Q4 2021 Galmed Pharmaceuticals Ltd Earnings Call
Including those regarding financial results statements and forecasts regarding anticipated timelines and expectations with respect to Huawei could it be.
And clinical development programs as.
As well as other statements that relate to future events.
These statements are based on the beliefs and expectations of management as of today.
And actual results trends timelines and projections relating to our financial position.
And projected development programs and pipeline could differ materially.
We urge all investors to read carefully the risks and uncertainties disclosed in our filings with the S. E C.
Including without limitation the risk under the heading risk factors described in our latest annual report on form 20-F filed with the S. E C.
Yeah that assumes no obligations to update any forward looking statements.
All information, which speak as of the respective dates only.
I would now like to turn the call over to islands virus.
Is it Didnt and Chief Executive Officer.
Adam Please go ahead.
Thank you Peter.
Good morning, and thank you for joining us on today's conference call.
I am pleased to be here today, with our Chief Scientific officer fully payout Denny our Chief Financial Officer, Ron Cohen, and Chief Accounting Officer, Joe Your question Slur to provide you with an update on our clinical development programs.
What does report to you on our financial results for the <unk> 2021 fourth quarter and full year financial results.
As always we will be happy to take any questions. You may have at the conclusion of our prepared remarks.
On April 28 government published interim results from the open label part of the or more phase III study.
As a quick reminder, for those of you who are new to our story. The open label part of the almost study was designed to explore the effects of the higher dose arm called well not induce fibrosis.
Kinetics of histological outcome measure is the function of treatment duration in preparation for the Registrational double blind placebo controlled part of the study.
Simple words, the aim with the open label study was to explore the speed and the extent of our Bronx reduction testing the hypothesis is higher Arab what exposure, resulting in an improved efficacy profile.
Acknowledging the complexity variability and moderates repeated stability in liver pathology reading. The open label part was also used to further assess different methodology. It may support an improved fibrosis, scoring.
All slides were assessed using three he still pathological reading the methodologies.
Central pathology comedy scored the biopsies according to the conventional formal nausea rent, scoring system, if one two or four.
Scoring was initially performed individually.
Three independent pathologists, followed by consensus reading by the committee.
Two spare breathing, maybe maybe reflect real world, but the logical assessment. The same Central Committee was also asked to perform a ranked assessment improvement worsening stable or third pre and post treatment biopsies.
And blended to sequence I E not knowing which is the baseline and which is the post to baseline.
Furthermore, artificial intelligence AI based tools are at the forefront of the development of a more sensitive automated conscious continuous scoring system for the detection of fibrosis change for future future Nash and fibrosis clinical trials accordingly, the same slides.
We're also read using fiber nest egg quantity digital pathology image AI analysis, providing continuous fibrosis composites Verity School F. C. S E T.
Allow identifying fibrosis improvement it may be missed by the formal scoring is one of the statistics, it's statistical quantification of change from baseline.
Results of both based on biopsies reform either at 24 weeks of 48 weeks from 46 subjects with Nash and F. One to three.
Received are on call support the anti fibrotic effects of our encore and reinforce the favorable safety profile of our important.
Treatment with <unk> 300 milligram B I D resulted in the high rate of subjects with fibrosis improvement across the three separate intelligent reading metals.
Both spirit and AI evaluations identified most objects with fibrosis improvement, indicating greatest sensitivity to detect change versus categorial, scoring four categories.
But to go risk scoring for.
For all methods of treatment effect was larger it's 48 compared to 24 weeks.
With 48 fibrosis improvement was identified in 40%, 65% and 100% of patients. According to nausea rain bird in AI, respectively.
Deprecation of change from baseline by AI demonstrated that reduction in fibrosis was statistically significant both at both at week 24.
0.017, and at week 48, P value smaller than 0.0001.
Further analysis based on AI are being prepared for publication in upcoming scientific conferences.
Altogether, we believe the results highlight the need to reassess histological analysis in future Nash studies.
With regard to the initiation of the double blind placebo control Registrational path or the phase III study.
Our current assessment of despite considerable efforts from the scientific community and regulatory agencies. There are significant uncertainties that remain unresolved.
These include dependence on biopsies as the primary surrogate endpoint with all the complexities describes about no significant progress invalidation of noninvasive biomarker and a high screen failure rate, but remain a substantial burden studies.
Studies.
In addition, <unk>.
Diamond is considering a more robust changes to its development program for Nash.
Changes may include focusing on higher risk patients if three.
Evaluating patients with compensated cirrhosis, if for as well as change to study design such as two smaller studies instead of one pivotal study and the addition of a combination arm.
Taking all the above into consideration government has decided to move the initiation of the double blind placebo controlled part of the study with our <unk> Meglumine.
Until the second half of 2023 subject to among other things. The result of our open label part sufficient funding.
Verification of the regulatory approval process for <unk> drugs by which time it Derisk scrutinized clinical development plan can be put in place.
Importantly.
As you May remember on January 2022, we announced that the United States patent and trademark office U S. PTO granted Gal made new patents related to the use of our own coal for the treatment of fibrosis and for the treatment for modulating gut microbiota.
With these latest patent government is strengthening and extending the IP protection of its lead compound or AMCOL until December 2038.
These broad patent protection and the clinical data on Nash induced fibrosis is broadening the potential of our own coal in fibrosis treatment.
The past 12 months have been an exciting time for garden made.
Reported positive interim data from the open label part of the or more phase III study.
And we will continue to advance our pipeline compound and below five mirror.
Emilio five mayor.
Synthetic peptide consisting of five amino acids that exert anti inflammatory effects by bond pro inflammatory amyloid proteins, preventing what amortization of serum ameliorate a S. A a monomers and thereby interfering with S. A a induced immune cell activation.
On January 2022, we announced the positive results from the first in human Phase one clinical trial of a mellow five mayor in healthy volunteers.
Government is currently assessing a number of potential proof of concept studies designed to rapidly generate data that will drive the next steps of the envelope five year clinical program with a clear and efficient route forward, we intend to provide more detail in the next few months.
Along with an update on our planned activities. We are pleased to welcome the Ron Cohen earlier this year as our newly appointed CFO .
The Ron brings more than 25 years of experience in the global financial markets, including significant experience on the buy side for life science companies.
Now, let me transfer the call to our Chief Accounting Officer, you harsh dantzler.
Alright, Thank you Allen.
This morning, I will be providing you with our financial results for the fourth quarter and year ended December 31 2021.
For more information please refer to our report on form 20-F filed earlier today with the FCC, which among other things provides a summary of such financial results.
Our net loss for the three and 12 months ended December 31 2021.
Seven 5 million and $32 5 million respectively.
Impaired with a net loss of $10 3 million and 28 8 million for the corresponding periods in 2020.
As a result, our loss per share for the three and 12 months ended December 31, 2021, or 13 cents per share and $1 32 per share respectively, as compared to 48 and $1 35 for the corresponding periods in 2020.
Research and development expenses for the three and 12 months ended December 2021 totaled $6 3 million and 20.
$27 2 million.
This compares with 9 million in $2026 1 million for the corresponding periods in 2020.
Turning now to G&A, our general and administrative expenses for the three and 12 months ended December 2021, both at 1.2 million and $5 7 million, respectively versus $1 3 million and $4 1 million for 2020.
During the three and 12 months ended December 31, 2021, we had a net financial income of the airplane zero 5 million 0.4 million, respectively versus 0.1 million and one 4 million during 2020.
Our cash balance as of December 31, 2021, which includes cash cash equivalents restricted cash and marketable securities totaled $34 9 million. This compares with 51 million on December 31 2020.
With that said operator, please provide instructions for the Q&A portion of our call.
Okay.
Thank you.
At this time well be conducting a question and answer session.
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One moment, please while we poll for questions.
Yeah.
Our first question is frontline of Steven <unk> with Raymond James. Please go ahead.
Yeah.
Yeah.
Mr Cheetos.
Your line has been on mute you can proceed with your question.
Yeah apologies can you hear me.
Yeah, we can hear you now hi, Steve.
Sorry about that guys technical difficulties.
Taking the question I wanted to ask about the histology data I noticed you had two cohorts 24 weeks and also greater than 48 weeks and I wanted to ask if that meant patients just showing up a week or two late for the 48 week biopsy or if in fact that combines 48 72 week.
Paired biopsies and if so could you break out sort of how many of you had maybe what data from 72 week biopsies would be forthcoming.
Sure.
So most of the patients came from the 48 weeks, we did combine the 48 and 72 groups.
Approximately five patients came from the 72 and most of them came from the 48.
Can you comment on just the relative fibrosis improvement rates between 48 and 72 expected.
We think the numbers are too small or five patients to draw any conclusions so but in general what we've seen before in the small numbers.
The 20 patient.
We see that also later on but we thought we don't you can't draw any real conclusions compliant patient well, we prefer to group the two together.
Okay. Thanks for taking my question.
Thank you Steve.
Thank you.
Next question is from the line of question Glasscock.
Cantor Fitzgerald. Please go ahead.
Hi, good morning, and good afternoon. Thanks, so much for taking my question. The first one I wanted to ask was on the second half of 2023 guidance in terms of the Registrational study.
Some of the factors that you cited are thing that of course, you as the company can control like understanding which patient population to evaluate but then some of the faster you cited were.
Out of your control. So for example, understanding the biopsies as a primary surrogate endpoint.
Wanted to understand a little bit about the timeline and what you hope to understand from the field more broadly by the timing plan to start the study next year.
So we believe that the.
The field is developing in the right direction and we are in the very recently there was the liver forum, where the FDA presented and now many of the AR.
Our pharma companies involved in the Nash space also participated so we certainly see a very positive development and AI in particular is a very important one but we feel that it is still from as I said I mean with all the enormous effort.
And the work that are done by a.
A number of consortiums.
Both from academia and industry trying to develop a bio markers and the better understanding of the a biopsy reading it is too risky now to initiate a registrational study.
When the primary endpoint is I'm, not very well defined and we feel that we should wait and look.
And we believe that by the time that we planted realization marine initiate the study in the second half of 2023 means that we have to start working on that already early 2023, I hope that at that time, we'll see some positive signs coming from our from all of these.
Before that many participants are.
Our advancing and we will also that will give us sufficient time to have a meeting with FDA to discuss all of these concerns and our information to share with them. The information. The FDA is extremely supportive and we would like to show them. The data that we have a I don't know many companies that.
Do these effort of reading the biopsies in three different methodologies.
So this is very important data we have submitted these data as a late breaker.
For easily and Ah and it's very valuable data for all <unk> companies.
Okay. Thank you for that and then one wanted to ask how some of the recent data that you shared last week, how you're thinking you could correlate the one daily of AMCOL Meglumine profile in light of some of the early PK work that you've shared between the two.
So as you'll recall.
Our uncle Mega Man in stipulated as all are on call. So the circling moiety is.
Our encore, we're just talking about a different kind of formulation or a different.
Both the advantage of Oracle Mechelen mine is that we'll be able to get to the same exposure that we see now with the twice daily 300, Meg with once daily 300, and something rather than 80 about a milligram of Oncall melamine once daily. So this is.
A great advantage.
Both in terms of compliance in terms of Ah Ah patient.
The cost.
Cost of goods and they are.
And the patterns of course are these.
This has a very long I think as I alluded before so simultaneously we are continuing the development of the Muslim women preparing it for the initiation of the double blind, but I don't really see any difference between the data between the two formulations are important <unk> meglumine.
Okay. Thanks, and then the last question for me was just on <unk>.
Highlighted that over the next couple of months you might share.
Some plans in terms of proof of concepts fashion, but I just wanted to ask if you're still looking to first in class IV.
First introduced in Europe , Latin America, you had discussed a number of potential program. Thank you.
So indeed, we do we.
Developed the first formulation for a mill or five Mer is an input colonic oral formulation.
And this is developed for IBD now, we look carefully at the space and the competitive landscape and we are trying to create a kind of an edge or a meal or five mer in this competitive landscape. So one of the possibility it would be a combination.
Another compound, which will ease the recruitment because we know that recruitment is in.
It is very challenging are almost as much as challenging for Nash trials, but.
But we can solve that if we do a combination treatment.
And also the population, which population that we're targeting mild to moderate moderate to severe at the same time. We are also looking for the systemic exposure of our mineral fiber and once we will confirm that it will open for us a variety of other indications.
So we're about Mueller today play a crucial role.
And one for instance.
Amelia Mediterranean fever, but I can name, others, which are highly relevant for us.
We are trying to do.
And Oh, all inflammatory looking for these inflammatory indications where immuno five merit 10 play important role.
Yeah.
Thank you Alan.
Thank you Christine.
Thank you.
Our next question is from the line of NAV Rehman with Maxim Group. Please go ahead.
Hi, everyone. Thanks for taking our question I have a few first I'm going to start on your recent data see how you use the three different methodologies could you just sort of talk about what you're starting to see is the clinical value of the different methodologies and have you had any conversation with like kols or the FDA on these methods.
<unk>, how the rates of fibrosis improvement, we're so different like did you find that.
Kols or potentially the FDA would prefer like a more stricter like.
The more attractive Sheridan methodology versus the AI methodologies.
Yes. So so thank you for the excellent question.
It is all all these methodologies are relevant to the question of sensitivity and we.
We need to really discuss the data with the FDA.
Got him that is under the opinion and together with the Kols. I mean this is something of course, we are consulting with the Kols the AR and AI company. We use was highly recommended to us by our Kols I know that a they are eight other abstract which companies.
Are going to.
It's easily for other Nash companies. So clearly there are the forefront of AI.
Now it's it's a we believe that there is a.
And and and and.
I think we this is nathan.
Also.
Presented but it certainly will be presented during easily is the correlation between the AR AI and everything for instance, and the high correlation between AI and everything and this is important because everything is the closest.
The methodology that we see for real life and if we can support the pair reading together with AI.
That would I think the combination of the two and potentially that can be also validated by Biomarkers noninvasive biomarkers all of that can bring the Nash space in particular, the fibrosis effect into a different.
Category, it's simply the nausea Ren is limited by definition.
As you may recall in the hepatitis C studies.
The ranking was not done through Nash CRA and it was done by everything.
And we are going back to the traditional quote unquote.
Reading that was used in Hep C. Clinical study is supported by the very novel AI technology.
Which a shows the improvement that is normally missed by and the human eye.
So we are where we are very excited.
And we try as much as possible to move away from that to go categorical reading E. F 123 into a continuous method.
Is much more and accurate.
Thanks, you actually brought up another point I was going to ask.
During your this is gonna analysis did you find any biomarker correlation with the AI reading or like any sensitive correlations with biomarkers and here I readings.
So I can't talk too much because otherwise are easily would not give me my late breaker. So unfortunately.
I have to be very careful with the information that I disclosed Ah.
But I can tell you. These are very very interesting and I think what the interesting point is.
Again as far as I know and our App struck me is the first time that you have both the clinicians they the key the kols and clinicians together with the leading he's still pathologies.
One paper agreeing and raising the the main issues and concerns and and basically putting it in a very open and Frank way Frank way, the a D. A biopsy reading challenges and hopefully that would support the.
In our space.
Just one last question on level five mer.
Have you considered or are you concerned potentially partnering the product for future development and non diluted sources of financing.
Absolutely absolutely and thank you again, Justin for this Oh sorry.
For this question we.
Government is a I think what we've demonstrated over the years is our core competence is to advance those preclinical assets quickly into clinical preferably phase one and proof of concept studies at <unk>.
For longer studies, and a phase two b phase III studies.
Collaborating with our other biotech or pharma companies I think especially nowadays.
<unk> is the right way to move forward.
And we would continue and this is what we're trying to do is foam coalitions of.
Note that our <unk> have the same.
Ideas that the end of the day, we will the idea to advanced assets as much as quickly as we can into advanced nickel studies no matter, whether it is a pharma or in other parts of the company.
Thanks for taking my questions.
Thank you.
Our next question is from the line of Ed <unk>.
Please go ahead Sir.
Okay.
Hi can you hear me.
Yes, Hi, Ed.
Hi, Alan Great. Thanks for taking my questions.
Well I I joined a bit late but I understand that you were.
Moving the timelines for the phase III portion of our more to the second half of next year.
Having to do at least in part with.
Hum.
Refining of the primary endpoint.
And working with the FDA.
Could you perhaps.
Just give us.
A bit more detail on some of the criteria that you are reviewing those you were considering pushing this back.
Just to give a better sense for why you felt this was necessary.
So thank you Ed so to start with the.
The screen failure.
When you look at other Nash studies, including our study.
Screen failure for the Nash studies is about between 80% to 90%.
It means you have to biopsy 10 patients in order to get one eligible patients.
I don't think that's running for you know.
Notice of Iran.
1000 page.
Patient pivotal study you would need to biopsy.
Patients.
This is something which I don't think no one should expect.
And we should wait and see.
And find.
Together with the everyone who is working on Biomarkers validated biomarkers.
<unk> reduced this number into.
So for numbers.
This not only for the cost of the study, but also I'm thinking of the patients all these patients.
Need to do the unnecessary biopsies and the frustration of.
The frustration of our.
Or both.
Hi, Andy.
Okay.
And we're looking for a method better with a better sensitivity will allow a smaller sample size.
AI.
So listen I'll start with the premium and then I'm moving towards the end of the study.
Results. The you can't run the study.
When the rules or the.
Okay.
We started playing basketball and we are moving and playing golf.
Hockey.
Cricket.
This is something which is again when you see the discrepancy.
When the different methodologies.
And no one can and there is no clear guidance.
Which one is the one that we should use.
This is probably the reason why we see so many Nash studies.
So these two by itself.
I think demand.
In addition, what I've said earlier the ability to better design.
How do you think about the population whether we should go for more advanced population.
Whether we should go for smaller studies, rather than one large pivotal study, but it was a combination.
And there's still no guidance on ambulation.
Would you argue include a combination arm in it.
Kind of.
So I hope that.
By the time that would initiate the reinitiate the double blind part of the study.
Understood.
To all these questions.
Okay great.
Yes.
The next question is.
Regarding your data your initial data out of <unk>.
Fiber and us and the fibrosis composite score obviously.
Truly compelling.
Data.
On the reduction of at least three units over that time period.
And I understand that this does not correlate well with the.
The Nash CRM definition.
Histology.
And in fact, if you were really trying to do.
<unk> is a better method.
You wouldn't necessarily want to have that correlate.
So histology so you have.
And I'm.
I'm half the space has had for several years sort of a catch 22 trying to move away from histology and yet still having to correlate to it.
So the question is with this data in hand.
Are you intending to have discussions with the FDA. This market can I'll say basically.
Moving to essentially a better method and not having to continue to to try things too.
Yeah.
A biopsy or is the FDA more inclined to listen to some of these.
Looks like.
In the U S and Europe .
<unk> large.
Large data.
<unk>.
But theyre being worked on over several years.
So thank you Eddy I think this is a very important question.
We are trying to move from a categorical method into a sequential.
Method, which by definition is more.
Sensitive and more accurate and hence we can also demonstrate that P value, which you cannot demonstrate a categorical.
Number.
I think that in the first stage it would be a combination.
With the AI support.
You know that.
The FDA has now already allowed to use AI is a false reader.
There's another AI reading, but this is not good enough.
That keeps us with enough CRA.
And create additional noise.
I believe we are not alone.
Eight other.
Yep.
At this time.
Yeah.
Large pharma.
No.
The same.
And trying to better that.
And together with the FDA are find ways, where we can.
The biopsies and.
Because I don't see in the near future.
Any validated biomarker that can replace the biopsies.
Can you the biopsies and.
And then.
Using it in a different way as I said before for instance, the combination of deferred and AI.
We expect top line correlation between market.
So for example, the 'twenty four is better than 48. So there is very very clear.
And dataset.
We already see from the Congress number notwithstanding the fact that we are using three different.
Methodologies.
And this is across this is by the way across all of the methodology.
What if all the 48 better than 'twenty four is the direction is the same so whether it's a CRM third or AI you see it.
The direction is the same and this gives us a lot of confidence in the poorer than AI.
Yes.
Great. Thanks, Alan Thanks for taking my questions.
Thank you Ed.
Thank you ladies and gentlemen, we have reached the end of the question and answer session and I would now like to turn the call back to Alan's matters for closing remarks.
So thank you very much everyone for joining our today's call.
And as always we're available for any follow up questions.
And we look forward to seeing you on next.
2023 first quarter call, which is just around the corner.
Sorry, 2022 first quarter call. Thank you all bye bye.
Thank you.
This concludes today's teleconference. You may now disconnect your lines at this time. Thank you for your participation.