Q3 2022 VistaGen Therapeutics Inc Earnings Call
Greetings and welcome to the Vista Gen Therapeutics third quarter of fiscal year 'twenty, two 2022 results conference call.
At this time all participants are in a listen only mode.
Question and answer session will follow the formal presentation, if anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
And please note that this conference is being recorded I will now turn the conference over to your host Mark <unk> Vice President of Investor Relations. Thank you you may begin.
Thank you John Hello, and welcome to decisions conference call covering our fiscal year 2022 third quarter financial results recent accomplishments and anticipated milestones.
Father, Vice President Investor Relations of estrogen.
Thank you for joining us today and welcome to our stockholders analysts and anyone taking an interest in Vista, Jim join me joining me today are Sean <unk>, Our Chief Executive Officer, Terry Dodson, Our Chief Financial Officer, and Dr. Mark Smith, our Chief Medical Officer format for this call will consist of prepared remarks from management, followed by thereby from management followed by a brief opportunity for questions.
Call is being webcast.
And will be available for replay link to access the replay can be found in the investors IR calendar section of our website Mr. Jin dotcom.
Today's call, we will make forward looking statements regarding our business based on our current expectations and current information forward looking statements speak only as of today and except as required by law, we do not assume any duty to update in the future any forward looking statements made today of course forward looking statements involve risks and uncertainties and our actual.
Results could differ materially from those anticipated by any forward looking statements that we may make today additional information concerning risks and factors that could affect our business and financial results is included in our most recent quarterly report on Form 10-Q filed earlier today with the Securities and Exchange Commission or SEC and in future filings that we make with the SEC from time to.
Time, all of which are or will be available on our website and the SEC's website now I'd like to turn the call over to our Chief Executive Officer, Sean Zhang.
Thank you Mark and good afternoon, everyone on behalf of our entire team at Vista, Jim. Thank you for joining this call. We sincerely hope you and those who are important to you are doing well both physically and mentally.
Taking care of your mental health is essential at every stage of life and as we enter into the third year of the COVID-19 pandemic.
I used to say that at one point or another everyones mental wellbeing may have been impacted in some manner.
Even before the pandemic anxiety and depression disorder represented large and accretive global markets with unsatisfied medical needs now, perhaps more so than ever before innovative treatments for anxiety and depression disorders are needed to improve the lives of millions of individuals around the world. We're suffering from these mental health.
Conditions.
Our team is on task and is working tirelessly to develop much needed novel treatments with the potential to deliver rapid onset beliefs or relief.
Without the negative side effects and safety concerns of herd medications.
Our third quarter results reflect notable progress across our pipeline and all other aspects of our business.
In calendar 'twenty, two we anticipate key top line phase III data readouts with exciting potential to transform major aspects of mental health care.
Our palisade phase three program is designed to further demonstrate the potential of ph 94 B as.
As the rapid onset as needed the acute treatment of anxiety in adults with social anxiety disorder or S. A D R.
Our two ongoing phase III studies in the program palisade, one palisade too.
Palisade long term safety study are on track for top line data readout as previously anticipated specifically palisade. One is expected to deliver top line results midyear. This year and pallet policy too is expected to deliver topline results in the second half of this year.
Should they be successful we anticipate that these studies in a couple of smaller studies will anchor our U S. New drug application for ph 94, B in S E D.
In addition to the milestones we achieved in our palisade phase III program.
During the recent quarter, we launched our phase Iia clinical study of ph 94, B and adjustment disorder with anxiety is the first study in our exploratory clinical evaluation program for ph 94, B and anxiety indications beyond F. C D with.
It's emotional stress and impaired functioning brought on by sudden change in health safety and economic and social circumstances that made many have experienced at heightened levels since the beginning of the pandemic the need for an innovative therapy for adjustment disorder with anxiety has become increasingly apparent to our team and the clinician.
And our ecosystem.
We believe ph 94, B has the potential to offer relief to the growing number of individuals', whose routine daily function has been impaired by the onset or exacerbation of adjustment disorder with anxiety.
We anticipate top line results for this phase Iia study in the second half of 'twenty two.
Later this year, we also plan to initiate additional small exploratory clinical studies to assess ph ninety-four bd's potential in populations suffering from anxiety disorders beyond both S. A D and adjustment disorder.
Indications, where we believe the current treatment alternatives are inadequate.
Also during the quarter, we reported important new preclinical data on page 94, B's potential mechanism of action or M. O E D.
Data from a tissue distribution study in laboratory rats demonstrated that a single intranasal administration of radio labeled ph 94, B was largely confined to the nasal passages with minimal or undetectable levels and most other tissues, including the CNS more importantly, no appreciable activity was observed in the brain.
We believe these results further highlight the fundamental difference and Peach 94, beans M away compared to that of all current anxiety therapies.
When the data from this radio labeled ph 94, B tissue distribution study is combined with that from previous in vitro studies demonstrating that the M away of ph 94, B does not involve direct activation of Gaba a receptors.
A growing body of evidence, suggesting the ph 94, b has the potential to achieve rapid anti anxiety effects without requiring systemic uptake or causing benzodiazepine like side effects or other safety concerns.
Regarding our other clinical stage drug candidates, we are preparing to initiate a phase II clinical study of ph Ted.
The potential rapid onset standalone treatment in major depressive disorder.
In the second half of 'twenty, two we believe page 10 as potential across multiple depression disorders.
Also during the quarter, we initiated a phase one b trial for oral pro drug candidate if you Wanna one in combination with an FDA approved probenecid.
Study follows two positive preclinical studies showing that the combination of if you wanted one probenecid substantially increased the brain concentration of the active metabolite of maybe one to one targeted at reducing rather than blocking NMDA receptors signaling.
We believe if you Wanna one in combination with probenecid has the potential to be developed as an innovative treatment for several CNS conditions involving the NMDA receptor.
I would now like our CFO , Jerry Dodson summarize some of the highlights from our fiscal 'twenty, two third quarter financial results Jerry.
Thank you Sean.
As Sean mentioned I'll highlight a few financial results from the third quarter of our fiscal year 2022, I would also encourage everyone to review our quarterly report on Form 10-Q filed with the SEC earlier. This afternoon for additional details and disclosures.
Our research and development expenses increased by $4 $5 million from $3 $5 million to $8 million for the third fiscal quarter ended December 31st 'twenty, 'twenty and 2021 respectively.
This increase results primarily from expenses related to preparing for and conducting our palisade phase III program for ph 94, B N S. A D, including the continuation of our palisade one in palisade to clinical trials as well as initiating our palisade long term safety study.
And our phase II study of ph 94, b for treatment of adjustment disorder with anxiety.
These studies and the continuation of non clinical and preclinical development and outsourced manufacturing activities for both page 94, B and ph 10.
Counted for increased expenses of approximately $3.1 million during the quarter ended December 31st 2021, compared to the same quarter of the previous fiscal year.
Salaries and benefits expense for the quarter ended December 31, 2021 increased by approximately zero point $8 million versus expense for the comparable prior year quarter, primarily due to the addition of new senior management and other personnel across multiple R&D disciplines.
Our general and administrative expenses increased to approximately $2.9 million for the quarter ended December 31, 2021 compared to approximately $2.1 million for the quarter ended December 31st 2020.
That increase was primarily due to continuing initiatives related to phase appropriate page 94 be prelaunch commercialization activities.
Our net loss for the third quarter of fiscal 2022 ended December 31, 2021 was approximately $10.5 million versus a net loss of $5 $3 million for the comparable quarter of fiscal year 2021.
At December 31st 2021, the company had cash and cash equivalents of approximately $83.7 million.
Again, please refer to our quarterly report on Form 10-Q that we filed earlier today for additional details and disclosures.
I'll now turn the call back to Sean.
Thanks Jerry.
Our experienced team is well positioned to advance our programs through important late stage clinical and regulatory milestones.
And also navigate a responsible path towards the potential commercialization of ph 90 for me.
Our team is comprised of amazing individuals, who not only possess vast knowledge and experience within our industry, but who also share our passion for social change and align with our corporate values.
As we forge forward as change makers, we are confident and we are very excited about the potential for our CNS pipeline to make meaningful transformation and mental health care and improve the daily lives of those impacted by anxiety and depression disorders everyday.
On behalf of our entire team at Vista Gen. Again, Thank you for your continued support.
Thank you Sean This concludes our prepared remarks, operator, we'd now like to open up the call for questions.
Thank you at this time, we will be conducting a question and answer session. If he would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate that your line is in the question queue. You May press star two if he would like to remove your question from the queue.
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One moment, please where we poll for questions.
Our first question comes from the line of Andrew Tsai with Jefferies. You May proceed with your question.
Hi, Thanks, and good afternoon I Hope you guys are doing well. Our first question is on the phase three.
Palisade programs I'm curious how are the rollover to the open label I guess long term safety portion and what percentage of patients who have completed.
Palisades are moving over and then maybe talk about whether or how does that compare your expectations, we'll start off with that thanks.
Thanks, Andrew Great Great to talk to you a good question I think just say we were pleased with the way that we're seeing a rollover from power one perl to into long term safety.
<unk> on track as we'd expected and we see it continuing that way.
Yeah.
And <unk>.
Remind us one more time, just you know what the powering assumptions for the Palisades, our and how should yeah. The sides efficacy reduction in the ph 94, B arm change as we go from phase to phase III, if at all and feel free to talk about you know how.
Placebo might change, but I believe you mentioned, how our responses are pretty consistent in the past maybe but can you just talk about that remember you remind us the powering assumption is wrong.
Well the sample size for power one peltier was based on what we observed as the main difference between the average subs for the 94 being the placebo arms in in Phase, two which was 12 points. So the various estimate it's used for the sample size calculation was increased as you'd expect.
When you move from a smaller number of sites is in phase II to a larger number of sites.
As we have in phase III to allow for.
Higher expected variability when you go up to the higher number of site. So.
We are.
We took that into account in the way you do that is to increase the standard deviation from phase II to phase III, which we did.
By about six points and and that may or may not occur, but it was the right way to go and we would expect also got 90% powered to detect a difference between the two independent groups under those assumptions.
Okay. Thanks, and maybe the final question before I hop in the queue phase III timing of palisade, one maybe talk about your confidence in you know January and data are in 2022 given.
And you know the Covid situation, we'd love just to hear about some color around how that's going and you know it is it are you ready to kind of talk about what it's looking like closer to Q2 or Q3 mm yeah I'll stop there. Thanks.
We're still expecting the topline data in mid 'twenty. Two so I think we're going to stick with that Andrew that's on target as previously anticipated and Pal palisade two in the second half of 2022 so we do get a lot of questions about COVID-19 and the omicron vary and how it's impacted you know enrollment in the ongoing trials so well.
We remain comfortable with the estimated timelines for topline data that that I've. Just noted and you know should somebody develop COVID-19 . During the trial period. There are procedures already in place that allow that individual to return to the trial when it's safe, resulting typically if at all and only a minor delay in their trial period.
So, although we're not able to predict the future of the pandemic and its potential impacts going forward. We believe that we're doing our best to do.
Minimize any potential disruptions in these studies and we will continue to monitor that situation very closely obviously always prioritizing health and safety of both the the subjects in the studies and the site staff members.
Great. Thanks, a lot for taking my questions.
You bet.
Our next question comes from the line of Tim Lugo with William Blair. You May proceed with your question.
Hey, guys. This is lachlan on for Tim Thanks for taking my question.
I was wondering also on the same topic of Palisades and kind of good to have you had to expand site numbers at all because it's causing disruptions or anything and then secondly, do any of the.
Sort of more local restrictions like mask mandates change anything in the study I mean does it change.
Patients will slot members or anything.
Moscow not.
During the trial.
Yeah. So the the trial site in hours remain constant.
I haven't had.
Any dramatic shift in what we laid out upfront so that.
Isn't surprising and then asked to consistency you know the local.
The local mandates are one thing, but the protocols that the sites have for safety that that were implemented really early.
On in Covid.
'twenty still pretty much remain in place so in our study all subjects and the and the audience members and the public sneaking challenge are masked.
Okay, great. Thanks D is there any reason to think that could sort.
Sort of change the experience of the public speaking challenge compared to the phase two.
Mark you can address that Mark Smith.
Yeah. It's good question.
Don't know for sure, but we've seen pretty high scores throughout this Ah study in other words high scores that theyre pretty stressed out by the procedure. So I don't think they're hiding behind their math, but the most important thing is.
Whatever they do.
The baseline visit is the same as the randomization visit and so we keep things consistent for each individual patient and.
And I think that.
Sure some consistency, but in answer to your question no I don't I don't think it's reducing the overall strength of the procedure.
<unk> are pretty stressed out by it.
Awesome. Thank you.
Our next question comes from the line of Brian <unk> with Baird. You May proceed with your question.
Hi, This is Luke Harman on for Brian . Thanks for taking our questions first for the social anxiety opportunity just looking beyond the palisade program I was wondering if you could remind us of the scope of the additional small studies still required.
And then granularity on the timelines for those and then just also if you could talk a little bit about ph 10 M D B.
Provide any color around the phase <unk> study design at this point thanks.
Thanks for question Blue So couple of things.
Other NDA, enabling studies beyond long term safety and the two.
Palisade studies palisade want to there's a small dose response study FDA wants us to do that has two different dose levels that we haven't assessed so that's the only about 90 subjects I'm forty-five in each dose level 0.8, and $6 four micrograms remember we're dosing in microgram levels and then there is a dosing interval study.
Which we're still working with the agency around what exactly they want to see but again pretty small study very shorts.
And pull of subjects, maybe two dozen at tops that all.
It won't take too long to complete it probably within the quarter that we initiated so those are studies that we will be initiating in the second half of 'twenty two.
As the ph 10, so what we've been doing with that and I don't really want to go into it yet, but obviously the focus is on major depressive disorder and the focus is on what the world needs today, which are rapid onset decisions of whether something is going to work or not work and.
A considerable differentiation and side effect and safety profiles given the alternatives that are delivering rapid onset effects. So we've had several meetings with kols and our internal team and we are we're huddling around the designed it.
We think we want to go forward with and we'll give guidance on that as we get a little closer to.
This study launch.
Alright, thank you so much.
There is a focus for sure is using page 10, as a standalone agent for for major depressive disorder. One that we think can be inserted very early upfront into the treatment paradigm, possibly even frontline.
But at a minimum second line.
And we think the characteristics of page 10 that we've seen in the study that was done the POC study gives us a lot of confidence that.
The direction, we're headed is the right way to go and as we see things evolving in the depression market over the coming years.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
Our next question comes from the line of Jason Mccarthy with Maxim Group. You May proceed with your question.
Hi, Good afternoon. This is Joanne Lee on the call for Jason Mccarthy. Thanks for taking the question. Congrats on all the progress in the quarter got to hear that the palisade program is on track to read out this year on the partnership side I would ask Matt I just wanted to see if you could provide some color on the progress of that partnership in China and as a fee.
Follow up and maybe if you could provide any details I wonder if the company intends to launch a global palisade trial and if we should anticipate further partnering opportunities outside the U S. Thank you.
Alright, thanks for the question so the the partnership with asthma Meds is.
Covers China, South Korea, and Southeast Asia.
And we're very pleased we've been making very steady progress in advancing 94 be closer to the start of our of our global clinical trial, which will call palisade Global do include China and the other territories. So we will.
Our plan to it.
Or for that trial to be held in five different territories.
With China being one of those five and we'd expect.
That we have an opportunity to launch that study sometime in the second half of 2022 so we will give further guidance as we are we get the kind of regulatory clearance that we need in order for that study to be greenlighted and and launch sometime in the second half of this year.
It's not a necessary study for our NDA, enabling program in the U S of course, it's important for our ex U S partnering activities and we'd expect to have additional partnering opportunities beyond those territories.
In in due course later this year.
Oh, great that was helpful. Thank you so much.
Our next question comes from the line of Andrew Tsai with Jefferies. You May proceed with your question.
Right. Thanks, two follow ups, and then Oh I'll leave it to that is just you know because palisades, one and two are staggered a little so let's just say if the first phase III was positive how would that affect the second phase III, because maybe there's some expectation bias. So you know how.
How do you guys think about that how do you control for that.
Well you know how it goes.
You can't be a hunter and you'll see it in the disclosure documents is the way. It works. One study is one study in the second study ideally you want to see the same results achieved to replicate design. We just have to continue to forge forward in the study are the same way we had in that study up to the point of data. So there really isn't.
The shift change or a course change.
I'm, not saying that there won't be different awareness, but.
<unk> is designed to be able to.
Hum.
All out anything that seems to be extraordinary but I.
It's.
It's.
That'd be a champagne challenge so we'll see how it goes but mark do you have anything further you want to add to that.
Yeah, I mean, they are identical studies. So I mean, this procedures and all are not going to change regardless of what happens in the first one but.
It is possible I suppose if our statistical calculations are off we could continue that study a while longer even.
And it earlier, so but that's that's the main thing that could change, but the protocols themselves are virtually identical.
Thanks, and a second question.
Talk about the pace of cash burn over the next 12 months and have been.
Very helpful. Thanks.
Thanks, Andrew So well you just might have seen we just last reported cash position at 12, 31, 21 was $83 7 million as Jerry noted so far.
Our current cash position is sufficient to advance the CNS pipeline through the very exciting stream of potential milestones that we laid out this calendar year, so, namely the topline data readouts of palisade, one in palisade too and also the adjustment to sort of study in phase two way. So we expect our burn.
To continue around current levels, and we will closely monitor and reassess. This after palisade one reads out at readout will of course impact the direction of cash spent beyond that.
Thanks.
At this time there are no further questions.
Thanks again, John if you have any additional questions. Please do not hesitate to get in touch with us at IRS decision Dot com or you can call any of the phone numbers listed on our press release issued today. Thank you for tuning in and we appreciate everyone's attention and support we look forward to keeping you current on our continuing progress. This concludes our call have a great day.
You may all disconnect now.
Okay.
Yeah.
Yeah.
Yes.