Q3 2022 Inovio Pharmaceuticals Inc Earnings Call
Certain factors that could cause actual results to differ materially from those expressed by the company verbally as well as statements made within this afternoon's press release.
This call is being webcast live and a link can be found on our website IR dot <unk> dot com.
And a replay will be made available shortly after this call is included.
I will now turn the call over to <unk>, President and CEO , Dr. Jackie Shay.
Thank you Tom and good afternoon, and thank you to everyone for joining today's call.
In the third quarter and continue to implement our strategy of delivering the promise of DNA medicine by prioritizing.
Our resources to those candidates that have the greatest near term potential for patient benefit and commercialization.
These include Dino 31 seven.
Promising DNA medicine candidate that treatments of HPV, six <unk> 11 caused recurrent respiratory papillomatosis or RFP.
<unk> is a debilitating often lifelong condition characterized by the development of small <unk> growth or <unk>, which are generally benign can cause severe life, threatening airway obstruction and respiratory complications.
The <unk> have a tendency to grow back after they have been removed surgically, which is the current standard of care.
There are currently no FDA approved therapeutic vaccines or drugs for the treatment of RFP.
We are encouraged by the positive interim phase two results, we announced last month no tiny because they build upon our ongoing work, indicating that DNA medicines have the potential to treat HPV associated diseases.
But more importantly, because these days it could be the first steps toward a new therapy to improve the lives of those patients suffering from this horrible disease.
While Mike will talk about the <unk> $31 seven data in greater detail in just a moment I'd like to highlight that the Nokia has long been committed to developing innovative treatments for HPV associated diseases.
Our DNA medicines have a number of characteristics that make them uniquely suited to this therapeutic area.
And previously completed trials DNA medicines have been observed to induce antigen specific long lift memory helper and killer T cells, which we believe may play a role in clearing the HPV virus.
DNA medicines also have exhibited the potential to be re administered without the loss of Immunogenicity and have favorable safety and tolerability profiles, both of which we believe are important factors in the treatment of chronic HBV associated conditions like RFP.
We look forward to continuing to build upon the foundation of clinical data, we have generated to date and our HPV franchise to bring potentially paradigm shifting treatment options to patients in need.
In addition, we expect to announce our reveal two phase III data with <unk> 3100 in cervical high grade squamous epithelia lesions or H sale later this quarter or in the first quarter of 2023, which will help define the next steps for this state.
<unk> related development program.
Moving beyond our HPV franchise, we remain encouraged by other candidates in our pipeline such as INO 50, 401, which as we reported earlier this year at Harsco demonstrated positive results as a potential treatments for glioblastoma and almost always faithful tenths worth the brain.
We've continued working on the next steps for this product candidate and look forward to sharing our plans with you next year once we finalize some key decisions.
We also look forward to continuing to advance our other pipeline programs for which we anticipate data announcements in the coming months.
Since I took over the reins of an IPO almost six months ago, we have been working on continuing to drive operational excellence throughout everything we do from running clinical trials to managing our capital and other resources to optimize our chances of successfully bringing our product candidates to the market.
And helping patients.
Our decision to discontinue our internally funded development of INR 4800, as the heterologous COVID-19 booster vaccine due to changed market conditions is reflective of this strategy.
We plan to deploy cost savings from this effort to the advancement of other promising candidates.
We currently believe these cost savings will now extend our cash runway into the first quarter of 2025, and we will continue to evaluate how we best deploy those resources across our portfolio as we move ahead.
With that I'd like to turn it over to our Chief Medical Officer Doctor, Microsoft to provide a clinical update for the quarter.
Mike.
Thank you very much and greetings everyone.
Last month, we announced positive interim results from our phase one two study for <unk> 107 in.
In patients with recurrent respiratory papillomatosis or RFP.
As a reminder, INR 31, 7% is composed of a plasmid and coding respectively for HPV, six and 11 Oems, Jim 67 proteins and delivered with INR 1912 plasma encoding the human interleukin 12.
This vaccine was evaluated in an open label Multicenter trial to assess safety Tolerability Immunogenicity and efficacy in participants with HBV 611 associated RFP.
The trial demonstrated statistically significant statistical significance based on the clinical endpoint of a reduction in the number of RFP surgical interventions and the year. Following administration of INR 71, seven compared with the year prior to treatment in the initial cohort of 'twenty.
All participants.
And the trial there was a median decrease of three surgical interventions.
Overall 16 of the 21 participants or 76% showed a decrease in surgical interventions in the year. Following administration of INR 71, seven relative to the number of surgeries and the year prior to the trial.
Importantly, also 16 participants six or 29% required no surgical intervention during the entire 52 week trial period.
Treatment with <unk> 107 induced immune responses, including CD, four and CDA positive T cells against those HPV six and 11.
All 21 partisans demonstrated an increase in peripheral T cells to one or more antigens from baseline.
Cellular immune responses against HPV six and 11 were also observed at week 52.
Which was 43 weeks after the last treatment dose, indicating our systems cellular memory response.
We believe this memory response could be a key factor in the treatment of chronic diseases such as RFP.
Finally, as we have seen with our other DNA medicines, INR 107 was well tolerated with Holdco assistance completing the treatment course.
Treatment emergent adverse events observed in the trial with generally low grade.
86% of participants experiencing at least one treatment emergent adverse events most of which were brand one.
Three participants or 14% experienced grade three treatment emergent adverse event.
But none of these were deemed related to iron out of 31.
The most commonly reported treatment emergent adverse events were injection site pain at 38% and fatigue at 19%.
While two serious adverse events were reported these were also deemed unrelated to INR 31, 7%.
Based on the announced data we are planning to meet with regulatory agencies to discuss the next steps for this program and determine the most expeditious path to bring the potential benefits of INR 30, 172, <unk> patients in need.
We expect our initial discussions with these regulatory bodies will include both adult and pediatric populations.
And as you know we will also consult key opinion leaders and patient advocacy groups for their percent perspective and input as we determined the next clinical development steps.
As Jackie mentioned, we are also considering the optimal path forward for our other promising candidates, including <unk> hundred 50, 401 is a clear blastoma.
For which we reported positive overall survival at 24 months data earlier this year.
Over the coming months, we plan to solidify the next steps Frac candidates in our pipeline that offer more near term opportunities to advance our strategy and bringing DNA medicines to market in.
In addition, we will be working to identify new drug targets and specifically leverage our ability to generate a significant cellular response encompassing broad T cell responses to target antigens.
Any project cancer would emerge for prioritization and our current pipeline will be required to exhibit compelling qualities not only belief in the candidates clinical potential based on the existing data, but also the ability to offer competitive clinical and commercial advantages.
And <unk> will focus on these candidates that can reach to market successfully in a shorter time as possible to contribute to improving patients' lives.
I'll now turn the call over to our CFO <unk> <unk> third quarter financial summary, Peter.
Thanks, Mike and good afternoon, everyone.
We finished the third quarter with $281 $9 million in cash cash equivalents and short term investments compared to $348 1 million as of June 32022.
As of September 32022, and <unk> had 249 5 million shares common outstanding and 268 7 million common shares outstanding on a fully diluted basis.
Our revenue was $9 2 million for the three months ended September 32.
<unk> 2022.
Compared to 292000 for the same period in 2021.
The increase in revenue resulted from the fulfillment of obligations under our contract with the U S Department of defense.
For our select Euro three P program.
<unk> research and development expenses.
For the three months ended September 32022 were $33 1 million compared to $47 1 million for the same period in 2021 the.
The decrease in R&D expenses was primarily related to lower drug manufacturing costs.
Outside services and clinical trial.
Clinical study expenses related to INR 4800, and <unk> 3100.
We also had lower engineering.
Services, and Expensed equipment related to select <unk> device array or <unk>.
Related to our <unk> device.
Ray automation project. These decreases were offset by $8 2 million lower contra.
Research and development expenses recorded from grants and other among.
Among other variances.
General and administrative expenses were $11 8 million for the three months ended September 32022 versus $13 2 million for the same period in 2021.
The decrease in G&A expenses was primarily related to a decrease in employee and consultant non cash stock based compensation. Among other variances total operating expenses for the third quarter 2022.
Decrease to $44 9 million compared to $60 2 million for the same period in 2021.
Our net loss for the quarter.
Ended September 32022 was $37 8 million or <unk> 15 per share basic and dilutive compared to a net loss of $60 2 million or <unk> 29 per share basic and dilutive for the quarter ended September 32021.
Looking forward <unk> expects.
And operating cash burn of approximately $45 million for the fourth quarter 2022.
As Jackie mentioned, we are updating our prior cash runway guidance and are now projecting our.
Our cash and cash equivalents should take us into the first quarter of 2025.
This projection does not include any funds that may or may not be raised from our ATM or other financing sources.
As a reminder, you can find our full financial statements in this afternoon's press release as well as in our Form 10-Q filed with the SEC.
And with that I'll turn it back over to Jacky.
Thank you Peter.
In summary, our work during the last quarter has enabled us to further advance our corporate strategy and sharpen our focus as we seek to realize the potential of DNA medicine to the benefit of patients globally.
As we continue to prioritize operational excellence and financial discipline. We have also advanced our commitment to environmental social and governance or ESG initiatives.
In the third quarter, we undertook a baseline assessment of our business and created an internal team focused on incorporating ESG practices into our business where appropriate with a particular focus on transparency. We recognize the impact <unk> can have on the world and we are committed to producing high quality products and.
Developing them in a safe and ethical manner.
With that let's now open the call for questions operator.
Operator.
Thank you we will now begin the question and answer session.
Ask a question you May press Star then one on your Touchtone phone.
Using a speakerphone please pick up your handset before pressing the keys and to withdraw your question. Please press Star then two and at this time, we'll pause momentarily to assemble our roster.
And the first question will come from <unk> with Oppenheimer <unk> Company. Please go ahead.
Okay.
Great. Thank you, thanks, Jackie everyone or the update.
I'm glad to see the company is getting focused Bob.
Jackie and team and Jeff again.
Question for me would be just on what do you think a potential trial could look like so if you can just kind of walk us through a few specific.
Components to that question one is.
Could the next trial.
If a contract or a potential registrational kind of pivotal trial. That's number one number two would you acquire more than one pivotal trial.
Like for example, the <unk>.
Yeah.
Excuse me then what patient numbers could we be looking at.
And then lastly.
Are you thinking off.
After therapy, 30, 107, and sort of adjuvant or new adjuvant.
Meaning.
<unk> are before synergies even contemplated.
And I just got a quick.
Quick housekeeping question runoff. Thank you.
Hi, <unk> nice to hear from you.
We're very excited as he can hear about 31 is set and then we are really excited around what the data we reported last month can mean for patients.
I'm going to hand, you over to Mike to give more specifics around what we're thinking around the trials Mike.
Thank you Jackie and thank you for your question.
Obviously, all things we are spending a lot of time discussing internally at the moment.
As you saw from the data that we presented we think that we were very encouraged by the efficacy data that we certainly believe there's a meaningful efficacy signal that.
So obviously that Tolerability is in line with what we've seen with our other DNA plasmids.
We will.
Design, a study that we hope will be.
Progressive in the Registrational strategy.
I think because we it's a rare disease and we have had the efficacy signal.
We would like to think that the FDA will see the next stages of Registrational study.
However, obviously, we can't speak for the FDA.
From a design perspective.
We were very fortunate in having interactions with the agency before.
And I think we have a lot of clues of how that study.
Will be should be designed in terms of what the FDA is looking for.
We haven't disclosed any of those things.
I actually think they are a competitive advantage to us in terms of how we move forward.
Propose the study designs that.
We are hoping we will have a good solid design that meets the FDA.
Comments that they've made to us in the past.
Hello to move forward as quickly as possible.
Great. Thank you Mike and then just housekeeping question is from Peter.
You said 45 million for the fourth quarter, you see sort of Burns are tailing off next year, I mean, I know you've given us.
Yes.
But just.
How do you think of Opex. Thanks.
Well, we're not providing any guidance past the fourth quarter, but I will tell you that I do see currently those those quarterly numbers continuing to decrease.
Understood. Thank you for all the questions.
The next question will come from Gregory Renter with RBC capital markets. Please go ahead.
Hi, This is <unk> on for Greg Congrats on the progress and thanks for taking our question.
First on 3100 could you help us set expectations around the VLT data that's upcoming what's the internal benchmark endpoints here focusing on to make decisions around path forward with this program.
And then.
Maybe more broadly with the recent development of our pipeline strategy, what's your latest thinking around prioritization and resource allocation among the programs and assets within your portfolio. Thank you.
Thanks, very much that great questions. So first of all on timing for reveal two data. So we're on track.
That data towards the end of this year.
Or into quarter one.
I think I'll hand over to <unk>.
Mike to talk a bit more around what we're expecting from that study, but to me a good outcome would be meeting the primary endpoint for the trial. So Mike do you want to comment on that and then ill go back to the prioritization part of the question Mike.
Thank you Jackie and you obviously hit on the.
The top points, we are going to readout with takeaway targeting three updated by the end of this year early next.
That will actually be the primary.
Endpoint, which is looking at.
Histological regression on viral clearance and that will be both in the biomarker population in the general population that was recruited into the study.
Obviously, we are expecting or hoping to see a greater potential for clinical benefit and the biomarker population.
But at the moment, we haven't.
Until we see the data we can't really comment on.
And what that clinical benefit and the biomarker population over and above the general population. We think is going to look like.
Kathy.
Thank you, Mike and say with regards to prioritize the prioritization of the pipeline I think over the past few months, we've seen really encouraging data.
In the Io space for clear Blastoma also in the HP be associated space with.
30, 174 for RFP and really what we're going to be doing going forward is prioritizing those resources.
Resources on those product candidates that have the best chances for success, the best chances of upbringing clinical benefit potentially rapidly to patients. So youll see us really focusing our resources, there and I think.
One of the sort of things that we've been very excited about is the consistent way in which our DNA medicines platform have been able to generate T cell responses. So antigen specific CD, four and CDA T cell responses.
And I think a focus on those T cell responses.
Going forward, it's going to be part of how we think about prioritization.
That's great. Thank you very much.
The next question will come from Geoff Meacham with Bank of America. Please go ahead.
Hey, this is Charlie on for Jeff. Thanks for taking the question I.
I guess I have kind of general question regarding how you think about the HPV vaccine impact in terms of a longer term.
Treatable population.
That's number one and number two I think just thinking about the.
The revenue from Vod like how should we think about that going forward.
Thank you.
Great Great questions. So I think model HPV vaccines have helped to reduce HPV infections in consequence, HPV associated diseases since they were introduced.
And I think now 2006, there is that our uptake Unfortunately, lower regimen that Aaron Singh completion rate than with other vaccines.
Lastly, the sizable number of people still at risk of becoming infected with HPV, which can lead to development of diseases, such as <unk> and cervical dysplasia.
So I think whilst vaccination rates vary around the globe I think unfortunately, we're still not seeing the level of the <unk> nation, which mean that HPV associated disease is going to be with us.
For quite a while to come.
So I think.
In terms of how we think about our relationship with DFT I mean, we've been extremely grateful for the support that we've had from dnb across multiple of our platforms, including support for the development manufacturing and scale up of our.
Sure.
It.
Investigational device the <unk> PSP.
Very grateful for that.
We're actually in the final stages of completing our obligations under those agreements.
And we look forward to.
Wrapping up work very soon.
Thank you.
Again, if you have a question. Please press Star then one our next question will come from <unk> with HC Wainwright. Please go ahead Sir.
Yes.
Hey, this is cheap hey, this is James on behalf of <unk>.
You've answered most of our questions. So.
The only quick question, we have is on iron ore type 401 in Glioblastoma.
What can we expect from this asset.
Two clinical updates.
Other key decisions moving into 2020.
Thank you.
Yes, that's a great question and I think Tom mentioned.
During the call that where we're currently.
Thinking about the next steps for 54, I won together with our partner Regeneron and we expect <unk>, providing an update on that next year.
Great. Thank you.
This concludes our question and answer session I would like to turn the conference back over to Dr. Jacqueline Shea for any closing remarks. Please go ahead ma'am.
I'd just like to thank everybody feedback questions and for joining us today have a good evening everyone.
Bye bye.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Okay.
[music].
Yes.
Sure.
Okay.