Q4 2020 Galmed Pharmaceuticals Ltd Earnings Call
Good day and welcome to the conference call to discuss financial results for the fourth quarter and year end of 2020.
Today's conference is being recorded.
Before we begin please note that we will be making certain forward looking statements on today's call, including those regarding financial results statements and forecasts regarding anticipated timelines and expectations with respect to our regulatory and clinical development programs as well as other statements that relate to future events.
These statements are based on the beliefs and expectations of management as of today and actual results trends timelines and projections relating to our financial position and projected development programs and pipeline could differ materially.
In particular, there is significant uncertainty about the duration and severity of the COVID-19, pandemic and its impact on <unk> business and operations.
We urge all investors to read carefully the risks and uncertainties disclosed in our filings with the SEC income.
Moving without limitation the risks under the heading risk factors described in our annual report on form 20-F filed with the SEC earlier today.
Okay. All of it assumes no obligation to update any forward looking statements or information, which speak as of their respective dates only.
I would now like to turn the call over to Alan on her off President and Chief Executive Officer. Alan. Please go ahead.
Thank you Ralph good morning, and thank you for joining us on today's conference call.
I'm pleased to be here today with our Chief Scientific Officer will you have how you are the.
The neat.
Our Chief Scientific Officer, Vice Chancellor.
To provide you with an update on our clinical development programs as well as the report to you on our financial results for the fourth quarter and year end of 2020.
As always we will be happy to take any questions you may have.
And of our prepared remarks.
Earlier this quarter, we hosted the Kols symposium on pipeline update focusing on that on our lead compounds all of them call. It phase three assets for Nash and fibrosis and all the pipeline compound of mill of five mirror developed for chronic inflammatory disease all of these.
Of these orders.
Let me share with you the highlights of the data we presented on these two programs.
In December last year, we announced the addition of an open label part of our while we're on more phase III Registrational study.
The open label part will enroll approximately 150 patients in selected sites.
It is designed to evaluate the treatment response pharmacokinetics and safety of twice Daily administration.
All of them called 300 milligram and explore the kinetics of histological outcome measure as well as the several non invasive tests.
Including proceeds of three health and fibro scan associated with Nash and fibrosis for treatment duration of 24, 48 72 weeks.
The addition, the open label of Board includes pre and post the baseline microbiome profiling, which will help us to develop early biomarker for efficacy.
We are currently checking the microbiome print of responding patients who are on call it which is significantly earlier than the histological response.
The open label of part B start addressing questions at the Paramount not only for drug development, but also for subsequent treatment of optimization for patients.
Such of how early kind of beneficial effect on fibrosis the observed other.
Subjects that improve with longer duration of therapy.
The non invasive tests that correlate or even predict the ace political response and others.
I'm happy to inform you today that debt.
<unk> of the open label part of our ongoing phase three was approved in the U S, Canada, Australia, UK, France, Belgium, and Spain and is expected to be approved in the coming weeks, and Israel Korea, Turkey, Mexico and Chile.
Based on our plans and the rapid regulatory approvals I can confirm that the results from the approximately one third of the study population about 50 subject that has completed the post baseline liver biopsy are expected to be available in Q4, 2020 one as planned.
The language of the advancement of our uncle Melamine program. The open label part will allow US an informed decision by providing initially histology data with the higher exposure and potential for improved efficacy.
Couple of the rising at the kinetics of histological outcomes and non invasive debt 24, 48 or 72 weeks for our on call.
And long term safety data on the kinetics of histological outcomes and non invasive tests in support of the regulatory submissions.
As you May recall, the open labor Board will enroll the broadest study patient population.
The initial almost total defined including subjects with Nash and liver fibrosis stages, one to three.
Subjects with Nash, who may or may not be overweight.
In subjects with Nash, who may or may not have the type two diabetes or prediabetes.
Almost double blind placebo controlled registration of the board is expected to initiate by the end of Q1 2022 based on our own call Meglumine, which is the sole form of arm called free of seed, we dint improved target product profile.
At the end of last year, we reported first in human PK data, which show that our uncle Mega mine and the arm called free acid. The drug product that is currently being evaluated in the open label part of a more of a very similar PK profile I E very similar half life and the sales team.
Max and circulate in the blood is our on call, regardless of which drug product is the administrative side.
On the mall or uncle Magnum line, and higher scalability, which results in better homogenize the blood levels.
These PK results also suggest that we will be able to those of our uncle Magnum line once daily to get the potentially 50% higher exposure than the one we had an hour of registry to be.
The study that was already approved by the FDA, but the almost study.
By developing our own call Meg low mine, we can reverse the once daily 300 milligram treatment in the automotive tradition of apart and optimize our clinical development program towards the subpart H filing and approval.
This would also have important economic effect on our on core commercialization modeling being able to reduce cogs by up to 50% as well as gaining patent protection until 2035.
We plan to submit new peak of the new PK results to the FDA along with other supportive data in it.
C meeting planned for Q2, 2021, and discuss with F. D. A plan to introduce the oncor make the mine into the double blind placebo controlled registration of the part of the all more phase III study.
Now shifting gear to all of apartment compound of Mila five share.
I mean low fives merit is the highly potent inhibitor of chronic inflammation currently under development for IBD.
The immuno <unk> downregulates multiple pro inflammatory cytokine secretion in preclinical studies of unified <unk> demonstrated in the Philippines with Cerro amyloid day polymerization and aggregation resulted in significant reduction of chronic inflammation in multiple animal models of me.
The five mirrors the U.
Nick mode of action upstream the all pro inflammatory cytokine production, which are currently being used in clinical trials.
The Lps induced inflammation in mice, the animal model for systemic inflammation immuno five mill reduce IL six TNF alpha highest and gamma in the IL one beta levels in the serum.
Elevated levels of pro inflammatory cytokines is the hallmark of acute and chronic inflammatory conditions and are symptomatic also them on COVID-19 patients.
Earlier this week, we announced the first dosing the first in human Phase one clinical trial of a mill of <unk> there for single and multiple dosing and includes switching also include orange, losing.
Top line data is expected in the second half of 2020 one the phase one proof of concept study is planned for Q4 2021 and would include biomarker for efficacy such as reducing Cerro Emilio each day in the serum of patients.
We are currently developing of mutual funds and there is an oral treatment for mild to moderate the ulcerative colitis. However, it is the mechanism of action is relevant to other chronic inflammatory diseases. We're also looking at additional multiple indications in the world.
The formulations accordingly.
Before concluding.
In February we raised approximately 18 4 million in gross dollars in gross proceeds in an underwritten public offering and through our at the market facility.
We intend to use the net proceeds of these offerings for the continued development of our pipeline products as well as the advancement of new programs business development activities and general corporate purposes.
Last but not least is the publication of a recent paper entitled the hour on whole Downregulates SCD, one in hepatic stellate cells, but generally sell of last couple of Genesis in the in <unk> with boats.
The paper summarized longstanding research collaboration the professor of Scott Friedman Chief of the division of liver diseases. Each on school of Medicine at Mount Sinai, New York and Professor of course, the muscle of the precision precision medicine and metabolism Laboratory CIC Biogen, Spain, describing for the first time.
The role of SCD, one pocket travel of Genesis and outlining the mechanism by which all of them call. It exerts its anti fibrotic effects directly by downregulation of SD Wan and the packaged salad kits.
That's a fair to support our of course, the role in fibrosis reversal, including the potential anti fibrotic activity in the ongoing phase III of most study in patients with Nash and fibrosis.
Allison the transfer the call the our CFO the hydrogen so the high.
Thank you Alan good morning, and thanks for joining our call today.
This morning, I'll be providing you with our financial results for the fourth quarter and year ended December 31st of all of the one plan.
The more information that's one of them.
Also on form 20-F by the LLC earlier today with the SEC, which among other things provide the summary of such financial results.
Our net loss for the three and 12 months ended December 31st with the other than timing of them.
Then on $3 million and 28.
<unk>, respectively, compared with the net loss of $8 3 million and 25 million for the corresponding periods in 2019.
As a result, our loss per share for the three and 12 months ended on December 31st 2020 with 48 per share.
The $1 35 per share.
As compared.
The 39 cents per share at <unk> 97 for the corresponding period in 2019.
Research and development expenses to be in 12 months ended December 31st of all of the airplane with a $90 million and $26 1 million as.
Compared with $7 4 million, an 18 point of view for the corresponding periods of 2019.
The increase primarily resulted from an increase in clinical trial on expenses in connection with the almost doubling.
Chris in drug development expenses in connection with the manufacturing of our on call support of clinical studies.
Turning now to G&A of general and administrative expenses for the three and 12 months ended December 31st themselves and plenty of free consistent with the corresponding periods in 2019 the.
The expenses totaled $1 3 million and $4 1 million, respectively versus one three and $4 two for 2017.
During the three and 12 months ended December 31st of the South of employee we had a net financial income of the one 1 million in one form of unexpectedly vs.
0.3, and $1 9 million doing the solvent.
Our cash balance as of December 31st of all then 'twenty, which you can cash cash equivalents of restricted cash short term deposits and marketable debt securities or the fifth.
The $1 million.
The amount does not include 17.
And the net profit growth.
February came on underwritten public offering from our ATM equity facility.
With that said operator, please provide instructions for the Q&A portion of alcohol.
Thank you.
If you'd like to ask a question today. Please press the star one from your telephone keypad and of confirmation tone of indicate your line is on the question queue.
You May press Star two of you like to remove your question from the queue.
From just sort of using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
On the one please while we poll for questions and once again Thats star one to ask the question.
Thank you.
My first question is coming from the line of Ed Arce with H C. Wainwright. Please proceed with your question.
Great. Thank you and good morning, everyone.
Thanks for this update and congrats on the recent progress.
Our first question from me is Alan if you could.
Remind us of the timeline now as you look to switch.
And the are more of a study to the meglumine the.
Beginning with the actual.
Switch of dosing and then ultimately full enrollment and expected data readout. Thank you.
Okay. So so thank you Ed.
So as I said, we are now expecting to reinitiate the double blind bars of the almost study by Q1 'twenty to 'twenty two.
If all goes well and there's no reason to believe that the things I mean as far as we can see everything is going as planned.
We are expecting that to enroll 1000 patients in 18 months.
So that will take us through our Q3 'twenty 'twenty three.
Then there is a very much would depend on the open label study what day. It was yeah. It would be 48 weeks of treatment of 72 weeks of treatment. These data will be able to generate from the open label kinetics efficacy connecting study we are still hoping that the 48 weeks will be sufficient.
The difference between the 48 and 72 weeks in terms of efficacy. So that's one year later, so we're talking about Q2 2024.
So around that time, we should be able to submit the AR or on coal for a sub H conditional approval of course.
We will continue at the time it will continue the recruitment of the additional 1000 patients which are needed for the outcome part of the study.
Fantastic Great and.
And then a couple of follow ups as well turning to your pipeline.
Pipeline.
Candidate of mellow of fly from her.
Clearly you're focused on the IBD as you just started your phase one this week.
But you also mentioned that there is a potential.
Potential given the mechanism.
For other types of chronic inflammatory conditions and I'm wondering if you could describe some of those that you think might be interesting.
For this compound and then lastly.
How should we think about the level or the pace of the increase of the R&D expense.
Through 2021 on given the support.
The both are more and then the Amira all five of our development.
Okay. So first week.
It's the the mechanism of action of a middle of five never indicate.
It is relevant for a number of chronic inflammatory diseases.
The one which comes immediately the mind he's already.
And the COVID-19, which is more relevant the two nowadays.
We as I said, we said before we are looking to develop the the these compounds gradually so the first thing we would like to see ease of a biomarker in the phase one the study.
We described in our.
Investing on our symposium on Okay, what are the symposium.
On the go these studies going forward.
20 patients.
And the it would the earlier.
Disclose the we're expecting to initiate the study in the second half of this year.
The study would initially be for IBD.
We are also the things on looking for if someone's honestly since these are very small.
Proof of concept biomarker studies, we would be looking also to initiate and subject to formulation that we are simultaneously a day.
Eloping different formulations from different indications, we would also look for an oral <unk> in an oral.
Formulation for the I V D forthright in light of piece, that's we wouldn't develop a liquid formulation of an injectable formulation for array, which is also local for the joints.
The COVID-19 needs of different story, it's more opportunistic and I assume we would only go to the direction, if we'd be able to secure.
Financing from a governmental regulatory such as the board Oh, NIH or local financing, we will not go into that the independently. So that's about the current other indications we are not going to pursue multiple sclerosis and the other indications.
Each of relevant from the mechanism of action. This is a completely out of the scope of government.
We are definitely open for collaboration so so if there'll be any pharma partner of debt.
We'd like to collaborate with US based on the <unk> study for any of these indications CNS indications, we'd be very happy to collaborate on that.
As to financing.
This is I think one of the advantages of working from Israel.
You've seen so far we've managed to do all of the work all of the R&D work of a millimeter are under the radar with the very low R&D budget.
So.
Really we are talking about a single digit a so so so far we spent about a $1 million to $2 million on the AR on the middle of five mirror.
And early work is the early R&D work of steel in the same magnitude.
The a phased phase one studies the phase two studies are still in the same ballpark number between one to 2 million U S dollars, so with our cash balance it doesn't really.
Ah disrupt our main activity, which is the initiation of the phase III.
All of them more part of the Oh.
Three of the stretch of a part of the face of the almost study.
Great Alan and if.
If I may squeeze one last one of them actually what I was actually trying to determine a better question really is.
Is there a of budget in mind that you have for the overall are more program in terms of our R&D spend.
Yes.
And you know, it's it's it's varies with the.
The the number of variables so it's very difficult.
We are talking definitely booking Ah of south of one hundreds of million U S dollars.
But it will very much depend on what would be the competitive landscape at that time.
We've seen today.
And again as a reminder, we are a 50% of the patients at least 50% of the patients will be recruited outside the U S. U S patients of the most expensive patients so 50% would come outside of the U S. And we have we know that are on average.
Each other.
These are tough or even a third of the cost of our U S patients.
The other 50% is the depends very much on the competitive landscape of sleep.
So to the the morning, the news about mobile and Gilead are initiating another phase two large phase two study for a combination of.
Well it depends on how many of the pace to be.
Assets would advance by next year, when we start to ramp up the the recruitment for the phase III.
The discretionary into phase III.
So so we're still we still believe the pieces are just as a reminder of the budget for that we had so far from the phase III, what was about $65 million.
Since the 150 patients that are now in the open label on most part of the double blind part a we still have to call on the full number of 65 million but.
Subject to the market condition that may increase in my mind I have somewhere between 70 to 80 million a day.
These are not firm numbers. These are are these numbers the shouldn't be validated once.
We have all 200 centers open and in the loop.
And we would like to ensure that recruitment would be on time as planned with 18 months and that may require additional funding.
Great. That's very helpful. On thank you so much.
Thank you Ed.
Our next question is from the line of Steve Steve <unk> with Raymond James. Please proceed with your questions.
Hey, Good morning, everyone. First question I had was just on Nash.
You know I.
I understand the FDA is the open tour in fact, encouraging sponsors to run phase III programs now with histology data in let's say of three patients, but also looking at for patients to collect outcomes.
The data as part of the sort of broader.
Pivotal program I'm curious if that's something you expect to discuss at the type C meeting that you have scheduled or GAAP.
<unk> thinking about.
Correlating at four patients into a phase III design.
So yes I've seen thank you. Thank you for the question Steve I've seen debt also but this is not part of the guidance. We received from the FDA. We are not recruiting patients to the study. Our study population has not changed in the double blind registration of park. It is true in F. <unk>.
With the risk factors. So so it's really the new proposed.
Structure is not relevant for government.
Okay Perfect and then the other question I had on also on Nash was just with respect to phase one studies.
The hepatic impairment cardiac repolarization I think there were a few of these that you'd mentioned in the past I'm curious if those are being run with the Ram called Meglumine.
Now given the the transition of the program.
So basically the.
Studied the hepatic impairment has been progressed very well there was some delay due to COVID-19, but the rate of recent weeks we've.
We've accelerated we've already completed the.
Single Administrated dose and the and we've almost completed the multiple administrated dose both for moderate and the mild patients fueled more patients that needed to be recruited in the severe part.
The as our on call and Meglumine in the RM called stipulate at the same moiety.
The difference between the two so what we've done we have done and are in the future of studies that we have conducted so far.
Based on our on call and use the black EQT, if would need cardiovascular not sure debt we will need this is another.
And the seat that would come from the open label study of collecting the data from these 150 patients based on these data we may get an exemption from the EQT study of future studies of course debt unnecessary for a proven we'll be done with our ample meglumine.
Perfect. Thanks for the clarity on.
Thank you Sir.
As a reminder, you May press star one if you'd like to ask a question on <unk>.
Next question is from the line of Christian <unk> with Cantor Fitzgerald. Please proceed with your question.
Hi, everyone. Good morning, and good afternoon, and thanks for taking the question.
So the first one I had was as it relates to the upcoming armor data do you think it's possible that this could be presented at the liver meeting during the fourth quarter and then can you remind us about the current IPSA on Aramco Meglumine I know you recently had the U S. Panic step of here is it just now that the.
Composition of matter of patents are pending at this time.
Okay. Thank you, Chris and for our for your question. So.
I E. We made the you know just missing the deadline for it every day.
The the because we're expecting the data to come in early Q4, and the the I think the a couple of pages September. So I don't think that we'd be able to get we will try and get into the late breaker, but I'm not sure there'll be acceptance of the late breaker. The certainly we are going.
To communicated these data as soon as a as we have the first analysis. This is an open label study. So we are accumulating all the data on a regular basis. So we would try and and if the data would be overwhelming maybe you know we win we win.
Wait for the 50 patients and report something of the 30 patients or so or when in order to meet the the timelines.
But I cannot promise that.
In terms of the pattern of the Encore Meglumine patent is the extent expiry date is December 20 of 34. So we are protected before.
And before the patent extension before that exclusivity before any of these kind of.
Additional the.
Times, we are free.
Protected until 2035. This is based on the new patent that was already accepted in the U S for low dose administration of our M call.
We are still waiting for the composition of matter.
The patent for all of them call Meglumine to be approved in the U S. In the same way. It was approved in the rest of the world and I'm sure. This will come very soon but the protection of patent protection in the U S is already there from the passenger it wasn't that was accepted on the low dose.
Administration of all of them.
Great. Thanks, so much and then just on the 50 patients that you've completed enrollment for could you speak to your level of confidence in collecting all of the key data that sometime during the fourth quarter in light of of the pandemic and I know that things have changed quite a bit from the.
The last earnings call just with the rollout of some of the vaccine.
Hum.
No we have no.
The system here is geared for a large phase III study of 1000 patient study.
On the way, we read the biopsies with the three windows and the old and the and the adjudication of the DMC I mean that the collection of everything is done in a standard of a registrational phase III study.
We have no problem.
Whatsoever, and collecting the data and I have very high confidence that indeed, we will meet these these timelines.
We are in fact, we are seeing a surge in the number of and the number of patients that have now been randomized in the.
The some restrictions COVID-19 restrictions have been lifted.
So numbers are very encouraging even even new recruiters.
Screenings.
The very very encouraging the numbers that I've seen in the last two weeks and please remember that we are operating now in selected sites out of.
Of the 200 sites that we have for the double blind. The art. We are only operating in 55 zero 50 selected sites, which were less affected by COVID-19 to start with so there's no we've been working with the sites now for a year in the half and other.
It's the it's a very good collaboration so I don't see any any interference and I don't see any risk in this.
Reporting of data.
Okay, great to hear thank you so much Alan.
Thank you Kristen.
Thank you at this time I'll turn the call over to Alan for closing remarks.
So I would like to thank you all for joining the call today as always we're always available for follow up calls and the.
E Mails and day she does any additional information if you would require of us.
On both on our on call, but the most specifically on a mill of five in there which is the.
An exciting time in all the time.
I'm, having a new compound now getting into the clinic and and the looking forward and keep safe and looking forward to talking to you on the next investor call.
Thank you. This will conclude today's conference you may disconnect. Your lines at this time of thank you for your participation.