Q2 2022 CohBar Inc Earnings Call
You
I three the.
Good afternoon. My name is Ryan and I will be your conference operator for today.
At this time, I would like to welcome everyone to co-bars 2nd quarter 2022 Financial Results with Consent Score.
All lines have been placed on mute to eliminate background noise.
A question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference, please press star 0 on your telephone keypad.
As a reminder, this conference is being recorded.
Now, I would like to turn the call over to Ms. Jordan Tarazi, Director of Investor Relations at COBAR.
Please go ahead.
Thank you, Ryan, and thank you everyone for joining Cobar's second quarter 2022 financial results conference call. Joining me on today's call is Dr. Joe Sarrett, Cobar's chief executive officer, Jess Buno, Cobar's chief financial officer, Dr. Nick Blahaka, Cobar's acting chief medical officer, and Dr. Kent Grindsdath, Senior Vice President of Research. Following our collective remarks, we will conclude with Q&A. Cobar's financial results, which was issued earlier today, may be downloaded from our website.
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 cobar.com, sec.gov, and cdar.com, as well as in our safe harbor statement included with today's press release.
Your questions that touch statements are not guarantees of future performance and that our actual results may differ materially from those that sport in the board of institutions.
COBRA 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 Jo Soret, COBRA's Chief Executive Officer. Jo? Thanks for my onto question.
Thank you, Jordan, and thank you everyone for joining us this afternoon.
On today's call, after my introductory remarks, Cantable Review are ongoing pre-coincal activities for CB-5138-3, our novel peptide for the treatment of videopathic pulmonary fibrosis or ITF, as well as our ongoing discovery efforts.
Nick will then provide some additional context about the approach to our initial clinical trials for our IPF program and Jeff will review our Q2 2022 financials.
COBAR is a leader in harnessing the power of the mitochondrial genome to develop a novel class of peptide therapeutics.
While people tend to think of mitochondria primarily in terms of energy production, in fact, they also play an important role in the regulation of a variety of biological pathways.
This regulation is partially mediated through the systemic effects of certain peptides encoded in the mitochondrial genome that are secreted and have distal effects on other cells, tissues, or organs.
We believe that tapping into the intrinsic activities of these mitochondrial peptides has the potential to lead to powerful new therapies to treat a wide range of conditions.
Additionally, by focusing our development on analogs of naturally occurring peptides,
We expect our product candidates to have fewer off-target effects.
Ideally translating to improve safety and tolerability profiles that can provide further benefits to patients and physicians. That can provide further benefits to patients and physicians.
We have already demonstrated clinical proof of concept for our approach with the release last year of positive top-line data from our first clinical trial.
As we have discussed previously, 2022 is a year of execution for the company, and in the second quarter we made further progress in our key areas of focus.
One of our primary objectives for the year is to advance CB 5138-3 towards the clinic, and we remain on track to file our IND for this program in the second half of next year.
Our ongoing I&T enabling studies continue to show that this peptide is well tolerated.
And we have not seen any notable systemic toxicity in animal testing.
We have also made significant progress in developing improved formulations for CB5138-3. And Kent and the team have identified some promising new approaches that we hope may provide further clarity on target engagement for this peptide.
which, while not essential for moving the program forward, may help inform biomarker selection for our clinical studies.
Based on the significant anti-fibrotic effects of CB5138-3 in preclinical animal models of IPF.
We believe this product candidate has the potential to offer significant value to patients.
While current standard of care can slow the rate of loss of lung function, there continues to be significant unmet medical need in this patient population.
IPF remains a devastating disease with substantial morbidity.
Patients experience chronic and increasing shortness of breath, frequently requiring supplemental oxygen, and quality of life is poor.
Mortality rates also remain unacceptably high.
Additionally, the available therapeutics are not well tolerated due to frequent gastrointestinal side effects and in the case of profanadone, photosensitivity issues.
In fact, in our discussion with pulmonologists, a common theme is that tolerability issues have a significant impact on their ability to effectively treat this patient population.
Despite the limitations of the available IPF therapies,
Both FDA-approved drugs have done well commercially, with combined annual sales in 2021 exceeding $3.5 billion.
While the broader capital markets for biotech remain challenging, recent activity shows that positive clinical data in IPS, even relatively early Phase II data, has translated into substantial enthusiasm from investors.
Additionally, multiple big pharma companies have prioritized fibrosis generally, and IPS typically, as an area of focus.
reinforcing our view that I.T.F. and the broader fibrosis and inflammation market are attractive commercial opportunities for COBAR.
Looking beyond our IPF program, we continue to seek to advance the development of CB4211 through a potential partnership.
I will now turn things over to Kent Grindstaff, our Senior Vice President of Research, to provide some additional color on our preclinical and discovery activities. Kent?
Thank you, Joe. Today I'll review our activities regarding formulation work, and the R&D enabling studies and MLA for our ITF program. The R&D enabling studies and MLA for our ITF program.
I will also discuss our ongoing discovery effort for novel classes of mitochondrial-derived peptides.
We recently completed the initial round of new formulation work for CB 5138-3.
We now have a better understanding of the key physical properties of this peptide and have identified interim formulations that were moving forward to the next stage of testing and further development.
These initial results are encouraging and indicate we're making substantial progress towards identifying a formulation suitable to advance into the clinic.
Our IND-enabling studies for CB 5138-3 are also progressing well.
In the safety and pharmacology work completed to date, except for the injection site reactions we previously reported, we have not observed any signals of concern and the systemic safety profile looks clean.
This gives us additional confidence as we move forward with testing new CB5138-3 formulations.
Our team is working diligently to ensure that we are well positioned to expeditiously perform any additional studies that may be required once the final phase one clinical formulation is selected.
Finally, the discovery team with input from Nick and our outside experts has recently initiated several new approaches to enhance our understanding of CB5138-3 target engagement, as well as its impact on molecular fibrosis pathways.
We believe this work will significantly expand our understanding of this peptide's activity and its biological role.
These approaches may also allow us to identify relevant biomarkers that can be incorporated into our Phase II clinical trial design.
In addition to ongoing work in our IPF program, our discovery efforts continue to progress.
We remain focused on growing and diversifying our pipeline to address diseases with high unmet medical need with this novel class of therapeutics.
We recently expanded our library of natural mitochondrial derived peptide sequences.
This will provide us with additional opportunities to identify novel therapeutic leads as we work through our discovery platform.
Building on our expertise, we are broadening our screening formats to focus on disease areas with strong translational correlation.
We are working closely with Nick to focus our efforts in areas where our pranic candidates can provide the greatest benefits to patients' lives.
Now I'll turn the call over to Nick to highlight certain aspects of our clinical plans for CD5138-3.
highlight certain aspects of our clinical plans for CD 5138-3. Next is though I am sure, marathon Curve, I have to get there.
Thanks, Ken.
As we move closer to filing the CD5138-3 IND, integrating the clinical strategy and development plans with the preclinical and IND enabling activity remains a cornerstone of COBAR's approach to developing this product candidate for IPF.
A good example of this are the preclinical studies that inform our dosing strategy.
for the first in-human trial and in turn for dose selection for our initial IPF study.
With the progress being made in our IND enabling studies, we are ramping up our plans on operationalising clinical, regulatory and study conduct strategies in support of the clinical program.
This will position us well to initiate our first in-human study with CB 5138-3 soon after IND clearance.
Given the clear ongoing unmet medical need for patients with this debilitating lung disease, we remain strongly committed to the IPF space.
Furthermore, the significant value of a program targeting lung fibrosis is highlighted by the continued clinical development activity in IPF.
We are working with our strong group of both US and international clinical IPF thought leaders to incorporate the most recent developments and thinking on IPF clinical study design and conduct. We are working with our strong group of both US and international clinical IPF thought leaders
Recent reports on Phase II IPF studies of other molecules have highlighted changes in the IPF drug development paradigm.
Supporting our clinical development approach for streamlining Phase 2 study design to speed the time for early proof of concept readout.
Overall, our timelines are progressing according to plan and we expect to kick off the clinical program quickly after AMD approval.
Now I'll turn the call over to Jeff to review our Q2 2022 numbers. Jeff?
Thank you, Nick. We continue to be in a solid financial position at the end of Q2 2022 with $20.1 million in cash and investments.
Our quarterly burn was approximately $3.5 million and we have no debt.
Research and development expenses were $1.2 million in Q2 2022 compared to $2.6 million in the prior year period, a decrease of approximately $1.4 million.
The decrease in research and development expenses was primarily due to lower clinical trial and preclinical costs.
due to the timing of such expenses.
General administrative expenses were $1.6 million in Q2 2022.
compared to $2.6 million in the prior year period.
It decreased that was primarily due to lower compensation costs and stock based compensation costs.
primarily related to the departure of our former CEO in the prior year period.
For the quarter ended June 30, 2022, COBAR reported a net loss of $2.7 million, or $0.03 per basic and diluted share, compared to a net loss for the quarter ended June 30, 2021 of $5.2 million, or $0.08 per basic and diluted share.
That loss included non-cash expenses of approximately $500,000 for the quarter ended June 30, 2022.
approximately $1 million for the quarter ended June 30, 2021.
Overall, we are pleased with our financial performance.
And we continue to estimate that we have sufficient capital to finance our operations into the second half of 2023.
At our annual meeting on June 15, 2022, are stockholders approved, among other things,
an amendment to our certificate of incorporation to affect a reverse stock split by ratio not to exceed one for thirty.
The approval for the reverse stock split was important to help ensure the financial health of COBAR.
With the ability to implement a reverse split, we expect to be able to maintain our listing on the NASDAQ exchange, which will afford us greater access to capital to further fund our pipeline and an increased chance of attracting high-quality institutional investors and commercial partners.
Now I'll turn things back over to Joe. Joe?
Thanks, Jeff.
As the team showcased, during the past quarter we made continued progress, particularly in advancing our IPF program, where we are on track to file our IND in the second half of 2023.
Additionally, we remain active on the business development front, having met with multiple potential partners during the quarter.
We continue to believe that IPF is a significant opportunity where our product candidate could provide clinical advantages for patients and are encouraged by the recent investor interest in this space.
The preliminary data from our new formulations for CB 5138-3 are promising.
And we look forward to testing those formulations in in vivo studies in the coming months.
At the same time, we are investigating novel approaches to gaining further clarity on target engagement of this peptide, while also making important progress in further characterizing our library of mitochondrial peptides to identify new potential product candidates.
Before we conclude our prepared remarks, I would like to welcome Dr. Effie Tozo, who recently joined our board of directors.
Effie has extensive drug discovery and early development experience, including at Merck, Roche and BMS.
Notably, she spent six years at MitoBridge, a company focused on developing therapeutics for diseases related to primary and secondary mitochondrial dysfunction, which was acquired by Estellas.
Although Effie only recently joined our board, she has already made substantial contributions to our scientific programs, and her collaborative style is a great fit with the rest of the COBAR team.
With a strong and high-functioning team in place, we are well positioned to execute on our operational goals of having a second clinical stage program by moving CB5138-3 into the clinic and continuing to mine the potential of the mitochondrial genome for additional potential therapeutics.
Ryan, can you now please open the line for questions?
Sure, sir. Thank you.
Ladies and Gentlemen, at this time we will be conducting a question and answer session.
If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue.
You may press star 2 if you would like to remove your question from the queue.
For participants using speaker equipment, it may be necessary to use a speaker device
Your handset before pressing the star keys.
One moment please while we poll for questions.
Our first question comes from the line of Kumar Raja from Brookline Capital Markets. Please go ahead.
Thanks for taking my questions. So first with regard to the target engagement, what can you share with regard to that and when can we expect like you know more details like you know what targets you are seeing engagement.
I'll start with that.
Okay, sure. Kumar, thanks for the question. I might turn this one over to Kent since he's the one handling the details on this.
Thanks, Joe. Thanks for the question, Kumar. Yeah, so as Bocho and I stated, we're taking several new approaches that we haven't previously done. We've talked a bit about the readouts that we observed, both in the fibrotic and inflammatory space. Unfortunately, at this point, we can't really comment on initially, or at this point, on any new targets that we've identified. We're actually providing a timeline.
and
how do you plan to do the manufacturing of that?
Yeah, again, thanks for that question, Kumar. So, you know, as we talked about in the prepared remarks, you know, we've been working diligently on identifying and developing additional formulations that have better properties. And so in the studies that we've done so far, as we said, we've identified multiple formulations that look promising. And so the process for the formulation development is iterative, where we get, you know, certain data then go back and make modifications. And so part of the...
as we mentioned. And so once we have identified a formulation that hits our target parameters that we think is suitable, then we'll pick the final formulation to move forward to the clinic. And once we've sort of gone through that process, we'll be updating folks. In terms of the manufacturing, we don't expect that any of the formulations that we're looking at would require anything sort of atypical or unusual with respect to...
you know, manufacturing process or complexity. So we don't expect that to be a significant hurdle on the way to moving this forward to the clinic and then ultimately commercially.
Okay great and finally with regard to CB4211 any updates in that front thank you.
Sure. So on that front, as I mentioned, we continue to have partnering discussions. And as always with partnering discussions, there's not a lot you can really say while those discussions are ongoing. But I will note that there has been additional activity in the NASH space more broadly over the last several months. So if you look back over the last couple of years NASH has had, has been difficult just because there have been some late stage
clinical failures, but if you look more recently, both in terms of big pharma interest in the space, there have been some activity there, as well as investor interest in investing in NASH companies, and so we're certainly hopeful that that sort of general enthusiasm for the space more broadly will have an impact on the timing and nature of the discussions that we're having with other parties. There's also,
a couple of companies that are having late stage clinical readouts later this year. And again, our hope is that that data's positive because we believe positive news for the space is actually beneficial to COBAR given just how large of a market opportunity this is. We don't think one company's gonna be the winner. And so having some momentum in the space we think is helpful for everyone in the space, including us. So we remain optimistic about the space and about 4,211 specifically as a peptide that can really.
make a difference for patients given the positive data that we released last year. So we remain optimistic and we'll certainly update you as we continue to make progress on that front.
Okay great, thanks so much.
Thank you.
Thank you.
Ladies and Gentlemen, we have reached the end of the question and answer session. For now, I would like to turn the conference over to Mr. Joe Sarrett for closing comments.
Well, thank you everyone for joining us this afternoon. We appreciate your continued support and look forward to keeping you updated on our future progress.
Ryan, would you please conclude the conference call?
Thank you, sir.
The conference of Cobar Inc. has now concluded. Thank you for your participation. You may now disconnect your lines.
to go.