.
Putting down versus truly circulating rasp assessments.
Single versus multi dose.
But is it fair to assume that wants to be running has gone on and certainly completed you would kind of at that point commit to one.
One form of of or.
Method of measuring rasp, and one kind of treatment protocol.
Or if that May change mid this first study postpone it.
Matt as usual you're absolutely correct, we have intentionally designed.
A couple of click.
Clinical data output to help us.
Plan.
The pivotal aspect of the trial. The first of those is the natural history study, which I've mentioned a few times. This morning, which is really functioning as an in vitro phase III.
To assess rasp level.
And the tears a dry patients as I mentioned in my prepared comments that tears from those patients will be tested at baseline.
Also be tested after exposure to drug and vehicle.
After the dry eye disease natural history study, we will have a very good idea of how well.
Assays I've described earlier are working the 20 patient run and serves a very similar function, which is to confirm.
The rasp assays and the protocol design.
Before the main cohort of the of the pivotal trial is initiated.
To your point.
The.
Protocol may change.
Somewhat depending on the results of both the natural history study and they run in the.
The good news is raffi R. The first new novel sign in dry disease in decades, the bad news is.
This has not been done and so I think that.
Part of the rationale for the the natural history study and part of the rationale for the run in phase of the pivotal trial.
Is too.
Confirm the protocol and the assays and so forth.
An area that I think is is very novel and exciting.
Perfect Yeah, no problem another very creative design from you guys. So I appreciate you confirming that and looking forward to the very forthcoming progress for the end of the year. Thanks. Thank.
Thank you very much ma'am.
Ladies and gentlemen, again as a reminder, if you would like to ask an audio question. Please press star one and.
And your next question comes from the line of Julian Harris Harrison with B T. I G. Please go ahead.
Hi, Good morning, Thank you for taking my questions and congrats on a quarter on the assets I was wondering if you could talk a little about your experience measuring rasp with a liza and mass spec so far beyond the natural history study and how you are applying any learning there to your ongoing efforts.
Julia and thanks for the question.
And I'm glad you asked.
The I think it's important to remind everyone that back in phase two a and dry disease, we demonstrated statistically significant changes from baseline.
After drug treatment of rasp in and dry eye disease.
Which is another reason why a liza is part of the assay mix not only for the natural history study, but also for the the pivotal trial.
Ah Liza as an interesting approach because protein bound dress.
Again, which we showed change after drug treatment and phase iia or chronic indicators of inflammation.
And change over time.
I think what is also possible based on the literature and based on.
The phase Iia trial is that Ras protein bound Ross levels May also change acutely.
And so as part of the natural history study and part of the run in will be using a liza for both acute and chronic assessments of.
Brass changes a long side mass spec, which is primarily designed to attack to measure.
Acute changes in rasp.
Okay, great. Thank you that that's very helpful. And then I'm, sorry, if I missed it but on the safety requirement for the dry eye disease NDA, how much can you lean on prior data what works still needs to be done there.
The safety package, which is part of every NDA submission as you know.
Numerous clinical trials and over a thousand patients to date.
Great. Thanks very much.
Good Thanks Julian.
And our final question comes from the line of Kelly She with Jeffries. Please go ahead.
Hey, Thank you for taking my question.
First question is also on the trial design Roscoe trial, what is your lack of patience bye same criteria as fall Daniel part of one and also the face to Saturday that has generated a birth date of that uhm rasp of reaction.
And specifically.
Lack of patients based on the the baseline level of Nebraska, and what is the impact of the baseline level author rats on the trial. Okay. Thank you.
Joey Thanks for the thanks for the question good to hear your voice.
I think that the criteria or if not identical substantially similar.
For enrolling patients.
And renew and the upcoming pivotal trial.
There is more or less a standard group of enrollment criteria.
Ross all dry disease trials.
Is that.
The levels of brass in tiers as has been published its probably in the low micro molar range at most.
May be higher for bound levels of brass.
The drug is minimal there in concentration so.
So as we have expressed previously administration of a single drop of approximate lab to the anterior surface of the eye.
Essentially represents a thousand fold or more.
We have heard from the agency no specific concern about rasp inefficient as it relates to safety and and again based on my prior comments in the number of patients that have been tested which approx lap I do not expect that to change.
Great to hear thank you very much that's all from me. Thank you very much Kelly.
Ladies and gentlemen, thank you for your questions now I would like to turn the call back over to Dr. Brady for any closing comments.
Well. Thank you again for joining us and on behalf of everyone. It out there at least stay safe and healthy during the holidays and as always.
We look forward to keeping you updated on our progress.
Ladies and gentlemen, thank you for your participation. This does conclude today's conference call you may now disconnect.