Q4 2020 Mediwound Ltd Earnings Call
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Okay.
Ladies and gentlemen, thank you for standing by and welcome to the maybe wounded and fourth quarter 'twenty and 'twenty Conference call I would now like to turn the call over to your speaker Mr. Jeremy Feffer. Thank you. Please go ahead Sir.
Thank you and Italian and good morning, everyone.
Earlier today <unk> issued a press release announcing financial results and provided a business update for the fourth quarter and year end 2020, you may access that release and the company's website under the investors tab with US today are Sharon Malka, Chief Executive officer of meta wound and Boaz Gur Lavie, Chief Financial Officer, following management's prepared remarks.
We will open the call for Q&A.
Before we begin I would like to remind everyone that statements made during this call, including the Q&A session relating to medicines expected future performance future business prospects or future events or plans are forward looking statements as defined under the private Securities Litigation Reform Act of 1095, although the company believes that the expectations reflected in such forward looking statements are based upon <unk>.
Reasonable assumptions actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of Matawan.
The company assumes no obligation to update or supplement any forward looking statements, whether as a result of new information future events or otherwise participants are directed to cautionary notes set forth in today's press release as well as the risk factors set forth and medicines annual report filed with the SEC for factors that could cause actual results to differ materially from those anticipated and.
Forward looking statements.
Conference is the property and meta wound and any recording or rebroadcast is expressly prohibited without the written consent of megawatts now I would like to turn the call over to Sharon Malka, Chief Executive Officer Matawan Sharon.
Yeah.
Thank you Jeremy.
Good morning to our linked and S and AR and the U S lead and F and good luck and on tall and anything that is anything but I can't do maybe one fourth quarter and full year, 'twenty and 'twenty conference call to discuss our financial results and business highlights.
We are very proud off and that is that in 2020, especially given the challenges of COVID-19 pandemic.
Despite those significant challenges our team has presented the highest commitment and and executed across the board clinically operationally and financially.
We are very pleased with our fourth quarter financial results.
We continued generating strong product revenue growth compared with the flywheel.
We have delivered on our BLA filing for Nexobrid, we advanced our phase II adaptive design study of pace correct.
And we initiated and new clinical development program.
That can be that zero five to treat non melanoma skin cancer.
Our fourth quarter results demonstrate the significant progress we've made in 2020 on several key metrics that give us confidence regarding our long term growth profile and the potential for significant growth acceleration as we move into <unk>.
<unk> and 'twenty one.
And we look forward to achieving multiple significant catalyst in 'twenty and 'twenty one.
Let me start with a quick review of Nexobrid before providing more detail on ex cat ex development program, and our new and exciting non melanoma skin cancer clinical development program.
We are pleased to see product revenue growing and the global expansion of Nexobrid to new territories.
From an operational standpoint, we continue to generate solid revenue growth with nexobrid aided by our Nexobrid strategic partnership with BARDA and our continued expansion globally through distribution agreements with partners who are live.
And each of those countries.
Yeah.
Following the BLA submission flow Nexobrid, we look forward to potentially adding one more major country offering Nexobrid D C and the U S.
We continue to work together with BARDA very sales and the F. D. A julien there are good and I thought you process as we prepare for our <unk> date of June 29th.
Total U S commercial partner for Nexobrid very active.
Actively preparing for commercial launch.
And I remind them.
We achieved several additional accomplishments with nexobrid.
The detect study, including long term follow up was completed and the 24 month patient follow up safety data was comparable across all.
We completed the patient enrollment stage in the Nexobrid pediatric study expecting top line that that and the second half of 'twenty 'twenty, one and continue to and the whole band passion and the net expanded access program and enabling U S burn specialists and their teams to Jan.
Alright hands on experience with Nexobrid.
Moving to our ex Cat ex development programs, we continue to actively recruit patients for our U S phase II adaptive design study for the treatment of finished like a zone.
And recently, we have adjusted and the volume target of the study to 120 patients down from the 174 originally planned.
The sample size adjustment was supported by in Veeva trial, with Us, which I will elaborate on shortly as well as statistical powering assessment of our pilot Phase two study with first generation S Guy.
The current design and enable us to accelerate static completion, while keeping the option to increase the sample size if required based on the interim assessment.
We expect to complete patient enrollment by either and 'twenty 'twenty, one and the eight day rate our expectation for the interim assessment around mid <unk> 2021.
We successfully completed a preclinical study designed to evaluate the deeper dive into efficacy of ex cat ex in Boston and how to heal wounds modelo and comparing the efficacy. We then F D. A approved and commercially available collagenase enzymatic debridement agent.
The study conducted in collaboration with the U S research and two concluded that SK treatment was more effective than the commerciality available collagenase agent and he moving Excalibur and this more than and.
And the results from this day.
Eddie.
And I expect it to be published in a peer reviewed journal and the first half of 2021.
Yeah.
We continue to explore escape pharmacological effect and its potential clinical benefits associated with chronic wound management.
We submitted a protocol to the FDA and up with bank to initiate if I'm a quality study and the first half of 2021.
The study is an open label single arm study assessing their pharmacological effect of aesthetics and apt.
215 patients with book values maintenance like ourselves and D. A few basic food also.
This study will teach us what is happening in the wound bed viewing and after debridement with SK and.
But they called out it will enable to assess the effect on the reduction and bathroom burden.
The reduction and inflammation.
And healing progression.
We expect data from this study and the second half of 2021.
To provide and more in depth review of our <unk> clinical development program.
We plan to host an analyst day in the coming weeks.
This event will feature multiple speak of who will discuss the current wound care treatment landscape and the U S. The particulars of our ongoing clinical studies the in vivo comparator study and the Biopharma opportunity.
Please stay tuned for more details soon and we look forward to your participation.
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We are also exploring pipeline opportunities and I'm excited with the initiation of our new clinical development program for the treatment of non melanoma skin cancer with our product candidates and the development 005.
The initiation of this new program and present, an important step in our strategic evolution to leverage our innovative and thematic platform technology to power and our solutions for unmet medical needs.
005 is a biological product candidate for topical self administration, which is based on the same active ingredient as nexobrid and ex kind of export docks and concentrate of portability and sand and reaching Brahma line.
The company's decision to investigate and see what they were five and moving into human trials for non melanoma skin cancer is based on positive preclinical studies combined we'd existing scientific evidence.
Demonstrated the Brahma line antique cars and organic activity.
Which reflected by inhibition of cancer cell growth via Antiapoptotic Cascade and the reduction of tumor formation and volume.
Yeah.
The preclinical studies were performed in parallel with successful clinical case studies that demonstrated the product candidate and safety and pharmacology effect, suggesting that let's do a five might have evolved and treatment of low risk non melanoma skin malignant.
Yeah.
Non melanoma skin cancer, including battery cell carcinoma BCC.
And by far the most common of all types of cancer and represents a significant potential market opportunity.
According to the American Cancer Society, BCC is the most diagnosed skin cancer and the U and United States.
With approximately $4 3 million diagnosed cases every year, increasing five 8% that you as a result of increase and exposure.
Okay, and the life expectancy.
And better skin cancer detection.
There is a need for more effective safe and topical treatment option and lowest BCC.
And we believe that 005 has the potential to be and effective <unk>.
Non invasive treatment for BCC and without the side effects.
Associated with the current topical therapies and the longer treatment duration.
Okay.
We plan to initiate the phase one and two open label randomized clinical study of <unk> five and BCC.
And to evaluate.
Ft, and tolerability using different schedules of administration.
As well as the pool.
Provide us with the preliminary evaluation of its efficacy as measured by the percentage of target lesion with complete histological Cleveland.
The study will enroll up to 32 patients with histological confirmed superficiality, all new day liability.
We and will be conducted at three leading clinical centers and the U S.
In parallel and investigator initiated phase II trial will be conducted at the Soca Medical center and inside designed to evaluate the safety and efficacy of <unk>, five and removing non melanoma skin cancer, and precancerous legions and up to 50 patients.
Including academia, keratosis fastest cell carcinoma, and squamous cell carcinoma.
We expect the data from both studies will be generated by Eli and 2021.
In summary, we believe that 005 represent a derisk opportunity leveraging our lead compound used in aesthetics, and nexobrid targeting sizable market with a clear unmet need and require relatively low development cost.
Yeah.
We are pleased with our achievement so far.
And looking forward to a pivotal ear and 2021.
Now I would like to turn the call over to Bob for a summary of our financials.
Yes.
Thank you, Sean and good morning to our USP centers and good afternoon to our lease centers in Israel.
First.
I'm proud with our 2020 financial result, which our teams executed and high uncertainty and fast changing environment.
We have continuously improved our internal measures to control and monitor our expenses and investments, while maintaining flexibility for additional cost reductions and future if necessary.
We are very pleased with our Nexobrid revenue growth driven primarily.
And the deliveries of emergency stockpile to BARDA, Europe sales and our global expansion with new countries and added in 2020, resulting in cash inflow to further support our balance sheet and clinical development program.
I would like now to provide you with an update on our financial results for the fourth quarter and full year of 'twenty and 'twenty.
Revenues for the fourth quarter of 2020 were $6 7 million compared with $5 4 million for the fourth quarter of 2019, and an increase of 23 per cent.
And I really driven by BARDA emergency stockpiling procurement of one 8 million and <unk>.
Partially offsetting with 0.5, and we don't decreased revenues from development services.
We generated strong revenue growth as sales of products and the fourth quarter of 2020 or $2 8 million.
Reflecting an increase of 100 and and 55% and income.
And probably soon to the fourth quarter of 2019.
Primarily driven by BARDA emergency stockpile recruitment.
Gross profit was $2 3 million compared to a gross profit of $1 1 million for the first quarter of 2019.
Gross margin for the sales of project with 56% and comparison to 32% for the fourth quarter of 2019 and <unk>.
Kris and gross margin from sales of projected results from work.
Results of our top line increase and the fixed nature of our cost.
Research and development expenses net of participations were $2 2 million compared with $1 7 million for the fourth quarter of 'twenty and into.
The increase was primarily due to the ongoing that's correct clinical development program.
Selling general and administrative expenses were $2 5 million stable with a $2 4 million for the fourth quarter of 2019.
Operating loss was $2 4 million compared with an operating loss of $3 1 million and the fourth quarter of 2019.
The company posted a net loss of $1 7 million or six cents per share for the fourth quarter of 'twenty and 'twenty compared with a net loss of $3 4 million or certain cents per share from.
The fourth quarter of 2019.
Adjusted EBITDA as defined below for the fourth quarter of 2020.
Lots of $1 8 million compared with a loss of $2 4 million for the fourth quarter of 2019.
I'd like now to turn to the full year, 'twenty and 'twenty financial results.
Revenues for the year ended December 31, 2020, or 21 8 million.
<unk> was $31 8 million for the year ended December 31, 2019, which included a $17 5 million upfront payment from the very small license agreement for Nexobrid.
Set of products for the full year of 2020, we're seven 8 million, reflecting an increase of 170% compared to the full year of 2019, primarily driven by BARDA and emergency stockpile procurement.
Gross profit was $7 5 million compared with a gross profit of $19 9 million for the year ended December 31 2019.
Excluding the $17 5 million upfront license payment net of 0.7 million of deal related expenses.
Profit for the year ended December 31, 2019 was $3 1 million.
Gross margin from sales of products for the full year of 2020 was 60% and comparison to 35%.
For the full year of 2019.
Research and development expenses for the full year of 'twenty and 'twenty were $7 7 million compared with 5 million from the prior year period. They.
The increase was primarily as a result of our U S phase II adaptive design study, that's correct and the non cash increasing participation from the Israel Innovation Authority Grant recorded in 2019.
Selling general and administrative expenses were $8 7 million.
And with a $9 3 million for the year ended December 31 2019.
The decrease was primarily due to the company's headquarters restructuring in Europe.
The company's net loss in 2020 was $9 2 million or a loss of 34 cents per share compared with a net profit of 5 million or and profit of 18 <unk> per share for the same period, and 2019, which included a $17 5 million upfront license payment and $1 7 million.
Deal related expenses.
Excluding the upfront license payment net of deal related costs.
Net loss for the year ended.
2019 was $10 per.
<unk> media for 40 cents per share.
Adjusted EBITA was a loss of $6 4 million compared to a profit of 8 million from.
And the December 31 2019.
And which included the upfront payment of $17 5 million from the various licensing agreements net of royalty payment of zero point $7 million.
The company had 21 6 million and cash and short term investments as of December 31, 2020, compared with $29 5 million as of December 31, 2019, there's no depth.
The company utilized seven 9 million and cash to fund ongoing operating activities and repayment of contingent liabilities. During 2020 done from a cash guidance for 2020 of eight to 10.
We expect to continue investing and that's correct and 005 clinical development programs supported by the expected cash inflow from Nexobrid.
And as a result, the company expects its cash used for operating activities in 2021 to be and the range of $5 million to $7 million.
With that and I've concluded the financial overview and.
I'll now turn the call back over to shell and Chevron.
Thank you boss.
As you can see we are.
I have several us tremendous opportunities before us.
And we'll continue our commercialization activities with our partner very sales and we look forward to working with FDA for the Golar total review process for Nexobrid.
We are actively recruiting patients for the S phase II adaptive design study and we are excited to initiate our new clinical program, a new melanoma and non melanoma skin cancer.
With that I conclude our prepared remarks and it is now my pleasure to open the call for your questions.
Operator.
Ladies and gentlemen at this time, if you would like to ask a question. Please press Star then the number one on your telephone keypad again to ask a question. Please press star one.
We will pause for just a moment and about acuity last day.
Your first question is from the line of Ryan Zimmerman with BT and EE.
Thank you good afternoon, Sharon and Baas, Thank you for taking the questions and.
Congrats on all the progress.
Maybe to start on <unk> since it is really the key.
Milestone or kind of key value creation event, this year and not to take away any thunder from the analyst day, but what can we expect in terms of what you may lay out.
At the analyst day to give investors a sense of kind of your thinking on Srs and <unk>.
Any other.
Things you can point to in terms of your confidence around timing of both the interim analysis and the broader trial design.
And thank you and.
And for your question Ryan first of our lives and now we remain excited about the aesthetics opportunity and believe it may become a game changer, if successful and debate up and directing a significant unmet medical need and we decided that below market opportunity.
And what we can expect for 2021 in this program is just follow fast.
We do of the ongoing phase II adaptive design study, where we anticipate the interim assessment that out and media and the completion of patient recruitment and towards the end of day.
A new design of the study after the reduction in sand per site and enable us to accelerate this program and complete patient enrollment by <unk> and 'twenty 'twenty, one while keeping the option to increase sample size based on the interim assessment and.
And given day, so all the kind of data we are confident with that then you some franchise.
And in addition, we plan to initiate the pharmacological study and this quarter and we anticipate to generate that start from this study towards the second half of D. C L.
Okay.
And.
But for you in terms of the cadence of BARDA procurement is there any color you can give around kind of your expectations for 'twenty and 'twenty one.
And how BARDA may choose to procure nexobrid and over the coming quarters. Thank you.
So thank you Ryan for the question.
And we're at.
Expected to have the BARDA procurement.
And in the quarters and completed by year end, and then found out with little Keystone and prorated basis throughout the day.
And it.
And I'll give or take.
Okay. Thank you for taking the questions.
Yeah.
Your next question is from the line of Kevin <unk> with Oppenheimer.
Hey, great. Thanks for taking my questions guys and.
Yes, congrats everything's moving really quickly and so.
A simple question on the non melanoma skin cancer program.
Yes, thanks for the additional detail on study design can you comment on how.
How many different desks.
Dosing regimens from May be looking at are up recaptured day, I don't not 32 patients.
And.
And.
It seems like that.
Your study is going to enroll quite quickly.
And your general comments on how to think about you know relative access for patients and and pace of enrolment for this patient population has that as comparison to your experience when and where that is correct.
Okay. Thank you very much for your question and I will start there and with the BTC and <unk>.
And while <unk> primary focus remains day continued growth of the company and advancement of the Nexobrid and S textbook on the company's continuously exploring potential clinical application of it slid compact and compound and that synergetic and product candidates to our portfolio our platform technology of <unk>.
Pharmaceutical grade Brahma line.
And it provides us with day, optionality and potential for future products and indications for which we already completed and the last day of preclinical and proof of concept and studies, we decided to pursue and non melanoma skin cancer is a opportunity to do a day and limited treatment option.
And the clear unmet need and.
And we believe that overall the development plan and E D.
These base first of all on the same active substance as Nexobrid and S. Correct for top eats for topical application and had supporting evidence, including clinical case studies, while the development plan and has relatively low development cost.
Specifically to day and Fei.
One two study that we plan and the U S.
Glenn and the study will enroll up to 32 patients were just illogically confirmed superficiality all not allow BTC.
And it will be comprised of two cohorts of 16 wildly will analyze the safety and Tolerability desktop after the first call and adjust accordingly.
Great and with regard to the clinical case studies and preclinical data on that and do you see that you highlighted in your prepared comments.
What we see and E.
Youll disclosure with regard to your either medical meetings or at the upcoming analyst day and <unk>.
Some of that data and and.
And the product profile.
Legion removed.
And confirmed by histological Cleveland.
Very helpful. Thanks, so much for taking my questions.
Your next question is from the line of Josh Jennings with Colin.
Good morning.
Okay.
That's correct.
<unk>, just thinking about doing them and houses.
Oh, how would you have.
And.
This central outcomes.
The patient and.
5001.
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And go ahead.
Just a clean life and cough continue it's our assumption is that was.
Providers and efficacy signal and we can interpret absolutely positive was I just wanted to make sure we understood and set up correctly and and and how would you have investors think about and the room and analysis and and the trial proceeding as is or even with let's increase and.
And page numbers.
Yeah. Thank you for the fish and it just I as I mentioned before.
At the current day, a design of day studied adoptive designer the study and day, if I as a modified some franchise and April two on one hand accelerate the folk and.
And complete patient and the modem and by ear and 2021, while keeping day.
The option to increase the sample size based on the interior and morality and.
And specific day to day and tell them analyses day.
Based on the Internet and analyses, we will have one of the from the outcome will be recommended by and independent statistician off the D. M C.
One is whether the studies futile I ate to stop the study.
Thick and identity is two continuous as planned.
Which and out of Sampras has which is 120 patients and.
And it provides us with a clear seeking out and about the potential a success to meet the primary input.
Whoa increase the sample size of the offer that option to increase the Sampras's Act two 160 patient of and all means and Additionally, 40 patients and based on this commendation. It will give the signal to all the potential success of this study assuming the residual balance of the patient will be able to stay.
And like the ones that already treated the sample size will be conducted after we will treat about 80 patient after out of that one out of 20.
That's true and that'll help I appreciate it.
From that <unk> I think he listens and this causes and working with this deal and that's true.
Bruce.
Continue.
To talk to us about your confidence level, yes, we will musician producer day too and.
The current capacity concern Association credit recruiters.
And well.
And this is very difficult to estimate it and know we remain excited about the next couple of opportunity and FDA potential approval of this product.
And is continuing to work closely with the FDA Dueling day, and if you have the same bye.
Your logic license application, we are aware that in many instances of course the industry. The fda's facilities inspection and schedule has been affected by the COVID-19 and related better stiction. However.
And our per Doofer Goldade remains June 29th 2021.
One question on and.
WCC.
Thanks for all the details and constables ossification opportunities can you talk about and help us understand topical.
And the market is today.
What.
Therapies.
And approved and and commercialized and and was the size of the top.
Per procedure.
Okay. So what I can share we do this initial insights from and initiate and market assessment be conducted in the U S. By herself party. What we know is total first of all day PCC is the most diagnose skin cancer and U S with about 4.3 million diagnose cases every year.
While it's increasing because all day.
Palmiter as I mentioned before the option to diagnose it.
Some exposure.
We know that and know della and superficial out the most common subtype of BCC and account for about 90% to 95% of overall.
Cases.
And the unmet needs for this low with skin and Melinda malignancies.
And.
Due to the fact that the current standard of care or the standard crystal low risk patient usually tumor.
Indication by a either stand out a surgical excision.
Oh, and some cases, mainly and the superficial one or the in eligible.
<unk>.
Positive patients.
<unk> any kind of topic as the topical treatment, which are mainly to one is the 5%. If you had chemo therapy and the second one is and make remote.
And Derek product are you, specifically and BCC patient.
But have limited use and reserved for surgery ineligible patient usually and they have several drawbacks, which include longer treatment duration. It requires more than six weeks of daily application. It.
No efficacy and of course because of the chemo therapy. This side effects associated with those day or upgraded that is why we believe that there is and need clear and need for more effective safe fail top because agent and low risk superficial BCC and surgery.
And in eligible patient.
And just one last question on the pipeline and historically lesbians and talk about and Wpc's.
Three and a couple of years and I believe is the 2000 and presentations and.
Gotcha.
And policies and update.
And you know.
And the pipeline holdings.
Under development.
And.
This for assessing all my questions.
Yeah. Thank you for this question I'd say.
Mentioned before we at the company.
Continuously axle and potential clinical application of our of a lead compound and.
In order to add additional product two hour a pipeline portfolio.
And as you know our platform technology of the pharmaceutical cat vomit, and which is basically a concentrate of pro athletic and time and reaching Bromelin provides us sweet optionality and potential for future product and indication as you mentioned before like a cough and like connected.
Tissue. This all day and for all those potential indications and petition product we already completed the preclinical development and the toxicology study fault injectable form and for the topical application and we completed two and 2020 proof of concept that is we concur.
<unk> to move forward into day clinical stage.
005, and the first and.
New indications portfolio and while we.
While the primary focus of course, and then they continued growth to the advancement of next up with and aesthetic.
And Sean.
Again, ladies and gentlemen to ask a question. Please press star and one on your tongue and keypad again and that is star line.
Your next question is from the line and flying and Pakula Rama with cancer.
Okay and.
Okay from here too and the mornings from.
A couple of quick questions.
And the next the next a bridge today and children's.
Your your your and spitting to put out some data and and the second half of 21.
So.
How should we think about this.
Study would this too.
Are sufficient to.
To get a pediatric indication and the United States and.
And you know.
Yeah. Thank you for your question.
We anticipate following the completion of direct quotes and we anticipate to report the top primary results from this study which will include the 12 months a follow up safety during the second half of 2021.
This study basically is and are intended to ask for labor extension, both in Europe, and and the U S.
And based on our experience with the detect study with FTA, we believe that we can.
We can be and a position to submit a pediatric indication expansion for next day with based on the 12 months a follow up data while the 24 months follow up data can be a post marketing submission we have to remember that as opposed to Europe and and the U S.
Excluded from the pediatric investigation and plan, but and this study was approved and designed together with both.
And the FDA.
Okay. Thank you from that and then moving.
Additional geographies, where you could potentially expense next I'm good.
Could commercialization uhm and you <unk>.
The progress and the any of these countries that you'll always kind of distribution agreements.
Last year.
<unk>, Switzerland and also.
And middle East and market.
Yeah.
So.
June 2021, and we signed several distribution agreement and a major countries I think that if you can split it into two fast some additional countries and <unk>, which is part of our hybrid model to a to basically.
Have a growth of next of with an outage and next away and a new and additional territories and within the European countries leveraging our existing approval, we do have and put marketing approval for all you country and with that designer as I said, France, Switzerland and.
Biotech country agrees and additional countries in a day you up with Dean those country. The distributor already have the marketing approval, all and needs to get is basically market access and to launch a product and and I believe that during 2021, and we will see and some countries already launched.
Of this product.
Moving to international countries or territories, we saw and several distribution agreements, while we're focusing three main continent, the Latin America area.
Russia, and a crane and of course as you Pacific.
We anticipate to have additional approval dooling, 2021, and giving the review process and some countries and we recently and also.
Distribution agreement.
In.
In United Arab Emirates, which provide us sweet.
You know open at you and market, which is the middle east market and the African market and we believe can generate more growth too nexobrid activity.
Thank thank you gentlemen, and thanks for taking my questions.
Hi, I'm showing no further questions at this time I would now like to turn the conference back to Sharon and Okay.
Thank you actually and my own everyone for joining us today will look continuing to exit and our strategy and bringing new therapy to market and to update. Thank you again on our next update call. Thank you and have a great day bye bye.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.
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