Q1 2021 Aldeyra Therapeutics Inc Earnings Call
And the timing on them.
Ladies and gentlemen, thank you for standing by and welcome to the El theory of Therapeutics first quarter 2021 financial results Conference call.
At this time all participants are in a listen only mode.
After the speaker's presentation, there will be a question and answer session.
I would now like the hand, the conference over to the Companys Chief Financial Officer, Joshua Reed. Please go ahead Sir.
Good morning, everyone.
With me are Dr. Todd Brady, President and Chief Executive Officer of out there.
This morning, we issued a press release reporting our financial results for the quarter ended March 31 2021.
A copy of the press release is available on the investors and media section of our website Www Dot Aldara dot com.
Please note that this morning's conference call contains forward looking statements regarding future events and the future performance of Aldara.
Forward looking statements include statements regarding submission of potential new drug application.
Potential commercialization the anticipated timing of results from our clinical trials.
Our projected cash runway, our possible or assumed future results of operations.
<unk> financial position and potential growth opportunities among other things.
These statements are based upon the information available to the company today.
These statements reflect out there at the current views with respect to future events and are based on assumptions and subject to risks and uncertainties, including the development clinical and regulatory plans or expectations for out there at the product candidates and systems based approach.
The risks that results from clinical trials or portion of the clinical trials may not accurately predict the results of the future trials for the same or different indications and are there is continuing review and quality control analysis of clinical data.
As the result of the COVID-19, pandemic clinical site availability staffing and patient recruitment.
Have been negatively affected and the timelines the complete our clinical trials may be delayed.
All of their assumes no obligation to update these statements as circumstances change.
Future events and actual results could differ materially from those projected in the company's forward looking statements, including the current and potential future impact of the COVID-19 pandemic on our business.
<unk> of operations and financial position.
Additional information concerning factors that could cause results to differ materially from our forward looking statements are described in greater detail in the company's press release issued this morning, and our filings with the SEC.
I would now like to turn the call over to Dr. Brady.
Okay.
Thank you Joshua.
The remarkable top line results, we reported last week.
From our phase III of invigorate trial on allergic conjunctivitis.
Net up what we expect to be a catalyst rich year for Aldara and 2021.
<unk> achieved statistically significant improvement of our vehicle for the primary endpoint of patient reported ocular itching the.
Key secondary endpoint of investigator assessed ocular redness.
On the secondary endpoints of patient reported ocular tearing.
And total ocular severity score.
The clarity of the P values achieved in the invigorate allergen Chamber further suggests of Approx of lapse clinical utility in reducing ocular itching redness and hearing which are the hallmark symptoms and signs of allergic conjunctivitis.
To our knowledge of Approx lap is the first allergic conjunctivitis compound that has been observed to show activity versus vehicle across symptoms and signs in a large well controlled allergen chamber trial.
Invigorate achieved the primary endpoint of improvement over vehicle and patient reported ocular itching score.
At all 11 pre specified time points, each with a P value of less than 0.0001.
Over the duration of the allergen chamber improvement over of vehicle for the key secondary endpoint of ocular redness was achieved.
As we are the secondary endpoints of patient reported ocular tearing score and total ocular severity score consistent with the primary end point P values for all secondary endpoints were less than 0.0001, indicating superiority of our products lap over vehicle and potential clinical utility of cross symptoms of <unk>.
And signs of allergic conjunctivitis, any setting of continuous moderate to high pollen exposure.
Consistent with the prior clinical experience of approximate app and other prescription ophthalmic solution mild and transient instillation site discomfort was observed but importantly, there were no observed safety or tolerability concerns in the trial and no discontinuation due to adverse events with <unk> has now been tested in.
Over 1200 patients.
With no clinically significant safety signals.
With the Invigorate trial completed we look forward to meeting with the FDA in the second half of this year to discuss the results and the potential submission of a new drug application.
Based on the results of invigorate for.
Very encouraged about the potential of our phase three tranquility and tranquility to trials of approximate app in dry eye disease.
Similar to the key secondary endpoint of invigorate the primary endpoint of the two day tranquility trials is ocular redness.
In the case of tranquility is assessed over 90 minutes and of dry eye chamber with tier rasp level Schirmer test in dry eye symptoms as secondary endpoints.
There is substantial documented clinical overlap between allergic conjunctivitis and dry eye disease, approximately half the patients who complain of ocular dryness also complain of ocular itching and vice versa.
In addition, ocular redness Navy the only objective sign of allergic conjunctivitis and dry eye disease that is of considerable importance to patients.
Patient enrollment and the train quality trial is underway.
Both tranquility and tranquility to which are identical and are expected to enroll approximately 100 patients per arm.
We remain on track to read out top line results in the second half of this year.
Turning to our systemic disease program. The initial phase III clinical trial results from the <unk> six to nine are expected in the second half of this year in asthma and psoriasis and COVID-19.
<unk> is a first in class orally available and irreversible covalent inhibitor of.
Pro inflammatory rasp.
And potentially represent a new paradigm and the understanding and treatment of immune mediated disease.
That could be broadly applicable across a myriad of clinical indications with unmet clinical need.
As I noted on our Q4 call. We are also evaluating new and potentially more important more potent rasp inhibitor compounds for retinal on systemic disease, the lead molecules of which could be in clinical development as early as next year.
We remain excited about the potential first line commercial prospects for approximately <unk> for the treatment of anterior segment of inflammation, but we remain equally excited about.
Without the possible therapeutic potential for rasp inhibition broadly, especially as aldara advances programs in inflammatory retinal and systemic diseases, the number and scope of which are far greater than that of anterior ocular disease.
Okay.
Our pipeline and clinical development plans are supported by a strong and well capitalized balance sheet.
Since the beginning of the year, we have generated combined net proceeds of more than $187 million.
Through two underwritten public offerings, including last month's offering that raised $125 million in gross proceeds.
We are extremely appreciative of the support from both the current and new institutional investors, who have participated in these offerings.
With that I'll turn the call back over to Joshua to review, our first quarter financial results.
Thank you Todd as.
As Todd noted, we recently sold 10 million shares of common stock at the price of $12 50 per share and an underwritten public offering the.
The offering generated net proceeds of approximately approximately $117 $3 million after deducting offering discounts commissions and estimated expenses.
Cash and cash equivalents as of March 31, 2021 for $138 4 million.
Based on our current operating plan, including the net proceeds from the recent underwritten public offering.
We believe that existing cash and cash equivalents will be sufficient to fund currently projected operating expenses through the end of 2023, including potential NDA submission for <unk> initial commercialization of our proxy if approved and continued in late stage development of the company's <unk>.
Product candidates in ocular and systemic immune mediated diseases.
Turning now to our first quarter 2021 results.
Research and development expenses were $7 7 million.
Compared with $6 6 million for the same period in 2020 the.
The increase of $1 $1 million is primarily related to higher clinical development and manufacturing costs, partially offset by lower personnel related costs and a decrease in preclinical cost.
General and administrative expenses were $3 1 million for the quarter compared with $3 million for the same period in 2020.
The net loss for the first quarter of 2021 was $11 $3 million or 25 per share compared with the net loss of $9 9 million or <unk> 34 per share for the quarter ended March 31 2020.
Now I'll hand, the call back over to Todd for closing comments.
Thank you Joshua.
We have continued to make significant strides in advancing our lead program toward commercialization in anterior ocular inflammatory diseases and we do so from a position of financial strength.
We are focused on executing our mission of improving the lives of patients by developing novel immune mediated therapies that satisfy unmet medical need.
With that Joshua and I would be happy to take your questions operator.
Thank you.
In order to ask a question for storms of the number one on your telephone keypad.
First question comes from Justin Kim of whole sometimes.
Your line is open.
Hi, good morning, Thanks for taking the questions.
Just a couple from me.
Just maybe touching on the cash bonds of the team reviews, the overall pipeline.
The robust cash position are the areas of the pipeline, where we might see or expect the.
Greater focus on potential pipeline on the BD M&A is there any thinking in terms of which programs.
For the handset.
The growth given from the.
Additional cash.
Well, let me just and thanks for the question and let me start off and perhaps.
Josh can provide some color.
I think we are.
Rich in our pipeline assets.
At this point.
I mentioned in my prepared comments were.
Very excited about the potential for rasp inhibition broadly.
Which is reflected not only in reprocess the lap our lead asset that I hope is close to the goal line.
In terms of the submission of a marketing application, but also in terms of.
The retinal disease and systemic disease, both of which are likely to relate to rasp inhibition.
So I think as as Josh mentioned, a lot of the proceeds that have been raised.
This year are earmarked for continued development of rasp inhibition of <unk>.
The as well as our retinal program with AVX 21 91.
Which as you know is currently in phase III testing for proliferative retinopathy.
Are always opportunistic in terms of.
Assessment and licensing of new assets I think we've proven to investors over the years that we're capable of evaluating in.
In licensing and developing the.
Novel assets.
But with that perhaps I will turn it over to Josh for further color.
I think Jonathan Thanks for the question.
Todd Todd Hasnt right, Yes, I think with.
We're at an ambition.
We expect to continue the development there.
Certainly we brought an AVX 21 91.
An acquisition that we completed in 2019, so we will continue to be opportunistic.
Where we see.
And assets that may fit with our portfolio.
Understood got it great.
And maybe just on trend quality can you discuss sort of of what that may be required prior to the initiation of of tranquility true.
There are no additional steps required prior to the initiation of tranquility to <unk>.
Tranquility to is identical.
Two tranquility one.
At this point of the initiation of.
Tranquility to is a matter of sequencing.
Do you wish to have a slight stagger.
Between the two trials so that we can adjust analysis plans and so forth if need be however, I do not expect.
US to do so based on the strength of the running cohort of.
Of tranquility, where we saw statistical significance in the primary endpoint after only 23 patients.
The primary endpoint for tranquility and tranquility to its also supported.
By the redness readout.
The from Invigorate as you know.
Okay got it and maybe just the through a follow up to that in light of the stagger and potential to have let's say some information around tranquility.
Higher to an NDA.
The NDA meeting on AUC.
Is that of hope of sort of the team to discuss.
Dry eye and <unk>.
Additional to sort of the AC program at that for.
The meeting with the FDA around filing.
Yes, Yes, you know the FDA typically.
Desires to discuss one.
At a time when program at a time in the pre NDA meeting for.
For allergic conjunctivitis.
Which I would argue could happen.
Early in the second half of this year one of the questions that are going to ask is how does the agency wish to receive.
NDA filings for.
Allergic conjunctivitis and dry eye disease.
Because the.
Where we as the sponsor of very interested in working with the agency and making sure that those.
Admissions are performed in a manner that is optimal for the agency to review.
So that I expect we will be guiding the street as to the precise mechanisms of those two filings.
The later in the second half of of this year.
Got it.
Thanks for taking the questions and congrats on the perfect.
Thank you Jasmine.
Your next question comes from Kelly <unk> of Jefferies. Your line is open.
Good morning, and thank you for taking my question.
My question is regarding <unk> ex <unk>.
On the immersion.
Thanks, a lot the non question.
And then all of that.
Sure on the nutrition work and part of what is the range of true too.
The nine programs from the <unk>.
Policy of where they thought the profile from the.
Perhaps the lab and the.
Also.
Strategic role.
How do you think about <unk>.
Type of indications for the two molecules.
Thank you.
Thanks for the question Kelly and I'm glad you mentioned <unk> six to nine.
Which we view as a hidden gem in our pipeline.
When we started this company many years ago, we were excited about rasp.
As a target.
Not only do of Approx of lap and AVX six to nine of which are closely related.
<unk> <unk>.
<unk> represents new molecules.
And not only do those new molecules.
The represent the <unk>.
Getting.
The new.
A physiologic mediators of disease.
But the entire pharmacology is different.
<unk> from 99% of drugs available today.
Most of drugs that we take today the buying to proteins.
Receptors.
<unk>.
Cytokines.
The directly involved in making proteins such as the case with gene therapy.
The most drugs available today.
Affect single targets.
A particular receptor a particular enzyme.
<unk> and <unk> 69 are different.
And that those drugs target a variety of.
Of non protein that.
That is small molecule inflammatory mediators.
And therefore, we've classified rasp inhibition.
As a systems based approach the challenge with the drugs available today is that inhibiting a single target.
That is taking a single molecule out of a physiological cascade leads to toxicity.
Analogous to driving your car with three tires.
Whereas modifying a system.
Without inhibiting a single target could have safety advantages and efficacy advantages. One reason that we believe we have seen the broad based symptomatic activity of approximately <unk> and dry disease, not just with dry ice for not withdrawing that score not just with.
With the ocular discomfort score of not just with burning not just with the stinging but across the board.
Is due to the fact, we believe debt reprocess the lap.
Effects of variety of.
Of the small molecule mediators of inflammation.
This kind of systems based approach could have efficacy advantages as well.
There is no reason why rasp inhibition should only apply to the eye for the front of the eye.
Which is why in response to Justin's questions I mentioned rasp inhibition as it may apply to the retina and systemic diseases.
We're really thrilled about AVX six to nine and the potential thereof.
We are currently testing the drug across different forms of inflammation.
Asthma, representing more of allergic for th two type of inflammation.
The ISS, representing more autoimmune for th one type of inflammation.
To your question Kelly at the really difficult to prioritize.
Diseases or kinds of inflammation as they relate to treatment with <unk> hundred nine until we see the results of that those the trials.
But I think you can hear on our voices today that we are optimistic.
Given the success of Approx to lap as you point out.
About the prospects of <unk> 69 in a way the front of the eye.
For out there has been a model.
Of inflammation.
I think it's very clear with the invigorate.
And the success, we've had in dry eye disease that for proxy lap is active.
And safe.
And therefore, I think there is considerable read through to the potential success.
AVX six to nine and that's why we're so excited about keeping you up to date.
Regarding the phase II results later this year.
The range that Paul Thank you Todd Thank you Kelly.
Your next question comes from Marc Goodman of SBB Leerink.
Your line is open.
This morning, guys two questions first.
For tranquility trials, obviously everybody's pretty excited about seeing the the secondary endpoint of redness in the previous trial. We just saw a few weeks ago and it gives us more confidence, but I guess just flipping that around when you think about these trials.
What are you worried about the most.
What if something happens that's just.
It doesn't go the way we were thinking of what do you think would be the reason.
Curious, how you're thinking about that and second question is can you just give us an update.
On the retina program, we haven't talked about that really so just total enrollments going and stuff.
For sure yes, thanks for the questions Mark.
Thanks for your recent activity regarding the redness in your notes along the line.
We were particularly interested prior to the readout of invigorate.
About the <unk>.
<unk> readiness will turn out because as I said in my prepared comments I do think.
There is a tremendous clinical relationship between allergic conjunctivitis, and dry disease, and if youre going to pick the sign.
The minus all of pick something that patients care about.
And that is ocular redness it is difficult for us to think of another sign that patients care about and by extension that health care providers care about I have never heard of patients say im.
I'm really interested in increasing by Schirmer score.
For my inferior corneal staining score or any other objective signs that we usually use to assess.
Dry eye disease for.
We're fortunate that reprocess the lap seems to have.
The anti readiness activity not only because that activity indicates.
Immune mediating.
<unk> in part, but also because it is commercially desirable and that patients and physicians are interested in.
Reducing readiness.
What can go wrong.
Well in the clinical trial business for those of us that have been around for decades have.
<unk> had lots of go wrong. It is always possible for clinical trials to readout sideways.
An unexpected manners.
On.
In dry eye disease, there is considerable variability.
This is why.
Many companies developing drugs today for dry eye disease perform a number of the phase III.
Trials and Aldara is no different.
One way to combat variability.
Is <unk>.
The numerous trials.
And that's exactly what we've done.
With the renewed trials with the phase III formulation trials that we believe will satisfy our requirements for.
Symptom control over 12 weeks in dry eye disease, but also the tranquility trials.
One and two.
Are we believe conservatively powered.
At least 90% powered to detect changes in ocular redness based on the activity we saw on the running cohort.
For tranquility and as I mentioned in response to Kelly's question.
Also based on the activity.
And readiness that we saw from.
Invigorate.
On the retina program.
We are continuing to move forward with AVX 21, 91 in terms of enrollment.
The proliferative the share retinopathy, which as you know is the disease that has no therapy today.
For which we have received orphan designation.
And.
For which Adi for 'twenty 191 has been fast tracked by the FDA. We continue to expect the completion of enrollment this year there.
There is a six month readout.
Readout per patient that is the primary endpoint is retinal detachment.
Over six months after initiation of therapy.
So that we would expect that results from the PBR.
Guard one trial that is the first part of guard at some point next year.
I have not spent a lot of time talking about the rasp rent.
On the program I've mentioned it briefly a few times today.
RASK are particularly interesting in retinal diseases for two reasons. The obvious reason is for the anti inflammatory effect of rasp inhibition.
But the other reason is that rasp are involved in binding two other small molecules, which are in some cases, not digested or metabolized.
By the sales in the retina.
And therefore lead to the accumulation of retinal aggregates and.
An example might be of Drugan.
In the.
Dry age related macular degeneration.
And related diseases, such as star of our disease.
So I think that there are at least two good reasons mechanistically to test.
Rasp inhibition in the retina for.
We're currently preparing.
For the submission.
Submission at some point in the near future as I mentioned in my prepared comments, we expect to potentially be in clinical testing with our RASK retina program.
The next year.
Thanks.
Thanks Mark.
Your next question comes from Igo locomotives from Citi. Your line is open.
Good morning, This is Craig Dahl.
Thank you.
Yes.
Just on.
On an earlier question regarding <unk>.
Discussion can you comment on what you see as the advantages and disadvantages of filing one NDA for <unk>.
And the allergic conjunctivitis great day.
The advantage.
The filing NDA.
For each indication and I guess the second part of the question is does out there I have a preference at the plant.
Between the two.
Thank you.
Hi, Carly good morning, and thanks for your question.
There are no obvious advantages or disadvantages.
That we are aware of.
Regarding filing separately.
At the same time.
And the reason for that is that in the event that.
There are two separate NDA, one NDA will reference the other.
As such that we don't have to replicate.
A good deal of work across NDA.
What we're not interested in is what the agency prefers.
I'll just take a step back to say how fortunate are we.
As a sponsor.
And as investors.
That we're in a position that we can file to mdas.
Perhaps the lab.
In getting this drug in the hands of patients and physicians.
Okay. Okay. Thank you for keeping your question.
Thanks for like.
Okay, and if you would like to ask the question for the stars on the number one on your telephone keypad.
Your next question comes from Edwin Jong of H C. Wisely. Your line is okay.
Hi, first of all could.
It came out of the question first congrats on the first of all.
The a quarter.
A quick question on the message.
The expansion, what's your current thinking on geographical expansion. After the recent clinical for example, sofa the across the lab.
Are you looking for partners ex U S O.
So the related to this.
Does the European regulator, except Tenbury studies.
For periods of trial and the year.
The approval.
Dry eyes and allergic comes on pay by it.
Thank you.
Everyone of good morning, and I will say I of enjoy discussing with you over the years.
Our potential outside of the United States.
Think too often biotechnology company to focus only on the United States I guess that is easy to do given that many biotechnology companies.
Are the on the file exclusively in the United States.
But there really is no reason why.
Reprocess the lab that couldn't be a first line option.
Across the world.
Ocular diseases, such as of allergic conjunctivitis, maybe even more prevalent.
Outside of the United States, particularly in Asia.
I can tell you that as a result of our continued progress in allergic conjunctivitis and dry eye disease.
Aldara has received a considerable amount of inbound interest regarding of regional partnering outside of the United States.
The direct the answer to your question is yes, we would intend to partner of Approx the lab outside of the United States.
Inside of the United States, we have that many options.
Any updates there it looks like data is going to be released in about 2022 from an investigator sponsored study in ovarian cancer, so any expectations and future plans in that indication.
Hi, there good morning, the thanks for asking you about 16 12, because we often don't have time to this.
<unk> discussed that the compound.
You're absolutely correct. The <unk> 12 is primarily now of the subject of a phase two ovarian cancer trial that is being.
Being run across multiple centers in Europe in combination with PARP inhibitors.
We're not exactly sure of the timing of the results of that trials because of that trial is investigator sponsored as you mentioned.
However, I think there is considerable preclinical reason to believe that the.
<unk> of <unk> inhibition, which is the mechanism of 16 12 income.
In combination.
With the PARP inhibition.
<unk>.
Potentially platinum therapy that could be beneficial for patients.
We await the results of those <unk>.
Investigations in the ISP.
Debt mdas are possible for dry of disease and allergic conjunctivitis. The by the end of this year or early next year.
I think the gating factors for those in the a submissions more likely relate to the standard in D. A safety studies, which and dry disease.
R 12 months of long Nonetheless, I still think that.
We're in a good position.
To meet the NDA submission timelines that I have mentioned.
Your next question.
Relates to.
New molecules.
Regarding rasp inhibition and the potential advantages thereof.
As I mentioned in my prepared comments, we have consistently developed new chemical entities.
With cynical similar Pharmacopeia force.
That are designed to irreversibly of.
Buying to rasp.
Some of those new molecules are considerably more potent.
Then.
The lab and AVX 629 the.
The advantages of potency.
Remain to be proven in the clinic.
However.
We are committed in the company to developing new intellectual property around compositions associated with Rasp. In addition, as well as generating a robust novel wrath of the division clinical pipeline.
Across the number of different.
Diseases.
And then I believe you had a follow up question for car yeah.
From Atheists 80, 6629 on the phase two trial in mind allergic asthma, given its the small proof of concept trial. The limited frequent urination could you seem expectations on on what could be expect to see on various on foreign tender any.
Any biomarker data on that you're moving measuring thank you.
Per car. Thanks again for the excellent question I'm thrilled to receive so many questions on our pipeline I think too often the street value of Aldara as a dry eye disease company.
Our pipeline as you know extend well beyond.
The two indications that we're moving forward.
It's just the ones that first I just want to confirm that the in terms of the reporting that on court T. One and two data.
Are you guys going to just.
Into one reporting of the outcome all your work for Ya.
The one after another another room in other words, the first of all for one and then for a second second for the security too.
Right. Good morning, Yale our goal is to keep you as busy as possible.
So I went to the fact that me when the day of work Yeah, I would suspect that we will report of tranquility them on entering volume two separately just given the.
Timing.
And the stagger between the two trials that I of previously mentioned.
And one follow up question here is that you the follow with the earlier comment in terms of the rats basically at the.
So that make the approach.
The flip side of that actually is the.
State the so how would in in addition to empirical studies.
How would you guys thinking about the state the that the of any of <unk>.
Just based on get the target or fit the.
One day, you know impact on the individual.
Yeah that is an excellent question I can tell you.
Because I was there.
The first institutional investment in the company, which was 2005.
Which was led by the main associates and Johnson and Johnson.
The question.
Of systemic toxicity.
Was first and foremost that is.
What are the safety ramifications of inhibiting Ras.
Broadway.
Throughout the body.
As we said in our 10-K now for many years.
That we know of there are only two.
Rap targets that are physiologic that is involved in non inflammatory of metabolic processes.
And those are retinal of the hide which is a form of vitamin a.
And paradox, Allen paradox of phosphate, which of forms of vitamin B six.
Both of those molecules are highly chaperones.
For highly protected.
We've had no evidence of animals or humans at.
Our rasp inhibitors on.
Are capable of even approaching so of molecules and we have seen no clinical evidence.
Either with topical ocular administration or oral administration.
Is that wrath of inhibition effects those two molecules.
What appears to be the case, then is that wrath that are available systemically and and the I R. Pro-inflammatory.
And those rats are the targets of our Prague we've.
We've now been through a rigorous phase one trial with high.
Of AVX 629.
We saw no.
[noise] adverse events related to drug.
And those data support the safety profile of of AVX 629.
We look forward to monitoring the efficacy of safety of 629 and larger trials.
And and disease patients.
Rest assured that the results of those investigations will be shared with the investors.
We hope by the end of this year.
Okay, great. Thanks for the file on one SEC.
Section.
You are welcome Gal, it's my pleasure.
We've reached the end of the Q&A assertion.
We'll now turn the call back to the Doctor Brady for closing comments.
Thank you operator and I. Thank you all for joining US again this morning as always we look forward to.
Keeping you updated on our progress next month, we will be participating in the Jeffries virtual healthcare conference.
Check our website for the scheduled presentation time and for those of you that are participating.
We look forward the meeting with you soon thanks again.
This concludes today's conference call.
Thank you for your participation even now just kind of.
Thank you.
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