Q1 2022 KemPharm Inc Earnings Call

Thank you for standing by and welcome to the Kim Farm first quarter 2022 results conference call. At this time all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone please be advised that today's.

Call may be recorded should you require any further assistance. Please press star zero I would now like to hand, the call over to your host Jason Rando with Tea brand strategic advisors. Please go ahead.

Good afternoon, and thank you for joining our call today to discuss Chem pharma first quarter 2022 financial and corporate results.

Before we begin I would like to remind our listeners that remarks made during this call may contain forward looking statements that involve risks and uncertainties.

Subject to change at any time, including but not limited to statements about <unk> expectations regarding future operating results.

Forward looking statements are made pursuant to the safe Harbor provisions of the federal Securities laws.

At present management's current expectations.

Actual results may differ materially.

<unk> disclaims any obligation to update or revise its forward looking statements, except as required by law.

More complete information regarding Kim farms forward looking statements risks and uncertainties can be found in <unk> filings with the SEC, which are available on the company's website under the Investor Relations section.

Speaking on today's call will be Travis Mickle, <unk>, President and CEO and the Duane <unk> Clifton CFO .

Following remarks, there'll be a question and answer session.

With that it's my pleasure to introduce Travis.

Thanks, Jason and thanks, everyone for joining today.

For those that aren't as familiar with Kim pharma just give a brief introduction here.

And discuss our value proposition can farm historically has been focused on the discovery and development of pro drugs. We to date have two FDA approved and partnered medications and stars and after that and certainly has been the history of the organization.

As we announced back in January our new focus is on a rare disease in CNS drug development.

Looking at innovative therapies, including in this particular case, a pro drug but.

But we're not subject to that limitation is this development of these novel treatments, we believe will create the largest value for us and our shareholders in the future.

Today's update will actually be relatively short we did provide an update just last about six weeks ago as well has been making great progress on all of the items that we discussed and had planned for this quarter.

There are several items that I have in the update here.

That will be looking forward to scheduling and we're updating that as we move forward.

So in the second.

In the first quarter.

It gives me a in the first quarter, we accomplished a number of different goals that we had as well as in the early part of the second quarter here, we filed the IND.

For K P 10, 77 for the treatment of idiopathic hypersomnia as well as got underway with the planning and the trial initiation around.

Around the phase two that should initial that should initiate officially in the second half of this year.

Once that study initiate will shortly follow that with the narcolepsy trial. So those two will be working almost in parallel at that point.

I think most importantly, and what the near term.

Sort of a milestone that we have for KPN 77 is our cardiovascular trial. This is looking at the safety of doses used to have a little more data here to provide but we actually should have a data readout in that in the third quarter.

Key differentiation for that particular product.

We did provide a little wholesome description of how starz is proceeding.

Preceding our of course this is our ADHD product partnered with corium.

Where they expanded the launch of a <unk> support that what we still believe as the opportunities to earn milestones and royalties and the continuing part of this year.

I did mentioned on the last call that we are planning to have an update from corium.

We're still in the planning stages of that of course, it's it's not on the near term horizon, we're kind of looking at what time ideally works for them as well as trying to time that when it may be most effective for them to discuss Oh.

The upcoming school year.

Sales activities.

Uh huh.

I did mentioned you know our attempt here to move forward and build a pipeline of differentiated assets in the CNS and rare disease space.

We have an internal product candidate that we plan to advance into a development stage and we will be announcing that are more than likely this quarter.

Again, it's an expansion upon some of the internal work we've done so a little bit earlier in that process.

And then Duane will be providing us a financial update on this call are that includes our strong balance sheet to support all of our efforts and external business development internal development as well as advancing some of our own candidates.

If we look just very quickly here is our pipeline I've already mentioned K P. 10, 77 for the treatment of idiopathic hypersomnia as well as our plans to develop that in narcolepsy. Both of these are a rare to sleep disorders. Many of you may be familiar with again. These both have milestones with trial starts in later.

This year and shortly after the idiopathic hypersomnia in the case of narcolepsy.

We do have an internal candidate we hope to advance.

This quarter, we can have that announcement.

Once we have.

All of the details around that are available to us.

And then as I mentioned.

Previously and as we've discussed before we continue our activities around business development looking for late stage assets.

We can acquire in license that would add value to our pipeline.

It would be near term value or a little bit later stage phase II.

Again looking for good value that we can add potentially with our technology as well.

You know develop those products to a potential commercialization.

So let me just turn briefly here and discuss some of the product attributes and then as well the trial that I discussed a few times now on the cardiovascular safety. So keeping 10 77 actually consists of a 100% of seer Dexmethylphenidate also known as S. T X. This.

The prodrug that 70% of the product in the stores. So it's something we understand and it's been well studied it's also already designated as a schedule for <unk> by the DEA.

When we look at the product candidate what we like about this is there's already features and benefits that distinguish it from the alternative products. So this would be generics as well as <unk> and other products that could be used to treat idiopathic hypersomnia and so one is of course the scheduling feature. Another is the fact that it doesn't have drug drug interaction potential.

<unk> with contraceptives and and anti depressants, which are a major part.

US quite heavily in that population.

What we're trying to show here is the potential additional features and benefits that could be study.

So we have a hypothesis, we really believe there's great support for it as we get greater Tolerability I E less side effects less.

Issues with cardiovascular effects.

Less issues with.

Some of the issues that can happen with stimulants, we believe we're going to able to provide a higher dose the higher dose should be more effective.

We also believe we have our dosing regimen, that's actually unique here, where it dose in the evening will start to work in the morning provide additional lift as it were in the waking hours.

This isn't a major side effect issue symptom of IH and then it's.

As the day progresses, the morning dose will be able to provide that that relief from the others major symptom, which is brain fog and we all know that methylphenidate is great at helping with cognitive abilities and just given the severe detriment brain fog, we believe that we'll actually be able to show a bigger difference.

The product itself is of course eligible for fast track orphan drug and breakthrough therapy designations and has solid IP through at least 2037.

Yeah.

So specifically looking at the cardiovascular studying and why we believe this is important.

As I mentioned brain fog is one of the most debilitating.

Symptoms of IH is something that is that inadequately addressed by current therapies, whether that's off label well, it's actually off label for most.

IH patients.

The ability to actually dosed higher provide more methylphenidate.

We believe it's going to provide a greater effect and actually be more effective at treating brain fog.

Cognitive enhancement that you can receive with methylphenidate due the neuro stimulation has been well documented it has its limitations in this population.

As you have a dose a dose limitation and not just from a safety perspective, but from a side effect perspective that physicians see a high blood pressure and heart rate are known to increase with stimulant treatments and this is more to do with their immediate release or there double extended release features a S. Tx come.

On very slowly and are a nice gradual curve that increases to about a peak of about eight hours after dosing.

And then again.

It comes down very slowly towards the end of that day.

We believe that profile will allow us to dose higher and have less cardiovascular issues related to its dosing. We have a study that we initiated its ongoing right now.

In order to assess that cardiovascular safety head to head with both immediate release and long acting formulations of Ritalin. These are the only two products are actually approved.

To treat narcolepsy related rare sleep disease.

And we should have topline results from that as early as Q3 this year.

So with that quick overview between now I'll pass it over to you for financial update and will conclude with some upcoming milestones.

Thank you Travis and good afternoon for Q1 of 'twenty two.

Revenue of 4 million derived primarily from consulting service fees. There were some royalties and then the success fee that we had reported out on from.

From corium related to our assistance and the approval of their product called and Liberty.

For this quarter, we had a net loss of about $1 $9 million or five per basic and diluted share.

And I would say as we look forward to the rest of the year as you would expect R&D expense will begin to increase quarter over quarter as the K P. 10, 77 program continues forward.

Looking at the balance sheet, we remain in a very strong position with.

With the balance at the end of the quarter of $119 1 million.

And as we've noted in.

In prior quarters.

We remain confident this extends our cash runway well beyond 2025, and so we have everything we need to execute our strategic plans.

Well as the development programs for 10 77 travelers has a numerator.

So with that Travis I'll turn it back to you and thanks for doing so.

So looking forward at the upcoming milestones or some of these we've already hit.

The phase one trial the IND filing that occurred this quarter type B meeting with FDA in the first quarter, we should have again the data from the cardiovascular differentiation trial in the third quarter and be initiating the phase II trial in the second half of this year.

And shortly after that and of course, we would start.

The process with narcolepsy, though of course, we'll have a type b meeting in the IND prior to that trial initiation.

We already had and I Didnt mentioned here. Some some results on keeping 87 nine and we continue to look for external funding and collaboration that's been part of our plan for that particular candidate and then.

Just briefly to remind everyone. We do expect the last half of this year to have some additional clinical stage candidates that we bring in through our business development efforts.

So with that I'd like to thank everyone for your time and see if there's any questions.

As a reminder to ask a question you will need to press star one on your telephone to withdraw your question press the pound key again Thats star one on your Touchtone telephone to ask a question.

Please standby, while we compile the Q&A roster.

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Again to ask a question press star one at this time.

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There appear to be no questions in queue. At this time are there closing remarks.

Yes, again I want to thank everyone for the time I hope to continue to beat the progress that we've shown already this year and last half of last year and that will continue to report an update as we have new information available. Thanks, everyone.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.

Okay.

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