Q4 2020 Reata Pharmaceuticals Inc Earnings Call
Ladies and gentlemen, thank you for standing by and welcome to the Reata Pharmaceuticals fourth quarter and full year 2020 financial results and update on development programs Conference call.
An audio recording of today's webcast will be available shortly after the call today on Reata is website at reata pharma dot com in the investors section.
Before the company proceeds with its remarks. Please note that forward looking statements disclosed in the company's press release.
The company will be making forward looking statements on today's call and there are many factors that could cause results to differ from expectations, including those noted in the company's SEC filings.
Today's statements are no guarantees of future outcomes.
Please also note that any comments made on today's call apply only as of today March one 2021.
No longer be accurate at the time of any webcast replay or transcript rereading.
Following the prepared remarks, we'll open the call up for questions.
At that time, we will ask you. Please limit yourself to one question and one follow up so we can accommodate as many questions as possible.
We are joined today by the company's Chief Executive Officer Warren Huff.
Research and development Officer, Colin Meyer.
Chief operating and Chief Financial Officer, Mike It's Tony.
At this time I'd like to turn the conference call over to Warren Huff, Chief Executive Officer of Reata.
Thank you good morning, everyone and thank you for joining us today.
We have of full agenda of information to share and I'll begin with our most recent updates starting on slide four.
I am pleased to report the Reata has submitted its new drug application for paradox of London outward syndrome. The completion of our NDA follows from the positive phase III year to data we reported just three five months ago.
This marks a major milestone for our company. It's the first NDA Reata has submitted in its history more importantly, this NDA marks a major milestone for outboard syndrome patients who have a devastating disease for which there is no approved therapy.
On behalf of everyone at Reata I extend my deepest thanks to the patients who participated in our clinical trials and also their families is a serious genetic condition output syndrome can have far reaching effects on the families who face it for them. Most of all we're committed to seeing the regulatory process through.
To completion.
As Youll see from our reata at a glance slide we have a number of updates to share today beyond the submitted NDA. Among other topics. We will highlight the progress of the Falcon study of our docs one in autosomal dominant polycystic kidney disease I'm very pleased with the momentum we see in Falcon enrollment across sites worldwide call.
And we'll walk through those details. He will also discuss the Merlin trial of our docks line in rapidly progressive forms of C. J D.
Continuing with the recent updates I want to acknowledge the patient petition that we received from the free drinks ataxia community of few weeks ago more than 74000 friedrichs of taxi of patients their families. The physicians researchers and others came together to express their desire for a regulatory path.
Forward for old math.
As you know we issued our response to the petition in which we emphasized our hope to be able to advance <unk> further through the regulatory process pending direction from the FDA.
We have requested a type C meeting to carry the discussion of forward at that meeting we plan to present additional 72 week data that we believe supports <unk> potential as a disease modifying therapy in friedrichs ataxia, Colin will offer a top line overview of these data as part of his comments on this call he'll also offer.
Sites into work underway to develop additional assets and our expanding neurology portfolio.
I want to emphasize the strength of our company's position as we move further into 2021, the onset of the COVID-19 pandemic in 2020 in pose significant challenges for reata. It a crucial interval of our company's mission to develop therapies that can change patients' lives for the better we will.
Continue to fuel this on the road ahead.
I will now discuss updates to our development pipeline.
Okay.
Thanks, Warren I'll provide the top line review of the progress in our development programs last year, followed by review of the updates for our Falcon trial of ADP J D or Merlin trial in COPD patients at risk of rapid progression the regulatory status of Comat of an assay and an update on <unk> and other one.
As we've discussed previously upward syndrome is the second most common hereditary form of C. J D, which is caused by mutations in college and that promote inflammation fibrosis and loss of kidney function. The misdiagnosis rate than has been reported to be as high of 62% and due to the rapid loss of kidney.
The function patients have a high likelihood of kidney failure in the most severe forms of the disease patients have the 100% lifetime risk of kidney failure with the median age of kidney failure of 25 years.
As shown on the next slide our NDA contains data from three separate of outward syndrome trials that contained just under 200 unique patients, including the phase two and phase III Cardinal studies as well as the ongoing Eagle Open label extension study that is continuing to accumulate data.
The Eagle the extension study allows patients who complete cardinal to receive open label of blocks alone until the drug is commercially available at this time, we have enrolled 100 patients in the Eagle extension study.
Next slide.
Unlike most rare disease development programs the container of relatively small data sets based on the extensive development history. Our NDA contains data from multiple clinical trials and disease states that have enrolled over 3000 patients, which the quarter Albert syndrome, NDA, we have shown improvements in kidney function.
As measured by estimated GFR for Egfr measured GFR and creatinine clearance demonstrating that the changes in egfr represent as assessed by serum creatinine represents a true change in kidney function, we have shown reductions in inflammatory biomarkers supporting <unk> anti inflammatory.
The vaccine.
We have observed sustained improvements in egfr for up to three years and output syndrome patients.
Prior to the outward syndrome trials, we have shown sustained improvements in egfr for a year and significant improvements and off treatment Egfr in two prior trials.
And the Cardinal phase III and a prior diabetic kidney trial, we observed a reduction in the risk of kidney failure of outcomes.
Next slide.
Chronic inflammation is integral to progressive decline of kidney function associated with numerous forms of chronic kidney disease or <unk>, Inc.
Including <unk> syndrome.
Pro inflammatory stimuli, such as <unk> and to increase the production of Ross, resulting in coronary alert the little dysfunction pathogenic Ms. Angela <unk> contraction and impair put aside assumption vs effects reduce the glomerulus surface area of port filtration or case of bass, which in turn reduce.
The single Nephron GFR.
Additional chronic inflammation drives kidney remodeling by activating Nf Kappa B, TGF beta and other pro fibrotic mediators.
The time these chronic processes result in the complete loss of function of individual net price.
Interest to us the transcription factor with anti inflammatory and tissue protects us ex that is depressed in many forms of CK. The genome wide analysis from kidney biopsies across nine different forms of TKD validate the association between impaired and rep to activity and reduced kidney function across more.
Total forms of <unk>, including <unk> syndrome.
The next slide.
We have conducted a large number of non clinical studies to elucidate the mechanism of action of our docs alone, which is novel our academic collaborators and we have conducted sophisticated imaging of experiments in living animals to demonstrate that road, Oxford acutely increases singled that non GFR by restoring the <unk>.
<unk> surface area in the kidney.
Reversing inflammation, we get the construction we have shown that this effect is not associated with any changes in the assets for ethnic tone demonstrating that this effect is not associated with increases in integral member of the of pressure or hyper filtration.
Lastly, we have demonstrated that rosslyn battle has anti fibrotic effects and improves kidney structure and function in response to pressure overload in multiple classes of animal models of TKD caused by hyper filtration hypertension.
The protein diabetes and Dyslipidemia.
Excellent.
Turning to supportive of upward sort of specific clinical data. They are contained in the NDA where call. It the Cardinal phase III study was a randomized double blind placebo controlled trial the trial enrolled a broad range of patients with Egfr from 30 to 90 bulk of minutes and AIDS from 12 to 70 <unk>.
The primary endpoints were the on treatment changes in Egfr at week, 48, 100, and the key secondary endpoints were the off treatment Egfr changes at week 52, and one of the floor.
We believe the on treatment changes in Egfr represent the full clinical benefit of blocks, one and the ask treatment changes were included to determine if the <unk> Egfr profile is consistent with the disease modification integral out harm.
As shown on the next slide and previously discussed Cardinal met its primary endpoints, demonstrating large clinically meaningful improvements in on treatment Egfr with significant P value.
It is important to recognize the distinction between the ITT and the M ITT populations.
The ITT analysis includes all available Egfr values from all patients even if they discontinued drought.
This is a very conservative analysis since it is diluted by patients who discontinued drug no longer benefiting from the drug to understand the treatment effect of Barack slowed while patients are actually receiving drugs, we prospectively defined the M. ITT population, which excludes egfr values once patients do.
Continued box flow and clinical practice when patients are receiving botox loans. The M. ITT Egfr improvement is likely most representative of the actual clinical benefit as we discussed during our last call. The M. ITT Egfr change over time from the second years separated from the paradox locations compared to the us.
The flow of patients.
As you can see on the next line all Prespecified subgroups of favorite paradox loans.
We observed a treatment effect in pediatric patients.
Males females.
Patients with high and low coating area.
The cross the Egfr range studied.
And all major genetic subtypes and on top of standard of care Ace inhibitors from their fees.
As shown on the following slide and previously discussed Cardinal also met its key secondary off treatment of endpoints. The persisting significant increase in Egfr following washout observed twice and Cardinal provided evidence that the on treatment Egfr improvement is consistent with.
<unk> beneficial and not harmful profile.
While we believe the on treatment of Sac represents the clinical benefits the off treatment improvements demonstrate disease modification. This off treatment endpoint was previously used to support the approval of <unk> for ADP J D.
Next slide.
Due to the relatively small size of the Cardinal trial, which was conducted in the rare disease population. It was not powered to show a difference in the off treatment Egfr from year one to year. Two. Additionally, the patients included in the each analysis are slightly differently to drop outs. So these.
On the endpoints aren't directly comparable.
To understand the relationship between the off treatment teams after year, one and two we performed the longitudinal off treatment Egfr slope analysis. This effectively uses per values from patients to generate individuals' slopes neither of them used to estimate the population per each treatment group as you can see in the figure.
The dotted lines represent the off treatment slopes and so is it 50% slower slope for Barack slowed.
This suggests the production is slowing disease progression by 50%.
As I've mentioned.
<unk> earlier <unk> has a novel mechanism of action and sustained increases in Egfr have not been observed in the <unk> studies within the other intervention.
The one intervention that has been shown to increase Egfr amlodipine does so by increasing pressure, causing hyper filtration.
And the African American study of kidney disease also known as pass the.
The initial Egfr increase was small in transit the.
Increase in Egfr was only four of milk per minute and peaked at six months of treatment. After this time Egfr decline quickly and more rapidly than was observed in the other treatment groups.
We performed a quartile analysis by Egfr change at week, 12, and Cardinal to determine what happens to the patients who had the largest acute changes in egfr. After two years of treatment as you can see in the table the core tile with the largest egfr change had a very large incur.
<unk> and Egfr of 27 Mil per minute at week 12, and after two years of treatment. These patients had the largest on and off the treatment changes at weeks 100, and 104 relative to all other part of OXXO and the placebo courthouse. Conversely, the burnt oxygen patients who had the smallest of.
Changes at week 12, and the smallest improvements at the end of two years. These state of our very important since they demonstrate that the acute increases in egfr of not associated with the accelerated progression of kidney disease long term and are opposite the pattern of hyper filtration.
Turning to slide 19, as we've discussed previously the largest improvements in egfr across all Prespecified subgroups were observed in the pediatric patients. These patients have the most of your mutations and progress of the fastest rates the.
The improvements in Egfr at week, 100, 104, where large clinically meaningful and even statistically significant within the subgroup, notably the most forms of CK two years of treatment may represent only 10% or less of patients remaining dialysis free time.
It often takes decades for patients to progress the kidney failure.
However in these patients with very rapid progression the two year duration of treatment represents approximately 30% of these patients remaining dialysis free time.
Next slide.
We've previously shown the proteinuria data measured as the Gregory of albumin to creatinine ratio or <unk> across all patients. The initial increases were observed in the paradox subgroup that where mathematically accounted for by the change in Egfr, which would be expected to increase the ACR.
Importantly, you ACR did not worsen over time and the value return to placebo levels during the two of our treatment periods and.
In the overall population, which was primarily adults there was only a slight worsening and USTR the placebo patients. Despite the large losses of Egfr.
The pediatric use of our data are shown on the slides and demonstrate a meaningful worsening of USTR and the placebo patients over the two year duration of the trial. These patients had a doubling of USTR, whereas the paradox untreated pediatric patients had no change from baseline.
The week 104 U S share levels in the paradox non accretive pediatric patients will reduced when compared to the placebo pediatric patients we.
We believe the pediatric data highlights the overall dataset and provide evidence that paradox non has a clinically meaningful and disease modifying profile.
Okay.
Moving onto the other topics on slide 21, those unfamiliar with the <unk> profile, sometimes ask if it is consistent with hyper filtration is sure.
On this slide and now extensively studied and non clinical and clinical studies. The profile is opposite of hydro filtration hybrid filtration is caused by increases in pressure within the kidney the cause damage, including increased permeability to the albumin the worsening of fibrosis.
We have shown that our OXXO acutely increases GFR by increased single of many of our surface area without affecting integral member of our crusher, where permeability of albumin in the gold standard model of hybrid filtration. The five six nephrectomy, we observed preservation of kidney function and reduce fibrosis as the.
<unk> mentioned, a few minutes ago, the clinical Egfr profile of hyper filtration clinically is associated with transient small increases in Egfr followed by an accelerated decline of Egfr after six months of treatment.
<unk> treatment Egfr changes are worse than placebo and hyper filtration increases kidney failure of composite of events.
<unk> Egfr profile is associated with large sustained increases in egfr for at least three years persistent improvements and off treatment Egfr any reduction of kidney failure of composite events.
The USTR profile type of the hybrid filtration is associated with the initial increases in UA CR that are out of proportion to changes in Egfr and continue over time off treatment values are higher than placebo due to the loss of the Maryland integrity from <unk> profile demonstrates the initial.
<unk> that is accounted for by increases in Egfr plateaus. After the initial increase and returns to baseline within four weeks of stopping drug. Therefore, the profiling of Arnox loans is novel and differentiated from hyper filtration. We believe we are fully address this issue and there is no evidence that supports that.
<unk> mechanism of action is due to hyper filtration.
Next slide.
Clinically we have observed increases in <unk>, which is associated with reductions in total bilirubin, where improvements in liver function. While <unk> asps are used clinically as biomarkers of liver toxicity as seen on the left are the slide they are expressed in numerous tissues other than the <unk>.
River, including fat tissue, the kidney muscle the brain lungs, and others. They have an important role in energy metabolism, and glutathione synthesis, which are fundamental processes associated with interactive activation Jeanette.
Genetic suppression of interrupt too is associated with lower tissue expression and serum activity L. T rich genetic activation of the interrupt to generally increases the ALC production and activity.
We have shown in sales from multiple tissues, including the liver muscle colon macrophages in kidney oxytone increases production of <unk> demonstrating that these increases are due to the pharmacological increases of production and non injury next.
The next slide.
The clinical profile of <unk> <unk> and bilirubin is consistent with data we have published from our prior trials in diabetic <unk>.
<unk> ASP levels of peak approximately two weeks after patients in each of the goal of dose level of spend trend down to the new steady state likely as the new equilibrium is reached and during the off treatment periods. The levels returned to baseline and placebo levels. The.
The cross our entire development program and clinical trials conducted to date, we have not observed any cases of highest law, which is associated with large increases in total bilirubin and impaired liver function. Instead, we've observed reductions in total bilirubin, where improvements in liver function.
And Cardinal we conservatively implemented the stopping criteria in accordance with FDA guidance of total of six patients met these criteria, notably none of these patients have any evidence of liver injury.
We have relaxed these criteria and our ongoing Falcon trial to further reduce this discontinuation of.
The draft proposed output syndrome label provides guidance for monitoring and management that we believe will minimize discontinuation due to these increases.
The next slide.
Regarding changes in body weight, we have previously shown in non clinical models that this effect is due the metabolic reprogramming, resulting in utilization of stored fuels in the form of that increased energy production and reduced weight to the fat loss, we have shown in four prior trials that <unk>.
Just an egfr or not due to changes in creatinine production or excretion, demonstrating the weight loss is not due to muscle loss. We are also showing the weight loss is dependent on baseline BMI.
And the Cardinal trial, there was no correlation between weight and Egfr change further in the pre specified subgroups of BMI lower than or higher than 30. The egfr change was almost identical despite the large difference in weight loss of one nine versus $7 one kilograms.
In summary, Egfr increases with box loans are not due to weight or muscle loss reflect true increases in GFR.
Next slide.
In conclusion, our outputs in a program that's been conducted in a rare severe form of <unk> with no approved therapies are phase III Cardinal trial hit its primary and key secondary endpoints demonstrated disease modifying activity and an acceptable safety profile the supported by a large.
Safety database of over 3000 patients. We are pleased to have submitted our first NDA and we believe that if approved by the OXXO, maybe the first therapy to preserve kidney function with disease modifying effects in patients without per syndrome.
Next slide.
Turning to our ADP J D development program <unk> is the second I'm sorry is the most common hereditary form of <unk> with approximately 140000 diagnosed patients in the U S.
Despite standard of care, including blood pressure control and one approved drug patient still this kidney function at a fast rate.
Because of this a high percentage of patients ultimately progress the kidney failure.
Our phase III Falcon trial is currently enrolling patients enrollment was passed last year because of Covid and we've been able to resume enrollment at most sites.
Currently over 220 patients have been enrolled and we're planning to increase the sample size of the Falcon to 550 patients from $300 primarily to account for the increased variability in the second year of the Cardinal trial. So that we can maintain the same statistical powering assumptions we.
We are not changing the estimated treatment of stat to drop out estimate or any other parameters.
And this change will make the trial similar in size to other ADP <unk> trials.
Similar to the Cardinal trial. The trial is two years in total duration and the key endpoints are at the end of the first and second year of treatment.
Even with the sample size increase we expect enrollment to be complete by the end of 2021.
Turning to slide 30, we recently initiated Maryland, a double blind placebo controlled phase two trial evaluating the safety and efficacy of <unk> in patients at risk of rapidly progressing CK day, due to multiple etiologies, including common and rare forms of <unk>.
Such as diabetic.
Hypertensive, TKD, Iga nephropathy, Sts and others.
We plan to enroll approximately 70 patients aged 18 to 70 with Egfr of between 20 to 60 mile per minute in one of several risk factors for progression the.
Primary endpoint of Berlin is the change in Egfr from baseline to week 12 enrollment began in February.
Last month and day are expected in the second half of this year.
With the results of the study are positive our plan would be the potentially proceed to a larger phase II trial in this population of patients at high risk of progression to kidney failure.
Now, let's move to our program in the previous ataxia.
S. A as a rare disease characterized by progressive loss of motor function with the median survival of 35 years.
There are an estimated 5000 patients in the U S out of 4000 diagnosed and these patients have no approved therapies.
On our last call I stated that we submitted a baseline controlled study to FDA in response to the request for additional analyses to increase the persuasiveness of the Moxie part two data.
After their internal review they stated that these analyses did not strength in the results and they recommended and initial analysis.
We have named these analyses the delayed start analysis. The compares patients initially randomized to placebo and one map to each other and the extension.
We believe this analysis is intended to determine if the <unk> profile is consistent with disease modification.
FDA stated that the potential for these analyses the sufficiently strength in the study results was questionable due to the small number of patients available for analysis.
Next slide the.
The delayed start analyses are shown on the next slide we compared the rate of change and employers in the extension for the patients initially randomized to <unk> versus those of originally randomized to placebo.
Conducting analysis using two populations first we used all available data in the extension to compute annualized rates of Empire has changed and 73 out of 82 or 89% of patients who enrolled of moxie part to contribute to this analysis, notably this is high.
And then the <unk> 14 per two patients who contributed to the base non controlled study.
Second we analyzed patients who completed one five years of the extension, which includes a total of 20 patients.
One of these patients have received or map per total of two and a half years.
As can be seen in the figure on the left.
Which includes data from all the extension patients once patients entered the extension those initially randomized to Omar progressed at a very slow rate of approximately of approximately <unk> five <unk> points per year. After another one five years of follow up.
Patients initially randomized to placebo progressed about one five points from the initial baseline of Moxie part to the based on the extension also progressed at a rate of approximately <unk>, 5% and price points per year of extension, which is slower than the prior rate of progression and the extension the slopes are generally parallel.
And there is no significant difference between them.
Most important patients initially randomized to placebo did not catch up with the patients who are nishu atomized Omar.
The one that only provided symptomatic treatment they would be able to achieve the same treatment response relative to the initial baseline.
However, patients who initially received one that have been able to maintain better absolute empire scores demonstrating that the first year of treatment of moxie part two provided the treatment benefit. This is the hallmark of disease modifying activity the.
Analysis on the right, which includes all patients who have completed one of half years of the extension. So similar findings the data at each time point contains the same patients with the exception of week 100, which has some missing values through the site closures related to COVID-19.
And this complete or subset the 11 patients who have received two and a half years of treatment have on average not progressed. The patients initially randomized to placebo who progressed, while receiving placebo have also on average not progressed during the one and a half years on the home App during the extension consistent with the analysis that includes.
All patients the patients originally randomized to placebo did not catch up with those initially randomized total amount, which demonstrates the disease modifying profile.
Next slide.
From a regulatory perspective, we have requested a type C meeting with the FDA to discuss the delay started ounces and the development program pending discussions with FDA and EMA, we plan to initiate a second pivotal trial of <unk> in the second half of 2021 to support approval.
Turning to slide 37.
We believe the moxie results provide proof of concept for the use of <unk> in other neurological diseases that have a common pathophysiology of mitochondrial dysfunction and neuro inflammation.
All of them out and analogs have shown activity of numerous non clinical models as well as patient biopsy samples and we believe the pharmacology of applicable to a broad set of neurological diseases, including other movement disorders, such as PSP, Parkinson's disease, and Huntington's disease as well as other diseases that affect neuromuscular function.
And memory.
Now on slide 39, our earlier stage pipeline includes RTA 901, which is wholly owned by Reata RTA 901 is the highly potent and selective oral small molecule C terminal modulator of <unk> 90, <unk> 90 of the molecular chaperone the facilitate.
The folding and stability of many proteins critical for some of our viability.
<unk> also regulates the expression of HSBC 70, another molecular chaperone that promotes cell survival and response distress and effects of mitochondrial function.
<unk> terminal Hsp 90 inhibitors previously developed as anti cancer agents increase HSBC the expression, but also instead the client protein folding which results in cytotoxicity and contrast, RTA 901 increases transcription of HSV 70, without inhibiting client protein folding resulting in robust set of.
Protection and the absence of some of the toxicity.
This biology is distinct from our interactive activator program, but as many parallels.
Next slide.
<unk> 901 has demonstrated activity of multiple models of diabetic neuropathy. It has been shown to reduce pain acutely in models of painful diabetic neuropathy.
Most notably RTA 901 treatment results in recovery of lost sensation in models of Insensate diabetic neuropathy, which stayed novel and differentiated profile from other agents at a targeted diabetic neuropathy.
Next slide.
Of the approximately 4 million U S patients with moderate or severe diabetic peripheral neuropathic pain approximately half of those treated do not achieve an adequate pain reduction with available therapies. We have completed phase one sad and Mad studies in healthy volunteers and have demonstrated an acceptable safety profile.
With no safety signals drug discontinuation or CES, while achieving appropriate safety margins.
In the second quarter of this year, we are planning to initiate two additional clinical pharmacology studies to support the launch of the phase two study in the fourth quarter of this year.
This study will be a randomized placebo controlled dose ranging study using the standardized pain scale.
I'll now turn the call over to the need to provide a summary of our financials for the fourth quarter and full year of 2020.
Thanks, Colin and good morning, everyone.
Please refer to our press release issued earlier today for a summary of our financial results for the fourth quarter and full year of 2020.
I will start on slide 43.
With our cash balance we maintained a solid balance sheet, ending 2020, with approximately $818 $2 million in cash and cash equivalents.
This includes cash proceeds coming from our financing completed in December 2020, amounting to approximately $277 5 million in net proceeds.
Our GAAP net loss for the fourth quarter of 2020, while 64, $65 8 million or $1.90 per share on both basic and diluted basis as compared to a net loss of $186 $9 million million are.
$5 91 per share on both basic and diluted basis for the same period of the prior year.
Our GAAP net loss for the year ended December 31st 2020 was $247 8 million or $7 35 per share on both basic and diluted basis.
As compared to a net loss of $292 million of $9.54.
Porsche on both basic and diluted basis for the prior year.
The decrease of net loss was primarily due to reacquired license rights expense incurred in 2019 and is offset by an increase in operating expenses in 2020.
And the addition of R&D expenses increased due to R&D activities and higher personnel and equity compensation expenses due to increase in head count.
Increases in our G&A expenses were driven by higher personnel and equity compensation expense due to increase in head count to prepare for commercial launch and to support growth in our development activities.
We have made all necessary investments to ensure the strong and successful commercial launch of products. Low later this year pending FDA review and approval.
Moving to revenues our collaboration revenues were $3 $2 million during the fourth quarter of 2020 as compared to $2 $7 million in the fourth quarter of 2019.
Increase was related to reimbursement from Casey related to manufacturing and non clinical study.
Moving to non-GAAP measures on slide 44 of our non-GAAP R&D expenses were $42 7 million for the fourth quarter of 2020 as compared to $36 7 million for the same period of the ear products.
Our non-GAAP G&A expenses were $12 $3 million for the fourth quarter of 2020 as compared with $13 4 million for the same period of the ear products.
To summarize our non-GAAP operating expenses were $45 2 million during the fourth quarter of 2020 with multiple pivotal programs and substantial free play preclinical activities reflective of the strength and potential of AOS pipeline.
In keeping with our current guidance at year end cash balance of $880 million is expected to find out of patients through mid 2024.
In terms of our commercial readiness with our submission of NDA and anticipated proof of later this year, we have taken consulted steps to ensure the launch readiness by Q4 of this year.
We continue to ramp up our broad based disease education efforts, including our newly launched disease education website output syndrome Dot com.
Designed for prescribers and patients are film directors of market access are on track for hiring in the second quarter.
We continue to advance our payer engagement strategy with the goal of achieving broad and timely payer of the coverage of paradox loans.
Finally, we are in the final stages of building, our logistics infrastructure with the patient hub specialized pharmacy and distributor network and third party logistics all aimed at full launch readiness for <unk> in the U S by fourth quarter of 2021.
With the longer term aim of supporting multiple launches over the next several years with that I will turn the call over to Warren who will take us to slide 47.
Okay.
Thanks, Amit as our presentation today indicates we're making significant progress across a broadening set of programs, including our late stage an earlier pipeline programs. We have now fulfill the major regulatory milestone for production line and output syndrome, we remain dedicated to advancing <unk>.
And friedrichs ataxia, we look forward to the year ahead and of maximizing the opportunities that it presents to our company.
That concludes our prepared remarks, and I'd like to thank everyone, who dialed in I will now turn the call over to the operator for questions.
Ladies and gentlemen at this time, we will open the line for questions.
The ask a question you May press Star and then one easing of Touchtone telephone.
To withdraw your question you May press Star two.
If you are using a speaker phone, we do ask that you. Please pickup your handset before pressing the numbers to ensure the best sound quality.
We also ask you. Please limit your questions to one question and one follow up.
Our first question today comes from Yigal <unk> from Citigroup. Please go ahead with your question.
Alright, great. Thanks for taking my question.
One with respect to the second stringency ataxia phase III trial could you comment on how that study may potentially differ from the market our team and.
The data and learnings from the delayed start analysis that you did from oxy part to impact the design of the second phase III.
Thanks, Yigal, so you're asking about the potential design.
The second pivotal study in Friedrichs ataxia.
Colin could you take that.
Sure and so I think yes, the prior amongst the two data plus the delayed start analysis as well as our baseline controlled study.
We will inform the next design and so we need to have discussions with FDA to determine the specifically.
What what we would need to do to fulfill the obligations.
In order to get the approval.
And so I think we'll provide more guidance after a type C meeting.
Okay got it thanks, and then just one follow up with respect to the increased enrollment in Falcon can you just comment on whether that was the internal decision or was that the result of any FDA feedback.
Possibly seeing any of the pools and blinded data that would suggest that the variability.
Later than you previously anticipated.
Yes so.
You are asking about the whether the.
Increasing the sample size was based on any FDA feedback or.
Overall analysis of the variability.
I'll actually all of respond directly to that it wasn't in response to FDA feedback it was directly in response to what we observed.
And the variability in the year two of the Cardinal study.
And which.
May be related to.
Two the pandemic environment that we're in and so we felt that was simply prudent to increase the sample size.
To preserve the Sis the statistical power, if we observed a similar rate of variability.
Got it excellent.
Okay.
Our next question comes from Maury Raycroft from Jefferies. Please go ahead with your question.
Hi, good morning, everyone and congrats on the progress thanks for taking my questions.
The first one is going to be on for your stack J do you just wondering if we can get a better sense of if you.
Could still file for approval after the type C meeting and price prior to running the entire during the second study I guess can you run through possible scenarios for outcomes from the type C meeting.
Sure I'll take that.
Obviously the.
The position of the agency has been to date.
That we need to increase the persuasiveness statistically of the result.
Or we need to provide additional data.
From the long term extension or perform a second pivotal study.
The purpose of the two.
Type C meeting that we just requested is to put the put that question directly to them and there are multiple outcomes. They could potentially see the additional analysis is supporting the conclusion that it's disease modifying if they reach their conclusions and there would be an ethical problem with conducting a second.
Pivotal study.
And then they might permit us to submit an.
On the NDA based on the existing clinical package.
However, they may find that that data doesn't support the conclusion that it's disease modifying and require us to conduct a second pivotal study.
So it's just the it's up to the FDA.
Got it okay, and just to clarify for the ongoing Falcon study.
Are you seeing anything with dose reduction discontinuation or anything else from the study that would also provide some reason to upsize that study.
Colin would you like to take that.
Yes, so as I mentioned during the prepared remarks.
There is no data.
That would suggest that we need to change our assumptions were dropouts treatment of factor or anything else. It's solely based upon the.
The ability from the Cardinal trial and the answer.
<unk> syndrome, as Warren said, we noted.
<unk> of variability of our standard deviation of change in estimated GFR in year or two.
Of Cardinal and so we're not sure if that's one of the shopping and the Falcon trial, but we thought it would be prudent to increase the sample size.
There is no other data.
That suggested that our assumptions may be wrong, but since standard aviation is of critical.
Put into the power calculations, you wanted to make sure.
Of that we accounted for a potential increase if the work too.
Part of it and then from an enrollment perspective.
Today disclosed for the first time day.
Number of patients, we have enrolled and despite having to pause enrollment due to COVID-19 and we have made substantial progress we've enrolled over 220 patients.
And since most of our sites are able to screen and enroll patients.
The incremental time too.
Increase.
<unk> enroll those additional patients is not that long.
So this makes the trial and the overall, we believe robust and similar in size to to other PK trials and.
<unk> account for any potential increase in variability there that we could sort of absorption.
Got it very good thanks for taking my question is on Capex.
Our next question comes from Annabel <unk> from Stifel. Please go ahead with your question.
Hi, Thanks for taking my question.
The Hopper. So can you talk about what specifically are gaining the address the discontinuation from the ISP and L. T in the J.
J J trials seems to be of big question amongst physicians the control of discontinuation.
And then follow on.
Yes.
What is it specifically do you know that the F.
J would be looking at to determine whether it is disease modifying does that change that the trends between the need to be statistically significant or is it enough that the parallel.
Thank you.
I'll take the I'll take the second question first Colin and then would you comment on Falcon.
The.
We believe that the analysis that they suggested is based on guidance that they've given for these type of analyses in the Alzheimer's setting and basically what you are looking for is to see the.
The patients that crossed over to the long term extension study.
From the active basically maintained a benefit over time versus the the patients that crossed over to the long term extension from placebo. So you actually want the slopes to be parallel.
And there should not be statistical significance.
The between them.
And that's we believe that that's what the data shows.
The key question will just be us.
Patient or the patient numbers high enough and has the confidence around that data is strong enough to convince them.
The debt is evidence of the disease modifying effect, we think it is but again.
That adapt.
The decision is the decision of the FDA.
Great and then on the on the.
A L P S T changes.
Yes, so as I disclosed.
A few minutes ago, we had six patients who met.
The criteria and standard FDA guidance, that's I believe probably almost all companies small low during clinical trials.
And if patients have an elevation of the certain magnitude.
It meets certain criteria, we had been requiring patients to permanently discontinued study drug.
It could not restart but based upon our extensive safety database and in consultation with the.
I apologize.
And as we've now published.
We believe that these changes are pharmacological changes consistent with activation of enough to and very distinct from a profile of of liver injury and so when the Falcon protocol, we did not require permanent discontinuation and sell if patients don't hit of certain thresholds that would've required from a discontinuation we simply.
Give the patients the drug holiday.
And they come back to the clinic and started at a low dose and so it's a very.
<unk> way to manage these elevations.
Total.
Yeah.
Our next question comes from Brian <unk> from Baird. Please go ahead with your question.
Hey, good morning, everyone. Thanks for taking the question and thanks for all of the granularity in the in the presentation. My question is really on sort of the differences across the different populations and how we should kind of thinks about the results from from Falcon.
With the increase in enrollment size, we've seen in beacon and we'd seen in.
Cardinal at least some sort of numerical benefits in terms of progression to end stage renal disease or partner Kirin is powered at about a little more than twice the size of the Falcon and diabetic kidney disease. So I'm just wondering if.
We kind of think about the ADP J D patient population, what the rate of progression the srd.
Isn't this patient population relative to die.
Diabetic kidney disease, and all poor and at the scale, if we sort of saw a.
The reduction in progression of <unk> on par with the numerical reduction we saw in Cardinal.
Would this be statistically of valuable secondary endpoint.
Colin do you want to take that.
Yes, so I think we we pre defined it and cardinal because we thought it'd be helpful to characterize the composite is now used in trials like our Japanese partners on the trial and so we don't we're not we're not changing the size so that the powered for that endpoint.
But it would potentially increase our chances of of showing statistical separation in Cardinal with the 157 patients the.
The P value was.
086, I believe.
And the hazard ratio was about <unk> five and so.
In ADP J D patients progressed at a slower rate.
And there's not as many of the.
Patients, who have extremely large losses expenses, the patient and Cardinal who had the largest losses of placebo patient and lost about 50 ml per minute over two years and so we don't expect patients to have that extreme of losses.
But potentially yes.
If things go the right way that that could be a very valuable input for us.
Skol.
Okay.
Our next question comes from Charles Duncan from Cantor Fitzgerald. Please go ahead with your question.
Hey, Thanks for taking my questions Congrats sworn and team on the <unk> filing an airport I had a question on the <unk> and I apologize if I missed the some juggling multiple calls this morning, but in terms of the type C. Meeting can you give us a little bit more color.
On that timing and would you wait for.
The meeting minutes to be able to disclose what you plan to do and I saw in your press release that you plan to start a second study in the second half when do you think you could operationalize that just a little bit more color on the plan forward with Allomap.
Sure.
We can't comment on the timing and in fact, we don't normally comment on the exact timing of the meetings, but we have submitted the.
The meeting request and then what we say publicly after the meeting really depends on it.
How quickly do that depends on what we hear if something is obviously very material then we generally release it even before we get the minutes, but normally we wouldn't prudence dictates that you wait.
To get their minutes before.
For your comment.
And it makes sense to me and then in terms of the study timing.
When can you operationalize them. So we believe the we could have it.
Operationalized by Q4.
Okay.
And but the good it can potentially be earlier, depending upon what the what happens in the interactions with the FDA.
Yeah, and then regarding the agency I mean the.
I appreciate the what you mentioned in terms of the Alzheimer's space.
And.
The kind of the setup for disease modification it seems like in.
In some ways I'm talking are seeing seen what's going on in the Alzheimer's space that paradigm is somewhat being thrown out.
In Alzheimer's disease modification vs symptomatic and so it seemed to be the symptomatic therapy in SA would be quite valuable as well do you do you have an argument for that to go to the agency with.
The.
The point about the analysis is not whether or not.
Purely symptomatic treatment would be approvable, it clearly would be approvable and they haven't indicated.
That there would be any problem.
With the approval of <unk> for FAA.
If the treatment was only symptomatic.
In fact, I've made clear that that's not the case the question really goes to the.
Ethical ness of conducting a second study.
Once you've demonstrated in a randomized controlled trial.
A disease modifying.
Activities and it's much more difficult to.
Ethically justify of SEC.
<unk> randomized controlled trial.
Especially in our finance occasion I appreciate taking the question Liana, yes, exactly especially in a deadly disease with no approved therapy.
Yes exactly.
Our next question comes from Joseph Schwartz from SVP Leerink. Please go ahead with your question.
Okay.
Great Hi, Thanks, so much from the detailed update I was wondering if you could talk about the patient inclusion methodology and criteria that you've proposed to the FDA.
For your proposed outboard indication in the NDA for BARDA ex alone and how many patients with these characteristics would you estimate of our addressable at the sites that you're targeting or focusing on for commercialization.
Right, So youre asking about like what what patients would be included essentially in the label.
Essentially just in order to exclude patients that are too too far advanced or otherwise.
Not well suited for treatment.
The chart you've found early on in development and the.
Type two diabetics the kidney studies.
Sure Colin would you like to comment on that.
Sure, we think that the the label would likely in general reflects the patients that we enrolled in Cardinal and so theres a broad age in GFR range recall that we had the.
Eligibility criteria were age as low as 12.
The high of 70 Egfr of 30 to 90 minutes above 90 is basically normal.
And we enrolled patients with all genetic subtypes and then as you alluded to we excluded patients who had a significant cardiovascular of history of BNP over over 200 peak of grams per mil, indicating that those patients were already entertaining fluid.
And.
I think I had mentioned probably a couple of years ago. Once we complete enrollment very few patients who discontinued.
Or I'm, sorry, we're not eligible to enroll because of significant cardiovascular and history of elevated BNP and so we think that those patients would represent a very small proportion of patients without force syndrome and in general.
We'll have to obviously negotiate the label with the FDA to figure out specifically, what it states and so they may draw hard volume of some of the.
Criteria or it could be less open for interpretation by the the treating physician.
But overall, we believe that.
It's likely to represent.
A large percentage of patients who.
Okay.
Impaired kidney function of who have not reached the end.
Need for dialysis or transplantation.
Hey, Joe This is Miami and then I can give you some numbers for the here right in terms of the total overall prevalence of opportunity I think we believe Bud could address the high unmet need and the estimated population of 30% to 60000 patients.
But the output syndrome in the United States and approximately 30 to 60000 patients in the EU five but if you look at the claims data of which came in the recently to the IQ of claims data. There are approximately 14000 projected patients diagnosed with output syndrome.
All of the stages of CBD in the United States and as you know the like.
Many of the rare diseases and this is all of that has no approved therapy, but that is no.
Center for physicians to diagnose and.
Identified patients and we believe many patients go unrecognized are undiagnosed or even misdiagnosed until the treatment will be of label and.
So the we are deeply committed to find those patients and as you remember last year, we initiated our agenda of genetic testing program kidney code, which was initiated to improve the accuracy and timeliness diagnosis in the United States and we were pretty impressed dried but the initial data, which we received and you would've seen of papers in the ASN.
Many new patients were diagnosed through that kidney kidney code and those patients were earlier misdiagnose. So I think it's too early to give you a specific number today, but we believe the opportunity is pretty big and it will continue to expand as we continue with our commercialization efforts and with our medical affair teams, which we have already initiated to make sure of the education and awareness.
And then I think testing is made up of label to physicians and that will keep expanding the market by itself.
Paul in the warrant do you want to add anything.
No I think you've covered it.
Thank you very much.
Okay.
And once again, ladies and gentlemen, if you would like to ask a question. Please press star and one once again two of Tau yourself from the list you May press star and two.
Our next question comes from Matt Kaplan from Ladenburg Thalmann. Please go ahead with your question.
Hi, good morning, guys.
And congrats on the progress.
If you could give us some more information in terms of your strategy with the.
Launch of the Merlin study.
In a rapidly progressing patients with C. J D and in the context of your plans to initiate additional studies in.
And other of CK be.
Indications, which he had studied before tens of Ige.
<unk> nephropathy in type one diabetes.
And at the FCS.
Your thoughts in terms of how.
Maryland, <unk> in that indication fits into your ear.
The kind of regulatory strategy for <unk>.
Yeah. So Matt you are asking about.
How merlin fits into our overall development strategy in the <unk>.
Hey, Colin would you like would you like the comment on that Colin.
Sure so as we've.
<unk> demonstrated.
In Phoenix.
And Cardinal observed activity in multiple forms of seeking its six or seven now.
And we decided to pursue.
The phase III studies with with the with two of those indications obviously upward in the first in ADP the second.
And as we think about how we progressed further with development Theres really.
Two two main pass one has to do.
On the single indication.
Studies, so the Falcon and the other Cardinal which in general would probably require 300 400, maybe 500 patients each depending upon the.
Acacia and the powering assumptions.
The other of our opportunity is to Julian the single study.
That allows us to enroll patients with multiple different etiologies, who have the common theme of likely some in <unk>.
<unk> defect in the kidney that puts them at a very high lifetime risk of progression to kidney failure, where we can also exclude patients who perhaps have significant cardiovascular comorbidities that may be targeted by other agents such as ace inhibitors, <unk> inhibitors et cetera, and so.
The data from Cardinal really struck us and that some of these patients have substantial loss of kidney function, despite receiving ace inhibitors and <unk>. The once again of the pediatric data really really highlights that with losses.
<unk> per million and two years and so we've thought about the way, but we can once again enrolled patients with the common phenotype of <unk>.
One of the few eligibility criteria.
For rapid risk of progression and what we could really increase the value to patients as well as to prescribers for use of our <unk> loans.
And differentiate the drugs versus other agents that the stacking of blood pressure or have cardiovascular effects.
And so the Merlin trials the way for us to tune up the eligibility criteria look at enrollment across sites and try to figure out how fast we can operationalize the future phase II trial that.
If we did proceed would likely allow sufficient patients to be able to power a floor of actual.
It comes composites.
Which would obviously be a very strong label, if we're able to demonstrate.
Demonstrated of difference in outcomes.
Great. That's very helpful. Thanks for the added color.
Hello.
And ladies and gentlemen at this point I would like to thank you and I'm showing no further questions in the question queue at this time.
Ladies and gentlemen, thanks for your participation in today's conference call.
As a reminder, an audio recording of the call will be available shortly after the conference call on Reata website at Reata of pharma dotcom and the investors section.
Thank you very much on your part to for your participation you may now disconnect your lines.
Okay.