Q4 2020 Eloxx Pharmaceuticals Inc Earnings Call
Good afternoon, everyone and welcome to the <unk> Pharmaceuticals fourth quarter and full year 2020 earnings webcast and conference call. Today's call is being recorded at this time I would like to turn the call.
Over to Barbara Ryan Investor.
Investor Relations.
Please again.
Thank you Victor welcome and thank you for joining US. This afternoon for a review of Elis Pharmaceuticals fourth quarter and full year, 2020 financial results and business update joining me. This afternoon are toxic ranked Williams, our Chief Executive Officer, Neil Beloff, Chief operating Officer, and General Counsel Dr.
Tom Haverty, our Chief Medical Officer, Dr. Matthew Garrett, Vice President and number of search and Stephen Macdonald, Our Vice President of Finance and accounting.
Before we begin I would like to remind you that any statements made during this call that are not historical are considered to be forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995 actual results may differ materially from those indicated by these statements as a result of various important factors include.
And those discussed and the risk factors section and our most recent annual report on form 10-K filed with the Securities and Exchange Commission as well as our other reports filed with the SEC any forward looking statements represent our views as of today March 11.
2021, only a replay of this call will be available on the company's website www Dot <unk> pharma dot com. Following the call. It is now my great pleasure to turn the call over to Dr. Greg Williams, Chief Executive Officer of <unk> Pharmaceuticals.
Thank you Barbara and welcome to <unk> fourth quarter, and full year 2020 earnings webcast and conference call.
We are continuing to advance our clinical and scientific programs for our E. R. S. G Library.
And as a priority.
To complete our phase two clinical trials for <unk> and cystic fibrosis and we are on track to report top line data and the first half of this year.
We believe that these proof of concept data will be a substantial value inflection point for our company.
As we previously shared we are pleased that youll ex so two phase II clinical trials independent safety review committees have concluded several planned meetings and allowed dose escalation up to the fourth and highest dose level.
To date, no drug related serious adverse events have been reported.
We are conducting these global trials the top CF clinical trial sites and are grateful that the cystic fibrosis Foundation has recently expanded their financial support beyond the U S to provide increased funding for our global your line. So two phase two clinical trial program.
And the expressed level of interest and support from top investigators trial sites and patient advocacy groups has been a fantastic benefit to the program.
Previously we've shared that we continue to evaluate additional clinical trial sites and other countries, where patient enrollment and maybe feasible.
We're pleased to report that we are opening additional clinical trial sites, and Australia and Canada.
As you know the cystic fibrosis Foundation has launched a $500 million path to a cure initiatives.
Moving to funding cures for all CF patients.
The foundations initiatives is prioritizing innovative approaches for individuals who do not respond to currently available treatments.
This includes those with nonsense mutations such as cheese 542, ex which is the focus of our <unk> phase II clinical trials.
Patients with nonsense mediated cystic fibrosis represent about 12% of the CF population. According to the cystic fibrosis Foundation.
Potential ability of and an investigational drug such as he liked so too to restore functional <unk> protein production in these patients could be a major advance and substantially improve the length and quality of their lives.
We believe that you'd like so too has the potential to be and important disease modifying therapy for these patients who feel left behind and have few if any treatment options.
We are committed to advancing the development if you like so to as quickly as possible.
Substantial advances have been made and the treatment of patients with cystic fibrosis with the introduction of disease modifying therapies, including the recent triple combination Troy Kafka from vertex.
While the benefits to patients have evolved as monotherapy transitions to combinations and most recently to the Triple combo. There remains a high unmet medical need among the 12% of patients with nonsense mediated disease for whom there is no approved therapy.
These difficult to treat patients are often the most severely afflicted by this disease.
Patients with an S. Five O Tel O Lille or another difficult to treat population where single agent Kalydeco was not effective.
And next generation combination products or can be and some deco demonstrated a clinically important benefit and these patients.
There was a five to 11 millimole per liter reduction and sweat chloride concentration for candy and a reduction of 10 millimole per liter from some deco.
These changes were associated with increases in S. E T one and the low to mid single digits.
And for our Caf to the Triple combo therapy has moved the needle even higher with sweat chloride concentration reductions from 42 to 45 millimole per liter, which were associated with 10% to 14% increases and that fee would be one.
We are evaluating <unk> as a single agent for another difficult to treat cystic fibrosis patient population.
It was with the G 542, ex mutation on one or both of wheels.
Our CF Phase II program consists of two open label trials, one for clinical investigators enrolling patients at sites in Europe, Israel and Australia.
And second enrolling patients and the United States and Canada.
Both trials focus on CF patients with at least one G 542 ex nonsense mutation.
And as I mentioned earlier, our global trials are being partially funded by the cystic fibrosis Foundation and our per.
Protocol has been endorsed by the C. F F therapeutic development network, the largest cystic fibrosis clinical trials network and the world.
And Europe, our protocol has been endorsed by the E. C F S clinical trial network.
The FDA has granted <unk> and orphan designation for cystic fibrosis, which confer a certain import important benefits to support development of medicines for underserved patient populations.
It looks so too has demonstrated pronounced C. F T. Our read through and plasmid H B E and F. R T and transgenic mouse models.
We've worked extensively with the hub Cubic's Organoid technology.
To better understand the electro twos activity across the cystic fibrosis and nonsense patient population and their library of patient derived organoid.
You look so to demonstrate significant restoration of CFT, our activity and patient derived organoid representing over 75 per cent of all nonsense allele.
Our screening programs continue to evaluate opportunities to advance the electro too and other novel molecules from our E. R. S. G library for new indications.
And so our R&D team continues to advance these programs, we expect an acceleration and the pace of publishing our results and important scientific and medical journals.
As a result of our progress we've had six scientific manuscripts published since April 2020, and we expect the steady cadence of publications free electro too and E. R. S. G library to continue.
In January the results of our renal impairment trial were published in the journal of clinical pharmacology and the results of our phase one b multiple ascending dose trial W. Waiting the safety and pharmacokinetics of helix. So two and healthy subjects were published in the journal clinical pharmacology and drug development.
And February scientific manuscript was published in the journal of cystic fibrosis on the results of our evaluation would be like so two mediated read through using the CFT are dependent force Colin induced swelling assay across a selection of G 542, ex homozygous and heterozygous patient derived Organoid zone.
And October 2020.
And our senior medical consultant Professor Eitan Kerem M. D globally renowned cystic fibrosis expert published a review OBL ex so too and the journal expert opinion on investigational drugs.
We also had a scientific manuscript published in the journal of experimental I research, which demonstrated the achievement of an important proof of concept milestone from our ongoing IND, enabling studies demonstrating restoration of protein production and the eye when injected intraventricular and a mouse model.
And a few moments Dr. Matt <unk>, our vice President of research will provide you with some highlights from these most recent publications.
We continue to be focused on delivering value to shareholders, while fulfilling our mission to provide treatment options to patients with high unmet medical needs and the most safe and expeditious manner.
We're the most advanced company tackling the great challenge of developing potential new therapies for nonsense mutations and Theres, a high level of interest and enthusiasm and the scientific and clinical community for our programs as well as and the business community.
We will continue to pursue partnerships where appropriate to expand our therapeutic footprint accelerate our progress and advance our pipeline.
We ended the fourth quarter of 'twenty, and 'twenty with $24 $7 million and cash and cash equivalents were on target to deliver top line data for <unk> and cystic fibrosis and the first half of this year.
We have a strong and experienced team with expertise and clinical drug development basic research and regulatory affairs.
I'm highly confident that we have the capabilities and the resources needed to deliver on our goals.
I would now like to turn the call over to Dr. From macro Darris, our vice President of research, who will expand on our recent publications and ongoing research activities.
Thank you Greg.
We continue to advance our preclinical efforts across our ear S T a library of molecules.
And with our research partners to advance our programs and.
And as Greg mentioned, we are pleased to have had several of our scientific manuscripts published and leading peer reviewed journals and plan to continue to present, our findings at scientific conferences.
In February we published scientific manuscript in the journal of cystic fibrosis title.
Targeting <unk> <unk> C F T R knots, and soils with El ex owe to restore see FTR function and human derived intestinal and work noise.
This manuscript details the work we performed using G 542 ex patient derived organoid.
As you know G. Five for two ex is the most common nonsense mutation and the population of people living with cystic fibrosis.
Like other nonsense mutations and <unk> 40 works change introduces an early translation stop and see FTR gene leading to a truncated and unstable protein product.
Current modulator therapies designed to improve see FTR activity are ineffective when see FTR protein is not being made.
To overcome this sells must be able to ignore or read through this stopped signaled to produce full length C. F. T R.
<unk> is a compound that interacts with the ribosome to induce mrna read through across many experiments we observed that youll ex O. Two can produce active see FTR protein and Organoid with G 542 ex mutations.
And no CFT our activity is found and these G 542, ex org and always went untreated and increase in activity as seen with increasing amounts of El ex O. Two.
We also observed that Youll ex O two increases to see FTR mrna transcript.
<unk> molecule used to produce the protein and about five fold and some cases.
As he L XO to advances to the clinic for people with CF due to cheap high for two ex mutations and we will continue to test the molecule with other types of nonsense mutations to determine if day to may benefit from this approach.
As Greg mentioned, we also recently published results from two important trials from our El ex O two phase one program.
And January the results from our renal impairment study were published in the journal of clinical pharmacology.
And the pharmacokinetics of El ex owe to tell us that the compound is excreted from the body unchanged and the ear and rec.
Recognizing that some of our potential target population may have reduced kidney function. This clinical study is a critical piece and our ability to dose adjust based on renal function and this study, we evaluated pharmacokinetics and safety and participants with varying degrees of renal impairment and the results demonstrate the relationship between plasma.
And that exposure and a key measure of kidney function Egfr.
A second manuscript was published in January and the journal of clinical pharmacology and drug development and covering our multiple ascending dose trial.
This study included 62 healthy volunteers and covered the dose range, we are evaluating and our cystic fibrosis trial.
We found that <unk> plasma exposure was dose proportional with no apparent accumulation and no severe or serious adverse events reported.
Together these clinical studies and our preclinical efforts laid the groundwork for our currently ongoing phase two trials.
Our preclinical progress applying novel compounds from our E. R. S. G library of read through compounds and autosomal dominant polycystic kidney disease, ADP KD and inherited retinal disorders continue.
And building them out models to evaluate the 80 P. K D nonsense patient population, we enlisted the support of Dr. Benjamin Freedman.
Professor of the division of Nephrology at the University of Washington, and.
Dr. Friedman is our expert and differentiating induced pluripotent stem cells and to three dimensional kidney organoid capable of modelling cyst formation observed and ADP J D.
We have modeled the most prevalent 80, PK D nonsense mutations and the cells and we anticipate providing updates on <unk> ability to prevent or reduce this and these organoid along with other program progress over the coming year.
Our inherited retinal disorder program continues to focus on pre IND, enabling work sustained release formulations and evaluation of a novel disease models through research collaborations.
The inherited retinal disorder landscape is genetically diverse however, we believe that a single agent read through approach may be able to broadly address multiple different inherited retinal disorders provided they are caused by nonsense mutations.
In order to expand our ocular research footprint and ensure we are evaluating the most relevant cellular and animal models of nonsense mediated blindness. We have established research collaborations with ocular disease experts at the University of Maryland University of Wisconsin, and UCLA and look forward to sharing more results as the programs.
Progress.
As always our latest public patients and presentations can be found on our website.
I would now like to ask Steve Mcdonald, our vice President of Finance and accounting to provide a review of our fourth quarter and full year 2020 financial results.
Thanks, Matt.
As of December 31, and 2020, the company had total cash and cash equivalents of $24 $7 million, which.
Which we believe will fund the company's operations through top line data and cystic fibrosis and into the fourth quarter of 2021.
For the quarter ended December 31 2020.
The company incurred and net loss of $6 1 million or <unk> 15 per share.
As compared to a net loss of $11 6 million or 29 per share for the same period and 2019.
Noncash stock compensation expense totaled $1 3 million with $1 1 million allocated to G&A and 200000 to R&D.
Fourth quarter, 'twenty, and 'twenty R&D expense totaled $2 $6 million.
And compared to $5 9 million for the same period and 2019.
The quarter to quarter R&D expense decrease was driven by reduced headcount and related salaries for 2020 period.
As well as decreases in certain clinical and preclinical research costs.
G&A expense for the fourth quarter of 2020 was $3 $1 million, which decreased from $5 6 million for the same period and 2019 due to lower head count and professional services costs.
For the full year ended December 31, and 2020.
The company incurred a net loss of $34 6 million or <unk> 86 per share as compared to a net loss of $50 9 million or $1 34 per share for 2019.
Noncash stock compensation expense totaled $8 $7 million with 1 million allocated to R&D $5 6 million to G&A and $2 1 million to the corporate realignment in February 2020.
Full year 2020, R&D expense totaled $14 $6 million.
Compared to $26 3 million for 2019.
The year to year R&D expense decrease was driven by reduced headcount and related salaries for the 2020 period, as well as reduce costs relating to certain clinical and preclinical research activities.
G&A expense for the full year, 'twenty, and 'twenty was $14 $8 million, which decreased from $24 $2 million and 2019 due to lower head count and professional services costs.
For your modeling purposes, our total shares of common stock outstanding as of December 31, and 2020 were $40 million 157000.
This concludes the fourth quarter and full year 2020 financial comments and I'll turn the call back to Greg.
Thank you Steve.
It's our highest priority to complete our phase two proof of concept clinical trials and cystic fibrosis. We are on track to report topline data on the first half of this year.
We believe that these data will be a major value inflection point for our company.
We're pleased that the independent safety review committees of our electro two phase II proof of concept clinical trials have allowed dose escalation up to the highest dose level and that to date no drug related serious adverse events have been reported.
The patient population. We're studying has few if any treatment options and the potential for electro too to restore the production of see FTR protein could be a substantial advance and meaningfully improve the quality and length of their lives.
We are laser focused on assuring that we are investigators.
And global clinical sides can accomplish these goals and we are pleased to be opening additional clinical sites in Australia and Canada.
We're also gratified that the FDA has granted orphan drug designation free and like so too.
Treatment of cystic fibrosis, which confers several important benefits to the Yale ex so two program.
Beyond cystic fibrosis, we continue to advance our portfolio of novel E. R. S. T molecules. Several of these compounds demonstrate encouraging levels of read through activity and Tolerability and supported their foods and therapeutic development and multiple disease states.
As we continue to advance our programs and Theres been a marked acceleration and the number of scientific manuscript is being published and important journals and we continued to present meaningful data at scientific conferences.
We thank you for joining us on our fourth quarter 2020 earnings call and we look forward to continuing to update you on our progress.
Operator, you May now open the call for questions.
Thank you as a reminder to ask a question you will need to press star one on your telephone.
And to enjoy a question press the pound key.
<unk> bio police and biologic.
The Q&A roster.
Our first question and I'll come at it from a line of Ted <unk> from Piper Sandler you may begin great.
Great. Thank you very much appreciate our free.
Update and you're taking my question what is sort of a sense for what would you see oh win.
And these two.
And agreement.
Communications.
Or non tungsten and patient pardon me.
No theres nothing really that works out well there. So what are you kind of see as sort of a threshold for success.
Yeah.
Hi, Ted Thanks for the question.
So.
When we think about patients with no meaningful.
Therapy no available therapies.
We think about or can be like and it's and deco like performance.
And as being the threshold for clinically meaningful changes.
And those compounds also represent a reasonable threshold for a regulatory approval just to remind you or can be came in with <unk>.
Sweat chloride concentration reductions and the five to 11 millimole per liter range.
And in bigger studies over longer periods of time, where can be was associated with.
F N b, one increases and the range of 2.72 about five 6%.
Some deco.
It was a little better with overall sweat chloride concentration reductions and the the range of about 10.
With F E V one increases and the range of about 4% so from our phase two <unk>.
Study.
We would be looking for a threshold.
Of sweat chloride concentration reductions that would be or can be and soon deco like that would be and the five millimole per liter.
Concentration reduction.
Great that's very clear and very helpful and looking for data. Thanks.
Thanks Ted.
Okay.
And our next question on Sunshine and so.
And those things and can afford.
You may begin.
Hi, Thank you guys for taking my question on.
I guess kind of building.
Building on on Ted's questions here.
Could you maybe give us a sense of what the variability is day to day of sweat chloride and I.
And I guess in inter patient variability and then.
And then also.
You know what.
Net.
What are you planning to report what what are the data that we're gonna get other than I guess, sweat chloride and and and.
Initial safety data on them.
How many patients and.
Uh huh.
And and.
Well you obviously are at the highest dose cohort, but will you report data from from all the dose cohorts and.
What what territories as well.
And then on.
Also I guess building on on that question on what's a good result is it important to see a dose response.
And obviously for the Cystinosis data.
And we didn't quite see a dose response and I'm just curious if that's going to be important and she does.
Thanks, Michele we appreciate the questions.
You've you've asked a few there so.
I will try to take them and turn and see if I've captured them all.
First you asked about what would be some of the variability may be inter and intra patient associated with sweat cord concentration changes.
And the literature the literature tells us.
Wouldn't be surprising to see changes around eight or nine millimole per liter kind of up and down. So it's important to have sufficient numbers to be able to really tease out the five to 10 thresholds that we'd be looking for in terms of or can be worse and deco like.
<unk>.
Responses.
We're not today, providing updates on our exact enrollment and the details of what our top line data will consist of but we will be providing those in the future.
We will be cooling data accrue.
Our clinical sites.
In Europe, Israel now, Australia will also be adding data from the U S as well as from Canada. So we'll give you a broad dataset that represents.
The body of data that's available at that point in time.
And we would anticipate seeing a dose response.
With Cystinosis, we did see a good response at one milligram.
Per kilogram.
And we didn't see any response and what was your 0.5, we saw a good response at one when we got to the higher dose of two we had two responders, but there was an issue with the third patient.
I think we identified a threshold for activity and the Cystinosis trial, but with more patients in the CF trial, we would expect.
They're to be on.
More clear cut dose response.
Cost of four different doses that were evaluated did I cover all your questions.
Yes, you did you did a wonderful job covering all my question. Thank you.
Thank you.
Yeah.
And it is and they're showing any further questions and the Q I went and shouldn't call back over to Brad for any closing remarks.
Well thank you.
Really appreciate your interest and your attention and he walks, it's an exciting time for US we remain on target to report top line results and the first half of this year and we're looking forward to updating you as we continue to progress. Thank you.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating.
May now disconnect.
Okay.
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Yes.
Okay.
And.
And.
Your line.
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