Q1 2021 Tricida Inc Earnings Call
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Good day. Thank you play standing body on the welcome. So that's why you see the first quarter 2021 financial results conference call at the.
This time, all participants are in a listen only mode.
After the speaker's presentation, there will be a question and answer session to ask the question during the session with each of past.
Tier one on the telephone please be advised that the the skol each being recorded if you require any further assistance. Please press star zero. Thank you.
I would now like to hand, the conference over to your speaker of today Ms. Jackie Kauffman the floor is yours.
Thank you Alex good afternoon, and thank you for joining the <unk> see the first quarter 2021 financial results and business update conference call on today's call very clear on our founder CEO and President will discuss an update on our ongoing dollar she kidney study the potential for near term data based on first.
The Prespecified interim analysis for early stopping for efficacy.
And our strategy for Reengagement with the F D. A Geoff Parker our C. O O N. CFO will then discuss our upcoming business activities and financial results for the first quarter and review our financial guidance. Please note that in today's call we will be making various statements that include forward looking statements as defined under applicable securities laws.
We're looking statements include our anticipated activities related to our ongoing renal outcomes trial, the valor C J D.
Our plans and interactions and communications with the FDA, our plans and expectations regarding potential pathways to approval of the xyrem or by the FDA and our expectations regarding our financial runway management's assumptions expectations and opinions reflected in these forward looking statements are subject to risks and uncertainties that may cause.
Actual results to differ materially from any future results performance or achievements discussed in or implied by such forward looking statements price either can give no assurance that these statements will prove to be correct and we do not intend and undertake no duty to update.
We also urge you to read the risks and uncertainties associated with our business that are described in our filings with the Securities and Exchange Commission.
We issued our first quarter financial results press release. This afternoon, just after the close of market for copies of our press release. Please go to Www Dot tried to the dot com and follow the link to our Investor Relations page at this time I'd like to turn the call over to Gary.
Thank you Jackie and thank you all for joining us today.
Primary of focus this year is on the <unk>.
Continued execution of the valid I think any real outcomes trial, which is designed to assess whether the very men can flow kidney disease progression in patients with metabolic acidosis and ticketing.
Given the complete response letter of that'd be on since last August and the appeal of the night letter from the Fda's office of new drugs, which we discussed at length. The earlier. This year. We believe the offer of a path forward for the potential pool of off of Irma is to provide additional data to the FDA from the ongoing outcomes trials.
We believe that positive data from our Zika in the out of the very much the ability to so think of the progression of our improved physical function would enable the productive discussion with the agency.
I'll talk about our plans to re engage with the FDA shortly but first let me provide an update on how the trial progress.
On slide three as a reminder, on I was thinking he is a randomized double blind placebo controlled trial that is designed to enroll the sixth subject the pro.
And part of the trial is the first time to first the crimes of D. D 40, the finance arena that he has a day well confirm guidance of 40% of reduction in Egfr the.
The port of call. It two pre specified interim analyses from early stopping for a fixed fee Inc.
From one of the craft 150 events in the interim to hooker off the 250 of us.
If the criteria from early stopping on not met the trial is scheduled to conclude on the independent Unblinded endpoint Adjudication Committee is positive the adjudicated $511 40 of it.
The trial is designed with the 87% power to show a 24 per cent of difference in the primary endpoint of it.
So that's another way that assumed hazard ratio for the powering of the buyers think of antitrust 0.76.
As you can see on slide four as of.
May 4th 2021 of I always think of the trial is randomized sporting on 40 of six out of the subjects from the App.
The treatment duration of approximately 15 months and the trial is of course 95 subjects with positive of the adjudicated primary endpoint of events towards our goal of 511 of that.
The projected event rate of I was thinking he is laid out on slide five so far there of 95 saw the subjects with the adjudicated from in front of event, we've accrued 26 additional subjects with adjudicated events since our February 25th fourth quarter financial results call.
Over the past two months of the rate of event the clause increased.
And is currently tracking closer I mean estimate.
The rate of of calling out in front of US is key to determining the timing of the interim analysis, assuming that the accrual of endpoint events of opinions at the projected rate as previously communicated the estimate that the number of adjudicated endpoint of events necessary for the interim on an interim two analyses would occur in the second half of this year and some.
Time around mid 2022, respectively.
On slide six at the bottom of the slide you can see that our approach to the two interim analyses as to keep of the majority of the offer for the final analysis at 511 event and the allocate meaningful alpha to the.
One of the 50 vented office.
Very little of the allocated to that there's relatively low probability that the 150 event the interim would lead to early stopping.
Put another way of looking at the interim analyses assuming the true hazard ratio is in line with all the trial design I E seven six.
Of a 1% chance of stopping it from one and two.
The 1% chance of stopping of the interim to 60.
The 65% of polymer meaning for the final analysis at 511 events from the overall par of 87% from the trial.
Given the hazard ratio observed from some of the academic trials related to metabolic acidosis and our own three of any trial. That's historic evident the treated populations of metabolic acidosis patients may experience greater benefit than the retrospective predictive models put indicated the.
Therefore, if we were to assume the true hazard ratio of <unk> seven O. Instead of point of 76, the probability of stopping early doubled to 40% of interim too.
Extending the true hazard ratio, the 0.6 and five of the combined probability of stuffing early and you know the first or second interim analysis increases to <unk> 83 per cent at 99% respectively.
And if he were to observe the hazard ratio of <unk>, six seven or less of them to the trough.
Would meet the criteria for all of the stopping for efficacy.
As such because of the interim too an important milestone for the <unk>.
All of US he can he trial and off of the well spent.
The interim analyses conducted by the independent Unblinded interim analysis of committee and of this committee does not recommend the stopping the trial early for efficacy we received no information from the interim analysis if however.
Data from the trial once a year of the statistically significant result for the primary efficacy endpoint it could potentially form the basis for resubmission of the NDA through the traditional pull the pathway.
Now turning to slide seven.
We may find ourselves in a situation where the must stop the trial currently for administrative fees.
As you're aware of.
Conducting clinical trials of expensive and uncertainties kind of rise at anytime.
If we are unable to ensure that we have adequate resources to complete the trial in accordance with the protocol or other events occur, which diminish the likelihood of reaching 511 event. We may explore the possibility of stopping the trial early for administrative reasons, which could occur prior to the following either of.
Both of the type of interim analysis any such decision would be made in the future of based on the range of considerations, including our ability to the reason, we stopped and wind down on the trial consistent with our regulatory and ethical obligations and within the confines of all of financial runway.
If you were to stop the study for administrative reasons the day.
Obtained from the study will be analyzed using all of our remaining at that time.
As an example of how all of the off of it would be applied to the administrative stuff I will use the 250 of N time point as an illustration of the power of the trial and the administrative stuff.
Assuming a true hazard ratio of <unk> 76 of the trial was stopped for administrative reasons of 250 event you would have 58 per cent Paula just seen 24% of deduction and the very members of placebo and part of it.
To provide you with the sensitivity analysis, if the treatment effect on the bot trial of slightly higher and we have of true has the official of 0.7 O. The power of increases to 81 per cent of stop at 250 events.
Switching from power to observe the hazard ratio of statistics it could be successful of 250 event, if the observed hazard ratio of seven eight it.
It is noteworthy that this hazard ratio, there's not much lower than the 0.83 hazard ratio of acquired at the final analysis of 511 events shown on the price side, if the data from the trial after that but as I have stopped but the yield statistically significant results for the primary efficacy endpoint it could potentially of form the basis for resubmission of the NDA.
So the traditional the tool the pathway.
India event at the primary endpoint was not met.
We would evaluate other endpoints related to seek a day progression as of.
Well, its physical function and standby common of endpoint, which could inform our discussions with the FDA and or additional clinical investigation of the effect of the very much on these price.
We've highlighted on slide eight the key zero and ADL issues.
We believe data from both of the thinking he will be very important in determining the regulatory path for approval off of their ulta.
Ultimately all goes on to one generate outcome data showing the impact off of very low and seek any progression and to show that the data are applicable to the U S population.
If we are successful on both counts, we believe that the data could address the regulatory concerns expressed by the FDA in the Sierra on India.
I would note fda's acceptance of the politics of the data in support of an NDA re submission, including the acceptability of the data from non U S countries or regions, which will comprise a substantial portion of the data from the trial of the ultimate they'd be a review issue.
Further the FDA may require additional clinical data beyond debt provided by the city. For example, we know that about two thirds of the subject of the trial will be from eastern Europe. So we anticipate that the subject to account for two thirds of more of the primary endpoint of it and the Sierra the FDA indicated that it believes differences of patient management.
The <unk>, such as concomitant medications and diet.
The treatment response from the very much an expressed the concern of the applicability of the tier one through when he trial data two of U S patient population.
All of the automation of the three wondering when he stay on bicarbonate data indicate that the HRD and treatment paradigm supposed to get here of substantially similar in the U S and eastern Europe and all of that based on the values are not substantially different.
We cannot be certain.
F D a well some of the views.
The proportion of events from regions outside the U S and it's the validation of the outcomes data.
We are preparing to analyze of all I think of the data once available to the value at the effect of geographic region of the predictor of response to the environment in the context of the multitude of other factors that play a role in asset base buffering.
Which brings me to our plans for future engagement with the FDA as you can see on slide nine.
We intend to Reengage with the FDA to discuss options for traditional of pool off of there but the.
The timing of this interaction will ultimately be dependent on the availability of data on guidance, we received from our regulatory advisors.
On the event of the trial was stopped early for efficacy at one of the interim analyses will put on a substantive discussion with the FDA. The data in hand type of got out of plans for potential resubmission of the van on the year.
So on the current estimate at the time for the interim analysis. Our earliest estimate for Resubmission of the NDA will be late 'twenty two early 'twenty three.
Assuming the trial has stopped early for efficacy at one of the interim analyses. We believe this would be classified as the resubmission on the original NDA submission and as such would qualify for six months of you clearly.
Specifics related to any NDA, resubmission and whether the timing will be determined the future FDA interactions.
Before I turn the call over to Jeff I'd like to take a few moments on slide 10 to highlight our efforts to advance the understanding of metabolic acidosis and its share.
There's complications.
We sponsored off of several presentations at the NK of spring clinical meeting 2021 that occurred in early April the <unk>.
Come on and sponsor of presentations by several key opinion leaders that included analyses of the association between metabolic acidosis next hybrid of the kidney declined association in kidney transplant recipients between metabolic acidosis, and graft failure and between metabolic acidosis and the higher risk of debt.
I see the off of that in vitro data showing that the volume it does not bind to affect the on binding properties off other non absorbed other non absorbed find the drugs that are prescribed to patients to seek a day such a spend on the Tulsa, Oklahoma and catchment.
More sponsors in the publications are planned for this year.
To engage for the nephrology community to present, all the findings, but that I'll turn the call over to Jeff.
Thanks, Gary and thank you all for joining us today before I provide a summary of our financial results.
Like to discuss our ongoing activities to further understand the market opportunity from <unk>.
Turning to slide 11, there are approximately 3 million people in the U S with <unk> and metabolic acidosis is the.
Previously stated if valor <unk> meets its primary endpoint, we are looking at the potential indication of slowing CK D progression through treatment of metabolic acidosis in our prior market opportunity analysis and commercial launch planning our target market focus primarily on the 600000 patients treated.
By Nephrologists. However, we would now also like the better understand how the broader HCP community, including primary care physicians cardiologists and endocrinologists might utilize the product with the <unk> product profile, assuming we have outcomes data on slowing CK CK the progression at launch.
We'd also like to understand the rate of adoption of of Irma with data based on outcomes of launch relative to our prior of assumptions of adoption, assuming accelerated approval based on a surrogate endpoint.
Therefore, we were conducting new surveys with nephrologist to further explore the attitudes and priorities for treating metabolic acidosis in patients with <unk> and.
And we are serving primary primary care physicians cardiologists, and endocrinologists to better understand how our product with the <unk> target profile.
Would fit into their treatment paradigms for their patients with metabolic acidosis and C. J D.
We believe this updated market research will be critical to understanding hcp's willingness to use of of Miramar. If it is approved with outcomes data on slowing <unk> progression.
On slide 12, I'd also like to remind you that we have a broad patent of state which includes composition of matter in the U S. The provides protection to 2038 and broad patent protection outside the U S.
Now turning to our financial results on slide 13.
R&D expense was $32 2 million and $49 4 million for Q1, 2021 and 2020, respectively. The.
The decrease in R&D expense was primarily due to decreased activities in connection with our <unk> clinical development program related to manufacturing process optimization, and the manufacturing of drug substance and lower personnel costs.
G&A expense was $9 $9 million and $23 5 million for Q1, 2021 and 2020, respectively.
This decrease in G&A expense was primarily due to decreased administrative activities in connection with our <unk> clinical development program, including pre commercialization medical affairs and personnel costs.
Net loss was $53 4 million and $74 $1 million and non-GAAP net loss was $38 $3 million and $63 8 million for Q1, 2021 and 2020, respectively.
Now on Slide 14, let me turn to our financial position.
As of March 31, 2021, cash cash equivalents and investments totaled $217 $7 million.
I would note that our cash balance at the end of the first quarter reflects the prepayment in March of our Hercules debt facility.
Given that this debt facility included a 100% cash coverage covenant, we felt it prudent to avoid additional interest charges and prepay the debt the.
Total prepayment or the total payment was approximately $83 $5 million inclusive inclusive of accrued interest and end of term charges.
There were no prepayment penalties.
Additionally in March we negotiated an amendment to our contract with P. P on our drug supply manufacturer.
This amendment will result in a cash savings for Tracy the of approximately $48 million through the end of 2022.
This cash savings will allow us to extend our capital resources through late 2022 under our current operating plans.
As previously discussed the two interim analyses of the valor <unk> trial are expected to occur within this timeframe.
We will continue to evaluate our available cash resources as it is one of the key factors relevant to any decision to stop our CPD early for administrative reasons.
Finally, as Gary described and I will reiterate here on slide 15.
We are focused on the continued execution of the valor <unk> trial in 2021 and beyond.
We anticipate that the interim analysis of 150 events will occur later this year in the interim to analysis of 250 events is anticipated to occur around mid 2022, if we remain on our projected event timeline.
And early stopping of the trial for administrative reasons may also be assessed as we consider our cash position and other factors related to the balance sheet QD trial.
Finally, I would like to take a moment to thank all of our employees, who are driving our key initiatives towards our collective goal of bringing <unk> to patients as soon as possible.
With that I'll turn the call over to the operator for questions operator.
As a reminder to ask a question you will need to pass star one on your telephone keypad again that is star one on your telephone keypad to withdraw your question press the pound key.
On by will become part of the Q&A roster.
Your first question comes from the line of Joseph of chimney from Needham <unk> Company. Your line is now open.
Hi, everyone. Thanks for taking our questions.
Go back to the.
The trial sites.
A question of all the trial site overlap between.
The <unk> and the 301 studies in particular in Europe, and Eastern Europe, but can you remind us what what.
On the.
Uh huh.
But I guess more general generally what the split U S. The EU.
As for each of those and I guess.
On Europe.
You know what the percent of overlapping sites sites, where it has a couple of follow ups to debt.
Yeah.
Enjoy the scarab, yeah I think the.
The vast majority of them.
And the 313 of any trial.
Eastern European side, I think it was around.
80% of zone.
And we expect ultimately the eastern Europeans are true represented about two thirds.
In the Valley I was thinking of your.
Trial.
There's a lot of overlap of the sites.
I think of the differences is that yeah. We almost have 10 10 times more size and of all of it I think of it is.
Remember the 301 for you on each one on 17 subjects.
And I think it was around 43 to 45 and here. We are we're talking between the types of truly global study.
And the and again about the about two thirds of those and in central and Eastern Europe.
Yeah.
Okay. Thanks, and then.
The I guess the as a follow up to that in terms of FTE is concerned about.
Single high enrolling site.
<unk>.
Uh huh.
[laughter] randomize the patient the dollar CTD I'm just curious.
Were there any.
Taken to the minimized given that there is some overlap.
And sites.
Especially in.
Eastern Europe.
We need to sort of mitigate maybe.
Ah side of it was the there was the high roller and three of one or.
Is there anything that day.
It could be done of course.
It has been done and for valor of CK, two sort of mitigate that debt.
The risks yes.
Yes, I think the mitigating the bi and Tri Ed Theres no side, that's the recording more than five per cent of the patients.
Got it.
And is that is that something that was.
Yes, you sort of put in place those.
Entry restrictions enrollment restrictions.
More recently or was that something you had in mind.
Or I guess, maybe take us through the timing of Windows.
The 5% of structure was put into place.
Yeah, just yeah.
I think we are in general I think we we knew that this was going to be but I.
Think of the of larger global trial of more size and let's be clear we started thinking of you in 2018.
And we got a zero of that doesn't 'twenty right.
So just to fix the timeline of FDA, obviously has.
<unk> the outcome trial, well before the initial NDA submission.
But but even with that and not knowing the issue I think.
We are you know we had so many sites that we didn't have any one.
Debt recruited a larger number.
Of subjects and we are handling this on the kinds of operations.
All of which is quite customary.
Okay, great. Thanks for taking our questions.
Yeah.
The next question is from Jessica Fye from Jpmorgan. Your line is now open.
Hey, there thanks for taking my question.
Just following up on some of your comments from prepared remarks, and maybe slightly related to the pass the line of questions given.
Given the demographics of the patients enrolled in the Valor study the thus far and therefore, the likelihood as you mentioned the eastern European patients will account for many of the events in the upcoming interim can you elaborate on how you think the FDA would interpret that data as evidence of the jobs Act.
Yeah, I think the.
When you look at it and we've analyzed you mean of outcome trials in the main on trials on general.
It's quite common to of the majority of on the subject has come from Eastern Europe. We don't believe that they're that differently. We are not aware of the any outcome trials of power to deliver certain resolved from certain regions, but we're also very mindful I think of.
FDA is concerned so.
All of our approach is obviously two of them.
Very tight and clear inclusion exclusion criteria.
Yeah, I understand the disease at baseline that's one thing and we've said this many times and we feel very very good about this low experts feel good about those two and then I think we are also looking at sort of you know a.
And the explanation of some variability that can occur among.
Among patients and quite frankly between patients in Florida, and California, while patients in the Republic of Georgia, The state of Georgia, and we are working on an approach where we can explain some of that variability.
The ability and responds to the there.
On the basis of the underlying pathophysiology of asset base balance.
And and normalization and also in terms of you know.
All the clinical data of a show so we feel that the you know that the the data from the territories that we reported from us.
Informative and the applicable to the U S patients with not just repeating the same argument we've made with the FDA before but we're supplementing it with explaining the expected variability in response.
The two asset based correction and in various patients from various territories.
Yeah.
Okay got it and maybe just one more quick regulatory question with respect of the possibility of the Resubmission on a shorter review period do you know the Resubmission has to happen within a certain timeframe. After the original crs to be eligible for that sort of review period.
<unk> you.
You resubmit in over two years later, you still eligible for that like six months from here.
Yeah, I'm I'm not aware of any of any sort of time, yeah expiring sort of timeframe for that but obviously as we've said you know that needs to be discussed with FDA on the context of of new data on the Resubmission, but.
But again, we believe that this is.
Uhm inclusion exclusion criteria of specific the match for <unk> and that's how we generate of thought again those are some of the trials on the bit older, but I think they're relevant and it's always good that'd be actually tracking now that we have a good number of events. So we think that this is quite.
Meaningful and obviously, we hope that the stay on track. So that we can have the interim one this year and in terms of the next year.
And I noticed you extended your cash when Wade amount of the last during the report you know the night.
Are you, saying.
<unk> <unk> <unk> <unk>.
2022 is there a potential to extend the cash one way further and what is.
<unk> I'm just trying to think about when you might expect to perform an administrative style for the child.
So the the extension of the runway of course was directly linked to the amendment with pay per view on so that was the 48 million dollar.
The savings if you will in the relevant 21, 22 time frame as far as extending the runway of course, we're gonna look at you know all of our expenses with with the Valor C. K D trial being our crown jewel in something that we want to not spare any expense on but but there are other error.
He is that we may look at it is premature to say what those savings could be but there there may be opportunities to extend the runway beyond the end of 22 independent of any financing and I'll turn it to get to the finish the answer yes.
Yeah, I think the gist of it.
Our goal is to to.
Conduct the boss he can eat study of part of the protocol and to get to.
To five of 11 events and I think we want to be very clear of that administrative stop does not currently something that we are planning for.
It's something that we will consider at the time when we have to and so that's why we wanted to be very cautious to to not.
Talk about any potential of the timing because of again, we we hope to.
Enable the.
The the completion of of all I think any and.
Of the interim analyses on the successfully the terminology is at least so so again I think that'll be of discussion at the time, we make the decision to the administrative they stop.
Okay, So you're still hoping to get to 511 events and hoping that maybe you can extend the cash runway to to get there.
Yeah, I mean, I think ultimately that all of it has to be the goal of reactivate recruiting patients into the study and they're signing up for the <unk>. The cat. He is we are the outline of the in the protocol and that's that has to be alcohol.
Okay. Thanks for taking my question.
And <unk>.
Your next question is from <unk> from Goldman Sachs. The line is Nelson.
Yeah. Good afternoon. Thank you for taking my questions.
I've got to my first.
And maybe it's because my memory's not so good these days, but can you provide me the a reminder of.
When you did the amendment to your clinical trial program.
Did you provide that feedback or did you provide feedback to the F. D. A and have have they directly responded with a view of the changes you made in how you plan now to analyze the data you know with the two which room. So I'm just I'm, just asking about kind of where F. D. A stands on on.
The changes to.
The current plan to get the bedroom or approved and then my second question is is more of of clarifying question with respect to the cash runway and the potential administrative stop to the trial.
Uhm I just want to understand the dynamics, so you've you've been able to uhm nice job, Jeff on there and extending the cash runaway, but there's a potential that you would consider the administrative stopped you know before or during the Interims and if you have cash of the end of 22, I'm just trying to figure out why.
You would have to be in a position to consider an administrative stop.
Maybe I'm just mistakes on things so I apologize for the question.
That's.
Great I think the from the FDA perspective of course, you know whenever you make a protocol amendment some of his F. D. A and if you don't have within 30 days proceed. That's what we've done me I haven't received any edition of feedback on the interim analyses and quite frankly, you know the.
The the amendment was based on the F. D. A letter from from last here from July I think 29th.
Discussed that very topic of of the follow out of.
What day suggested so.
Get the specific feedback we did follow the standard procedure of protocol submissions of part of our amendment.
And and we also and from that after you that'd be honestly I'm conducting on continuing the study of per protocol.
And number two.
Currently on this is new things of of you know obviously, we engage.
And then on the on the administrative stopped again I think this is this is the.
Let me of discuss that at the time, you know I think looking at.
A bunch of different things, including the runway.
And the balance sheet strength and so on I think we will we will look at at the end the need for the timing off of potential administrative stop.
Okay. Thank you very much.
Thank you.
You don't have any of my questions. At this time you may continue for centuries.
Thank you Alex and thank you all for joining us today as always if you have additional questions. Please don't hesitate to email on and I are at Tracy the Dot com, Thank you and goodbye.
[noise] Sniffs concludes the the conference call. Thank you for participating you may now disconnect.
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