Q1 2022 CohBar Inc Earnings Call
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Good afternoon, My name is John and I'll be your conference operator today.
At this time I would like to welcome everyone to cobalt first quarter 2022 financial results conference call.
All lines have been placed on mute to eliminate background noise.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
And now I would like to turn the call over to Jeff <unk>, Chief Financial Officer at Gold Bar. Thank you Sir.
Thank you John and thank you everyone for joining US co bars first quarter of 2022 financial results Conference call.
Joining me on today's call is Dr. Joseph <unk>, Chief Executive Officer, Dr. Nicola Hockey's, cobalt acting Chief Medical Officer, and Dr. Tent Grindstaff Senior Vice President of research.
Following our collective remarks, we will conclude with Q&A.
<unk> financial results press release was issued earlier today and may be downloaded from our website at Www Dot Kumar Dot com.
Before we begin I'd like to take a moment to remind listeners that except for statements of historical fact.
On today's conference call May include forward looking statements within the meaning of the securities laws.
Forward looking statements are based on current expectations projections and interpretations.
And involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by cobalt.
These risks and uncertainties are described in our registration statements reports and other filings with the Securities and Exchange Commission and applicable Canadian Securities regulators, which are available on our website at cobalt dotcom FCC dot Gov, and SEDAR dot com as well as in the Safe Harbor statement included with today's press release.
You are cautioned that such statements are not guarantees of future performance and that our actual results may differ materially from those set forth in the forward looking statements.
<unk> does not undertake any obligation to update publicly or revise any forward looking statements or information, whether as a result of new information future events or otherwise.
Now I'd like to turn the call over to Joe Surette co bars, Chief Executive Officer, Joe.
Thank you, Jeff and thank you everyone for joining us this afternoon.
In the first quarter of 2022 we made steady progress that we believe positions khobar for an exciting several years ahead.
On our last call we communicated several important updates about the direction and focus for the company and during this past quarter, we focus our efforts on execution in those areas.
We aligned our pipeline strategy to prioritize the advancement of CB 50, 138 S. Three our IPF program towards the clinic.
Notably our I N D. Enabling studies for this program remain on track and our reformulation efforts are well underway.
We invested further in our novel Milo plus platform.
Identify new product candidates.
We continue to explore potential partnerships for C. B 42 11 program.
And we hired significant talent to our team, which we believe will enhance our ability to achieve long term success.
On today's call. After my introductory remarks, we will share commentary from canton neck. The most recent additions to our leadership team, who bring unique perspectives and extensive expertise in their functional areas.
Kent will provide an overview of our science and our micro plus platform and it will provide a recap of our IPF program.
Jeff will then review our Q1, 2022 financials and summarize our upcoming proxy vote and NASDAQ listing requirements.
Yeah.
I'm very excited about where we stand at co par and we remain on track to hit our important upcoming milestones.
As we think about where we are headed I would like to put the intriguing opportunity we have to mine the mitochondrial genome into perspective.
Well researchers have been looking at the nuclear genome as a source of novel Therapeutics for quite some time.
The country has been largely overlooked when you think this is due to a couple of factors.
First the utility of Mike mitochondria has historically been viewed solely through the lens of a T T in energy production, but.
But it turns out the function of mitochondria is much broader than that.
And they play important roles in regulating a variety of different biological pathways as well as impacting a wide range of diseases.
Second I think there is an inherent assumption that the peptides encoded in the mitochondrial genome would be acting locally within the mitochondria and some of them certainly do that.
But it turns out that many of these peptides are secreted and circulate systemically.
Mediating important effects on organs and tissues quite distant from where they are produced.
And so as these two insights about the breadth of the impacts of mitochondria on the body and the fact that peptides encoded in the mitochondrial genome are acting systemically that really led to the formation of Cup are and that's the rationale underpinning our approach to drug discovery using our motto plus platform. They can't will talk about in a few minutes.
Additionally, my targeting analogs or modifications of natural peptides, we expect to have fewer off target effects, which may translate into a better safety and tolerability profiles for our product candidates.
And this is a true platform in the sense that the commonality here is the mitochondrial origin of these peptides.
As you May recall, we have identified over 100 peptides and when you look at the individual compounds in our library. They are structurally quite distinct and operating through a variety of different mechanisms, which we believe de risks our overall approach.
Importantly, last year, we demonstrated clinical proof of principle for this mitochondrial biology from the first human study of a peptide derived from the mitochondrial genome.
The positive topline data from our CB 42, 11 program was an important validation not just of that program, but if our overall platform and approach.
As you can imagine we spent a lot of effort identifying and sequencing. These peptide families to carve out our broad patent portfolio, which we firmly believe is the leading portfolio in this space.
We recently received notification regarding the issuance of two additional patents that further expand our IP position on C. B 42 11.
The U S patent and trademark office has informed us that tomorrow. It plans to issue the second U S patent for this program.
Most recent patent is expected to be eligible for listing in the FDA Orange book upon approval of C. B 42, 11, as a therapeutic for obesity in the United States.
At the same time, we've also progressed our international patent prosecution strategy with the issuance of a Japanese patent covering C. P 47, 11 unrelated compositions.
Well as medicines comprised of C. B, 42, 11 and related peptides for treating Nash.
We believe this expansion will strengthen the overall C. B 42, 11 package as we seek to advance its development with a partner.
With that it is my pleasure to now turn the call over to Kent Cryin staff, our senior Vice President of research, who will review our platform approach and progress Kent.
Yeah.
Thanks, Joe and good afternoon, everyone. As Joe mentioned, we are uniquely positioned to cobalt to capitalize on the largely untapped area of scientific research.
The breadth of what we expect to be able to achieve through the power of the mitochondrial genome is tremendous.
Let me first tell the story of our science, there's sometimes a perception that we're targeting relatively rare mitochondrial dysfunction.
Which is not our area of focus.
Rather we are pursuing broad systemic conditions typically chronic diseases that have the large inflammatory fibrotic and metabolic component.
So native mitochondrial peptides play critical roles in the maintenance of normal homeostasis.
And many chronic disease states that's normal homeostasis is disrupted.
Which we believe can be restored by our novel peptides.
I'd like to point out that this field has been steadily growing.
To date, there are over 40000 publications on the role of mitochondria disease of which nearly 400 cover mitochondrial derived peptides or M. D piece with known systemic effects demonstrating the level of interest in this space and the potential for further discoveries.
One recent paper notes because the review that addresses a broad range of properties are some of the most widely studied M D piece, human and Moxie and Schweppes.
There's parakeet paper was published just last year and emphasizes the well established cited protective anti inflammatory and metabolic properties of these M D piece.
As well as the strong correlation between M. D piece in a wide range of important biological processes, such as Atlas sclerosis, Hyperlipidemia insulin resistance and aging.
Thus highlighting the potential value of empty pieces, both novel, Biomarkers and therapeutic targets and disease development and progression.
This paper provides a good example of how the evidence for the role of mitochondria and complex multifactorial diseases continues to bill.
Simultaneously demonstrating that the area of mitochondrial derived peptides and their systemic calls it's still relatively untapped.
<unk>, both the opportunity and the need for further investigation.
At cobalt, we've developed a robust proprietary development engine called might've, plus that aligns with our strategy to pursue broad systemic conditions.
Our platform enables us to leverage the power of the mitochondria and the longstanding evolutionary pressures on peptides encoded in the mitochondria genome.
Our approach begins with a focus on understanding the inherent properties of mitochondrial peptides that have been developed through evolutionary processes.
And our clinical candidates are improved versions of these natural sequences there'd been optimized to enhance both biological activity and drug like properties.
They'll be on IPF and fibrosis, we're continuing to interrogate the mitochondrial genome and our library of peptides to identify high value expansion opportunities.
For the platform and therapeutic indications, where mitochondria played significant roles in disease processes such as inflammation.
Our screening processes are designed to detect peptides that interact with cell surface receptors, and how that kidney and the important systemic biological pathway.
Resulting in product candidates with the potential to impact multiple biological pathways that are driving complex multi factual diseases.
Our goal is to create first in class drugs that are truly disease, modifying which is really exciting and why we look forward to working to lap each day.
So to summarize I'm really pleased with what our discovery team is doing and we've only begun to scratch the surface of the potential of our peptide library, we look forward to providing additional information as we make progress with our discovery efforts.
Now I'll turn the call over to Nick to provide a brief overview on <unk> 50, 138 dash three.
Nick.
Thanks, Kent and good afternoon, everyone.
As we've discussed previously we believe the preclinical data demonstrating the anti fibrotic effects of C. B 50, 138, that's three in models of IPF is compelling and we are optimistic that this program could provide important clinical advances for patients and commercial advantages over.
Current standard of care.
Pulmonologists I've taken care of many people with lung fibrosis, both in the clinic and intensive care unit and have witnessed up close the devastating reality of Ips and the burden of disease that is carried by these patients and their families.
As a result, I'm, particularly excited about the potential of a <unk> 50 138, that's three program to address the significant unmet need in this area.
We continue to make progress with our I N D enabling studies.
In our ongoing toxicology works systemic safety profile of C. P. 50, 138 Dash three continues to look quite clean this is particularly encouraging as we prepare for clinical studies to assess the site. So it says safety and Tolerability in human subjects as.
As additional preclinical data becomes available for this program it increases our understanding of the molecule and how we expect it to behave in humans, enabling us to make further refinements to our clinical development program.
As I mentioned in our last call. We expect that our initial clinical study will be a phase one single ascending dose and multiple ascending dose study in healthy volunteers performed at a phase one clinical research unit.
We plan to quickly followed this study with a multi center phase two study in IPF patients.
The clinical team continues to plan ahead to be well prepared for initiating the clinical program when the I N D is clear.
The clinical development path for development in Ips has been laid out and refinements to the phase. Two study design are ongoing Ken and I are collaborating closely and along with the rest of the cobalt team are working hard to further clarify the most relevant mechanism in IPF specific biomarkers for use.
As exploratory endpoints in our initial IPF study.
Timelines for the program remain on track and we continue to expect to file our IND in the second half of next year.
Now I'll turn the call over to Jeff to review, our Q1, 2022 numbers Jeff.
Thank you Nick we continue to be in a solid financial position at the end of Q1, 2022 with $23 $5 billion in cash and investments.
In addition to our quarterly burn rate was approximately $3 1 million and after repaying our last promissory note during the quarter, we have no debt.
Research and development expenses were $1 $5 million in Q1 2022.
Compared to $2.7 million in the prior year period.
The decrease of approximately $1 $2 million.
The decrease in research and development expenses was primarily due to lower clinical trial and preclinical costs due to the timing of those expenses.
In terms of G&A.
Our general and administrative expenses were $1.7 million in Q1 2022.
Appeared to $1 $4 million in the prior year period.
That was primarily due to higher stock based compensation costs and legal fees associated with our IP portfolio.
For the quarter ended March 31st 2022, cobalt recorded a net loss of $3 $3 million were four cents per basic and diluted share compared to a net loss for the quarter ended March 31, 2021, a $4 million or seven cents per basic and diluted share.
Net loss included noncash expenses of approximately $500000 for the quarter ended March 31, 2022, and $370000 for the quarter ended March 31 2021.
Overall, we were pleased with our financial performance and we continue to estimate that we have sufficient capital to finance our operations into the second half.
For 2023.
As you May have seen we issued a press release last week announcing that NASDAQ has granted US an extension until November 7th of this year to regain compliance with nasdaq's, one dollar minimum bid requirement.
I'd like to take a moment to highlight the fact that our board has included a proposal to authorize a reverse stock split in this year's proxy statement, which is specifically designed to enable us to regain Nasdaq compliance.
Continuing as a NASDAQ listed company, we expect to have greater access to capital to further fund our pipeline.
Proved liquidity for our stockholders and a higher likelihood of attracting high quality institutional investors and commercial partners.
On behalf of the board I asked that you vote in favor of this proposal to help build long term value.
Now I'll turn things back over to Joe Joe.
Thanks, Jeff.
We take your questions I'd like to provide a summary of our recent progress and review our upcoming timelines.
During the first quarter of the year, we made steady progress across the key areas of our business and the year ahead will be focused on execution.
First and foremost we continue to advance CB 50, 138 S III through IND, enabling studies.
When you think IPF is a significant opportunity where C. P 50, 138 S III could make a real difference for patients.
We have successfully scaled our manufacturing necessary to support the initial clinical study and as we progress our I N G. Enabling studies, we continue to demonstrate systemic tolerability of T. P. 50, 138, that's three in animal models.
In parallel we look forward to finalizing a formulation work as we move closer to clinical development in the second half of 2023.
And as you heard from Ken today, we continue to mine our extensive library of peptides derived from the mitochondrial genome to identify those peptide families that show the most promise for further development.
We're also evaluating the commercial and competitive landscape.
To pursue disease areas, where we think we have a clinical advantage we have.
We're not focused on me two opportunities in drug development as we aim to create disease modifying therapies.
Make a real difference in People's lives.
We believe C. B 42, 11 has that potential and we are working to secure a partner to enable further clinical development of that program.
We look forward to providing updates throughout the year as we continue to make progress on these initiatives.
In summary, 2022 is off to a good start we have an exciting scientific platform based on the mitochondrial genome that we believe offers a breadth of untapped therapeutic opportunities, we have a clear and focused strategy to develop therapies for difficult to treat multi factorial diseases like I P. F <unk> and we have the right team in place to advance our <unk>.
Science and pipeline.
John can you. Please open the line for questions.
Yes. Thank you at this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
Confirmation tone will indicate that your line is in the queue. You May press star two if you would like to remove your question from the queue and for participants using speaker equipment. It may be necessary to pick up your handset before pressing any star keys.
One moment, please while we poll for any questions.
Our first question comes from the line of Kristen <unk> with Cantor Fitzgerald. Please proceed with your question.
Good afternoon. This is Rick on for Christian. Thank you for taking my questions I've got two for you here. When you think about potentially optimizing CB 50, 138 dash three for delivery in I P. F could you give us an idea of delivery modalities that you're potentially exploring and think makes no sense.
The indication given previous experience in I P. F is there anything special about this particular molecules chemical or drug properties that makes it either good or bad as a candidate for any of these delivery method.
Hi, Rick Thanks, Thanks for the question.
So you know our our approach generally involves a delivery of peptides and so peptides for the most part are require a delivery either subcutaneously or intravenously and so our general approach here is to deliver this subcutaneously.
But Nick I think you probably have the most familiarity with this patient population. So maybe you can talk a little bit about delivery methodologies and their acceptance by this group of patients.
Yeah, great. Thanks, Joe and Greg. Thanks for the question Yeah. It's a good question I think as you've stated Joe for Us and the peptides that we have the plan and certainly.
For a non oral non oral therapy. So subject subcutaneously certainly is the main goal. There's always a question of inhaled delivery for a lot of pulmonary diseases I think I, yes is a complicated disease and certainly.
<unk> from where we stand at this point in early development sort of taking that approach is it's currently I'm not something that we're looking at but given the disease population subcutaneous delivery is certainly something that would be acceptable to the set the pace.
Population and we think it's actually a very effective way to deliver mitochondrial peptides.
Great, Okay, and I'll just ask one more here.
You talked about the expanded patent coverage for C. B 42, 11 could you give us a sense for how we should be thinking about potential patent life span now for this for this candidate.
Sure. So as I mentioned in our remarks. This is the second a U S patent that we had issued on this program. So that just to remind everyone. The first patent was issued last fall that patent covered a composition of matter of C. D 42, 11 and related peptides as well as the method of use.
<unk> for the treatment of Nash and so the new patent the new U S. Patent expands that now to also include our methods of use to treat obesity are both patents have a expected terms that will expire in 2037.
And then the Japanese patent that we talked about earlier.
Is essentially the foreign counterparts that initial patent that issued last fall and.
And so we've got existing patents are sort of pending from that family and multiple other jurisdictions outside the U S. But for US most of those patents.
Well are also expected to have a 2037 exploration date.
Okay.
Okay. That's it thank you.
Hmm.
Thank you. Our next question comes from Kumar <unk> with Brookline Capital markets. Please proceed with your question.
Thanks for taking my questions and then one more on the problem relation.
How is the water in that area are progressing and also how are you thinking in terms of a potential frequency as the let's say the potential to be combined with the Dod there are approved drugs.
Thanks Kumar So it's as we mentioned in the remarks. The formulation work is progressing well everything is on track I think we spoke about this a little bit on the last call, but the process here in terms of the formulation work is an iterative one meaningly do certain.
Work in the lab are looking at different types of formulations, we do some in vitro tests to sort of see how well are those new formulations look and then we test them in an in vivo setting and depending on what the results of that are that inform sort of the next cycle of work. So again, it's an iterative process, but but so far things are progressing.
Quite well.
On the on the development or our expected dosing frequency is likely to be a daily subcutaneous injection with this with this program.
Which we think again given this patient population is it's likely to be quite acceptable given how symptomatic are these patients are.
So I think that answers your questions Nick I'm not sure. There's more you want to say in terms of the the you know how that works with the existing standard of care and in frequency there.
Yeah, Yeah, I think the one thing I would add.
To that Joe.
You know being so early on in the formulation a part of the development.
But 51, three I think the frequency of delivery, obviously will become much more clear to us as we move forward as we begin to understand the pharmacokinetics of the formulated drug product and the ought to be thinking our initial here.
<unk> studies.
So I think.
Really that's a bit of an open question and as we gather more preclinical and clinical data will get a much better understanding of that.
Okay. Thanks.
And then felt our resources being spent on mitral plus how are you thinking about COVID-19 given the market.
Market conditions.
Maybe you can just highlight like you know how how that is being utilized.
Patients in the South Bay, Don Alright, and defining and molecule.
Platform.
Sure Kumar Thanks, Yeah, it's a good point and so obviously, we are very much focused on on resources and spend particularly in the current sort of market environment and so the majority overwhelming majority of our spend is really focused on is the 50 138 three the IPF program.
And we having said that we are you know putting some additional effort, particularly compared to what we've been doing in the more recent past on some of the discovery work that that Kent was discussing our early on but certainly are our focus for those efforts is really on identifying peptides with interesting.
And doing some additional characterization and an early work on those and those efforts are but you know we would yeah. We're not expecting in the near term are to be bringing another you know program forward into clinical development until we have further visibility on future funding.
Okay.
In terms of the R&D expense. So if you guys talked a little bit about the timing. So was there something we'd think about RMB compared to Halloween tie ins in Q1.
And so if you want to talk about that.
Kumar Thanks for that.
It's a very fluid thing.
In cycle, where it will tend to hockey stick towards the end of the year as we start getting deeper and deeper into the programs and into the spin.
You Didnt not think of Q1 as representative of what might happen down the road in Q3, four and enter into 2023.
So it will hockey stick a bit.
Not providing guidance is specifically to percentages, but in historical.
It has fluctuated between sale.
Randy depending on the timing between.
Between a 45% to 47% allocation of Opex, all the way up to 60% in the past. So that's the range and you know it will hockey stick with it and a lot of it's largely dependent on again timing.
And what we decide in the very fluid nature that we operate the business where to allocate more funds or less loans.
Okay, and probably we will see a lot more early next year as you get closer to that NDA filing.
Yeah.
Yes, yes.
Yes, some of those R&D costs, obviously have been picked up since we're in the middle of them, but there still is some straggling cost that's associated with that but yes, that's correct.
Alright, thanks, so much.
Absolutely. Thank you Tamara.
Yeah.
Thank you at this time, we have reached the end of the question and answer session and I will now turn the call back over to Joe for any closing remarks.
Thank you everyone for joining us this afternoon during this quarter and over the summer we were planning to present at several investor and scientific conferences, and we look forward to keeping you updated on our progress as we move through the year. Thank you again for your continued support John would you. Please conclude the call.
Yes. Thank you. This concludes today's conference call you May now disconnect. Your lines at this time. Thank you for your participation and have a great day.
Okay.
Okay.
Okay.
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