Q2 2021 Brickell Biotech Inc Earnings Call

Greetings and welcome to Brickell Biotech incorporated Q2.2021 financial results call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.

And once you require operator assistance during the conference. Please press star zero on your telephone keypad.

As a reminder, this conference is being recorded.

Now I'd like to turn the conference over to your host Garth Russell lifestyle advisors.

Thank you operator, and good afternoon, everyone. Joining me on today's call are Brookfield, Chief Executive Officer, Rob Brown, Chief Financial Officer, Bert Marchio, Chief R&D Officer, Deepak Chopra, Chief operating Officer, Andy Swallow.

Before we begin I would like to remind everyone that this conference call and webcast will contain forward looking statements about the company.

These statements are subject to risks and uncertainties that could cause actual results to differ materially. Please note that these forward looking statements reflect our opinions only as of the date of this call. We will not undertake obligation to revise or publicly release the results of any revisions to these forward looking statements in light of new information or future events.

Factors that could cause actual results or outcomes to differ materially from those expressed or implied by such forward looking statements are discussed in greater detail in our most recent filings on Form 10-K, and other periodic reports on forms 10-Q, and 8-K filed with the SEC I would now like to turn the call over to the company's Chief Executive Officer, Rob Brown.

Rob the floor is yours.

Thanks, Darren good afternoon, everyone and thank you for joining our call today. So far 2021 has been a tremendously productive year for the entire brickell team as we've executed against our strategy to advance soft trinian bromide through our pivotal phase III program as a potential best in class treatment option for primary acts.

Larry Hyperhidrosis.

Also known as excessive underarm sweating.

First off we announced that we recently announced that we completed enrollment in both of our phase III pivotal clinical studies Cardigan, one in Cardigan, two respectively and that the last hyperhidrosis patients who completed all scheduled visits and the Cardigan one study.

We expect the last hyperhidrosis patient in the Cardigan two study to complete their final visit this month Accordingly, we remain on track to receive and concurrently announced top line results for both Cardigan studies in the fourth quarter of this year.

Secondly, as many of you are aware, we recently completed a financing of approximately $8.1 million with this infusion of capital. We now expect to have sufficient cash to fund our operations beyond the potential NDA submission for soft protein and broke my gel 15% to the U S. FDA.

Which is anticipated to occur in mid 2022 pending the phase III results.

Turning now to updates from Japan Tuck in is still in the very early stages of its commercial launch of E clock or soft running <unk> bromide gel, 5% for the once daily treatment of primary axillary hyperhidrosis in Japan. The clock launch is an important milestone for both companies as Japan as the <unk>.

First country to approve soft bromine and bromine for any indication in <unk> is the first topical prescription product for the treatment of primary axillary hyperhidrosis in the country.

In addition to the benefit of copycat of car can building, a regulatory and commercial track record for soft Coronium bromide vertical currently receives royalties based on a percentage of net sales of E clock in Japan and is also entitled to receive sales based milestone payments. We are encouraged by tuck ins early sales.

Progress as well as their continued investment in the commercial ramp up of E clock disease state awareness and lifecycle management activities.

Along those lines. This brings me to the most recent news the Kotkin in June tuck in and initiated a phase one clinical study exploring the pharmacokinetics safety and efficacy of soft running <unk> bromide gel in patients with primary palmar plantar hyperhidrosis or excessive sweating of the palms and soles.

This is it this is an extremely embarrassing and anxious and anxiety provoking German collage nickel disorder that commonly interferes with the social and professional aspects of daily life and there are currently no approved topical prescription treatment options for this disease in Japan or the United States.

We look forward to seeing the results of this phase one study, which will help us in car can determine next development steps if any in this new potential indication now lets turn the call over to Deepak to provide a clinical update deepak.

Yeah.

Thanks, Rob and greetings everyone.

As stated by Rob in his opening remarks Bill.

Continue to be encouraged by our team's execution of the phase three pivotal studies evaluating software indium bromide gel 15 person for the treatment of primary axillary hyperhidrosis and nine years and older patient population.

We started these two studies in the fourth quarter of 2020 less than one year ago midst of pandemic and belt before vaccines wherever available to the public.

As such we recognize that we are extremely fortunate to have a day or two of our clinical study conduct timelines most.

More specifically, we announced at the last hyperhidrosis patients completed the cardio <unk> study and today as Rob mentioned, we currently expect to have the lost hyperhidrosis patients.

Complete the Carty going to study this month.

Entire brickell team and of our Clo's have worked tirelessly to ensure that these two phase III pivotal studies were started and completed on time and we greatly appreciate their hard work and dedication to get us through this critical moment in company's history.

In addition, we owe.

A great deal of gratitude to all the clinical sites investigators and their associated staff and most importantly to the approximately 700 hyperhidrosis patients that participated across these two studies.

It is because of the strong showing by the hyperhidrosis community that we remain on track to concurrently report such top line results from both cardiac and studies in the fourth quarter of 2021.

If these studies are successful.

We expect to proceed with an NDA submission to the U S. FDA in mid 'twenty 'twenty two.

As a basin minder, the phase III pivotal co primary efficacy endpoints agreed to with the FDA are the proportion of subjects achieving at least two point improvement on the patient reported outcome assessment.

That is the hyperhidrosis disease severity measure Exhilarate O S. T. S M. A X scale and the change in gravimetric set production each from baseline to the end of treatment.

Lastly on.

The second quarter, we also announced the results from our Phase III Open label long term safety study, which assessed the long term safety tolerability and efficacy of software indium bromide gel five and 15% for 48 weeks of treatment in patients 90 years and older with primary exited.

Hyperhidrosis.

We were proud to have these data presented in a late breaking oral presentation at the American Academy of Dermatology 2021 what sort of meeting experience in April.

Overall, the safety Tolerability and efficacy results of software indium bromide gel five and 15% in the long term open label safety study with <unk>.

But prior clinical experience and no unexpected safety findings were observed.

With that I will now turn the call over to Bert to provide a financial overview Bert.

Thanks, Deepak and good afternoon to everyone on the call.

Before I provide a summary of the second quarter financial results I want to encourage you to read our full consolidated financial statements and MD&A contained in our quarterly report on Form 10-Q, which can be accessed through the investors section of our website.

Once filed with the SEC.

Starting with cash and cash equivalents the company reported $24.4 million as of June 32021.

As noted by Rob subsequent to the end of the second quarter, we announced the completion of an equity capital raise for gross proceeds totaling approximately $8.1 million we.

We intend to use the net proceeds of our offering for research and development working capital and general corporate purposes.

Most importantly, we believe our current cash position will support our operations beyond the potential soft coronium bromide NDA submission to the U S. FDA, which is anticipated in mid 2022 pending the outcome of our ongoing phase III.

Clinical program.

Revenue for the second quarter was the royalty revenue we recognized from the sales of eat clock in Japan by <unk>.

Ken of approximately 151000 up from 17000 in Q1.

This was compared to 600000 in total revenue.

<unk> for the same period in 2020, which was driven by collaboration revenue recognized for the yard for R&D funding provided by Kotkin to Brickell back in 2018.

R&D expenses were $8.8 million for the second quarter of 2021.

Paired to $2.7 million for the second quarter of 'twenty 'twenty.

This increase was primarily due to an increase in the clinical trial plus related to the phase III Cardigans studies.

G&A expenses totaled $2.9 million for the second quarter of this year compared to $3 million for the second quarter of the prior year.

Net total other income.

Was 429000 for the second quarter of 2021 <unk>.

Compared to 7000 for the second quarter of 2020, the increase was primarily due to a gain on extinguishment of debt that resulted from the forgiveness of the paycheck protection program loan in June of 2021.

Lastly, our net loss for the second quarter of 2021 was $11.1 million compared to $5.1 million for the second quarter of 2020 as I. Previously noted this increase was driven by the increase in our R&D expense and with that.

I'll turn the call back over to Rob for closing remarks, Rob.

Thanks, Deepak and Bert for your recap. This is an exciting time for Brickell, we continue to work together and build momentum towards the upcoming phase III readout later, this year, which we hope will be meaningful in a meaningful advancement for the company the patients we support and the physicians who treat them in.

In addition, we are continuing to explore potential business development opportunities to expand our pipeline with products that we believe can become potentially transformative therapies for patients. We look forward to providing additional updates to the extent these efforts materialize.

Lastly, it's worth mentioning that the clinical financial and corporate milestones that we've achieved over the past year would be meaningful in normal times, but considering they were all accomplished in the middle of the pandemic speaks to the resilience and Roche resourcefulness of our team as well as the unmet need that exists for a safe and effective.

Hybrid hybrid hyperhidrosis treatment.

This concludes our prepared remarks I'll now ask the operator to open the call up for questions operator.

Thank you.

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One moment, please when we pull for questions.

Our first question is from Leland <unk> with Oppenheimer. Please proceed.

Oh, Great Hey, congratulations on the progress and thank you for taking my questions.

Two questions for me first want to ask.

Ending the.

Data from the trials, assuming they are positive are there any significant.

Items outstanding required for the NDA or is it simply a matter of compiling the pivotal data.

The CMC section and so forth and then wanted to ask with Ken's going into from a plant or yeah that leads me to kind of wonder how you may see indication expansion.

Under under under per gallon would that be an indication that you would look to do a trial in for perhaps an S. N. G E. How should we think about expansion opportunities.

You know for soft for owning them. Thanks.

Hey, Leland first thanks for the questions as Rob.

And in regards to the submission there really arent any there are no clinical.

And any no clinical work needed to do that submission. Obviously, there is a significant amount of work to pull the whole thing together, we do plan to have a meeting with the FDA those phase III meeting with the FDA.

But but.

All the big pieces are done through clinical trial once the phase III data is completed so we feel really good about that in terms of car can and and and and you know their work in this phase one I mean, we're really excited about that we have obviously rights for that data will.

We'll be really interested to see the results of that and be interested then to make a decision on how we go forward. It's a really interesting indication in the sense that there's a lot of unmet need and in many ways. The sweating. This of the hands is one of the most debilitating aspects of hyperhidrosis, it's hard to use.

The phone E boards et cetera, Besides the social and bear an embarrassment that people have so there's a real there's a real functional challenge to that.

It can create significant problems for patients. So so obviously, we need to see the data and we will take a look at that obviously when khaki and gets done but works, we're happy that they're they're investing in the products and we're excited about that being a potential future opportunity for this asset.

Great that's very helpful. Thanks.

As a reminder, if you would like to ask a question. Please press star one on your telephone keypad.

Confirmation tone will indicate your line is in the queue.

There are no further questions at this time, so I'd like to turn the call back to Rob Brown for any closing remarks.

Great. Thank you, Joe and thanks to everyone for taking the time this afternoon to listen to our update I wanted to close out the call by thanking everyone for joining us and your continued interest in Brickell, we look forward to keeping all of you updated on the progress and the App our studies over the coming months as always please feel free to reach out to us at anytime.

With any further questions have a great rest of your day.

This concludes today's conference you may disconnect. Your lines at this time. Thank you very much for your participation and have a great day.