Q3 2021 TFF Pharmaceuticals Inc Earnings Call
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Ladies and gentlemen, thank you for standing by our conference will begin in just a few minutes. Once again. Thank you for standing by our conference will begin in just a few minutes.
Yes.
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Greetings, ladies and gentlemen, and thank you for standing by.
Welcome to the T F F Pharmaceuticals third quarter 2021 results conference call.
As a reminder, this conference call is being recorded.
A question and answer session will follow the formal presentation.
If anyone should require operator assistance. Please press star zero on your telephone keypad.
I would now like to introduce the call introduced.
Corey Davis of life, sorry advisors to begin the call.
Thank you operator, Hello, everyone and welcome to the <unk> Pharmaceuticals third quarter, 2021 financial and business results Conference call with me on the line today has gone Mad as President and CEO of TFS, Kirk Coleman, Chief Financial Officer, Dr. Dale Christiansen TFS director of clinical development.
Dr. Bill Williams at the University of Texas at Austin.
Chris can now PFS, Chief operating officer, a press release announcing our third quarter results is available on the TFS Pharmaceuticals website.
Please take a moment to read the disclaimer about forward looking statements in the release this earnings release and this teleconference. Both include forward looking statements and these forward looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from the statements made factors that could cause actual results to differ are described in the disclaimer and in our filings with the U S Securities.
And exchange Commission, including the risk factors section of our 2020 annual report on Form 10-K filed with the SEC and now it's my pleasure to turn the call over to Mr. Glenn matters.
Good afternoon, and thank you for joining us today to review the company's third quarter operations and recent highlights.
During this call I will provide an update on our overall corporate progress.
After my opening comments I will ask Doctor Dr. Christensen to update us on the outstanding progress, we are making with our internal clinical programs.
He will be followed by our CFO her Coleman.
Our updated financial results and Dr. Bill Williams will review the highlights of new data on thin film freezing generated in just the last quarter and finally, our chief operating officer, and Vice President of business development, Kris can now well update the status of our partnering efforts.
The third quarter was extremely productive with significant milestones in every area of the TFS business.
These accomplishments are almost too many to discuss in a timely manner. During this update.
The positive outcomes have been accelerating throughout 2021 and continues to position <unk> for positive value creation in the short mid and long term period.
I'm going to begin by reviewing the significant milestones for our development of the internal pipeline.
I'll provide a topline and Dr. Christopher <unk>, who will provide greater details.
We've included in our reported results from both the phase one and phase one B TFS inhaled <unk> program.
These data have confirm safety and allowed us to select a dose to study and our upcoming pivotal phase II program, which will initiate by the end of this year.
In addition, the results of the Phase <unk> study gave us our first look at safety data in asthmatic patients. The data from both studies were quite positive and confirms our clinical strategy of pursuing an indication in patients with invasive pulmonary aspergillosis.
We also concluded the phase one study for our TFS Acura limits and the results indicated that our inhaled product has an acceptable safety profile to achieve the appropriate balance of local and systemic concentrations for immuno suppression at the site of the lung transplant, while minimizing the risk of <unk>.
Super therapeutic exposure, well known to cause significant renal toxicity in patients.
The outcome of this study allows us to initiate the pivotal phase III program shortly.
Later in the Cogs After Christmas and it will provide a more detailed overview of the data from both programs.
And inform you on our progress.
We also achieved significant milestones in our two partner programs, which features a novel antibody augment their 33 87 co developed with augmented by works and the antiviral like Hudson, who we partner with Union Therapeutics.
As a reminder, augmented 30 387 is being formulated as a dry powder using PFS pharmaceuticals proprietary didn't fell freezing process to enable direct delivery to the lung and remove the need of IV infusion that is required for delivery of current COVID-19 antibody therapy.
Fees.
And separate announcements, we described the high level of potency in animal testing.
And these studies augmented 33, 87 demonstrated the ability to reduce viral load in a dose dependent manner. After the animals have been fully inoculated.
This is a unique finding and in our view augmented 30 387 is fast emerging as one of the most promising new therapies for the treatment of COVID-19.
A record 33 87 also demonstrated binding to the major COVID-19 variants, including Delta Lambda.
And move.
Our inhaled my close of my program has achieved a meaningful development milestone when we announced the TFS has received approval from health, Canada to begin a phase one clinical trial of a dry powder version of that close to my that was demonstrated safety data and allow for dose selection in subsequent clinical development.
Of this potent antiviral agent.
By way of additional background my call somebody and is included in the World Health organization's list of essential medicines and has recently been showing to exhibit potent antiviral activity against Sars Covid two.
The inhaled version of and I quote survival overcome the limited waterfall your ability as well as low absorption in oral bioavailability.
Using the TFS technology to develop a dry powder formulation of <unk> that can be delivered directly to the site of viral replication within the lungs by inhalation will be administered in the outpatient setting providing an important treatment option for physicians.
Again, Teo will provide greater detail in just a few minutes.
The significant progress we've made and we'll be making in the common days and weeks with all of our internal portfolio closer to monetization and meaningful revenue streams for PFS.
Both the TFS for Carnival in TFS Chakra Women's Phase II program will be designed with an interim analysis of data <unk>.
Data sets will be available mid 2022.
Once we have the data we will begin a process to find a licensed partner to ultimately commercialize the assets.
We have already received interest from pharmaceutical companies and we will use the interim data as the inflection point to pursue those partnerships.
For a night closer minds the successful completion of the phase one study in the early part of next year will be the inflection point for Union therapeutics to trigger their option period.
And for augment a 33 87, we are committed to share funding of the development of the monoclonal antibody through phase one at which time, we will pursue a pharma partner to license the asset for further development and commercialization.
PFS is rapidly reaching meaningful economic milestones for our internal portfolio.
I also want to congratulate the CFS team for advancing all four of our development programs in a timely manner in the face of the global pandemic.
As you know COVID-19 has been a significant issue for clinical development in the industry and <unk> been able to successfully navigate these issues and produce results with limited or no delay and on budget.
Also on this call back to Bill Williams will highlight important new data that is generated during the quarter.
Pacific Lee, who will review new data demonstrating the applicability of thin film freezing in creating successful formulations and biologics and complex molecules.
These are the opportunities we're thin film freezing is highly differentiated from other methods for creating dry powder.
It is important to note that these data were generated with materials provided by companies who are partnering with Tfl.
Bulk of these MTA and statements of work with companies, who we intend to partner with continues to expand the proof of the value of the technology and allows us to attract additional opportunities.
It is also important to note that these observations and findings has enabled PFF to greatly expand our IP estate.
We now have approximately 100 patents either granted or pending both in the U S and the rest of the world.
Our academic and government collaborations are also proceeding very well.
We have initiated the work with DARPA on formulating countermeasures and the development of novel vaccines and <unk> is also progressing.
We expect the second create us shortly expanding the work we're doing in the vaccine area at Safford.
Our collaboration with Dr. Ted Ross at the University of Georgia on Universal flu and Dr. Karthik shop drawn at the Albert Einstein College of Medicine on GSV vaccines are now in the animal testing phase.
And our work with Dr. Zhu Weitzman at the University of Pennsylvania is now in full swing looking at the application of the thin film freezing technology and mrna vaccines and therapeutics.
Dr. Weisman as the inventor of the current biotech Pfizer mrna COVID-19 vaccine and we're honored to be working with Dr. Weizmann and believe this collaboration will result in important new products to prevent and treat viral infection.
Dr. Weisman provided this quote.
The freeze dried powder formulation by Tfl has enormous potential to move the mrna LNP vaccine platform to efficient worldwide use by allowing room temperature storage and the development of oral inhaled delivery of <unk>.
Quite high praise from Dr. Weisman.
I also want to thank our partner plus products.
Their work in optimizing the PFF formulation of cannabinoid and implementing thorough market testing.
Plus has successfully completed a number of formulations, which are being evaluated by potential consumers leading to what we hope will be a successful commercial launch in the very near future.
In relation to the status of our partnership business development activities.
Continue to strongly believe with confidence that we're on track to sign meaningful partnership licensing agreements.
I'm aware that it is November 15th and we're entering into the final weeks of the year.
The number of programs. Our MTA is continues to grow. Moreover, we are also seeing expansion of thin film freezing application across a more diversified set of companies and drug candidates.
Mostly in the Biologics arena.
The work we are conducting with partners closest to finalizing transactions our focus on animal testing the thin film freezing formulations.
Stability work and in some cases production of GMP material.
We are also discussing specific terms and agreements with a significant number of potential partners.
In our discussions with these companies we have agreed to the specific data that needs to be realized as the potential seminal milestone leading to a completed transaction.
<unk> works with great purpose to get these data produced and delivered to the partner for their assessment and analysis.
At that point, we were at the Mercy of the partners timing to evaluate the data and provide feedback the PFF there.
There are situations, we were asked to optimize the material and the process continues and PFS has been billing the partner for the additional work performed has been outside of the original MTA and statement of work.
So certainly great news that many of our current partners with open MTA NSO w's, our large commercial stage pharmaceutical companies.
Pace of moving forward with these companies can be a challenge.
This has led to extended evaluations and in some cases are taking a bit longer than we expected.
We do not have the ability to accelerate these discussions we.
We have communicated a strong desire to close these agreements by the end of this year and remain confident that this will happen. We strongly believe that we're on track, we will communicate and update the status of this work and ongoing negotiations.
Every reason to be confident that our numerous technology evaluation program.
Will result in meaningful collaboration and we will drive near mid and long term shareholder value.
Later on the call, Chris <unk>, our Chief operating officer, and head of business development.
We will provide more details on the total view of this effort and how the opportunities are progressing as well as expanding.
I will now turn the call over to Dr. Dr. Christensen, who will provide detail on our development efforts supporting our internal portfolio.
Dale.
Thank you Glenn and good afternoon to everyone, who has joined our update call today. The third quarter has been extremely busy for us when we continue to make great progress in our internal clinical development programs.
Last quarter I provided an update on our phase <unk> study of <unk> inhalation powder in the asthma patients, where we found that the 40 milligram dose is well tolerated.
And that we had escalated the dose and we're starting to enroll patients in the 80 milligram twice daily cohort.
I am happy to announce that enrollment and dosing has been completed for the full study.
Initial observational data following completion of the 80 milligram dose cohort shows that <unk> is well tolerated in asthma patients.
And the 80 milligram dose has been selected as the proposed dose for our phase III study.
We are now working on the closeout activities for this reactive airway study and will be incorporating the findings from this study into our data package in preparation for the upcoming phase end of phase one meeting with the FDA and continue to prepare for a phase III study.
For upcoming Phase II trial, we have held scientific advice meetings with two regulatory agencies in Europe in the key countries, where we will be initiating the study.
The feedback and advice we received from these regulatory agencies is critical to moving forward with the phase III study.
In addition to the regulatory guidance, we received the data from the Phase <unk> study in asthma patients will also be used to complete the protocol for our upcoming phase III study in patients with invasive pulmonary aspergillosis.
The study in asthma patients provides critical data for the physicians participating in this phase II study on the use of concomitant medications, including inhaled steroids or bronchodilator.
And there are patients that will be included in the study.
The development of the final protocol will facilitate completion of the Cta that will be filed by the end of the year and upon approval, we will begin dosing patients.
In addition to the work on the solid results, we completed database locked in the phase one trial of our Kronos inhalation powder.
As a reminder, the goal for this program is to create an inhaled immunosuppressive therapy that can improve the survival of lung transplant patients well.
Well also experience patients as much of the systemic toxicity as possible.
So all of US has proven highly efficacious in the prevention of transplant rejection.
Lung transplant patients continue to lag behind other solid organ transplants with the median survival rate that is around five years shorter than heart liver or kidney transplantations.
This is because only a fraction of the Tacoma it gets into the blood reaches the lung where it is required to inhibit the immune system from attacking the transplanted lung.
As a result of this reduced delivery to the loan from the blood.
Doctors have responded by prescribing higher dose levels of two columnists and raising the blood to chromium. This level. So thats sufficient levels can reach the loan to fight off the rejection.
Unfortunately, when they raised the level of two <unk> in the blood to get enough into the lungs. It also increases toxicity in kidney is due to the high blood levels.
This paradox is a big factor in the lower median survival of lung transplant patients compared to other solid organ transplants.
The paradox of getting enough to CRO limits in the lung to fight rejection, but keeping systemic levels low enough to spare the kidney toxicity is exactly what the inhaled form of <unk> is designed to address.
We flipped this paradigm and delivered the drug directly to the lungs.
Winter Colin this is delivered to the lungs.
The drug is deposited in the lung tissue and just been released at a slower rate into the blood.
In animal models, we demonstrated the inhalation delivery results in lung to <unk> levels that are three to four times higher than blood levels.
This means that you can achieve high enough levels in the lungs to prevent rejection, while at the same time, keeping the blood levels low enough to avoid damaging the kidneys.
<unk> offers a new paradigm for lung transplant patients and the physicians that cannot be achieved by oral delivery of the drug.
In our phase one study, we dose healthy normal subjects for a total of seven days and the most common adverse effect in this study was hypomagnesaemia.
And there were not adverse events from the entire took hold on us that were not previously described for the oral form of the drug suggesting that inhalation is not associated with any unexpected toxicity.
In the case of Hypomagnesaemia. This is a known toxicity of Tacoma that results when blood levels are too high.
With a full data set available we can now confirm that mild hypomagnesaemia occurred in patients with the highest drug levels in the blood.
In fact, three of the four subjects that developed Hypomagnesaemia showed blood <unk> levels above 15, nanograms per mil, which in clinical practice would have triggered a dose reduction when the blood levels reached this level.
A physician treating a lung transplant patients with lower <unk>.
Prescribed dose if it ever went above a trough level of 15 nanograms per mil so that their blood level would return into the targeted range of 10% to 15 nanogram per mil.
Since this is an expected signs of toxicity from two columns.
Study subjects received will supplementation with magnesium when mild hypomagnesaemia was detected.
All subjects continued dosing and completed the study with complete resolution of the mild hypomagnesaemia during their enrollment period.
However, as I stated previously due to our direct to lung delivery, providing a higher level of <unk> in the lung as we move forward, we will be looking to achieve blood levels that are below 10 nanograms per mil.
Since no subjects in the study with trough levels below 10 nanograms per Mil experienced hypomagnesaemia. We believe this is strongly suggested that we will be able to provide significant anti rejection activity with lower toxicity than the oral form of the drug.
In addition to demonstrating enhanced bioavailability. We also showed lower variability in blood levels across all the doses are inhaled docomo Ms powder.
This is important because it should allow for more precise Joseph.
We also demonstrated that a once daily dose of our inhaled <unk> can achieve sufficient blood levels for systemic immunosuppression.
But with reduced blood concentration spikes, which is typically seen with the administration of high dose oral to chromium us.
And is associated with toxicity.
When subjects, who received inhaled <unk> dosing at two five milligrams, while fasting or within 30 minutes. After a high fat meal. There were no significant differences in systemic exposure demonstrating the delivery by inhalation was not associated with food effects in this cohort of subjects.
By contrast, the rate and extended the absorption of <unk> has significantly decreased winter Korlym is administered orally when taken with food and this effect is most pronounced after a high fat meal.
Thus the once daily dosing is also an advantage for patients and when combined with the potential of eliminating food effects.
This would mean that a patient would have fewer limitations on their daily activities, while maintaining effective immuno suppression levels to chromium us.
For this reason, we believe that there is potential for the inhaled form which korlym is to extend beyond lung transplant patients.
We are currently preparing to initiate our phase II study that is designed to validate our working hypothesis as described it does namely that we can reduce systemic exposures to kronos to levels that are safer for the kidney and other organs.
While maintaining sufficient levels in the lung to prevent rejection.
To facilitate this study we have identified our lead investigator and are preparing the protocol and other regulatory documents. So that we can submit for approval to begin dosing lung transplant patients.
This phase II study will be performed in lung transplant patients with stable graft function.
But who are experiencing significant nephrotoxicity that is severe enough that their physician is planning to reduce their takomas dose in order to spur their kidneys.
As you can imagine their physicians are concerned that by reducing the blood level of to curl unless in order to protect the kidney that.
The lower levels of <unk> in the lung may lead to rejection of the transplanted.
Don.
However, our preclinical and phase one clinical data with the inhaled to call on US suggests that the physicians can reduce the systemic blood levels to protect the kidney and at the same time keep enough to call him I said in the lung to prevent allograft rejection.
We and the physicians, who will be the key investigators in this study have high hopes that we will prove these benefits from the inhaled to grow with us in this phase II study.
Moving onto our <unk> program in the third quarter, we filed a Cta in Canada to begin dosing healthy normal volunteers with our inhaled nice close to my powder.
Inhaled might close might is being developed for the treatment or prevention of Covid infections.
A couple of weeks ago, we announced that we had received no objection letter from health Canada.
It would be able to proceed with dosing the site startup work has gone very smoothly and at the time of this recording we anticipate the dosing of the first subjects with Nicholas might inhalation powder should be completed very soon.
The anticipated first dosing in the study inefficient recruitment are encouraging and we believe that we will complete dosing in early 2022.
The night clubs might inhalation powder represents a highly promising approach for COVID-19 and other associated respiratory viruses and to our knowledge will be the first dry powder anti viral to progress to clinical trials.
Our future studies will position Iqos, Mike for outpatient use so that the patients diagnosed with COVID-19 can pick up the drug from a pharmacy and administer it at home health.
Self administration would make not close might inhalation powder competitive with at home oral medications.
We also have reason to believe that the local delivery to the lung can provide an even greater benefit to patients.
The excitement we carry into this program.
Is based on completion of an in vivo efficacy study, where we demonstrated that low dose of 0.25 milligrams per kilogram.
Dosing of course might inhalation powder resulted in a seven fold reduction in lung viral boat, ensuring enhancers when the treatment with nightclubs <unk> initiated a full 24 hours after inoculation with Covid Corona virus.
The initiation of treatment 24 hours after Corona virus inauguration allowed the hamsters to have a very active infection before treatment was initiated.
By contrast, mono peer there sure.
Reduction in viral load in the same hamster model, but only when the drug was administered orally before COVID-19 infections were established in the animals.
Well no carrier has gone onto demonstrate reduced hospitalization rates and COVID-19 infected humans and was recently granted approval in the U K.
Our strong data showing the benefit and the hamster model in animals.
More severe infection suggest that I close my powder could have a benefit to COVID-19 patients that are either more ill when they initiate therapy or can provide an even greater reduction in the rate of hospitalization for these at risk patients.
Also of note that is in addition to Covid, Let me close my it has demonstrated potent activity against the original Sars coronavirus, the merged Corona virus RSV and influenza.
This activity derived from targeting cellular processes in the respiratory epithelium cells that are required for viral replication.
Each indicates that in addition to COVID-19 or inhaled might close to Mike formulation could be used for other respiratory viral diseases with no suitable therapeutics exists.
Yeah.
Finally in the last quarter, we also announced that we had selected a lead monoclonal antibody August 30, 387 as part of our collaboration agreement with augment to bio works.
Importantly, we recently published data showing the dose dependent reduction in module viral load. When all 30 387 was delivered directly to the lungs of infected hamsters.
These efficacy data in animals represents a critical step in the development of <unk> 30, 387, because all anti viral drugs to prove beneficial in humans to date has demonstrated a viral load reduction in this model.
This includes the antibody therapies to date have proven to be the most effective drugs that reducing the rate of hospitalization for COVID-19 patients.
We are excited about the future possibilities for this antibody because staple dry powder created using the TSS process can easily be administered at home instead of requiring the patient to go to an infusion center to receive the antibody.
This will be the first dry powder antibody delivered to the long end.
Our bodies are well tolerated and inhaled antibody could provide the efficacy of antibodies without the potential for systemic toxicity that come with the combined oral anti virals regimens.
It can also be administered in locations that lack the infrastructure to deliver drugs by slow infusion.
Furthermore, the dose reduction that can be achieved by direct pulmonary delivery means that more people can receive the drug for every manufacturing run.
This more economical than infusion.
And with that update I would like to turn the call over to our Chief Financial Officer, Kirk Coleman for a review of the financials FERC.
Thank you very much sale for the three months ended September 32021 research and development expenses for the company were $6 3 million compared to $2 8 million for the same period in 2020 the.
The increase in research and development expenses. During 2021 was due to increased manufacturing costs clinical and preclinical expenses related to the close mind TFS <unk> TFS Tac and AEG $33 87, along with the increases in payroll and related expenses and stock based compensation.
The increase in research and development expenses also includes our preliminary analysis and testing of dry powder formulations of several drugs and vaccines owned or licensed by third parties that we believe may lead to out licensing of our <unk> technology for the development of dry powder product candidates.
General and administrative expenses for three months ended September 32021 were $2 4 million compared to $2 3 million in 2020.
The company reported a net loss for the third quarter of $8 7 million compared to a net loss of $5 1 million in 2020.
Weighted average.
Average common shares outstanding basic and diluted for the three months ended September 32021, or 25, 371781, compared with $20 million 867526 for the same period in 2020.
As of September 32021, we had total assets of approximately $49 3 million and working capital of approximately $45 9 million.
At the end of the third quarter, our liquidity included approximately $44 7 million of cash and cash equivalents.
And with that I'd like to turn the call over to Dr. <unk> Williams, who will talk about some of the groundbreaking work we're doing using our thin film <unk> platform, particularly with large molecule biologics and how our technology is unique in its ability to successfully transform these complex molecules into inhalable dry powder Bill.
Thank you Clark and good afternoon, everyone. I am pleased to report that we have had a very productive quarter on many fronts for further expanding the thin film freezing technology platform.
Our laboratories have been engaged with many partners validation projects, where we test and confirm how a partner's compound will perform with the thin film freezing technology to produce an engineered dry powder, having the desired properties for its intended route of delivery such.
As by inhalation to the lungs installation in the nasal passage wise our injection after reconstitution.
With regards to thin film freezing our studies to date continue to confirm that because the process uses large millimeter size drops having a very low surface area to volume ratio.
Protein stability is preserved because it is not substantially exposed to the air liquid interface and this is compared to competing technologies like spray freeze drying that create very small micron sized droplets generated through a high pressure too fluid.
Nozzle.
That had a much larger surface area to volume ratio.
Which decreases the stability of protein at this expansive air liquid interface.
This is a significant advantage of thin film freezing that we continue to leverage in our studies as I will discuss now.
Today I would like to review a few of the programs that focus on application of thin film freezing to biologics, specifically to monoclonal antibodies and vaccines that contain adjuvant.
First our work is focused on the formulation stabilization and delivery of monoclonal antibodies by a variety of routes of administration, including reconstitution for injection and inhalation.
Specifically in collaboration with all the bio works, we applied the thin film precinct technology to formulate and stabilize an inhalable powder of their monoclonal antibody <unk> thousand 387.
As Dr. Christian and just stay that demonstrates a high affinity for the spike protein of the original viral strains that are responsible for COVID-19, and all variance tested to date.
This work has resulted in the publication of our preprint paper titled <unk>, $33 87, a human derived monoclonal antibody neutralize Sars COVID-19 two variants and reduces viral load from therapeutic treatment of hamsters in vivo.
And this collaborative pre print paper co authored with augment the bio works.
<unk> Research Institute, the University of California, Berkeley, and CSF Pharmaceuticals, we confirm successful administration of an inhaled form of the TFS engineered dry powder containing <unk> G 33 87.
We prepared a dry powder form of the monoclonal antibody by them film freezing that exhibit excellent powder properties that could be used to deliver the monoclonal antibody directly to the lungs of COVID-19 infected patients using a dry powder inhaler device.
We showed that delivery of the TFS prepared.
<unk> 33, 87 dry powder into serious hamsters 24 hours after intranasal Sars Covid two infection demonstrated a dose dependent reduction in the lung viral load of the virus. Thus supporting its use as an engineer of dry powder to treat COVID-19 infection.
The <unk> 33, 87 monoclonal antibody preprint will be submitted to a peer reviewed journal.
Three shortly.
Furthering our applications of them film precinct mono clonal antibodies. We also published the preprint paper titled Dry powders for inhalation containing monoclonal antibodies made by time film precinct.
In the second Preprint paper, which has also been submitted to a journal for peer review.
We report the use of thin film freezing technology to produce dry powders for delivery of three monoclonal antibodies, including a non specific immuno globulin G. R. I G G antibody.
Specific antibody called anti programmed cell death protein or anti PD, one monoclonal antibody and anti tissue necrosis factor alpha or anti TNF Alpha monoclonal antibody, we confirmed that thin film freezing a suitable for converting the law.
Four of these monoclonal antibodies into stable dry powders, having excellent properties for inhalation to the lungs.
Thin film Freeze-dried anti PD, one monoclonal antibody powder.
Is chemically and physically stable when stored at room temperature for up to 10 weeks, indicating that monoclonal antibodies converted from a less stable liquid form to the more stable dry powder form by thin film freezing may not need such cold chain storage.
This work on stabilizing and delivery of monoclonal antibodies has contributed to our robust intellectual property portfolio.
Next our efforts have also focused on applying the thin film freezing technology to different hard to formulate and stabilize nano emulsion based adjuvant like in the 59, and <unk>, which are used to spare doses of different vaccine antigens while.
Boosting a strong immune response.
The problem with nano emulsion based adjuvant is that they require storage at two to eight degrees centigrade and must not be frozen because unintentional exposure to freezing temperatures can lead to significant damage to the vaccines.
We have published the preprint paper titled formulation of vaccines containing MF 59 or out of acts by thin film freeze drying in collaboration with Professor Ted losses Laboratory.
The center for vaccines in immunology at the University of Georgia.
<unk> 59 is novartis is proprietary vaccine adjuvant based on our squalene oil and citrate buffer nano emulsion stabilized with two nonionic surfactants may.
Maintaining its specific formulation composition and physical properties are critical for in that 59% to exert an adjuvant effect.
So why isn't about 59 important for us to study.
M. F 59 is important to study with thin film <unk> technology, because it is a commonly used adjuvant and seasonal and pandemic influenza vaccines.
<unk> being used in audience in influenza a H five N. One monovalent vaccine and in flu add quadrivalent influenza vaccine against influenza virus subtypes, a and b because it enhances the immunogenicity and efficacy of these vaccines there are many.
More in that 59 adjuvant vaccines against various other infections currently in clinical trials.
Because MF 59 adjuvant is not available for commercial purchase we studied the adjuvant out of box, which is a pre clinical grade nano emulsion vaccine adjuvant with the same composition as <unk> 59. So in other words out of acts as a surrogate for M at 59 and our stuff.
These.
As previously mentioned these clinically important adjuvant are formulated in liquid form as a liquid nano emulsion.
This liquids Natalie malls and contained nanometer size oil droplets measuring about 160 nanometers in diameter within a continuous liquid aqueous phase.
<unk> and emulsions in general and particularly nano emulsion or not physically stable if exposed to freezing temperatures and they can face separate or in other words. The nanometer size, all droplets will coalesce into larger droplets or into a single oil stays causing the adjuvant to lose.
Is it the ability to boost the immune response induced by the antigen.
In our pre print paper, we apply thin film printing technology, the vaccines containing and that 59 or out of acts as an adjuvant for.
For example, we applied thin film freezing to the flu add quadrivalent influenza virus vaccine that contained in that 59.
And we applied the thin film printing technology to mono bi and Tri valent influenza virus vaccine candidates containing H, one <unk> III recombinant hemagglutinin protein and data backs.
The results clearly demonstrate that for all in that 59 and added that adjuvant vaccines. We tested the thin film freezing technology successfully converted the liquid form to a more stable dry powder form.
For example, the thin film freeze dried vaccine powders, we're not sensitive to repeat it freezing and thawing in contrast to the liquid vaccines.
And the chemical integrity and hemagglutination activity of the Hemagglutinin antigens remained intact when the dry powders were stored at 40 degrees centigrade for up to six weeks, whereas storing the same vaccine in liquid form at 40 degrees centigrade for six weeks led to <unk>.
Difficult antigen degradation and a reduction of hemagglutination activity.
Importantly, we confirm that using monovalent and bivalent and trivalent recombinant hemagglutinin proteins against H, one <unk> H three influenza viruses adjuvant with that effects. The thin film freezing process did not significantly affect the immunogenicity.
The city of the antigens in the mouse model, thus pointing to the potential development of a universal dry powder flu vaccine, which may enable their storage or stockpiling at room temperature.
This pre print will be submitted for peer review shortly.
And this work has further contributed to our robust intellectual property portfolio.
In closing I think TFS pharmaceuticals for their continued support of our technology validation and research studies at the University of Texas at Austin, I acknowledge my colleague professors and Rock Creek for his significant contributions to these very important advancements in the thin film processing platform.
Now I'd like to hand, it over to Mr. Chris <unk>, Chief operating officer, and Vice President of business development to update you on TFS Pharmaceuticals business development activities Chris.
Thanks, Bill and good afternoon, everyone. Thank you for joining us today.
The TSS business development team is focused on three key areas of growth for the company.
These three key areas are one growing the TFS pipeline.
And our internal development programs.
To our farmer partnering efforts and three our government and academic contracting efforts.
We continue to make tremendous progress in each of these key areas.
For today's call I will be focusing on our lead collaboration efforts with both our pharma partners and our academic collaborators.
<unk> continues to be very active in the <unk> space.
Number of mrna projects has significantly increased since our last earnings call.
And we are in discussions with other companies to discuss additional mrna projects.
We are working with pharma partners to formulate their proprietary mrna into a dry powder.
For some partners, we are formulating a dry powder inhalation delivering.
Delivering the dry powder mrna deep into the lung to treat respiratory talents.
For other partners, we are formulating their proprietary mrna vaccines into a dry powder to form a more stable vaccine that overcomes cold chain storage challenges the TFS dry powder quickly reconstituted for injection onsite.
We have many mrna projects to discuss here are a few examples.
First we will discuss the vaccine project, where we successfully formulated our partner's proprietary mrna.
The TFS dry powder showed very good particle size.
Ali disparity index or PDI and.
And had a very high encapsulation efficiency rate greater than 95%.
We have subsequently sent samples to our partner to run an accelerated stability study and this study is ongoing.
We are also preparing additional samples to send to our partner to run a transfection study.
With successful formulation testing completed and what we expect to be positive in vitro testing and stability testing.
Based upon this well defined path forward TSS has initiated meaningful licensing discussions with our partner.
Another leading mrna project at TFS is with the top 10, Big Pharma company, where we are formulating their proprietary mrna port delivery to the lung.
This project continues to gain momentum as our formulation work is close to completion and we will be shipping samples to our partner for transaction testing.
This partnership continues to grow.
Based on the performance and success of the TFS technology on this mrna project.
We are now formulating our partners monoclonal antibodies where maps for inhalation.
And we are also generating a T S that dry powder for our partners pressurized metered dose inhalers or MDI.
The many applications of the TFS technology to different complex biologics is a real game changer.
This one project has now turned into three different projects across the portfolio of a big pharma company.
They're a leader in the respiratory space.
This is an outcome that we are seeing repeat itself often building on the success of the initial engagement.
Yes, that's as many other nucleic acid projects underway.
Including formulating SA RNA oligonucleotide plasmid, DNA and other RNA molecules into our TSS dry powder.
These programs predominantly focused on delivery of the nucleic acid formulated as a dry powder for delivery directly to the lung to treat different respiratory diseases.
For our most advanced nucleic acid project, a plasmid DNA for delivery to the lungs, we successfully formulated our partner's proprietary plasmid DNA.
The TFS dry powder showed very good aerosol properties, including very good particle size and lung deposition.
Our partner recently shared with us very positive in vitro testing that for the TFS dry powder performed just as well as the liquid version did knockdown testing and transfected cells.
We are currently in discussions with our partner to finalize the protocol for animal testing for our TFS dry powder.
<unk> has initiated licensing discussions with our partner and these discussions are ongoing.
PFS continues to be very active in the monoclonal antibody space formulating either Matt or facts.
As in the case with our mrna portfolio. Our number of Mad projects has also increased and we continue to discuss new projects with companies.
As mentioned previously by both Dale and Bill we have made very good progress with our partner augmented by works and we continue to build our expertise in formulating antibodies utilizing our innovative dry powder technology for delivery of these therapeutics directly to the wall.
The TSS dry powder technology is differentiated from other dry powder technologies when it comes to formulating peptides proteins and faces.
We are currently working with a number of different companies formulating their proprietary peptides proteins and pages into our dry powder for delivery to the lung to treat respiratory elements.
The number of TSS vaccine projects continues to grow as well.
Our most advanced vaccine project, we successfully formulated our partner's phase III vaccine into our TFS dry powder.
The TFS dry powder showed very good particle size and potency.
We have recently sent samples to our partner to run an accelerated stability study.
The study is ongoing.
We also sent additional samples for a partner to run additional potency testing in order to complete the formulation optimization testing.
We are looking to engage in licensing discussions at the next time point during the stability study, which is expected to be in about the next two weeks.
Next is an example of the broad application of our thin film Freesync technology, we're working with a partner to develop an oral delivery to improve bioavailability and absorption in the Gi.
We have successfully formulated our partner's proprietary compound in the TSS dry powder showed very good dissolution and solubility properties.
We finalize the protocol for animal testing of our T at that dry powder and this study is scheduled to start later this month.
CFS has initiated licensing discussions with our partner.
<unk> goal is to enter into licensing agreements with each of our pharma partners.
These transactions would contain a license to our TSS technology in exchange for an upfront payment development milestones.
Commercial milestones and trailing royalties.
A few partners have requested is TFS would enter into a milestone based licensing agreement, where the upfront payment will be paid upon successful animal testing <unk>.
Asphalt stability testing results.
These requests are under consideration.
Each negotiation is unique.
But the underlying premise in negotiating these licensing arrangements.
To secure and maximize the full value of the Tsi technology for the company and its stakeholders.
As mentioned on our last call. We have completed the negotiation of the new praetor with you Sam route.
This agreement has been approved by both parties.
Just sitting on the commanders desk awaiting signature.
Once signed we are ready to ship, our TFS dry powder materials in order to start our animal efficacy study.
We continue to make very good progress with our academic partnerships.
As Bill previously mentioned in collaboration with the University of Georgia, We filed the publication a few weeks back on the TSS technology formulating certain adjuvant.
We're adjuvant utilized in our mouse Immunogenicity study.
Also with our partners at UGI, we are expecting to have initial results from our efficacy study and ferrets by month end.
This study is being funded by civics, the collaborative influenza vaccine innovation center.
With the Albert Einstein College of Medicine, we are now moving our VSP program into animal studies, while performing stability testing.
And with with Dr. Drew Weissman at the University of Pennsylvania, We are beginning our initial mrna formulation work and we have finalized our protocols for animal testing, which we expect to start later this month.
As Glenn stated previously Dr. Weisman is very supportive of the TFS technology being part of future mrna formulation work.
In summary, the TFS BD team has been making tremendous progress and our partnering efforts. We continue to grow the number of collaborations with pharma partners and with our academic collaborators.
As we continue to expand the application of our thin film freeze in technology.
In closing I would like to thank our partners at the University of Texas at Austin with the continuing efforts and support with Dr. Bill Williams and his research team. We continue to expand the applications of the thin film freezing technology into new and innovative areas of drug delivery.
The TFS BD team is focused on closing meaningful licensing transactions by the end of the year.
We are very well positioned to meet this objective and we continue to foster future growth opportunities for both our technology and our company.
Thank you for your time today enjoy your evening I will now hand, it back over to Glenn.
Thank you to all of US here have leaders, who presented on this call and congratulations on the progress and success.
I Trust that we've been able to communicate the outstanding progress <unk> is making across all facets of our business. Our hybrid business model are creating shareholder value with our internal portfolio and business development is on track to realize the potential of the company I do apologize for the length of this call.
What we have so much information to share with you we decided to put it all in here for your consideration and we'll certainly leave time for questions at the end of this call.
Thank you for sticking with us.
The <unk> board and management fully recognize that the past few months have been a challenging period for small cap biotech companies.
And shares of TFS pharmaceuticals have not been immune from this trend in my view <unk> has not received the recognition for the many significant accomplishments in the business as well as the near term value creation opportunities.
I want to reassure our investors that TFS pharma remain steadfast and confident in the progress, we're making to build value for our shareholders.
Over time, we believe both the healthcare focused institutional and retail investor base based most of their decisions upon the strength of clinical data generated from well controlled trials in areas of high unmet medical need.
Therefore believes that ongoing success with our internal portfolio products will realize that in addition to <unk> being a technology platform company where.
We're also an innovation driven developer proprietary therapeutics addressing areas of high unmet medical need and we expect that more investors will understand TFS dynamic business model and reward us for the progress that we've made and will continue to make both our proprietary and current and future partner programs.
Yes.
The opportunities for value creation in both the portfolio and partnership arena are remarkable and growing every week, we look forward to sharing our progress again with you next quarter as always we appreciate the support of our investors and partners.
Again, thank you for listening we will certainly spend a lot of time answering all your questions and with that I will turn the call back to the operator and open up the line.
Thank you we will now be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
Information total indicate your line is in the question queue.
You May press Star two if you would like to remove your question from the queue for.
Vince using speaker equipment, it may be necessary to pick up your handset before pressing the star keys, one moment. Please while we poll for your questions.
Yeah.
Our first questions come from the line of Jonathan Aschoff with Roth Capital Partners. Please proceed with your questions.
Hi, Thank you good evening, guys and congrats on the progress. My first question is for Kirk can you help us with the R&D expense trends for <unk> 'twenty, one and next year, given how it's bounced around quite a bit this year so far.
Yes, Jonathan I'd be happy to.
Leading into this to this previous quarter, we had in it.
Higher amounts of normal because of the increase manufacturing for the three clinical trials that are kicking off here in this fourth quarter.
I would expect the fourth quarter to remain at around the same levels previously and then as the clinical trials begin to mature then that will tail off at that point in next year in Q. After Q1 next year.
So you are saying that fourth quarter looks lighter like half of what it was this quarter.
The third quarter.
I wouldn't say that it would be lighter but.
It will be it will start to trend off into next year for sure there's going to be three trials is going to be running concurrently at the same time.
Understood understood. Thank you that was that was clear.
Can someone please give me an update on the status of the Greenlight Biosciences vaccine collaboration.
Okay got it.
Sure. Thanks.
Thanks, Jonathan So with Greenlight, we continue to make very good progress.
We have received their mrna we have formulated there mrna we have sent them back samples.
And there is testing underway right now at Greenlight so.
We are actually.
Continuing discussions and continuing our collaboration that's about all I can disclose at this time, but we're making very good progress with Greenlight and we're very excited about our collaborations greenlight.
Thank you that was fine.
As always appreciate it.
Can you update us on any noteworthy recent additions to your patent state.
You mentioned the number about 120, but any ones that are standouts.
Yeah. So our strategy has been pretty focused on wherever we.
Have new data.
Sorry.
The technical area of therapeutic compound area, we felt very very broad patents. So for example in the areas of mrna fr wherever we've made really great progress, especially in the yoga biologics, we file pretty broad patents there than anything that we've recently learned around.
Method of use of process and working with those materials. We also file we also a focus driving quite a bit on expanding our domestic patent portfolio and expanding those patents across the rest of the world.
Okay, great. Thank you guys.
Thanks, Jonathan.
Our next questions come from an in line.
Yeah mom Tani with B Riley's Securities. Please proceed with your questions.
Hey, good afternoon. This is sahil kazmi on for Mike. Thanks for the really comprehensive update a couple of questions from US first off as it relates to the knick close to <unk> and the augmented program can you talk about how you're seeing the value of those programs given the recent developments from Merck and Pfizer in the antiviral space.
Sure.
Can I ask you to give perspective on that please.
Yes.
And.
So in terms of I'll address my close to my first and foremost.
First in this and essentially the value from.
Four nights close might as well as the augment it is that.
While Pfizer has been very effective it also has.
Some PK issues and so it has to be administered with raton at there to make it less.
Last long enough.
And so there are some systemic toxicity that can develop through that two drug combination. So it is it's not quite as clean as a single drug the other thing is.
And this applies to all.
All the competition for both.
<unk> compounds at Pfizer results.
Is that while they are promising they are systemically delivered.
And then you have to have higher levels and so there is the possibility of a systemic toxicity, whereas we're delivering the drug right directly to the site of infection.
We intend to get there early and if you compare as I mentioned previously if you compare the Merck compound to <unk>.
Two our animal results.
We showed that we could in fact more or we can treat effectively more severely infected animals and so we think that there is an opportunity for better efficacy there and so certainly we don't think that just that those results are going to eliminate a market or create problems.
Thing with with the micro.
I'll close my just that there is a broad spectrum activity. So it could work calls it has been documented to already work with art kill RSV as well as influenza so.
Now of course, my product can be a pan respiratory viral <unk>.
<unk> therapeutic in the future.
Great. Thank you and then as it relates to some of your business development activities. Maybe we can start with kind of how do you expect any ongoing discussions or activities to the best you are able to disclose to play into anything getting done by the end of the year and then I'll know more long term basis.
A little more color on sort of the size and plans for the interim analysis in the GFS Tac program, and what sort of patient exposure from a sample size of duration perspective might qualify you for sort of a meaningful biopharma transaction.
Yes, I'll start with the BD. So as Chris described we have a number of.
Our.
Partnerships there.
Wrapping up some data analysis. This marks we have term sheets that are.
Already assume that we've gotten to the finish line on.
On the work and diligence is being performed so well.
We're all aware that it's November 15th and.
We are doing everything we can.
Canada partners understand our desire to get to the finish line by the end of the year and we're hopeful that that will happen.
It takes two to get the signatures on the agreement, but all things being equal and getting cooperation from those partners.
We still are saying that we think there is a.
Our likelihood reasonably high likelihood or.
Christopher confident we have the ability to close to <unk>.
April transactions by the end of the year.
We have so many things in the funnel.
Yes.
We remain confident that that will be the outcome.
By the end of the calendar year.
As to attack program, I'll again turn that over to Dale.
Sorry could.
Could you. Please restate the question on Tac.
Yeah, absolutely I was just wondering kind of the size of the phase III study, including the number of patients at the interim analysis, you're planning and what level of patient exposure sample size of duration do you think will qualify pursue meaningful biopharma transaction at that point.
Okay.
Thank you so so the study as designed.
Is one that will really set the stage for the phase III. This is the case, where we've already gotten feedback from the FDA that our phase III efficacy study demonstrating efficacy would be required and so the phase II, we're targeting 20% to 25 patients.
And we are planning on treating for a duration of 28 days, where they would.
Where are the patients coming in will be on oral medication, but already experiencing significant kidney toxicity and so there are physicians are ready to reduce there.
Reduced their blood levels of to call on us to protect the kidney.
And so the idea is.
Since they are already planned for a reduction they are going to go on to the inhaled therapy with the plan being a lower systemic level.
Would be coupled with a higher lung.
Maintaining the lung tissue level to prevent rejection and so they will get bronchoscopy at the start bronchoscopy at the end and we can compare the lung levels to the blood levels from oral <unk> and then inhaled and then from the Bronchoscopy is will also be able to look at Biomarkers.
Our predictive of rejection and so we'll be able to document that in that study that will give us the information we need to move on into the face into phase III. So it's about.
20% to 24 patients total and 10 patients will be treated before and as you can imagine we're doing this open label because the.
The physicians need to know exactly what the patients are getting.
In this case and all of the endpoints are very objective.
Excellent. Thanks, a lot I'll jump back in the queue. Congratulations on all the progress and I appreciate you taking our questions.
Thank you.
Yeah.
Thank you. Our next question comes from the line of Michael <unk> with Maxim Group. Please proceed with your questions.
Hey, guys. Thanks for taking the question.
So I wanted to ask something that relating to the.
The particle size for the proteins you discussed being on the millimeter scale as opposed to the micron scale to provide greater stability.
You talk about how the student films breathing platform allows you to maintain proper aerodynamic properties.
Having that lower service area to volume ratio for the stability.
Hey ask Dr. <unk> to answer that question.
Yes, certainly that's a great question, so actually what I was talking about is the we get asked often to compare third film cruising to spray freeze dried.
And we have studies ongoing and have had we've got several papers published on this.
And what I was speaking of is the difference between the droplets size that is applied to actually freeze the thin film freezing technology. The droplets are in the millimeter sizes are quite large which means theres just not a lot of surface area to for the protein to diffuse to very low sorry.
Sorry, the volume by yourself.
On the other hand, the liquid droplets for spray freeze-dry are in the micron sites. So they are very small and so theres a very high like <unk>.
6000 times as high as literally.
Surface area to volume ratio. So that's what I was speaking to.
Not necessarily to the to the Arab aerodynamic particle size, our powder does produce very high <unk> powder.
For these for the different products that we've been talking about for the proteins.
Hopefully that answers your question.
Yes. It does thank you.
And then I also like to touch on.
You mentioned a bit before you were talking about applying TSS to both PD ones in TNF alphas.
Some of the most successful drug classes of all time. So is this something you are looking at.
Targeting for a new drug for inhalation for lung localized disease, considering the significant toxicity and off target effects and these drug classes.
Or is this more just a proof of concept to show the power and broad applicability of the TFS platform.
Yeah, Great question, and we're doing it for the latter we are using those as you know.
Models that we can learn from and try to.
And be able to anticipate every different physicochemical property are different.
Antibodies different proteins and so we are using that as a model not not necessarily is something that we are developing internally as a product.
Alright. Thank you very much and then just one more and I'll hop back in the queue.
I know there was previously some discussion as to whether the upcoming phase twos could be registration, enabling it seems like for CAC now we're looking at a phase III, how should we be thinking about the path forward for Lori.
And what should we look at for the potential timeline to approval.
Yes, so we've always said actually Michael that we were going to need some phase III data for <unk> tack in lung transplant. So we're hoping that the work we're doing in the phase II program will minimize the amount of patients that we're looking to recruit for the phase III and again it won't distract us from <unk>.
<unk> the process of finding a.
Partner for <unk>.
The way, we look at the <unk> program as well.
<unk> is never going to tell you, yes, or no it depends on the data and that's the position we're taking it it's going to depend on the data.
Getting input from.
Okay.
A rabbit tourists in Europe, as well as we're going to get some information from the FDA about the protocol before we acquired has finally started.
So I'll use the same answer that the FAA will given it depends on the data.
Again, we're hopeful that that will allow us to get into the queue for approval I believe the trial and about mid year to third quarter next year.
Correct.
February.
Yeah.
Youre correct Glenn.
So the normal and there are accelerated a normal review at that point.
Alright, Thank you very much.
Michael.
Thank you. Our next question comes from the line of Richard Deutsch with National Securities. Please proceed with your questions.
Yes, Thank you for taking my call.
Getting me along the way from my Phd presentation today.
This is productive Williams.
You mentioned that one of the monoclonal antibodies you were working with had stability yet.
I think I recall 10 weeks.
Was that the limit that was able to maintain.
Maintain stability or is it still open for ongoing.
Stability longer than that and I have one other follow up.
Yeah. So Richard that is still ongoing that was 10 weeks of 40 degrees centigrade.
Selic rate, which is extremely harsh conditions.
We still do have that that that particular antibodies were still studying it odd stability.
So it can extend quite a bit longer thank you and the other question.
Patients on ventilators.
Ultimately do you expect them to be able to use your powder inhalation.
I'm going to let <unk> answer that.
Okay. Thanks, Bill. So currently there is no existing device that is approved by the FDA with a device approval to deliver dry powders through a endotracheal tube.
So our intent clinically is to actually treat the patients early before they get to the hospital and before they get Intubated.
<unk>.
We're treating them before they would get to that point.
Okay. Thank you.
Okay with that I don't see any other questions in the queue.
Actually I do have two pieces of news that came in while we were having this call.
Number one I wanted to report that we did actually dose.
The first patient in the <unk> phase one trial today. So that's the headline that trial should conclude recruitment and be done.
Very early part of two.
2022, and we are going to have the second TFS Science day.
On the 13th of December we'll announce at the time I believe right now is scheduled for 130 PM Eastern time with Chris.
Chris I may CEO of Atlanta.
And our Carson Schwartz, who will talk about our <unk> program.
So with that.
I would like to thank all of you for participating in this call again I apologize for the length, but we have an awful lot to communicate.
I want to wish you all health and a great holiday season.
And as you know I am always accessible for follow up thank you and good evening.
This does conclude today's teleconference. We appreciate your participation you may disconnect. Your lines at this time and have a great day.
Yeah.