Q2 2021 Tricida Inc Earnings Call
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Good day, and thank you for standing by and welcome to just try to feed US second quarter 2 thoughts on 'twenty, 1 financial results conference call.
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I would now like to hand, the conference over to your Speaker today Jackie Kauffman. Please go ahead.
Thank you Mary good afternoon, and thank you for joining the price through the second quarter 2021 financial results and business update conference call and today's call, Eric Lerner, our founder and CEO and President who will provide an update on the ongoing balance sheet could be renal outcomes trial and discuss our business progress Geoff Parker, our C O O and CF.
Paul will discuss the recent results from our new market assessment and <unk> as a potential therapy for slowing CPD progression and provide a summary of our financial results for the second 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 the applicable securities laws forward. Looking statements include our anticipated activities related to our ongoing valor <unk> renal outcomes clinical trial, our plans for interactions and communications with the FDA, our plans and <unk>.
Expectations regarding potential pathways to approval of a fair number by the FDA, our assessment of potential clinical development pathway for the Burma, the future market potential of for Werner and our expectations regarding our financial runway management's assumptions expectations and opinions reflected and these forward looking statements are subject to risk.
<unk> 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.
And it can give no assurance that these statements will prove to be correct and we do not intend and undertake no duty to update. These statements. 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.
We issued our second quarter press release. This afternoon, just after the close of the market for copies of the press release. Please go to Www Dot <unk> 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 Jack and thank you all for joining us for that and today.
Carl will provide a status update on our continued progress for the balance of getting trial.
And also provide highlights on the new commercial market assessment based on that.
And the potential therapy, and disclose thing any progression and.
And I will provide a brief overview on future development opportunities for them and that we believe could unfold and positive I think any data.
Finally, we will provide a recap of our second quarter financial with us and cash.
Now turning to Boston.
On slide 5 and a summary on the biotech and each of us have had to randomize subjects.
And that helped placebo and the trial and on the independents line in Cleveland and funded relocation commodity has positively adjudicated and 511 subjects with D. D 40 events defined as you may know that he has a day or confirm greater than or equal to a 40% reduction on egfr.
And as you saw on our press release, we now have 1 interim analysis that will occur and we have a quote 250 subjects pardon me on a point of it.
We anticipate that this will occur on May 2.2000 and try to if.
And if the criteria for early stopping and for efficacy and not met at the interim analysis and trial is scheduled to conclude at 511040 of it.
We recently removed the other 51 and turning to us for Novartis took any protocol.
We chose to eliminate this early analysis.
The physical and the regulatory Optionality for the trial.
It's about I think and he trial, that's on 87% power to show, a 24% difference and pardon me and part of it.
Said another way the assumed hazard ratio for the power and how about I think and he is.
7.6.
And on slide 6 you can see that'd be on and making good progress and the conduct of the laws and they go to trial as of August 6.2000, and Taiwan that trial had randomized for Ken and 55 on the plastics on subjects and average treatment duration of approximately 17 months and <unk> 27 of the targeted 511, and finally endpoint events have been accrued.
With respect for the overall trial enrollment rate change and our geographic focus and the impact of COVID-19, that's supposed to read out for enrollment somewhat and we now anticipate completion of enrollment and the first half of 2022.
On slide 7 and stuff and 32 additional time and point events since our last quarterly call based on when the call protection for long because he believes that we are still on track for 250 event and done an awesome and mid.
2022.
Yeah.
Now on slide 8 before I turn to the assumptions are on the O&M and US and final analysis I want to provide some perspective on the assumed hazard ratio off the balance getting trial, you can see that the epidemiological studies analyzing and relationship between sand and bicarbonate level and risk I think and he progression with Volta and estimate hazard ratio for 76.7.
Several published prospective studies of the effect of increasing standby covenant and I'm thinking of the progression in patients with metabolic acidosis and security.
And as hazard ratio and the range from point to 0.5.
As we've previously described and discussing all of us because he powering assumptions and we took a conservative approach and used epidemiological data to apply a <unk> 7 and 6 hazard ratio to estimate the power about ticketing.
On slide 9 and if we assume that true hazard ratios and 5.7 and 6 you have it.
22 for central body of meeting the criteria for stopping the trial early for efficacy at 250 events and.
As I said, the overall power and to 5 hours a day, 7%, however, given the risk reductions on slowing thinking and progression from some of the published prospective trials and patients treated with them AR VR and AR.
And may experience greater benefit involved because he and Neptune and logical models might suggest for.
For example, if we were to assume it to a hazard ratio of <unk> 7 zero and so the point and 76 and probability of something that I think would be early for efficacy at the interim analysis doubled from 22% to 47% and.
And then said between out of Asia were.
6 up 1.5 for the possibility of stuffing earliest income increases to 88 or 99, 6% respectively.
At the bottom on the slide expect another way and observed hazard ratio for less than 6.7 at the interim analysis, but for adult and meeting the criteria for early stopping of the trial for efficacy.
We believe for the interim analysis will be and an important milestone for us because you get enough of us, but and will be conducted by the independent unblinded interim and I'll just come in it and it is committee does not recommend and stopping early for efficacy, but we received no information from the interim and office.
If however, and.
And I was just supposed to yield a statistically significant result for the primary efficacy endpoint and the committee recommended early stopping for efficacy it could potentially form the basis for resubmission of the NDA for traditional approval pathway now.
Turning to slide 10.
They find ourselves and a situation, where we must stop the trial early what administrative fees.
And we are conducting clinical trials and expensive and uncertainties can arise at any time.
And if theyre unable to ensure that we have adequate resources to complete the trial in accordance with the protocol.
And what other events occur, which diminish on the likelihood of reaching 511 events, we may be compelled to stop the trial early for administrative reasons, which could occur either prior to or following the patents and technologies.
Any such decision would be made and in the future based on a range of considerations, including our ability to respond and somebody stop and wind down on the trial consistent with our regulatory and ethical obligations and within the confines of our financial runway.
If we were to stop the trial for administrative fees and the primary endpoint for the analysts during all off our remaining at that time.
As an example of what we estimate the power of the trial would be on that administrative sub scenario and you've laid out too hypothetical time points. After 850.250 primary endpoint events have occurred.
And to a 200, if they show a point and 7.6 and trust 30.
And 39% or 58% and power at hand, and 50 or 250 events, respectively to provide you with a sensitivity analysis and the treatment effect is a larger and a true.
Hazard ratio of <unk>, 7 O the pie and places to 59% on hand, and 50 events stopped and.
You bet.
And as we move to hazard ratio of <unk> 6 up 1.5 estimate power goes up significantly.
On the last line express and the other way if a child that's come on in early for administrative reasons on 250 and the data from the trial show a statistical significance of the observed hazard ratio is less important and 7.8 and if that occurs and could potentially form the basis for an NDA resubmission for traditional approval pathway.
As a reminder, we highlight on slide 11, the keys here on a delicious and yet.
We believe outcomes data from biotech and he will be very important and determining the regulatory path for approval for very loud.
And could address the regulatory concerns expressed by the FDA and this year on India.
And the applicability of the trial was off for the U S population and the practice of medicine, while we expect a few primary endpoint events will come from U S patients, 10% to 20% of patients I expect it to be enrolled and the U S, Canada and Western Europe will conduct subgroup analysis of the primary endpoint and by geographic region.
In addition, we plan to conduct sensitivity analyses to assess the effect of country and the other day on variables on the primary and secondary endpoints on the trial. We also intend to ensure that no single trial sites and the biotech any trials for life credit for 5% of the total number of trials subject.
I would note however, the fda's acceptance of the Biosecurity data and support them. The NDA re submission, including the acceptability of the data from non U S countries and regions, but ultimately be a review issue and as always and presenting today are for the F. D. A.
Just kind of is.
On slide 12, and summarize our recent and planning to FDA interactions. We have submitted a protocol amendment to eliminate the on and 50 of interim analysis and provided the FDA was and update on the biotech and he trial and potential future development activities for example.
The timing of future substantive action for the FDA will ultimately be dependent on the availability of all the security data.
And so I think and he stopped early for efficacy at the 250 of an interim analysis and mid 2020..2 we used submission of the San Diego to correct and try and tenancy.
However, if a trial and must be stopped early for administrative fees and so it could occur prior to the plant and 50 event interim analysis and that case, if the data demonstrate efficacy resubmission of the NDA could occur as early as late 'twenty 2 and.
We believe our submission will be classified as a resubmission and under the original NDA and as such have a qualified for 6 months with you clearly the specifics for the any NDA submission resubmission and the latest timing let me know.
Chairman for a future FDA interactions.
With that I'll turn the presentation over to Jeff, but update on the variable on market opportunity.
Thanks, Gary and thank you all for joining us today.
Our goal with the new market assessment and was twofold first we wanted to evaluate physician receptivity to a new target profile that included disease modifying outcomes data and second we wanted to understand how a broader population of physicians beyond Nephrologist are currently diagnosing and.
And metabolic acidosis and further understand how they might use for <unk> as a treatment for patients with metabolic acidosis and CK D. For <unk> were approved on the basis of a target product profile with outcomes data.
On slide 14, the 2019 target product profile is on the left and the target product profile that we presented and the recent surveys is on the right.
As you can see the major difference is the primary efficacy endpoint in 2019, the focus was on a change and serum bicarbonate. While the current profile focuses on outcomes data specifically D. D 40.
Now moving to slide 15 in.
In addition to 71 Nephrologist, we broadened the survey population in this new survey to also include 91, non Nephrologist, who were cardiologists endocrinologists and primary care physicians.
Now stepping back for a moment on slide 14 to characterize the opportunity and the non Nephrologist market. You can see that there are about 500000 diagnosed patients with metabolic acidosis and CK D that are under the care of physicians other than Nephrologist.
When we were considering a commercial launch based on accelerated approval prior to availability of outcomes data from valor CK D. Our strategic focus was on Nephrologist.
That would still be the primary target audience.
About 50% to 60% of diagnosed patients are seen by nephrologists with the percentage increasing as the patient moves into later stages of CK D.
But as we look at a possible commercial launch based on a potential label for slowing <unk> progression with outcomes data, we wanted to understand the receptivity from non nephrologist physicians to prescribe and of Aramark.
On slide 17, we have provided both for 2019 and 2021 survey results that provided us with answers. The 2 questions first wouldn't apologist and non non nephrologist be likely to prescribe for Burma based on a target product profile for slowing C could eat.
Russian and 2 what percentage of patients with metabolic acidosis, and TKD would receive a miramar 5 years after launch.
As you can see here a physician survey results demonstrated a strong interest and prescribing for Burma, with 93% and Nephrologist and 71% of non nephrologist, indicating that they.
And would definitely for probably prescribed of armor.
In addition peak patient penetration for prescribing for murmur was estimated to be 74% among nephrologist and 58% among non nephrologist.
I would like to note that to avoid variations and responses based on the price of the product or insurance coverage. We ask physicians to assume price is not an issue and there was adequate insurance coverage.
It is typical to adjust these numbers down based on these factors and others as we look at modeling of future revenue opportunity for <unk>, but these results are very encouraging and signaled significant increased interest from nephrologist as well as strong interest from non nephrologist as a result of a target product.
While that includes renal outcomes data.
We also conducted a new payer survey a summary of this is on slide 18, our early work with payers included education on chronic metabolic acidosis clinical data from 301 and 3 a week.
301, 3 on when he trial and discussions about the mechanism of action of a murmur.
We also educated payers on the medical need for and economic benefits of a potential treatment for chronic metabolic acidosis prior to our anticipated launch.
Our early efforts paid off here and we found that payers were generally well informed and understood. The link between metabolic acidosis and CK D progression as well as the additional cost of care that are incurred by the health care system for patients with metabolic acidosis, and CK D compared with <unk>.
Similar patients without metabolic acidosis.
And this new survey payers are clearly interested in <unk> as a disease modifying therapy and the verification of this through and outcomes based endpoint from Valor CK D was a net positive.
And as always they consider the cost savings to the health care system from treating metabolic acidosis, which is estimated to be approximately $40000 per year to be a key driver to adoption.
We tested a range of prices and the general consensus among survey responses respondents was at approximately $3000 per month for $36000 per year would be a reasonable price for <unk>, which is and the same range as previous survey results.
I mentioned earlier that our survey numbers are unadjusted and so on slide 19, we for we've provided our previous estimates of the anticipated payer mix for the target population of patients with <unk> and metabolic acidosis.
We believe that over half of the initial targeted patients with metabolic acidosis and CK D will have either low copay, such as Medicaid Medicare with subsidy or V. A D O D or may have assistance with their co pay which would be the commercial segment of the payer mix. We believe this would provide access to.
And <unk> to the majority of patients with metabolic acidosis and <unk>.
Now turning to slide 20.
Want to highlight that patent protection for <unk> runs until 2038, and the U S and we continued to expand our patent protection and other regions as well, we believe <unk> long patent life will enable us to maximize the value of aramark over time.
In summary, we believe that there is significant market opportunity for <unk> based on the initial anticipated indication as we delve more deeply into the science of acidosis, we were already starting to think beyond that to look at a broader population of patients who may benefit from asset removal.
I'll turn the call back to Gary to describe this expanded opportunity.
Thanks, Jeff, let's move to slide number 22.
If the valor <unk> trial demonstrate the treatment with a famous low seek any progression we have an opportunity to pursue and expanded development program.
And they had to this 2 papers have been published and the clinical journal of the American Society of Nephrology and see Jason This year by preeminent experts and the field of metabolic acidosis research and 1 by the clinical dose Matthias and the other productive dialogue with both.
Both publication and focus on the concept of clinical and metabolic acidosis defined as a standby carbon and less in 'twenty 2 milligrams per liter.
A lagging indicator of asset retention and patients with <unk>.
Prior to a chronically low Sam bicarbonate level. These patients have already accumulated assets that has used and depleted multiple buffering mechanisms designed to mitigate the deleterious effects of the accumulated assets.
Growing evidence suggests that asset accumulation.
Prior to avert metabolic acidosis causes clinical on.
Let me review the science briefly and then I'll turn to how we're thinking about our future development plan for the variable that could benefit patients and standby covenant levels still and the normal range.
The diagram on slide 23 depicts the multiple strategies and interactions between the strategies to mitigate assets fast and.
And kidney damage for close to complete the expansion of the daily asked about.
This is a complicated slide but the key message here is that multiple systems and play and standby covenant is a lagging indicator of the impact of asset accumulation.
As summarized both.
By both Dr Smith, and Wesson experiments and both animals and clinical trials in humans and suggest that app and accumulation prior to avert metabolic acidosis and thoughts on kidney injury.
Thus, while standby covenant, maybe the most widely used method of diagnosing asset accumulation today, it may not be sufficiently sensitive.
And measure of asset accumulation, particularly on prior to depletion of any other assets mitigation mechanisms used by the balance the.
And the importance on this work and the fact that 1 and supports the basic premise that standby caught on is a lagging indicator of the impact of ASIC, you mentioned and 2 they made a considerable benefit to early intervention for savanna to improve asset based on and prevent clinical consequences of asset retention.
Now on slide 24, as we looked at the various mechanism of action you can see that the analysts designed to supplement asset removal and the setting of the kidneys reduced ability to excrete acid because of kidney disease.
And that's both high capacity and high selectivity of hydrochloric acid binding, yielding and elegant means for moving assets within the Gi tract.
As we examine more closely the full spectrum of mechanisms that impact asset based on and they believe that for them and they provide kidney protective effects and seek any sooner and the diagnosis of metabolic acidosis and it may have the potential to benefit and brought a population of patients.
And as you can see on slide 25, and we believe this may be similar to the development path used by the <unk> 2 inhibitors.
We are the first studies supporting labeling for slow and seek any progression are conducted in patients with advanced disease for subsequent studies involving patients with progressive lean model.
And the gateway for them I believe that successful for us to get a trial could support approval for as long as it can be progression and patients with chronic metabolic acidosis and she getting made.
And we May then conduct additional outcome trials to seek to expand the label for them and to include the slowing of ticket day progression and patients with ticket and you have not yet developed of brick metabolic acidosis, but for whom asset combination.
On.
Given this broad view.
And the potential to significantly expand the addressable patient population for example.
Ask Jeff to review, our financial results for the quarter.
Thanks, Gary on.
On slide 27, as a quick overview of the second quarter results R&D expense was $19.8 million and $28.8 million for the 3 months ended June 32021, and 2020, respectively.
The decrease 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 was $9.6 million and $28.4 million for the 3 months.
Ended June 32021, and 2020, respectively. The decrease was primarily due to decreased administrative activities and connection with our <unk> clinical development program, including pre commercialization medical affairs and personnel costs.
Net loss was $33.6 million and $58.2 million and non-GAAP net loss was $24.6 million and $48.8 million in Q2, 2021 and 2020, respectively.
Now on Slide 28, let me turn to our financial position.
As of June 32021, cash cash equivalents and investments totaled $175.8 million. We currently have a $200 million 3.5% convertible senior note outstanding with a maturity date of 2027 and.
At June 30, we had approximately 50 million shares outstanding.
We believe our current financial resources will fund our planned operations into late 2020.2 based.
Based on the current rate of primary endpoint event accrual and the valor TKD renal outcomes trial for 250 event interim analysis for early stopping of the trial for efficacy is expected to occur within the timeframe of our existing capital.
If we were compelled to stop the trial early for administrative reasons that event could occur prior to the planned 250 event interim analysis with.
With that I will turn the call over to the operator for questions operator.
Yes.
Absolutely. That's a reminder to ask a question you will need to press star 1 on your telephone should we draw your question cash to county.
And just standby and wanted to compile the Q&A roster.
Okay.
Your first question comes from the line of <unk> <unk> of Cowen Your line is open.
Hi, Thank you for taking my question.
And just had a question about the event rate and down.
And there is it tracking thus far with the estimated is that a cool timeline based on your internal forecast.
Yes.
And can you remind us how often egfr is measured in patients and the trial.
It's measured at at every study visit.
So it's really multiple times a year.
Okay and Uh huh.
Quick follow up so based on like the last 6 months reported accrual numbers of endpoints the accrual rate seems to be rather linear when does that does that.
To accelerate.
Do you happen to know the equation many exponential regression.
On page 7 you can see that we have and outlook for our estimated event rate of accrual and and you're correct that it is it looks primarily linear and we are tracking right now right around the mean, so that would be the green dots on that.
Of course, if we get to the higher <unk>.
Right it would become a little more accelerated and the lower.
Confidence interval would be a little less accelerated but but our forecasters appear.
Appears to be fairly linear.
Okay. Thank you very much.
Your next question comes from the line of Jessica.
J P. Morgan your line is on.
Hello, Daniel Thanks for taking my question.
And yes, just for fun.
When looking at patients with COPD and asthma.
Given that that does not feel for how do you plan to identify the patients and yes.
When do you expect to start the study.
Yes.
Future studies post balance and kidney data and.
We would still use serum bicarbonate and we would basically use patients who are and the low normal standby covenant range between 22, and likely 24 milligrams per liter.
Yeah.
Great.
And then the accrual.
Cool.
And the primary endpoint for the last report sensor on 34% while day randomization.
And as around 1%.
Given the lack of for the randomization and Airbus you can reach tanker and before enrollment completion.
Yeah.
Let's be clear the vendor accrual and enrollment.
On decoupled.
I think you know the patients that are currently and the study for on average duration of about 17 months or so they are the ones who are contributing the pardon me and events. The patients we are adding into the study.
And I'm, assuming that we were successful at the interim analysis are.
Sometime mid next year on not likely going to contribute significantly to 2 and accrual.
Got it thank you.
Your next question comes from the line of grade Silver net of Goldman Sachs. Your line is open.
Hey, good afternoon, and thanks for taking my questions I, just wanted to revisit the hazard ratios from some of the other studies that you mentioned earlier on your presentation and I believe you mentioned that.
C and hazard ratios of 020 to close to zero fleet size can you just remind us what those interventions.
Sure.
And then secondly, a question just on I guess cash and Jeff I Might've missed this but if you could just remind us.
And.
And the circumstances with which year would be leaning towards perhaps pulling the trigger on and administration will stop for the guidance around cash being sufficient until late 2022 does that basically take.
On the.
The bill that you might have.
Too easy administration and stuff.
Yeah on the prior studies are those on really the academic often single center.
The studies that are in 1 case.
For example used on alkali that's a debate on study and another 1.
Used really a diet.
Intervention and a very low protein diet and.
And <unk> and both of those and dimensions.
Those very large event rate reductions compared to the controls on them.
And.
And and again those were those for 1 to 2 year studies.
So Greg on on the administrative staff and these will be our cash and again, we forecast cash into late 2020..2 so if you look at the calendar that would imply.
If we did need approximately 6 months of runway to ethically and and and appropriately wind up that study.
We would need to see data and the second quarter of 2022.
Yeah.
Okay. Thank you very much.
Yeah.
Again as a reminder to ask a question you will need to press star 1 on your telephone and again that is star 1 on your telephone keypad.
And there are no further questions at this time I will now turn the call over to Jacky Kauffman for any closing remarks.
Thanks, Nate and thank you all for joining us on today's call as always if you have additional questions. Please don't hesitate to email us at IR and Tracy the dot com, Thanks and goodbye.
This concludes today's conference call. Thank you for participating you may now disconnect.
Yeah.
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Yes.
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And.
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Good day.
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Good day, and thank you for standing by and welcome to that Tracy that second quarter no thoughts on 'twenty, 1 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 to ask a question. During this session you will need to press star 1 on your telephone you for it.
Any further assistance please press star zero.
I'd now like to handicap on French you'll work your speaker today Jackie Kauffman. Please go ahead.
You made good afternoon, and thank you for joining the price to the second quarter 2021 financial results and business update conference call and today's call very clear on our founder and CEO and President will provide an update on the ongoing balance you could do renal outcomes trial and discuss our business progress Geoff Parker, our C O O and CFO.
And we'll discuss the recent results from our new market assessment of for Werner as a potential therapy for slowing CPD progression and provide a summary of our financial results for the second 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 the applicable securities laws.
Forward looking statements include our anticipated activities related to our ongoing dollar she K D renal outcomes clinical trial, our plans for interactions and communications with the FDA, our plans and expectations regarding potential pathways to approval of repair them or by the FDA, our assessment of potential clinical development path.
It's a way for them to be armor, and the future market potential of for Burma, and our expectations regarding our financial runway management's assumptions expectations and opinions reflected and 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 on.
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. These statements. 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 second quarter press release. This afternoon, just after the close of the market for copies of the press release. Please go to www dot try to see 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 for their and today's call. We will provide a status update on our continued progress for the balance of getting trial.
And also provide highlights on our new commercial market assessment based on the data and the potential therapy and as long as Nick any progression and that will provide a brief overview of future development opportunities for them and that they believe could unfold and positive I don't think any data for.
Finally, we will provide a recap of our second quarter financial results and cash for us.
Now turning to Us and Guinea.
On slide 5 and somebody on the biotech and he tried to that if I had to randomize picking on subject to whether or not a placebo and the trial and on the independent blinded clinical endpoint Adjudication Committee has positive and Jody Cain and 511 subjects with D. D 40 events defined as you mean on that or confirm greater than on <unk>.
And 40% reduction and Egfr.
And as you saw on our press release, we now have 1 interim analysis that will occur and we have a crew.
And 250 subjects pardon me and fines of it.
We anticipate and this will occur on May 2000, and trying to <unk>.
Tell you for early stopping for efficacy and not met at the interim analysis and trial is scheduled to conclude at 511040 events.
And we recently removed the other day event in terms of assets from Nevada, and take any protocol. We chose to eliminate this early analysis to preserve statistical and regulatory Optionality for the trial.
And I think and he trial that's on an 87 for the power to show, a 24% defense and timing and part of it.
Said another way the assumed hazard based on for the powering up I don't think any disappointment 7 and 6.
And on slide 6 you can see that they have and making good progress and the conduct of and all I think any trial.
On a 6 to 11, and Taiwan and trial had randomized for 10 and 55 on the plastics on subjects and average treatment duration of approximately 17 months and how net 27 of the targeted 511 and timing and fund the Vantiv and the quote.
With respect to the overall trial enrollment rate the change and our geographic focus and the impact of COVID-19, and supposed to wait on the enrollment somewhat and we now anticipate completion of enrollment and the first half of 2022.
On slide 13.
And 32 additional time and 1 event since our last quarterly call based on when the call protection for La and thinking he believes that we are still on track for 251 and done in Austin.
2022.
Okay.
Now on slide 8 before I turn it on the assumptions are on O&M and ask some final analysis and provide some perspective on the assumed hazard ratio. It's about I think and he trial you can see that epidemiological studies analyzing the relationship between standby covenant level and west coast any progression resolved and estimate Hasnt mentioned on <unk> 76.
Several published prospective studies of the effect of increasing standby covenant I'm thinking and progression in patients with metabolic acidosis and <unk>.
For the hazard ratios and the range from point to 0.5 and <unk>.
Previously described and discussing all of Us and Guinea powering assumptions and he took a conservative approach and used epidemiologic data to apply a point and 76 has been shown to estimate the power about ticketing.
On slide 9.
So on the true hazard ratios in fact points and 622% probability of meeting the criteria for stopping the trial early for efficacy and a 250 event and as I said, the overall power and the final analysis and 8.7%. However, given the rest productions on slowly pick any progression from some of the published perspective trial patients treated on the map.
And may experience greater benefit and Boston.
And you haven't even illogical and models might suggest for.
For example, if we were to assume it to a hazard ratio of 170 and set up <unk> 76 and Pablo.
They are suffering and loss it could be early for efficacy at the interim analysis.
And from 22% to 47%.
And then set for 2 out of Asia.
6 up on 5 wells early on.
Stuffing earliest income increases to 88 or 99, 6% respectively at.
At the bottom on the slide and expect another way and observed hazard ratio of less than 6.7 at the interim analysis would result, and meeting the criteria for early stopping of the trial for efficacy.
We believe the interim analysis for the an important milestone for us because he and off of US spent and when he conducted by an independent unblinded interim and us committed and and this committee does not recommend stopping early for efficacy, but we received no information from the enzyme and office.
If however, and.
Assets was to yield a statistically significant result for the primary efficacy endpoint and the committee recommended early stopping for efficacy and could potentially and form the basis for resubmission of the NDA for traditional approval pathway now.
Turning to slide 10.
And find ourselves and a situation, where we must stop the trial early for administrative fees.
And we're conducting clinical trials and expensive and uncertainties can arise at any time.
And if they are unable to ensure that we have adequate resources to complete the trial and according to the protocol.
And I have other events occur, which diminish on the likelihood of reaching 511 event, we may be compelled to stop the trial early for administrative reasons, which could occur either prior to or following the plant and terminal assets.
Any such decision would be made and the future based on a range of considerations, including our ability to possibly stop and wind down the trial and assistance with our regulatory and ethical obligations and within the confines of our financial runway.
If we were to stop the trial for administrative reasons. The primary endpoint will be analyzed using all of our remaining at that time.
As an example of what we estimate all of the trial would be on that administering and sub scenario and laid out too hypothetical time points I'll take it on.
150 for 250 primary endpoint events have occurred and some.
200, and Vishal, <unk>, 7 and fixed and trust.
39% or 58% power at hand, and 50 or 250 events perspective and.
To provide you with a sensitivity analysis and the treatment effect and the larger and its a hazard ratio of <unk> 7 O. The power and <unk> 50, 950 events and for 81% of stopped at 215 minutes.
And as we move for Hesitations off 0.6 up on 5 estimate tog was up significantly.
On the last line express and another way if the trial is coming on early for administrative reasons that 250 event. The data on the trial that showed statistical significance observed hazard ratio is less than 7.8 and if that occurs and could potentially form the basis for an NDA resubmission for additional fill a pathway.
As a reminder, we highlight on slide 11, and the key Sierra and any other issues for our initial and yet we believe outcomes data from biotech and he will be very important and determining the regulatory path for approval for them and can address the regulatory concerns expressed by the FDA and this year on India.
Regarding the applicability of the trial results for the U S population and practice of medicine.
And we expect that few primary endpoint events would come from U S patients, 10% to 20% of patients and I expect it to be enrolled and the U S, Canada and Western Europe will conduct subgroup analysis of the primary endpoint and by geographic region and.
In addition, we plan to conduct sensitivity analysis to assess the effects of country and other based on variables on the primary and secondary endpoints of the trial.
Also on tend to ensure that no single trial sites and the balance of any trial provides credit for 5% of the total number of trials subject.
I would note however that fda's acceptance of the volatility data in support of their NDA re submission, including the acceptability of the data from non U S countries and regions will ultimately be a review issue.
And presenting today at the FDA and the interest kind of ayes.
On slide 12 to summarize our recent and pending FDA interactions. We have submitted a protocol amendment to eliminate the and 50 event interim analysis and provided the FDA was and update on the biotech and he trial and potential future development activities progress.
The timing of future substantive interaction for the FDA will ultimately be dependent on the availability of policy for the data.
While our ticketing and stopped early for efficacy at the total 50 event and interim analysis and mid 2022 resubmission of the NDA could occur and transparency.
And the trial and must be stopped early for administrative fees and that could occur prior to the planned 250 event and to have analysis and in that case and the data demonstrate efficacy resubmission of the NDA put up there as early as late 2002 and.
We believe our submission will be classified as a resubmission on the original NDA and as such will qualify for 6 months revenue clearly the specifics related any NDA submission resubmission and the latest timing will be determined for future FDA interactions.
I'll turn the presentation over to Jeff, but update on the volume and market opportunity.
Thanks, Gary and thank you all for joining us today.
Our goal with the new market assessment was twofold first we wanted to evaluate physician receptivity to a new target profile that included disease modifying outcomes data and second we wanted to understand how a broader population of physicians beyond Nephrologists are currently diagnosing and.
Treating metabolic acidosis and further understand how they might use for <unk> as a treatment for patients with metabolic acidosis and CK D.
For <unk> were approved on the basis of a target product profile with outcomes data.
On slide 14, the 2019 target product profile is on the left and the target product profile that we presented and the recent surveys is on the right and.
As you can see the major difference is the primary efficacy endpoint in 2019, the focus was on a change and serum bicarbonate. While the current profile focuses on outcomes data specifically D. D 40.
Now moving to slide 15 and.
In addition to 71 Nephrologist, we broadened the survey population and this new survey to also include 91, non Nephrologist, who were cardiologists and endocrinologists and primary care physicians.
Now stepping back for a moment on slide 14 to characterize the opportunity and the non Nephrologist market. You can see that there are about 500000 diagnosed patients with metabolic acidosis and CK D that are under the care of physicians other than Nephrologist.
When we were considering a commercial launch based on accelerated approval prior to availability of outcomes data from Ballard TKD. Our strategic focus was on Nephrologist that would still be the primary target audience.
About 50% to 60% of diagnosed patients are seen by nephrologists with the percentage increasing as the patient moves into later stages of TKD.
But as we look at a possible commercial launch based on a potential label for slowing <unk> progression with outcomes data, we wanted to understand the receptivity from non nephrologist physicians to prescribe <unk>.
On slide 17, we have provided both for 2019 and 2021 survey results that provided us with answers. The 2 questions first wouldn't apologist and non non nephrologist be likely to prescribe for Burma based on a target product profile for slowing <unk> progression.
Russian and 2 what percentage of patients with metabolic acidosis, and TKD would receive a murmur 5 years after launch.
As you can see here physician survey results demonstrated a strong interest and prescribing for <unk> with 93% and Nephrologist and 71% of non nephrologist, indicating that they.
<unk> definitely are probably prescribed <unk>.
In addition peak patient penetration for prescribing for murmur was estimated to be 74% among nephrologists and 58% among non nephrologists.
I would like to note that to avoid variations and responses based on the price of the product or insurance coverage. We ask physicians to assume price is not an issue and there was adequate insurance coverage.
It is typical to adjust these numbers down based on these factors and others as we look at modeling of future revenue opportunity for <unk>, but these results are very encouraging and signaled significant increased interest from nephrologist as well as strong interest from non nephrologist as a result of a target product.
While that includes renal outcomes data.
We also conducted a new payer survey a summary of this is on slide 18, our early work with payers included education on chronic metabolic acidosis clinical data from 301 <unk> hundred <unk>.
301, <unk> hundred <unk> trial, and discussions about the mechanism of action of Aramark.
We also educated payers on the medical need for and economic benefits of a potential treatment for chronic metabolic acidosis prior to our anticipated launch.
Our early efforts paid off here and we found that payers were generally well informed and understood. The link between metabolic acidosis, and CK day progression as well as the additional cost of care that are incurred by the health care system for patients with metabolic acidosis, and CK D compared with similar.
Patients without metabolic acidosis.
And this new survey payers are clearly interested in <unk> as a disease modifying therapy and the verification of this through and outcomes based endpoint from Valor TKD was a net positive and.
And as always they consider the cost savings to the healthcare system from treating metabolic acidosis, which is estimated to be approximately $40000 per year to be a key driver to adoption.
We tested a range of prices and the general consensus among survey responses respondents was approximately $3000 per month for $36000 per year would be a reasonable price for <unk>, which is and the same range as previous survey results.
I mentioned earlier that our survey numbers are unadjusted and so on slide 19, we for we provided our previous estimates of the anticipated payer mix for the target population of patients with <unk> and metabolic acidosis.
We believe that over half of the initial targeted patients with metabolic acidosis and <unk> will have either low copay, such as Medicaid Medicare with subsidy or VA Dod.
Or may have assistance with their co pay which would be the commercial segment of the payer mix.
We believe this would provide access to <unk> to the majority of patients with metabolic acidosis and <unk>.
Now turning to slide 20, I want to highlight that patent protection for <unk> runs until 2038 in the U S and we continue to expand our patent protection and other regions as well, we believe of Armours long patent life will enable us to maximize the value of our meramec overtime and.
Summary, we believe that there is significant market opportunity for <unk> based on the initial anticipated indication as we delve more deeply into the science of acidosis, we were already starting to think beyond that to look on a broader population of patients who may benefit from asset removal.
I will turn the call back to Gary to describe this expanded opportunity.
Thanks, Jeff, let's move to slide number 22.
If the valor <unk> trial demonstrated that treatment with <unk> Clos seek any progression, we have an opportunity to pursue and expand the development program.
Related to this 2 papers have been published and the clinical journal of the American Society of Nephrology and see Jason This year by preeminent experts and the fear of metabolic acidosis research 1 by our clinical dose Matthias and the other but after that on the west.
Both obligation and focus on the concept of clinical and metabolic acidosis defined as a standby carbon and less in 'twenty 2 milligrams per liter is a lagging indicator.
And retention and patients with <unk>.
Prior to a chronically low standby comment level. These patients have already accumulated assets that has used and depleted multiple buffering mechanisms designed to mitigate the deleterious effects of the accumulated assets.
Growing evidence suggests that asset accumulation prior to various metabolic acidosis causes to clinical harm.
Let me review the science briefly and then I'll turn to how we're thinking about our future development and plan for the Verma and could benefit patients and standby covenant levels still and the normal range.
The diagram on slide 23 depicts the multiple strategies and interactions between the strategies to mitigate assets fat and kidney damage for close to complete the expansion of the failure mode.
This is a complicated slide but the key message here is that multiple systems and play and standby covenant is a lagging indicator of the impact of asset accumulation.
As summarized both.
By both Dr Smith, and Wesson experiments and both animals and clinical trials and humans suggests that asset accumulation prior to observe metabolic acidosis and thousand kidney injury.
And while assumed by covenants may be the most widely used method of diagnosing asset accumulation today, it may not be sufficiently sensitive and.
<unk> of asset accumulation, particularly on prior to the depletion of the many other assets mitigation mechanisms used by the body.
The importance on this work.
And the fact that 1 and supports the basic premise that standby carbon and the lagging indicator of the impact of ASIC, you mentioned and 2 there may be considerable benefit to early intervention and Havana to improve asset based on and prevent clinical consequences of asset retention.
And now on slide 24, as we look at the various mechanism action you can see it for them is designed to supplement ephedrine removal and the setting up the kidneys reduced ability to excrete acid because of kidney disease.
And as both high capacity and high productivity and 5 to plug acid binding, yielding and elegant means of moving assets within the Gi tract as.
And as they examine more closely the full spectrum of mechanisms that impact asset based on we believe that for them and may provide kidney protective effects and seek any sooner and the diagnosis of metabolic acidosis and it may have the potential to benefit and brought a population of patients.
And you can see on slide 25, and he believes this may be similar to the development path used by the <unk> inhibitors.
And the first studies supporting labeling for slow and seek any progression are conducted in patients with advanced disease for subsequent studies and enrolling patients with progressively madder Sidney and.
And the case of for them I believe that a successful for us to get a trial could support approval for slow and I think any progression and patients with chronic metabolic acidosis and Guinea.
And conduct additional outcome trials to seek to expand on label for them and to include slowing uptick a day progression and patients with <unk> and you have not yet does that affect metabolic acidosis, but for whom asset accumulation and still harmful.
Given this broader view, we believe that.
Tension to significantly expand the addressable patient population for that line.
That.
And Jeff to review, our financial results for the quarter.
Thanks, Curt on slide 27, as a quick overview of the second quarter results R&D expense was $19.8 million and $28.8 million for the 3 months ended June 32021, and 2020, respectively.
The decrease 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 was $9.6 million and $28.4 million for the 3 months.
<unk> ended June 32021, and 2020, respectively. The decrease was primarily due to decreased administrative activities and connection with our <unk> clinical development program.
Including pre commercialization medical affairs and personnel costs net.
Net loss was $33.6 million and $58.2 million and non-GAAP net loss was $24.6 million and $48.8 million in Q2, 2021 and 2020, respectively.
Now on Slide 28, let me turn to our financial position.
As of June 32021, cash cash equivalents and investments totaled $175.8 million. We currently have a $200 million 3.5% convertible senior note outstanding with a maturity date of 2027 and.
At June 30, we had approximately 50 million shares outstanding.
We believe our current financial resources will fund our planned operations into late 2022 based.
Based on the current rate of primary endpoint event accrual and the valor TKD renal outcomes trial for 250 event interim analysis for early stopping of the trial for efficacy is expected to occur within the timeframe of our existing capital.
If we were compelled to stop the trial early for administrative reasons that event could occur prior to the planned 250 event interim analysis.
With that I will turn the call over to the operator for questions operator.
Absolutely as a reminder to ask a question you will need to press star 1 on your telephone to withdraw your question best accounts.
Please standby, while we compile the Q&A roster.
Your first question comes from the line of evolve for you that Dara of Cowen Your line is open.
Hi, Thank you for taking my questions.
I just had a question about the event rate and dollar is it tracking thus far with the estimated is that accrual timeline based on your internal forecast.
Yes.
And can you remind us how often egfr is measured in patients and the trial.
It's measured at.
And every study visit.
So it's really multiple times a year.
Okay and.
A quick follow up so based on like the last 6 months reported accrual numbers of endpoints the accrual rate seems to be rather linear when does that does that accelerate.
Can you tap into the equation ready exponential regression.
On page 7 you can see that we have and.
Outlook for our estimated event rate of accrual and and you are correct that it is it looks primarily linear we are.
Our tracking right now right around the mean, so that would be the green dots on that chart.
Of course, if we get to the higher.
Higher rate it would become.
And more accelerated and the lower <unk>.
Confidence interval would be a little less accelerated but our forecast is.
Appears to be fairly linear.
Okay. Thank you very much.
Your next question comes from the line of Jessica Lee of Jpmorgan. Your line is open.
Hello, Daniel Thanks for taking my question.
Yes, yes.
When looking at patients with COPD and.
So given that that does not feel for how do you plan to identify the patients and yes.
So when do you expect to start the study.
Yes.
Future studies post balance and kidney data and.
We would still use serum bicarbonate and we would basically use patients who are and the low normal standby covenant range between 22, and likely 24 milligrams per liter.
Okay great.
And then yes.
Cool right.
The primary endpoint for the last reports sensor on 34% while day randomization.
And is around 1%.
And given the lack of for the randomization and Airbus.
And current before enrollment completion.
Yes.
Let's be clear the vendor and the.
And enrollment.
And decoupled.
Thank the patients that are currently and the study for on average duration of about 17 months and so they are the ones who are contributing the primary endpoint events.
And patients we are adding into the study.
Rooming that we were successful at the interim analysis.
Sometime mid next year on not likely going to contribute significantly to 2 event accrual.
Got it thank you.
Your next question comes from the line of Greg <unk>.
Marvin of Goldman Sachs. Your line is open.
Hey, good afternoon, and thanks for taking my question I, just wanted to revisit the hazard ratios from some of the other studies that you mentioned early in your presentation I believe you mentioned that.
And hazard ratios of 0.0 to close to 0.5 can you just remind us what those interventions.
Sure.
And then secondly, a question just on I guess.
Cash and Jeff I Might've missed this but if you could just remind us.
The circumstances, which year would be leaning towards perhaps pulling the trigger on and administrations.
Administration will stop for us the guidance around cash being sufficient until late 2022 does that basically take.
Al.
And the possibility that you might.
Decide to use the administration.
Yeah on the prior studies.
And those are really the.
Academic often single center.
And the studies that and 1 case for.
For example used oral alkali that's a day.
Brito study and and.
Another 1.
They used really as a diet.
And a very low protein diet.
And and both of those dimensions.
And those those very large event rate reduction as compared to a control group.
And and again those were those for 1 to 2 year studies.
So Greg on on the administrative staff and this via our cash.
And again, we forecast cash into late 2022.
So if you look at the calendar that would imply.
If we did need approximately 6 months of runway to ethically and and and appropriately and wind up that study.
We would need to see data and the second quarter of 2022.
Okay. Thank you very much.
Again as a reminder to ask a question you will need to press star 1 on your telephone.
And that it is star 1 on your telephone keypad.
So there are no further question at this time I will now turn the call over to Jacky Kauffman for closing remarks.
Thanks, Nate and thank you all for joining us on today's call as always if you have additional questions. Please don't hesitate to email assets IR at <unk> Dot com, Thanks and goodbye.
This concludes today's conference call. Thank you for participating you may now disconnect.