Q3 2020 Dicerna Pharmaceuticals Inc Earnings Call

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Pharmaceuticals, Inc. earnings call yes.

And and at what point or is there.

<unk> Q3 2020.

Thank you may have the spelling of your free said nothing please.

Yes first names Conner see on our last.

Hi, same mcdaid M.C.D.A.D.

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And your company name please.

It's era A.I.E.R.A.

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Thank you Andy I'll join you now.

Thank you.

You're welcome.

Three which is the most recently identified the least understood and perhaps the most under diagnosed over the P.H., sometimes as such we are conducting or fireworks will be ex natural history study, who established disease progression and outcomes for people, who would be age three no such a stone formation rate.

We also plan to begin dosing page three patients in our filings for study this quarter.

We initially planned to see accelerated approval for page three when we file our India next year.

In parallel we have started or will initiate in the near term additional supportive studies on the dos around in our Fioptics programs, including the renal study that we anticipate starting in quarter one of next year.

Turning to our hepatitis B virus program, which is partnered with Roche, we announced positive interim results from our phase one trial of RG 6346 in participants with chronic hepatitis B in August.

The ongoing study in adults is comprised of three groups group. They are healthy volunteers groovy participants with newly diagnosed and naive to nuke antiviral therapy received a single three milligram per kilo dose of RG Sixthree Foursix and group see participants concurrently receiving new country viral therapy, who are randomized.

Receive for monthly injections of one of three doses of RG 64, six at 1.33, 0.0 or 6.0 milligrams per kilogram.

Group see participants that completed the day 112 treatment period and achieved a greater than one log reduction in hepatitis b surface antigen. We're eligible to continue into an extended follow up observation period.

As of the data cut off of June 25th nine of 10 group see participants who completed the 112 and achieved a greater than or equal to one log reduction in hepatitis b surface antigen and entered the extended follow up period.

This included two or four participants in the group C. Six milligrams per kilo cohort as two had not yet reached the 112.

We were pleased to see deep and sustained reductions in hepatitis b surface antigen across the 1.53 0.0 and the available participant data in six milligrams per kilogram group see cohorts.

Among groups see participants who completed the D 112 treatment period, the maximum hepatitis b surface antigen reduction from baseline was 2.7 logs the participant in the 3.3 milligram per kilo cohort.

He robust mean maximal S antigen reduction of 1.88 logs was measured in the three milligram per kilogram cohort.

Advancement of our own internal pipeline as well as through our partnerships.

For work and 880 continues to progress as expected and in the first quarter, we plan to select one of our two programs for even the liver disease to advance to phase II.

We also plan to announce our next wholly owned program in liver target for a large market indication, which we plan to enter clinical development sometime mid year next year.

We anticipate.

The last patient out in our fireworks two pivotal trial of mythos around in the first half of 2021 with data to follow sometime mid year and culminating in the planned NDA submission during the third quarter.

We are looking forward these important milestones and the year ahead.

With that I would like to build the call over to our CFO gum to cover the financials Doug.

Shri.

Now I'd like to walk through the key financial results for the third quarter for additional details. Please refer to our press release outlining financial results in our quarterly report on the form 10-Q, both issued earlier today.

At loss for the quarter ended September 30th 2020 was $21.8 million or 29 cents per share compared to a $38 million or 45 cents per share for the same period in 2019.

A period over a period decrease in net loss was driven primarily by higher revenue related to our collaboration programs, which was partially offset by increases in research and development in general and administrative expenses during the quarter.

R&D expenses were 54 $8 million for the third quarter of 2020 compared to $31 million for the same period in 2019 the.

The change was attributable to a $12.5 million increase in contract research and manufacturing expense associated with core in collaboration programs for clinical study costs associated with our nodosa in a 180 trials as.

As well as a 10 $7 million increase employee related expenses.

Related to head count increases throughout the R&D organization to support these programs.

G&A expenses were $17 million for the third quarter of 2020 compared to 10 $6 million for the third quarter of 2019.

The change was driven primarily by a four $6 million increase an employee related costs, including salary NFS in stock based compensation due to increases in head count necessary to support our growing operations.

We expect overall operating expenses to increase in coming quarters, as we continue to grow headcount to accommodate additional R&D efforts and launch readiness as well as from higher external spend associated with increased activities in our pipeline.

During the third quarter of 2020, we recognized $48 $9 million in revenue compared to $8 million and the prior year period the.

The changes primarily attributable to the editions of the Roche and Novo collaboration agreements as well as increased activities, but they alexi on Lily collaborations.

Most of the collaboration revenue will be recognized as services are provided using a cost to cost measure of progress method.

In other words, the transaction price, which includes upfront payments and in some cases equity premia and certain contingent milestone payments is recognized for each individual partnership based on the percentage complete of ongoing work rather than a straight lines basis.

As of September 32020 at approximately $200 million of current preferred revenue that we expect to recognize over the next four quarters and approximately 269 million expect it to be recognized over the following several years.

As of September 30th 2020, we had 609 $9 million in cash cash equivalents and held to maturity investments.

Compared to $348 $9 million as of December 31, 2019, we continue to believe that our current cash cash equivalents and held to maturity investments and expected receipts for milestones achieved and other payments from our existing collaboration arrangements will be sufficient.

To execute our current operating plan into 2023.

Which includes our expectations to advance the dose rent through pivotal development regulatory filing and commercial launch and to support all in all R&D activities for the current pipeline programs, both collaboration and internal.

This estimate assumes no funding from new collaborations arrangements or from external financing events and no significant unanticipated changes and cost for expenses.

Including in our current cash runway or more than $100 million and milestone and other payments from existing collaborations anticipated through the end of 2021.

These payments representing important source of proceeds and demonstrate the value of these collaboration program should continue to generate as they mature.

With that I'd like to open the call for questions.

Ladies and gentlemen, if you have a question at this time. Please press. This time and then the number one key on your Touchtone telephone is a question has been answered are you wish to remove yourself from the queue. Please pass the palanquin.

We have our first question from the line of <unk> from Evercore. Your line is now open.

Next in line is Jonathan Miller from Evercore I S. I E line is now open.

Hey, guys sorry for the confusion there I think we must have been on the other line.

<unk>.

I'd like to start with the HBV data it looks like the airflow D. Abstract is the same as the R&D day, but you unplug that you're going to have updated data from the R&D day in your prepared remarks have the final two patients in that six Meg brocade cohort finished dosing regimen.

And they'll be will they be in the ALLL. The final data and has as you imply to be R&D. They have they continued to track at a higher level of Hbf's antigen reduction.

Lowering overall average there the other interesting observation I thought from the R&D day was the long duration of effect that you get on Hvis antigen, even after dosing cessation something that you guys mentioned in the prepared remarks as well given the expectation for a limited.

Time limits dosing regimen and eventual practice, how relevant is that long tail of duration when the length of dosing isn't isn't clear I guess, what I mean is.

In so far as frequency of dosing and a chronic setting isn't likely to be a drive with commercial uptick how relevant is that long term.

Thank you John.

When a T program would you say they'll choose your molecule first quarter next year, what's the bar for taking one program forward versus the other and what are your expectations for likely sources of differentiation between the two candidates.

Sure.

I mean, we know how to make a very good clinical candidate and so to our colleagues at Alnylam and so I believe that there is no bad choice here between the two molecules, but it only makes sense to take one forward. So we will be comparing both the human healthy volunteer data collected from the Alnylam molecule in that were collecting from.

Our molecule as well as details from the non clinical programs in rodents and non human primates.

I think that you are looking at differentiation that's in the details and not.

At a macro level of a particularly large magnitude, but it is for efficiency part of the collaboration is to combine the programs and take one forward we need to choose one but it is from two very good options.

Thanks, John.

Thank you.

Next is money final Haar from SVB Leerink. Your line is now open.

Hey, guys. Thanks for taking my question one quick follow up on an earlier question about when 80.

Proceed through the quarters.

Great. That's really helpful. I know, there's a lot of other analysts on the call. So I'll hop back in the queue.

Thanks Bonnie.

Next <unk> ego and like some of it from Citigroup. Your line is now open.

Great. Thank you very much thanks for taking the questions that you've made of several a rather interesting comments with respect to the opportunity for ph three that it's in under diagnosed population and also that you plan to seek accelerated approval could you just clarify therefore, when you filed the N D. A for ph one M th too is is.

P H three going to be part of that or is it going to be it's own filing.

Feels the form of an accelerated approval because we expect that additional information beyond what's in the core file will be required.

It will be determined.

Okay got it thanks, and with respect to your some of the other early earlier stage programs that you've outlined in CNS skeletal muscle in adipose at this point I've can you provide any more as far as what diseases or disorders.

You might be pursuing for for those three tissue types.

Yeah, <unk> been some talk of questions about it already I just kind of wanted to get your direct perspective here Uhm looking how you kind of thinking about your drug positioned and the HVV drugs I'm talking about kind of say versus the January drug from my advocacy or maybe administration perspective do you think.

Pollick space. So it is.

Molecule from that's the target so gene in that therapeutic area.

Okay. Thanks, very much guys.

The issue for the FDA to get comfort on having said that there is a pretty general view in the K oilfield in the FDA respects it that.

A late in life treatment for liver disease.

Discussion, but that the conversations about precisely that alan's looks like.

Will only get finalize in the context of the actual face to protocol at least for us. So.

I would posit, saying that you've identified an important area, but I won't.

I won't be able to give you guidance on a precise commitment or specific agreement with the FDA on it yet.

Understood I.

I appreciate the caller. Thank you.

X Steven.

Next question is from the line of <unk> from I V C capital Royal Bank, you reminded how open.

I don't think either one really changes our strategy, which is to focus on providing very effective and what we believe will be a quite safe way to address the accumulation of misfolded protein and thereby addressed the liver disease associated with the with a one.

Okay.

So let me start with the end for us which is net.

Noticed today.

Another player in the space for Hep B.

That brings that into a combination so I'm really particularly optimistic about combinations with an R. N. AI involved I think different mechanisms should be explored particularly those involving.

On the initial.

Competitor data for our in our guidance on 18 liver disease, and how does that influence your thoughts on trial design, specifically of duration of treatment and potential clinical endpoints.

I see so.

The.

Indeed, the trials that we're doing we'll we'll evaluate still new and trades.

Moving into longer term follow up we will continue in fact street.

So that's clearly an important element to follow as we will as we follow estimated jafar changes over time, so so thats clearly something that we will do.

I think as far as they went 80 programs data is our concern as Doug said, you know for us, it's not surprising, but very encouraging to see that this mechanism of action.

What was expected, which is a meaningful reduction in before subjects that were reported in their equity levels in the serum in the liver with concordant changes in some markers related to liver function.

As well as Biomarkers submitted the fibrosis late on fiber scan or proceeds three weeks, we look forward to seeing additional data.

But at this point in time in terms of the impact on.

How that will inform our phase two designs I think I'll simply say that these are all the elements that will be recovered in any meaningful phase two.

Controlled setting.

It was encouraging to see that at least directional changes seen really.

Expecting are pivotal study received is is very robust effects.

None of durable.

In our in our quite aligned with the analysis plan that we have for our pivotal study so.

I'm very excited to see.

Those data and what they mean door pivotal phase two study.

I think from the perspective of competition with a new one.

Sure I mean, we saw in our ph one patients that across the set the average oxalate level was in the normal zone.

And that I believe.

Should it be similar resolve <unk>, two and that would be the expectation.

Would give us a very competitive profile on the most important parameter oxalate reduction in more to the point oxalate reduction into the normal range for.

Four patients. So we're very optimistic that are those around will be very competitive product and ph. One we have.

Decided to dose of the drug differently, we haven't discussed this today and it hasn't come up in a question, but we have formulated the product as to launch with a pre filled syringe herself administration on a monthly basis. This is a very robust dosing schedule that gives the most effective knockdown.

It also is robust in the sense that if there was a problem miss those or something like that that it would not.

Not have any rebound, which is not true if you Miss quarterly dose respect to see some rebounded or a six month period and also in the context of normalizing.

The life experience of a ph patient allows them once a month small subcutaneous injection.

They don't have to go to the physician that interact with healthcare provider fully autonomous we think the maximum normalization on a very intuitive easy to remember monthly schedule. So I think all in all that describes a profile that we believe will be very compelling.

In a market that will continue to grow with increased diagnosis. So for many years and of course, there is the ph to market and the ph three market for which we're not aware of a competitive product that has anything like this kind of activity. So.

I think with those elements altogether. This is a very compelling commercial opportunity for us.

Great. Thank you so much.

Hi, Dan if you would like to ask that can that can these past Dar one.

Oh.

No if I that question. Please continue.

Well. Thank you operator, we are really excited about what is in store. They start over the next 12 months and beyond by this time next year, we expect to have an N D. A submitted for <unk>. We also expect to have an ongoing phase two trial and even a T liver disease and a new internal galaxy candidate in phase one development for a large market indication.

Over a five year horizon, we have an active plan to expand our core pipeline across multiple tissue types and anticipate a myriad of galaxy partnered programs to move into clinical development.

With a strong balance sheet and place we move forward with confidence. Thank you all for joining us and have a good evening.

Ladies and gentlemen. This concludes today's conference call. Thank you for your participation and have a wonderful day give me now disconnect.

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