Q1 2021 Mediwound Ltd Earnings Call
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Uh huh.
Good day, and thank you for standing by and welcome to the acquired there of 191 2021 conference call. At this time all participants are in listen only mode. After the speaker presentation. There will be a question and answer the session. The ask a question during the session you will need the press the star and then the number one on <unk>.
The telephone keypad the advice of today's conference is being recorded if you require any further assistance. Please press star Zero I would now like to turn the conference over the your speaker today, Mr. Jeremy Feffer.
Please go ahead Sir.
Thank you and good morning, everyone earlier today.
Issued a press release announcing financial results and provided the business update for the first quarter of 2021, you may access that release from the Companys website under the investors tab.
With us today are Sharon Malka, Chief Executive Officer of meta wound and Boaz Gur Lavie, Chief Financial Officer. Following management's prepared remarks, we will open the call for Q&A.
Before we begin I would like to remind everyone that statements made during this call, including the Q&A session relating to <unk> expected future performance future business prospects or future events or plans are forward looking statements as defined under the private Securities Litigation Reform Act of 1995, although.
Although the company believes that the expectations reflected in such forward looking statements are based upon reasonable assumptions actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of the Maryland the comp.
<unk> assumes no obligation to update or supplement any forward looking statements whether as a result of new information future results or otherwise participants are directed to cautionary notes set forth in today's press release as well as the risk factors set forth in metal loose annual reports filed with the SEC for factors that could cause actual results to differ materially from those anticipate.
The forward looking statements the <unk>.
Conference call is the property of meta wound and any recording of broadcast is expressly prohibited without the written consent of meta world.
Now I would like to turn the call over to Sharon Malka, Chief Executive officer of megawatt shrunk.
Thank you Jeremy.
Good morning to all of our U S listeners and good afternoon lifting out of the Nissan.
Welcome to marry the ones first quarter 2021 conference call to discuss our financial results and business updates and highlights.
This quarter, we continued to generate product revenue growth compared with the flywheel driven by the procurement of Nexobrid the buyback for the emergency response preparedness and out of U S sales.
As we continue to execute on our global expansion strategy of expanding the use of Nexobrid. In addition of international markets.
In addition, we.
We have again progress across each of out of the ongoing clinical programs highlighted by the enrollment of the first patient in our phase II of pharmacology study of ex kind of ex <unk>.
And the launch of a new program in non melanoma skin cancer, while we continue to advance all of the U S Phase II adaptive design study of ex Guy for the treatment of venous leg ulcer.
Let me now provide you with the more call. It all on the progress we've made and the review of the first quarter highlights.
Starting with Nexobrid, we continue to enroll new patients to the next expanded access program at leading U S. Burn centers with 82 burn victims, who are already treated with nexobrid to date.
The expanded access study.
Through our pool of value and there is plenty of opportunity to continue to enroll patients across all of our 20 sites, which will continue to increase been centered surgeon experience with nexobrid.
The pediatric study is fully enrolled and we expect to report topline they thought from the.
The study in the first quarter of 2021.
Yeah.
On the commercial front.
Of the procurement for the emergency stockpile continue to drive product revenue growth.
And we are expecting to recognize the remaining revenue related to BARDA procurement of Nexobrid in 2020 one.
We are satisfied with Nexobrid global expansion into new international out of market supporting our topline signing additional distribution agreement in Europe, and Asia, and receiving marketing approval for Nexobrid in Taiwan and Chile.
Turning to the BLA in September 2020, the F. D. A accepted for review of our BLA for Nexobrid for severe Burns and the signed up of Doofer call date of June 29 2021.
However, I think the parent from recent FDA action of course the industry.
All of the friction related to COVID-19, pandemic impacting the F D. A ability to complete manufacturing facility inspections and the review processes have been affected.
Recently, the FDA has informed us that due to these travel restrictions it may be unable to conduct the required the inspection of our manufacturing facilities in Israel in Taiwan bite at Baidu fatigue and that it is unlikely that the addition of the CMC information provided.
Both of our BLA would be the if you're doing the kind of them because it W cycle.
The Purdue if I call date. The main June 29, 2021, and FDA review is ongoing as we continue to work closely with the agency.
At this time, we expect that the timing of potential approval and the commercial launch of nexobrid to be impacted.
We are committed to bringing nexobrid to the U S market I thought of in North American commercial partner very sales continued to make significant progress with respect to its commercial and medical affairs.
Pre launch activity.
Given the robust clinical data package, we believe that nexobrid the remains well positioned to replace surgical excision of the standard of care of of full eschar removal in patients with severe burns and we look forward upon approval to bringing nexobrid to the U S market.
Moving to our product candidate ex cat ex with our development program is well underway.
We continue to actively the code patients for our U S phase II adaptive design study for the treatment of finished like also.
We are on track to reach the target of 80 patients.
While for the interim assessment and reiterate our expectation for an interim assessment around mid 2021, and anticipate completion of patient enrollment by the end 2021.
As part of the ex Cat ex development program, we are conducting the phase II pharmacology study.
Flow the potential clinical benefits of ex cat ex associated with chronic wounds of men and management.
The study is an open label single arm study assessing the pharmacological effect of ex cats in up to 15 patients with both the values and the issue was.
The study will provide us with the better understanding of what is happening in the wound bed huling and after the debridement with S correct and more specifically it will enable us to assess the effect on the reduction in Bakken burden the reduction in inflammation and initiation of healing process.
We enrolled the first patient in this study last month and expect that the from this study in the second half of 'twenty or 'twenty one.
We were proud to host and S kind of analyst day in March featuring four prominent key opinion leader of who will discuss the current U S wont be broaden the practices and how ex cat ex upon approval has the potential to change the current standard of Frac, the east and care of.
Chronic wounds.
Our three key opinion leader of Doctor ski Snow Zynga and Snyder.
About the need for better therapeutics and improving upon the current standard of care.
We the billion dollar market opportunity in each of the FILO and day of fuel market.
The Cleveland cliffs unity in the hospital outpatient setting and the potential for meaningful improving on the current standard of care. We believe ex cat ex can have a meaningful meaningful impact on corn and corn management offering significant benefit for patients health care professionals and.
Sales.
Moving now to our product candidate sales they were five.
We submitted the protocol to the FDA for of Phase one two clinical study of the for the treatment of past the cell carcinoma, and we are advancing the initiation, which is planned for the second quarter 2021.
The study.
Is designed to evaluate safety and tolerability using different schedules of administration at the.
Well as to provide a preliminary evaluation of its efficacy as measured by the percentage of target lesion with complete histological Cleveland.
In tandem and investigator initiated phase two trial will be conducted at the sort of medical center in Israel designed to evaluate the safety and efficacy of 005 entry of moving non melanoma skin cancer, and precancerous lesions like actinic keratosis, but instead.
Got cinema and squamous cell carcinoma.
We expect the data from both studies will be generated by the end of DCF of 2021.
We believe that sales they were five has the reasonable path to market with the clear unmet medical need and the clinical plan. We have laid out carries the relatively low development costs given its active substance is the same that connects the weight in aesthetics and the intended indication.
In closing, we anticipate 2021 to have multiple data readouts in aesthetics and deal with the over five clinical trials and excited about the next of the opportunity in the U S.
We continue to work closely with the F D a.
We remain focused on continuing to drive growth and further strengthen our company with a deep pipeline of bio therapeutic solutions for tissue repair and regeneration.
Now I would like to turn the call over to Bob for a summary of our financials.
But.
Thank you Sean.
Good morning, everyone and good afternoon store of listeners in Israel.
I'd like to start of our financial review of no things that the continued to generate strong product and license revenue growth.
The U S and ex U S markets as Nexobrid continues to support our balance sheet and clinical development program.
Now I'd like to provide you with an update on our financial results for the fourth quarter of 2021.
Revenues from the fourth quarter of 2021 were $5 8 million compared with $4 4 million for the first quarter of 2020, an increase of 32%.
Revenue from product and license fees were $2 9 million income.
Fees of 300% compared to the first quarter of 2020 of them.
Not really driven by barges procurement for emergency stockpile and sales increase outside of the U S.
Gross profit was $2 4 million.
The 41% of net revenues compared with the gross profit of $1 2 million or 28% of net revenues for the first quarter of 2020.
Research and development expenses were $2 2 million compared with $1 7 million for the first quarter of 2020.
The increase was primarily driven by S correct clinical development program.
Selling general and administrative expenses were $2 1 million compared with $1 7 million in the fourth quarter of 2020.
This was as a result of directors and officers insurance premiums increase.
As a percentage of revenues SG&A expenses were 36%, reflecting three hundreds of basis points of decrease.
She is the final quarter of 2020.
Operating loss was $1 9 million, reflecting a 13% decrease in operating loss compared to the $2 2 million in the first quarter of 2020.
The company posted a net loss of $2 9 million of 10 cents per share.
With the net loss of $2 5 million or <unk> <unk> per share for the first quarter of 2020.
Adjusted EBITDA was the loss of $1 3 million compared with the loss of $1 8 million for the first quarter of 2020, reflecting the decrease in adjusted EBITDA loss of 28%.
Moving now to the balance sheet.
As of March 31, 2021, maybe $117 9 million in cash and short term investments.
<unk> was $21 6 million as of December 31, 2020, and no debt.
Maybe one remained on budget utilizing $3 7 million in the first quarter of 2021 for each of operational activities.
The company reiterate its expectation for cash use in 2021 to be in the range of $5 million to $7 million.
With that of concluded the financial overview.
Now turn the call back over to Sean Sean.
Thank you Bob.
As you can see we have several tremendous opportunities before us we will continue our commercialization activities with our partner very sales and we continue to work with FDA for the regulatory review process for Nexobrid.
We are actively recruiting patients for the aesthetic space to adaptive design study and we are excited to initiate the new clinical study in non melanoma skin cancer.
With that it is my pleasure to open the call.
For your question.
The title.
Thank you.
To ask a question. Please press star and then the number one on your telephone keypad again that starts and then the number one on your telephone keypad did withdraw your question. Please press the pound.
Please standby, while we compile the question and answer the roster.
Your first question comes from the line of Kevin.
From.
Oppenheimer.
Hi.
Right.
Yes, hi, good morning. This is Susan calling on behalf of Kevin Nikita <unk> Oppenheimer.
My first question is the clarification on the comment you said earlier.
You mentioned that the FDA will not be able to inspect the manufacturing facilities for Taiwan, Chile, and can you comment on how that will affect the regulatory timeline for BLA approval.
Yes, good morning, Suzanne and thank you for the question.
As we communicated during the call. The FDA accepted the review of the BLA and provided us with the <unk> date of June 29.
As we are seeing in the industry from recent FDA action.
The travel restrictions related to COVID-19 pandemic are impacting the FDA ability to complete manufacturing facility inspection on time and the view processes have been affected.
As communicated the FDA has informed us that due to the travelers picture and it may be unable to conduct of the quad inspection of our manufacturing facility in Israel in Taiwan.
And at the end.
And that is unlikely to the if you like the CMC information provided.
By the Purdue for the though within the current review site Kin D of Baidu <unk> goal date. The remains June 29, and the FDA review is still ongoing as we continue to a.
The work closely with the agency however at this time.
Expect the timing of the potential approval and commercial launch of <unk> to be impacted.
Given the different potential scenarios.
And we cannot speak for the FDA, although the several of their scenarios.
We cannot predict how long the FDA may take to complete the review of the BLA.
We are committed to bring next of into the U S market, while our partner very sales continued to make significant progress with the preparation for launch and given its robust clinical data package, we believe that nexobrid the remains well positioned to become the standard of care and the globe.
Both the inspection and the additional information provided the potential timing issue.
Got it thanks for the clarification.
Just one more question from me.
So.
You are planning to initiate the BCC study.
And the next I guess couple of months.
Can you provide any color on just.
Just on the study protocol.
The central enroll men trained anything.
Yeah. So we submitted already of the protocol as the air communicate to the FDA for the phase one two study a.
This study is the poor treatment of buses cell carcinoma, no the lab and superficial cell carcinoma, and we plan to initiate the study in the this quarter or the second growth of 2021.
The study of objective is to evaluate the safety and tolerability using different schedule of administration as well as to provide us with the preliminary evaluation of its efficacy as measured by the percentage of target lesions with complete histological clearance, we would have two cohorts of patients while we assess the first.
Of course, and adjust accordingly to the second call regarding the administration regimen.
And we believe that sales of a five five a reasonable path to market with the clear unmet need.
This clinical plan that we laid out there is relatively low development costs.
Given the active substance in the intended indication.
Got it. Thank you that's all from me.
Thank you.
Next question comes from the line of swine fly them for cooler.
Your line is open you can ask your question.
Thank you this is RK from H C Wainwright.
Good morning, Sharon and Bose.
It's quite unfortunate that.
The FDA is unable to deal with the.
The day.
It's a huge backlog, it's not just for you folks I understand that day.
Industry wide.
Situation and even the G O O is looking into this.
Having said that you know.
Sure.
What is the what is the.
All of the conversations going because I believe.
You know it.
It is trying to figure out how to manage this even accepting.
The inspection reports.
From other regulatory agencies.
Because you suddenly have been inspected.
By BARDA.
At least a couple of times, if I remember it correctly biff.
Before the next of the.
The contract came through.
Any commentary on that though the anything that you can.
You can provide us.
Yeah. Good morning, I can't think of for the question.
Specifically, we are not going to discuss the specific details from the interaction of the at the end we respect the FDA review process.
However, with less than two months left before the <unk> date.
Filled at this stage a day inspection is that actually took care of before the payoff of date and this is the reason that we communicated.
We can't speak for the FDA, although the FDA guidance and assessing alternatives vehicle to conduct inspections and although the number of scenarios. It is very difficult to predict.
The impact.
We can look at the two at the recent examples of course the industry. As you mentioned it's of course, the industry now and now of the Fda's handling this type of situations and outcomes.
H form of deferral deferred action through major of amendment with the extension of the cycle and potentially of a sea of rail.
And given the different potential scenarios, we cannot predict how long it will take the FDA to make L to complete their review.
But we do think that both the inspection of the CMT that the provided we believed the poor.
<unk> timing issue and hopefully it will be resolved the sort of I do clearly stated Nexobrid is approved in Europe and in other international market with all of the <unk>.
7000 patients that were treated with the product with BARDA procurement continue and we continue to tweak patient in the U S. Under the expanded access protocol next.
And given its sales, but the clinical data.
We believe that the next day of clinical data that Nexobrid will be approved in the U S. A.
And our commercial partner relative continue to plan for launch.
Okay. Thanks for that I'm, just just to clarify.
So I'm assuming.
Up until.
The proof of it that you will not even know whether this is going to be at three months here a lot of six months of delay right.
Correct.
Okay.
No.
And then just staying with the Nexobrid on the on the pediatric study that you were talking about your expectations of the data in third quarter.
Could you kind of highlight to us what sort of data we were expecting.
On the study.
For a label expansion or would you need to do any additional work.
Yeah. Thank you. So the pediatric study is a communicated is fully on all of the completion of a completed the enrollment of a stage and we expect to report the top line data results, which will include the acute stage safety and the 12 months follow up data in the third quarter of the sale 2021.
We believe the day. This data is sufficient for a label is ex.
However, we believe that the submission of the pediatric indication expansion for Nexobrid will be subject of course to the review.
Part of that is ongoing and we get more clarity regarding of the BLA review outcome.
In general what I can tell you that doesn't often the rock we are waived in the U S. Pediatric investigational plan. The study was initiated based on our European Pediatric investigation plan, but the study is conducted with two protocol from the FDA and EMA and it will be used for both of authorities.
Our label extension.
Okay. One last question on next and I'll step back into the line.
Regarding the global expansion that you have been.
And the king or the last.
Six to eight months.
What can you highlight the out of that.
Any of any.
Any insight into.
How we should think about revenues from other geographies.
Yeah. So we look at the other geographies as the ex U S. We have the U S geography kind of thing with BARDA and later on upon approval with the commercial market for better sales the ex U S geography comprised of the European market and the international market.
As the.
We discussed during the call we are satisfied of the Nexobrid global expansion into new international in the market, which support out of topline primarily by advance payment or upfront payment as part of the distribution agreement and later on by selling the product the deals the distributor we continue.
Hey, upon our strategy to sign additional distribution of distribution agreements in Europe, and Asia and are present in the last quarter. We already received two additional marketing approval for Nexobrid, one in Taiwan, and one in Chile, and we are getting ready with the distributor for a launch in this the territories.
Thank you. Thank you.
Yeah.
Thank you.
Next question comes from the line of Nathan Thanks.
The from Aegis, Sir Your line is open you can ask your question.
Yes. Thank you good morning, Sharon Boaz. Thanks for taking my question I just had one question and it's a follow up on the international opportunity and specifically I was thinking about BARDA and whether there are stockpiling of opportunities from other ex U S governments.
Yeah. Thank you for the question Nathan.
So you're totally right, we are working with BARDA and BARDA procurement for the magic of stockpiled continue to drive product revenue growth format and met the wound.
As mentioned, we expect to recognize the remaining revenue.
Form part of approximately $6 5 million in 2021 related to the initial procurement of part of that and we are pleased with the increase in sales of product and expected to continue in 2021 looking at the other territories.
Ex exploring the options of having such a model in other countries worldwide.
I can tell you that the ability of the budget allocated for such a procurement is different than U S and in other territories. However, we are in contact with several of them.
The governmental authorities worldwide to have of such kind of mechanism, but with less significant amount of our procurement compared to about 16 million procurement.
Thanks, that's very helpful. I appreciate it.
Thank you.
Your next question comes from the line of Josh Jennings from Cowen.
Your line is open you can ask your question.
Hi, This is Brian here for Josh. Thank you for taking my questions. I also of a couple on the FDA approval process for Nexobrid.
Just to start can you clarify the role of the manufacturing facility in Taiwan I thought the Israel facility was the primary site responsible for manufacturing and I guess, where I'm going with this is do you need both.
Facilities inspected before a final decision or could you start with just the Israel facility approved.
Good morning, Brian.
The question Mehdi wound is the primary manufacturing facility, we are manufacturing here in our facility in Israel, both the drug substance and the drug product the API and the product as well as the gel vehicle. However, because the Taiwanese manufacturer or supplier is manufacturing the promo line special production, which is the key raw material.
All the intermediate the rocks up stance at the subject also all required all of sudden inspection and what you've been informed that the FDA may be unable to conduct the day required inspections of our manufacturing facilities, both in Israel and Taiwan.
Okay, that's helpful and just.
On any potential for estimates of time revisions do you expect to receive any kind of estimate for when these facility inspections could occur and also if if it turns out that the FDA does not make the June 29th Paducah date do you expect there to be an estimated tie.
<unk> for a final decision if if they are.
Do not make that June 29th day.
Yeah. So first of all currently the reviews on growing of the Paducah date is June 29, FDA communicated Didnt anticipate to meet these day June 29, but off a day, but you know we can't speak for the FDA and things that are evolving.
The last few months due.
Due to the backlog and other things that they have and although the number of scenarios that it is very difficult for us to predict now what will be the impact of about two per day. The FASB will wait for further communication for the F. D. A whether it's alternative a VA.
Vehicles to conduct the inspection or whether they are scheduling inspections et cetera, but current given the different potential scenarios, we cannot predict now how long it will take them to complete the review of the complete the including of course, the inspection of the facility.
Okay. Thank you and maybe just one more on the BARDA procurement process of you're about halfway done with the delivery. There do you have insight yet into the BARDA plans for potentially additional procurement. After this first tranches completed.
Yeah. So as we said we are on track with the Buzz about the procurement for emergency stockpile, which continue to track the revenue growth of Fannie Mae demand and we expect to recognize the remaining revenue.
During 2021, which is about $6 5 million of our portion out of the other of $10 5 million of 2021.
Currently we have no a definitive decision by bad guys of the option of the option for additional procurement.
It will be a sort of discussion of powder and I assume that you'd be utilized only when the current the procurement will be expired for rotation of expired stock or alternatively, if they will be required to increase the level of safety stock of emergency stock.
Okay and are you directly and those discussions are as varicella handling those primarily.
Are we out of the primary contract with BARDA, we are the sponsor of the end up.
Part of it would be of course the sponsors.
The point about the alcohol and with the FDA. So we are the primary quantity of about that.
Okay. Thank you.
Thank you. Thank you.
Again to ask a question that would be star and the number one on your telephone keypad, sorry, and then the number one that's one Keith.
There is no question at this time presenters. Please continue.
Thank you everyone for joining us today.
Look continuing to executing on our strategy and bringing new therapies to market and to updating you again on our next update call. Thank you very much and advocate day Bye bye.
Thank you that concludes today's conference call you may now disconnect.
Yeah.
[music].
[music].
[music].
Good day, and thank you for standing by and welcome to the acquired there of 131 2021 conference call. At this time all participants are in listen only mode. After the speaker presentation. There will be a question and answer session. The ask a question during the session you will need the press the star and then the number.
One on your telephone keypad piece of the advice of today's conference is being recorded if you require any further assistance. Please press star Zero I would now like to turn the conference over at the Yours Speaker of today, Mr. Jeremy Feffer. Please.
Please go ahead Sir.
Thank you and good morning, everyone earlier today <unk> issued a press release announcing financial results and provided the business update for the first quarter of 2021, you may access that release from the company's website under the investors tab with US today are Sharon Malka, Chief Executive officer of matter wound and Boaz Gur.
All of the Chief Financial Officer, following management's prepared remarks, we will open the call for Q&A.
Before we begin I would like to remind everyone that statements made during this call, including the Q&A session relating to <unk> expected future performance future business prospects of future events or plans are forward looking statements as defined under the private Securities Litigation Reform Act of 1995.
Although the company believes that the expectations reflected in such forward looking statements are based upon reasonable assumptions actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of the megawatt the comp.
<unk> assumes no obligation to update or supplement any forward looking statements whether as a result of new information future results or otherwise participants are directed to cautionary notes set forth in today's press release as well as the risk factors set forth in <unk> annual report filed with the SEC for factors that could cause actual results to differ materially from those anticipate.
The forward looking statements the.
Conference call is the property of meta wound and any recording of broadcast is expressly prohibited without the written consent of better word.
Now I would like to turn the call over to Sharon Malka, Chief Executive officer of megawatt shrunk.
Okay.
Thank you Jeremy.
Good morning to all of the U S leasing out and good afternoon, Nathan as anybody.
We have come to me the ones first quarter 2021 conference call to discuss our financial results and business updates and highlights.
This quarter, we continued to generate product revenue growth compared with the flywheel driven by the procurement of Nexobrid by BARDA for the emergency response preparedness and out of U S sales.
As we continue to execute on our global expansion strategy of expanding the use of Nexobrid. In addition of international markets.
In addition, we.
We have again progress across each of out of the ongoing clinical programs highlighted by the enrollment of the first patient in our phase II of pharmacology study of S kind of ex <unk>.
And the launch of a new program in non melanoma skin cancer, while we continue to advance all of the U S Phase II adaptive design study of ex cat ex for the treatment of finished like also.
Yeah.
Let me now provide you with the more call. It all on the progress we've made and the review of the first quarter highlights.
Starting with Nexobrid, we continue to enroll new patients to the next expanded access both of them at leading U S burn centers with 82 burnt victim well already treated with Nexobrid to date.
The expanded access study the runs through I pull the vial and there is plenty of opportunity to continue to enroll patients across all of the 20 sites, which will continue to increase burn center south of Johns experience with Nexobrid.
The pediatric study is fully enrolled and we expect to report topline results from the study in the first quarter of 2021.
On the commercial fault by the procurement for the emergency stockpile continue to the right product revenue growth.
We are expecting to recognize the remaining revenue related to BARDA procurement of Nexobrid in 2020 one.
We are satisfied with Nexobrid global expansion into new international out of market supporting our topline signing additional distribution agreement in Europe, and as yet and the saving marketing a pool of us for Nexobrid in Taiwan and Chile.
Turning to the BLA in the.
September 2000, 20-F D. A accepted for review of the BLA for Nexobrid for severe burns and the sign up of Doofer call date of June 29 2021.
However, I think the burden from the recent FDA action of course, the industry, rather the thick channel related to COVID-19 pandemic.
Pocketing the F D a ability to complete manufacturing facility inspections, and the review processes have been affected.
The recently the FDA has informed us that due to these travel restrictions it may be unable to conduct the required inspections of.
Our manufacturing facilities in Israel in Taiwan by the Purdue fatigue.
And that it is unlikely that the addition of the CMC information provided in support of all of a BLA with the if you're doing the kind of them because of your cycle.
The Paducah date. The main June 29, 2021, and FDA review is ongoing as we continue to work closely with the agency.
At this time, we expect that the timing of potential approval and the commercial launch of nexobrid to be impacted.
We are committed to bringing nexobrid to the U S market I thought of in North American commercial partner very sales continued to make significant progress with respect to its commercial and medical affairs.
Pre launch activity.
Given it's the robust clinical data package, we believe that Nexobrid the remains well positioned to replace surgical excision of the standard of care of for ex kind of move outs in patients with severe burns and we look forward upon approval to bringing nexobrid to the U S market.
Moving to our product candidate ex cat ex where all of the development program is well underway.
We continue to actively the code patients for the our U S phase II adaptive design study for the treatment of finished like us of.
We are on track to reach the target of 80 patients.
While for the interim assessment and reiterate our expectation for an interim assessment and all the me 2021, and anticipate completion of patient enrollment by year end 2021.
As part of the ex Cat ex development program, we are conducting the phase II pharmacology study.
So the potential clinical benefits of ex cat ex <unk>.
LCA did with chronic wounds of meant management.
The study is an open label single arm study assessing the pharmacological effect of ex cat ex in up to 15 patients with both the values and the issues.
The study will provide us with the better understanding of what is happening in the wound bed the link and after the debridement with ex correct and more specifically it was unable to assess the effect on the reduction in Bakken and better than the reduction in inflammation and initiation of healing process.
We enrolled the first patient in this study last month and expect data from the study in the second half of 2021.
We were proud to host and S kind of analyst day in March featuring four prominent key opinion leader of <unk>.
The cap the current U S wont be broaden the practices and how ex cat ex upon approval has the potential to change the current standard of practice and cure of chronic wounds.
Our three key opinion leader of doctors Kiss now Zynga and Snyder.
Talk about the need for better therapeutics and improving upon the current standard of care.
We the billion dollar market opportunity in each day and day of fuel market.
The claim opportunity in the.
The hospital outpatient setting and the potential for meaningful improving on the current standard of care. We believe ex cat ex can have a meaningful meaningful impact on corn and corn management offering significant benefit for patients.
It's kept professionals and barrels.
Moving now to our product candidate sales they were five with.
We submitted the protocol to the F D. A fore of phase one two clinical study of the <unk> for the treatment of path of cell carcinoma, and we are advancing the initiation, which is planned for the second quarter 2021.
The study.
<unk> is designed to evaluate safety and tolerability using different schedules of the installation as well as to provide a preliminary evaluation of its efficacy as measured by the percentage of target lesion with complete histological clearance.
In tandem and investigator initiated phase II trial will be conducted at the sort of America centered any trial designed to evaluate the safety and efficacy of zero zero of five energy of moving non melanoma skin cancer and precancerous lesions like actinic keratosis by the silicon.
Cinema and squamous cell carcinoma.
We expect the data from both studies will be generated by the end of DCF of 2021.
We believe that sales they were five has the reasonable path to market with the clear unmet medical need and the clinical plan, we have laid out carrying relatively low development costs given its active substance which is the.
The same that connects the weight in aesthetics and the intended indication.
In closing, we anticipate 2021 to have multiple data readouts in ex cat ex and deals over five clinical trials and excited about the next couple of the opportunity in the U S. As we continue to work closely with the F D. A.
We remain focused on continuing to drive growth and further strengthen our company with a deep pipeline of bio therapeutic solution for tissue repair and regeneration.
Now I would like to turn the call over to Bob for a summary of our financials.
But.
Thank you Sean.
Everyone and good afternoon to our listeners in Israel.
The start of our financial review of no things that we continue to generate strong product and license revenue growth from.
<unk> of the U S and ex U S markets as Nexobrid continues to support our balance sheet and clinical development program.
Now I'd like to provide you with an update on our financial results for the fourth quarter of 2021.
Revenues from the fourth quarter of 2021 were $5 8 million compared with $4 4 million for the first quarter of 2020, an increase of 32%.
Revenue from product and the licenses were $2 9 million, an increase of 300% compared to the first quarter of 2020.
Really driven by BARDA procurement for emergency stockpile and sales increase outside of the U S.
Gross profit was $2 4 million from 41% of net revenues compared with the gross profit of $1 2 million or 28% of net revenues for the first quarter of 2020.
Research and development expenses were $2 2 million compared with $1 7 million for the first quarter of 2020.
The increase was primarily driven by S correct clinical development program.
Selling general and administrative expenses were $2 1 million compared with $1 7 million in the first quarter of 2020.
This was the result of directors and officers insurance premiums increase.
As a percentage of revenues SG&A expenses were 36%, reflecting 300 basis points decrease.
She is the final quarter of 2020.
Operating loss was $1 9 million, reflecting a 13% decrease in operating loss compared to the $2 2 million in the first quarter of 2020.
The company posted the net loss of $2 9 million of 10 cents per share.
Compared with the net loss of $2 5 million or <unk> <unk> per share for the first quarter of 2020.
Adjusted EBITDA was the loss of $1 3 million compared with the loss of one 8 million for the first quarter of 2020, reflecting the decrease in adjusted EBITDA loss of 28%.
Moving now to the balance sheet.
As of March 31, 2021, maybe one had $17 9 million in cash and short term investments.
<unk> was $21 6 million as of December 31, 2020, and no debt.
Maybe one remained on budget utilizing $3 7 million in the first quarter of 2021 for its operational activities.
The company reiterate its expectation for cash use in 2021 to be in the range of $5 million to $7 million.
With that kind of concluded the financial overview.
I'll now turn the call back over to Sean Sean.
Thank you Brian.
As you can see we have several tremendous opportunities before us we will continue our commercialization activities with our partner very sales and we continue to work with the FDA for the Golar The review process for Nexobrid.
We are actively recruiting patients for the ex cat ex space to adaptive design study and we are excited to initiate the new clinical study in non melanoma skin cancer.
With that it is my pleasure to open the call for your questions.
Operator.
Thank you.
A reminder to ask a question. Please press star and then the number one on your telephone keypad again that starts and then the number one on your telephone keypad can we draw. Your question. Please press the pound key.
Standby, while we compile all of the question and answer the roster.
Your first question comes from the line of Kevin.
From Oppenheimer.
Hi, Your line is open.
Yes.
Yes, hi, good morning, this is suzanne calling on behalf of Kevin Nikita <unk> Oppenheimer.
My first question and a clarification on the comment you said earlier you.
You mentioned that the FDA will not be able to inspect the manufacturing facilities for Taiwan Shelley.
Can you comment of how that will affect the regulatory timeline for BLA approval.
Yes, good morning, Suzanne and thank you for the question as we communicated during the call. The FDA accepted the review of the BLA and provided us with the <unk> date of June 29.
We've actually seen the industry from recent FDA action.
The travel restriction related to COVID-19 pandemic I the.
Impacting the FDA ability to complete manufacturing facility inspection on time and the view processes have been affected.
As communicated the FDA has informed us that due to the travelers seek churn it may be unable to conduct the required inspection of our manufacturing facility in Israel in Taiwan.
And at the end that is unlikely to the if you like.
The CMC information provided.
By the Purdue for the though within the current review cycle David.
Baidu <unk> goal date, the remains June 29, and the FDA review is still ongoing as we continue to.
The work closely with the agency. However at this time, we expect the timing of the potential approval and commercial launch of <unk> to be impacted.
Given the different potential scenarios.
And we cannot speak for the FDA, although the several of the scenarios.
We cannot predict how long the FDA may take to complete the review of the BLA.
We are committed to bring nexobrid to the U S market, while our partner of various sales continue to make significant progress with the preparation for launch and given its robust clinical data package. We believe that nexobrid remains well positioned to become the standard of care in the group.
Both the inspection and the additional information provided the potential timing issues.
Got it thanks for the clarification.
Just one more question from me.
So.
You are planning to initiate the BCC study and in the next I guess couple of months.
Can you provide any color on.
On the study protocol.
The central enroll men trained anything.
Yeah. So we submitted already of the protocol as the air communicate to the FDA for the phase one two study.
The study is for treatment of passive cell carcinoma, no the lab and superficial basal cell carcinoma, and we plan to initiate the study in the this quarter or the second growth of 2021 the.
The study the objective is to evaluate safety and tolerability using different schedule out of administration as relative to provide us with the preliminary evaluation of its efficacy as the.
Measured by the percentage of target lesions with complete histological clearance, we would have to call the of patient while we assess the first chord and adjust accordingly to the second call regarding the administration regimen.
And we believe that sales of five has a reasonable path to market with the clear unmet need.
This clinical plan that we laid out carrying relatively low development costs.
Given the active substance in the intended indication.
Got it. Thank you that's all from me.
Thank you.
Next question comes from the line of slight fly him for cooler.
Your line is open you can ask your question.
Thank you this is RK from H C Wainwright.
Good morning, Shneur on numbers.
It's quite unfortunate.
The FDA is unable to deal with the.
It's a huge backlog, it's not just for you folks I understand that.
The wide.
Situation and even the G O is looking into this.
Having said that you know.
The war.
What is the what is the.
All of the conversations going because.
I believe.
You know.
If they're trying to figure out how to manage this even accepting.
The inspection reports.
From other regulatory agencies.
Of course, you suddenly have been inspected.
By BARDA.
At least a couple of times, if I remember it correctly.
Before the mix of it.
The contract came through.
Any commentary on that or anything that you can.
You can provide us.
Yeah. So the good morning, I can thank you for the question.
Specifically, we are not going to discuss the specific details from the interaction of the at the end we will respect the FDA review process.
However, with less than two months left before the <unk> date.
Feel that at this stage a day inspection is unlikely to occur before the part of the date and this is the reason that we communicated.
We can't speak for the FDA, although the FDA guidance and are assessing alternative vehicle to conduct inspections and although the number of scenarios. It is very difficult to predict.
The impact we can look at the two at the recent examples of close the industry as you mentioned.
Of course, the industry now and now of the Fda's handling this type of situations and outcomes.
H form of deferral deferred action through major of amendment with the extension of the cycle and potentially of <unk>.
And given the different potential scenarios, we cannot predict how long it will take the FDA to make arrow to complete their review.
But we do think that both of the inspection of the CMC data provided we believe are just the.
Potential timing issue and hopefully it will be resolved the sone I do clearly stated Nexobrid is approved in Europe and in other international market with all the 7000 patients that were treated with the product with BARDA procurement continue and we continue to tweak patient in the U S.
Under the expanded access protocol next.
And given <unk> robust clinical data.
We believe that the.
The next day clinical data that Nexobrid will be approved in the U S.
And our commercial partner of furniture continue to plan for launch.
Okay. Thanks for that I'm, just just to clarify the.
So I'm assuming.
Up until.
Of the Paducah, the that you will not even know whether this is going to be at three months here a lot of six month delay right.
Correct.
Okay.
No.
And then just sort of staying within the Nexobrid on the on the pediatric study that you were talking about.
Your expectations of the data in third quarter.
Could you kind of highlight to us what sort of data we are expecting.
And is the steady enough for a label expansion or would you need to do any additional work.
Yeah. Thank you so the pediatric study is the X.
Communicated is fully on all of the completion of the completed the enrollment of stage and we expect to report the top line that the results, which will include the acute stage safety and the 12 months follow up data in the third quarter of this year 2021.
We believe that the the stat is sufficient for a label.
However, we believe that the submission of the pediatric indication expansion for Nexobrid will be subject of course to the review.
Of course, if that is ongoing and we get more clarity regarding of the BLA review outcome.
In general I can tell you that as an orphan drug we have waived in the U S comp at the Outback Investigational plan. The study was initiated based on our European Pediatric investigation plan, but the study is conducted with two protocol from the FDA and.
The amount and it will be used for both the authorities for label extension.
Okay. One last question on Nexobrid and I'll step back into the line.
Regarding the global expansion that you have been.
The conducting over the last.
Six to eight months.
What can you highlight the out of that.
Any.
Any insight into.
How we should think about revenues from other geographies.
Yeah. So we look at the at the geographies of ex U S. We ask the U S geography coffee with BARDA and later on upon the full value with the commercial markets were very state of the ex U S geographic comprised of the European market and the international market as the.
The we discussed during the call we are satisfied of the Nexobrid global expansion into new international in the market, which support our topline primarily by advance payment or upfront payment as part of the distribution agreement and later on by selling the product the deals the distributor we continue.
Hey, upon our strategy to sign additional distribution of distribution agreements in Europe, and Asia and eight.
Present in the last quarter, we already received two additional marketing approval for next couple of one in Taiwan and one in Chile, and we are getting ready with the distributor for a launch in this the territories.
Thank you.
Okay.
Thank you.
Your next question comes from the line of Nathan Weinstein from Aegis.
Line is open you can ask your question.
Yes. Thank you good morning, Sharon Boaz. Thanks for taking my question I just had one question and it's the follow up.
On the international opportunity and specifically I was thinking about BARDA and whether they are stockpiling of opportunities from other ex U S governments.
Yeah. Thank you for the question Nathan.
So you're totally right, we are working with BARDA and BARDA procurement for the months of the stockpile continue to drive product revenue growth format and met the wound.
As mentioned, we expect to recognize the remaining revenue.
The format of approximately $6 5 million in 2021 related to the initial procurement of.
Part of that.
And we are pleased with the increase in sales of products.
And expected to continue in 2021 looking at the other territories we are.
Blowing the options of having such a model in other countries worldwide.
I can tell you that day by day.
The ability of the budget allocated for such a procurement is different than U S and in other territories. However, we are in contact with several of our government.
Governmental authorities worldwide to average such kind of mechanism, but with less significant amount of procurement compared to about 16 million procurement.
Thanks, that's very helpful. I appreciate it.
Thank you.
Your next question comes from the line of Josh Jennings from Cowen.
Your line is open you can ask your question.
Hi, This is Brian here for Josh. Thank you for taking my questions. I also of a couple on the FDA approval process for Nexobrid.
Just to start can you clarify the role of the manufacturing facility in Taiwan I thought the Israel facility was the primary site responsible for manufacturing and I guess, where I'm going with this is do you need both facilities inspected before a final decision or could you start with just the Israel facility approved.
Good morning, Brian The question Mehdi wound is the primary manufacturing facility. We are manufacturing here in our facility in Israel, both the drug substance and the drug product the API and the product as well as the gel vehicle, however, because the Taiwanese manufacturer or supplier.
The factoring the promo line special production, which is the key raw material all of intermediate the rocks up stance at the subject also all acquired all of a sudden inspection and relative been informed.
Is that the FDA may be unable to conduct the day required inspections of our manufacturing facilities, both in Israel and Taiwan.
Okay, that's helpful and just.
On any potential for estimates of time revisions do you expect to receive any kind of estimate for when these facility inspections could occur and also if if it turns out that the FDA does not make the June 29th Paducah date do you expect there to be an estimated time.
<unk> four of final decision if they do.
Do not make that June 29th day.
Yeah. So first of all currently the reviews on growing of the Paducah date is June 29, FDA communicated Didnt anticipate to meet these day June 29.
The date, but we can't speak for the FDA and things that are evolving in the last few months.
Due to the backlog and other things that they have and also the number of scenarios. It is very difficult for us to predict now what will be the impact of about two per day. The SaaS, we will wait for further communication for the F D. A whether it's alternative.
The cost of conducting spec channel, whether it's the scheduling the inspections et cetera. The current given the different potential scenarios, we cannot predict now how long it will take them to complete the review of the complete the including of course, the inspection of the facility.
Okay. Thank you and maybe just one more on the BARDA procurement process of you're about halfway done with the delivery. There do you have insight yet into the BARDA plans for potentially additional procurement. After this first tranches completed.
Yeah. So as I said, we are on track with the bar by the procurement for emergency stockpile, which continue to drive revenue growth of met the wound and we expect to recognize the remaining revenue.
During 2021, which is about $6 5 million of our portion of out of the overall $10 5 million of 2021.
Currently we have no.
The definitive decision by about the guidance the option the option for additional procurement.
It will be a sort of discussion of powder and I assume that you'd be utilized only when the current the procurement will be expired for rotation of expired stock all of that.
Alternatively, if they will be required to increase the level of safety stock of magnitude though.
Okay and are you directly and those discussions are as varicella handling those primarily.
We are the primary contract with BARDA, we are the sponsor of the pleasure with vehicles, where the sponsors.
From the <unk> call and with the FDA. So we are the primary contract with BARDA.
Okay. Thank you.
Thank you. Thank you.
Again to ask a question on that would be star and the number one on your telephone keypad star and the net number one the fine Keith.
There is no question at this time presenters. Please continue.
Thank you everyone for joining us today.
Continuing to executing on our strategy and bringing new therapies to market and to update. Thank you again on our next update call. Thank you very much an appetite day bye bye.
Thank you Beth can conclude today's conference call you may now disconnect.