Q3 2022 Acurx Pharmaceuticals Inc Earnings Call

Yeah.

Greeting and welcome to <unk> Pharmaceuticals, Inc to discuss 2022 a third quarter financial result, and I've done before 2022.

At this time all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. If you if anyone should require operator assistance during the call. Please press star one on your telephone keypad.

As a reminder, this conference is being recorded it is now my pleasure to introduce your host Rob sure. She Chief Financial Officer. Please go ahead Sir.

Thank you.

Good morning, and welcome to our call.

This morning, we issued a press release, providing financial results and company highlights for the third quarter of 2022.

This press release is available on our website at Acura Pharmaceuticals Dot com.

Joining me today is David Lucci, President and CEO of <unk>.

We will give a corporate update and outlook for the remainder of 2022.

After that I'll provide some highlights of the financials from the quarter ended September 30th and then turn the call back over to Dave for his closing remarks.

As a reminder, during today's call, we'll be making certain forward looking statements.

These forward looking statements are based on current information assumptions estimates and projections about future events.

They are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward looking statements.

Investors should consider these risks and other information described in our filings made with the Securities and Exchange Commission.

Including our quarterly report on Form 10-Q, which.

Which we filed on Thursday November 10 2022.

You are cautioned not to place undue reliance on these forward looking statements and <unk> disclaims any obligation trips update update such statements at any time in the future.

This conference call contains time sensitive information that is accurate only as of the date of this live broadcast today November 14th 2022.

Correct undertakes no obligation to revise or update any forward looking statements to reflect events or circumstances. After the date and time of this conference call.

I'll now turn the call over to Dave Lucci, Dave.

Thanks, Rob and good morning, everyone and thanks for joining US on this conference call to review our financial results.

During today's call will review our financial results for the third quarter ended September 32022, and also cover some key corporate highlights and then we'd be pleased to take any questions.

In the third quarter, we continued to enroll more patients in the phase two b clinical trial of <unk> as a whole set our lead antibiotic candidate for the treatment of patients with C difficile infection.

The clinical trial is the 64 patient randomized one to one non inferiority double blind trial of oral life as opposed to add compared to oral vancomycin the standard of care to treat CDI.

The primary endpoint of the phase two b clinical trial.

Clinical cure at the end of trading met and the secondary endpoint is sustained cooler measured at day 38 at 838 follow up visits.

Yes. This is a double blind trial results won't be known until the end of the trial. However, operationally the trial is proceeding as expected with no safety signals reported to date.

The protocol includes an exploratory endpoint comparing the impact on the microbiome between <unk> and vancomycin and the.

The event non inferiority of life as opposed to tobacco milestone as demonstrated further analysis will be conducted to test for superiority.

Additionally, due to slower than expected enrollment during the aftermath of it possible in your searches.

19 infections, we expanded the number of clinical trial sites participating in the phase <unk> trial from the initial eight U S trial sites.

<unk> U S trial sites.

Currently there are approximately 24 sites opened for enrollment with additional six trial sites on boarding at this time.

We remain particularly excited about the dual impact of using <unk> to treat C. Difficile infection, while appropriately managing the long term care of each patient's microbiome, which we believe is exceptional for antibiotic therapy.

Details of the impact on the microbiome were presented in oral and poster presentations at I'd week in October in Washington, D. C and are available on our website.

Other key highlights from the third quarter of 22 alright.

Or in some cases shortly thereafter include the following.

The company has continued its R&D collaboration with Leiden University Medical Center in Holland.

Further evaluate the mechanism of action of <unk> inhibitors against the DNA, Paul Ricci enzyme.

It is the bacterial targets of our lead antibiotic candidate and of our product pipeline, both orally and systemically for Gram positive bacterial infections.

Secondly, the company has completed certain portions of its laboratory study at the University of Houston.

Comparing the killing and factors like that as opposed to add to vancomycin and Fidaxomicin and metronidazole using both in vitro and ex vivo analyses.

<unk> results have been presented at the Arab Society of America Annual Scientific conference.

Results demonstrated that there is a clause that has favorable killing kinetics.

<unk> the standard of care to treat C. Diff infection at standard and high bacterial concentrations supporting continued development of this first in class antibiotic to treat patients with C difficile infection.

Comparisons of the killing effect of life as opposed to debt to EBITDAX of Madison and metronidazole are ongoing.

Presentations at various aspects of it as opposed to debt and our second antibiotic program, which is currently in preclinical development.

To treat infections caused by MRSA, we're presenting at two recent prominent scientific conferences as follows.

The antimicrobial resistance conference.

September of 'twenty two.

And ideally in October of 'twenty two.

Additionally, <unk> recognized that the month of November as C. Difficile awareness month as designated by the U S centers for disease control and prevention.

And so it points to support the work of both the <unk> Foundation, and the Peggy Lillis Foundation, and educated and advocating for the prevention treatment clinical trials in environmental safety of C difficile infections worldwide.

But actually in July of 22, the company raised $4 $3 million of gross proceeds by consummating, a registered direct offering to one U S institutional investor and three executives of the company.

At $3.25 per share for the U S institutional investor and $3 80 per share for the company's three executives who have invested a total of $225000.

And the transaction, we issued a total of $1 million 159000 common shares at approximately 131000 pre funded warrants warrants.

Warrants to purchase common stock totaled approximately $2 6 million with warrant coverage at an exercise price of $3 25 per share for the U S institutional investor and $3 55 per share for the company's executives.

To reiterate in July to about 22, we increased the target number of clinical trial sites and continue to onboard new trial sites with an anticipated. So of 30 active clinical trial sites before the end of the year.

In addition in October two O 22, the company filed for a non dilutive grant of up to $16 million, which if approved would provide funding for our second antibiotic program ACX $3 75 targeting the treatment of MRSA infections for a period of five years right up to the start.

A phase II clinical trials.

The company's portion of this funding would be approximately $5 million and we expect a decision by the funding party in April 2023.

Now back to our CFO , Rob Shovlin to guide you through the highlights of our financial results for the third quarter of 'twenty two.

Rob.

Thanks, Dave.

Our financial results for the third quarter ended September 32022 were included in our press release issued earlier this morning.

The company ended the third quarter on September 3rd youth with cash totaling $10 $6 million.

Compared to $13 million as of December 31, 2021.

Research and development expenses for the three months ended September 30 were $1.6 million.

<unk> to $1 $1 million for three months ended September 32021.

The increase was due to an increase in phase two b trial related costs and related consulting costs.

For the nine months ended September 32020 to research and development expenses were $3.3 million versus $1.3 million for the nine months ended September 32021.

This increase was due primarily to phase two b trial related costs in the current nine month period, and an increase in consulting costs related there too.

General and administrative expenses for the three months ended September 30th.

2022 were $2 million compared to $3 $5 million for the three months ended September 32021.

The decrease was primarily due to a decrease in share based compensation.

Weighted to the company's initial public offering and a decrease in legal fees associated with the company's intellectual property estate.

For the nine months ended September 32022, general and administrative expenses were $5 $5 million.

Versus $8 $9 million.

For the nine months ended September 32021.

The decrease was primarily attributable to a decrease in professional fees and stock based compensation related to the company's initial offering.

Partially offset by an increase in insurance costs.

The company reported a net loss of $3.5 million or 32 cents per diluted share for the three months ended September 32022.

Compared to a net loss of $4.6 million or 46 cents per diluted share for three months ended September 30.

2021.

And a net loss of $8 $8 million or <unk> 80, 584 cents per diluted share for the nine months ended September 32022.

Compared to a net loss of pinpoint $1 million or $1 27 per diluted share.

For the nine months ended September 32021.

For the reasons previously mentioned.

The company had 11 million 592690 shares outstanding.

As of September 32022.

With that I'll turn the call back over to Dave.

Thanks, Rob and to all of you for joining US today, we're very enthusiastic about our continuing strong fundamentals and we're especially pleased to report <unk> progress in the third quarter of 'twenty two.

We look forward to building on this momentum in the coming months, even during these most challenging times and to update you as we do so.

I will now turn the call over for questions operator.

Thank you.

Ill be conducting a question and answer session. If you would like to ask a question. Please press the Taiwan and your telephone keypad, a confirmation tone will indicate your line is in the question queue.

Yeah My past, it's tied to if you would like to remove your question from the queue.

Participants using speaker equipment, it may be necessary to pick up your headset before passing Vicky.

One moment Levi with poll for questions.

Okay.

Our first question comes from Jason Mccarthy with Maxim Group. Please go ahead.

Good morning, David Thanks for taking the questions just on the on that.

Phase two b and the C. Diff trial, you had mentioned that you added a lot more sites have you guys provided any update on where enrollment is.

In terms of numbers for the eye the target 64 correct.

Yes, the target.

In the protocol.

64 patients one to one randomized.

As we've previously mentioned.

We're planning to announce when we get to 50% enrollment.

And the only caveat that I would add is you know except that.

If our data is looking particularly good like the phase one data in the phase Iia data.

There may be an opportunity for us.

To early terminate the two b trial, if and to the extent our data safety monitoring board.

It makes that recommendation the company is double blind, so we have no ability or insight into whether or not they will be doing that but we are we are aware that there is some activity there and it's a possibility.

Okay.

Okay. So.

On the just on the second program you'd mentioned targeting Merritt said there was some good preclinical data back in September I think again in October you know what is the path forward. There what does it look like to get to I N D.

In a phase one study and what particular indication could you target.

So the initial target indication would be.

Cities are a.

A few bacterial skin and skin structure infections.

Caused by MRSA.

That's one of the most abundant if not the most abundant.

Area of MRSA infections in the U S.

And we would be targeting and are working on both an oral and an IV.

Formulation so.

The next steps on that program are to complete the lead optimization.

To conduct some manufacturing.

Scale up.

As well as our preclinical tox work.

To support the IND submission.

And then we would go into a phase one and if we get the non dilutive grant that we're looking for it would pay five years of these cost things or I should say, 70% or so of five years of these $16 million of cost things.

And we would have to pay the balance of about 5 million Bucks.

Okay.

And do you expect the outcome of that grant and file our submission in April is that correct because you have that right.

Yeah. So April can do is when we will hear if we'd been approved and then at that point Theres a negotiation period for our contracts are.

With the funding party.

At the end of November we'll find out if we get into the second round of consideration for that non dilutive grant.

We expect we will we've had steady interaction with the funding party since even before for the past three years, even before the RFP came out.

So we're particularly.

Hopeful about our candidacy for this particular grant and we feel that we fit right down the middle of the RFP.

Got it.

And then any just quickly any updates.

On the program that the government was working on in Congress, the Pet store Act.

Oh, the past sooner after the disarm Act.

Are still like right beneath the surface as we understand it.

Through our interaction with the antimicrobial working group for.

For the past couple of months with the election, and you know the volatility that we've seen in the stock market in the global markets.

And it hasn't bubbled its way back up.

Just yet, but the AWS G. In the bio industry organization are both very confident that one or both will be approved.

And the new Congress.

In the past due or act enjoys bipartisan support.

And on the Democrat side is championed by Patty Murray.

<unk>, who for this purpose thankfully has made her way to being reelected last week.

So, we're particularly hopeful the pass through where it will be passed and that would really increase the valuations for all developers of R&D stage antibiotics.

Treat patients with life, threatening or serious infections Q IDP infections.

Hmm.

Our novel first in class.

So we feel that we've really tailor made for past due or it was scratched from in favor of a defense spending bill.

About six months ago.

Last minute ninth inning, so we're still hopeful that in the new Congress that it will pass.

Got it thanks for taking the questions. This morning.

No problem. Thank you. Thank you Jason.

Yeah.

And so a reminder, if you would like to ask a question. Please press star one on your telephone keypad.

There are no further questions at this time. This concludes today's teleconference call. You may disconnect your lines and have a great day. Thank you playing I think the basin. Thank you Victoria.

Thank you.

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