Q3 2022 Mediwound Ltd Earnings Call
Good day and welcome to the meta winning third quarter 2022 earnings call.
Today's conference call is being recorded and at this time I would like to turn the conference average men need coffee sorry advisors.
Go ahead ma'am.
Thank you operator, and welcome everyone earlier today <unk> issued a press release announcing financial results for the third quarter ended September 30th.
'twenty two.
You may access that release on the company's website under the investors tab with US today are Ofer <unk>, Chief Executive Officer of Madewell, and Boaz Gur Lavie Chief Financial Officer.
Following our prepared remarks, we will open the call for Q&A.
Before we begin I would like to remind everyone that statements made during this call, including the Q&A session relating to meta wounds expected future performance future business prospects or future events or plans are forward looking statements as defined under the private Securities Litigation Reform Act.
1995.
Although the company believes that the expectations reflected in such forward looking statements are based upon reasonable assumptions actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of Mad alone.
The company assumes no obligation to update or supplement any forward looking statements, whether as a result of new information future events or otherwise.
Participants are directed to cautionary notes set forth in today's press release as well as risk factors set forth in meta was annual report filed with the SEC.
Factors that could cause actual results to differ materially from those anticipated in the forward looking statements.
The conference call is the property of medical and any recording or rebroadcast is expressly prohibited without the written consent of meta world.
Now I would like to turn the call over to Ofer, <unk>, Chief Executive Officer of Madeleine Ofer.
Thank you Monique and good morning, everyone.
Welcome to our third quarter 2022 conference call to discuss our financial and operational highlights.
This quarter, we continued to be on track with a series of positive announcements across all our program.
We are approaching several significant inflection point for the company.
We believe that once Nexobrid is approved it will generate meaningful revenues in 2023 and significant growth going forward.
Following the launch of Nexobrid.
Focus on a billion dollar market opportunity.
Wanted to ask with S. Correct, well, we plan to initiate the phase III study next year.
We have all these things shall element, allowing for success.
I'm not sure pipeline.
Favorable data large addressable market.
So operational scheme.
Tier one partners and a strong balance sheet.
Before I discuss the progress we made this quarter.
Good luck with the rest of the capital raise we completed in October where.
Well, we have added an additional $30 million to our balance sheet.
Combined registered direct.
Okay.
These significant additional funds will support our activities through 'twenty.
2025.
What was important for us to complete this raise now.
This positive news.
That's a position maybe one for success.
We stopped participation of our shareholders.
Additional benefit we were able to bring in new validating invest off for the company.
Oh so.
We're pleased with the vote of confidence from both our management team and board member.
Participated in the offering demonstrating commitment.
Of course.
Our strategy.
Now with the funding we will be able to accelerate.
Our clinical progress.
Correct Okay.
And manufacturing to address the increasing demand for Nexobrid.
Our global operation.
We are in a strong fundamental position for the future.
Both the near and long term.
In addition to securing our financing we have established a strategic advisory board.
Grisel highly esteemed industry leaders.
No John landscape.
I'm with Boyd.
Eric Shen.
They will contribute their experience and insight to our strategic and operational activities.
They're medical expertise in all aspects of.
Sure.
But I think the knowledge of life Science innovation.
One thing that was left over from unfair.
<unk> facilities and optimize our manufacturing processes.
As a C O I believe engaging with such talent is essential in advancing many one seem to be falling awards last night pharmaceutical company.
Moving to our clinical development program.
Let me start with an update on that well, we have demonstrated the tremendous unmet medical need.
Our belief in the <unk>.
Michigan promotional opportunities.
We are now more certain than ever potential could be.
Lockbox.
Our phase two results from both clinical studies were robust.
That's correct, what's proven to be safe well tolerated effective.
So the nonsurgical standard yeah of.
Across all key parameter.
The incidence of complete debridement.
Number of indications require time.
Time to achieve completely blackman et cetera.
We also saw reduction biofilm and bacterial burden, which further demonstrated.
Next is super you're always people, but also do blackman modality.
These results were highlighted in two poster presentations at the symposium on advanced wound care in Las Vegas.
We will honor when one of the poster presentation was selected out of the 290 upfront.
B the one featured in an oral presentation.
They thought were very well received.
Our next step.
In the coming few weeks is to meet with the F D. A.
The phase III study design.
We will provide an update once we gain clarity of the regulatory path forward.
In the meantime, we are on track and prepared to initiate our planned.
Phase III study in the first half of 2020 three.
We believe that our clinical development program.
No. It's only due to the robust that that we've generated to date.
Also due to the fact that that's correct.
Is the same API as an extra boost.
And we have seen nexobrid used as a commercial product to successfully treat over 11000 patients worldwide.
We continue to generate interest from strategic players.
I don't think there'll be blackman agent.
The competitive quality demonstrated by correcting the phase two studies.
Most players in the wound care market.
Boeing very closely.
We are evaluating all of our options from collaborating with their strategic partner.
Developing S correct on all.
Oh.
We all need to be very well positioned with the flexibility to create significant shareholder value.
We believe we have a winner here.
Turning to Nexobrid.
As we announced in our last call the Mexico Bleed. The BLA Resubmission was accepted for review by the FDA and <unk>.
Even if they do per day for January 1st 2023.
Yeah.
The BLA is progressing.
Inspection of our manufacturing facility in Taiwan and in Israel are underway.
Our partner very still continues to actively plan well.
Dan Shull Nexobrid launch in the first half of 'twenty 'twenty four.
Oh Boy expanded access program, Nick continues to enroll patients and help physicians gain important first hand experience with nexobrid.
Good day.
183.
Patients are being treated with nexobrid.
Four of the leading burn centers in the United States.
These sites have been very supportive of Mexico.
The patient and physician experience is confirmed our belief that nexobrid will become an important part.
The standup go practice in the United States.
Additionally, I'm pleased to report that our collaboration with the United States Department of defense or the development of Nexobrid.
Non surgical solution for the treatment of Burns in the spin remains on track.
In Europe sales of next week to steadily grow.
We see that Nexobrid is embraced as the standard of care in.
More and more.
Last quarter, we submitted a pediatric label extension request to do patent medicines agency and we anticipate a decision from first quarter or 23.
So the ethnic patients represent about 25% to 30% the total burn population.
They often face painful surgery, which can be very problematic for the young patients and their families.
Approval will allow for the athletes patients who have safe.
Yes.
<unk> debridement option without having to undergo.
Surgery.
The growing interest in burn months mass casualty incidents the burden. This Europe is another opportunity for Nexobrid.
This is fueled in part by the Ukrainian and Russian conflict and buy mass casualty events.
Could suggest recency.
While we are unable to quantify the magnitude of diesel for Genesee.
Does the preferred and the strategy.
Father indoors.
I would say it will be embraced in Europe as well.
Lastly, we were pleased by the warm reception we received at the 19th you can Burn Association Congress in Italy.
Mexico was highlighted in a 45 posters and presentations.
Leading burn specialist.
He says from around the world.
Third the positive experiences patients outcomes, using Mexico grid in a wide range of upsetting.
Internationally, we anticipate additional approval in large meaningful market, such as Japan, and India by the end of this year.
So de Mexico.
<unk> is approved in 41 countries and we look forward to the expansion.
Gentlemen, two MW Oh five.
It continues to move forward in the development of the topical treatment for their patients with novel cell carcinoma obesity.
We saw positive initial results from our U S phase one two study.
M. W. O O five were shown to be safe and well tolerated.
The majority of patients who completed the study achieving clinical and histological clearance.
Target lesions.
We anticipate announcing the study result, but the answer would be yes.
Yeah.
In conclusion.
We are very well positioned to continue to excel across board.
We anticipate the potential approval and commercial launch of Nexobrid in the United States.
This will also enable us to generate meaningful revenue in the near term.
We are eager to launch our phase three people to programming X correct.
And we continue to develop a compelling pipeline follow on therapies, such as M. W. O O five.
We have all the resources to do that I'm very optimistic about <unk> future and look forward to updating you on our progress.
Let me now turn the call over to Bob.
And a brief review of our play match up.
Bob.
Thank you Ofer and good morning, everyone. We're pleased with the recent fund raising despite the turbulent capital markets, which has significantly strengthened our balance sheet.
Along with the expected $7 5 million milestone payments from very soon upon the BLA approval plan in January 2023, and mix would be commercial sales growth.
It leaves that we have sufficient funding to support our fifth correct clinical development program.
Moving to our financial statement.
So total revenues for the third quarter of 2022 were five 8 million.
Third to $6 4 million for the third quarter of 2021.
Revenues from products in the third quarter of 2022, with one 4 million compared to $2 6 million.
This was primarily the result of a $1 million decrease in emergency stockpiling procurement like board.
Gross profit for the third quarter of 2022 was $2 4 million or 42% of net revenues compared to gross profit of $2 5 million or 39% of net revenue.
Research and development expenses for the third quarter of 2022 with $2 9 million.
<unk> is in the pilot period.
G&A expenses for the third quarter of 2022, or $3 1 million compared to $2 4 million.
The increase was primarily results of approximately zero to 2 million of share based compensation costs.
0.3 million, one time marketing expenses related to this correction market research activities and the European Burn Association conference.
Operating loss for the third quarter of 2022 was $3 5 million compared to $2 90.
Our financial expenses, which are noncash in nature or 0.7 million compared to 0.5 million in the third quarter of 2021.
The increase was primarily due to 0.4 million, resulting from warrants expenses allocation relating to our recent fundraising.
So location is dictated by I first regulation, which is different than they used to get.
This has affected our loss per share by two cents.
The company posted a net loss for the third quarter of 2020 to $4 2 million with 13 cents per share.
<unk> to a net loss of frequent 3 million or 12 cents per share.
Adjusted EBITDA for the third quarter of 2022 was a loss of $2 5 million compared to a loss of $2 2 million.
Moving now to year to date 2022 financial results.
Total revenue for the first nine months of 2022 were $14 9 million compared to $18 3 million in the firm.
Nine months of 2021.
Revenues from products in the first nine months of 2022.
$4 2 million compared to $7 7 million.
This was primarily the result of a decrease those people and screaming in emergency stockpile the cumin by BARDA.
Operating loss for the first nine months of 2022.
It was $10 5 million compared to an operating loss of seven point Sidney.
Net loss for the first nine months of 2022.
$1 1 million or <unk> 38 cents per share compared to a net loss of $9 4 million or 34 cents per share.
Adjusted EBITDA for the first nine months of 2022.
What was the loss of $7 9 million.
<unk> to a loss of $5 five.
Moving to the balance sheet highlights.
As of September 30th 'twenty, 'twenty, two and the $117 6 million in cash and short term investments compared with $11 million as of December 31st 2021.
Maybe one utilized $4 6 million.
Third quarter of 2022 for each generation activities.
The company reiterates cashews for 2022 to be in the range of 13 to 15 million.
In addition, $17 2 million in gross proceeds $16 6 million net proceeds.
Our assembly in October from the 30.
35 million equity offering providing sufficient cash to fund the company's expected operation through 2025.
With that <unk>.
Clearly the financial overview.
I'll now turn the call back to Austin well Phil.
Thank you Bob.
Our momentum continues to build.
We believe that we are on a very positive trajectory. This.
This year and into 2023.
As I mentioned, we have significant catalysts ahead.
We anticipate nexobrid marketing approvals in India, Japan, and the United States.
The meaningful revenue follow.
Is that revenue continues to increase.
Golf ball manufacturing facility to ensure we are able to meet the growing demand.
We are ready to confirm or phase III design and move it to a pivotal development program next year with correct.
This billion dollar market opportunity will definitely be our focus.
Finally, we look forward to sharing more about our M. W. O O five.
Land in Basel cell carcinoma.
With that it is now my pleasure to open the call for your questions.
Rachel.
Thank you and we will now begin the question and answer session.
Ask a question you May press Star then one on your telephone keypad.
If youre using a speakerphone you may need to pick up your handset before pressing the keys.
To withdraw your question. Please press Star then two and at this time, we will pause momentarily for the first question.
Alright first question today will come from Josh Jennings with Cowen. Please go ahead.
Hi, good morning, Thanks for taking the questions.
Two questions first on S correct.
It sounds like you're making nice progress there about you get in front of the FDA and proposed to.
The final design of the Phase III program I'm just wanted to see.
Whether there is any push pull in terms of the timing there.
For your FTAA locking in a trial design and front of locking in a strategic that may want to be involved in the program and have their own team.
Contribute to that to the design parameters and then just on Nexobrid.
Maybe for Paul as it would be helpful and just remind us on the web.
Generation potential.
FDA approval and then any milestone payments that we should be having have have on our radar.
So it gets ready to launch in the United States and also just.
Any timing in just terms of revenue contributions.
With launches in India, and Japan would be helpful. Thanks for taking the questions.
Okay.
Hi, Josh.
Good question, Thank you for asking.
So as we said our next stepping back upcoming week is to meet with the FDA and discuss the study design.
What you can assume that we will.
One for the <unk> indication to begin with.
But the discussion is basically around the sample size of the study design for the call today.
Right.
We will provide an update once we get the clock.
Alrighty.
<unk> of the regulatory pathway forward and as you can imagine and.
Strategic partners.
Assuming being part of that are also very interested in the answer of what do we get from regulatory agencies.
As for the next by the way after that we will.
So also for the V a few.
But also we need to get some clarity from the agency about how they see the future development plan.
Excellent next would be the thing you should answer the question.
Yeah, So hi jealous.
Regarding an extra beat I think you know what you we should expect.
When you're going to see first BLA milestone payments up seven five very soon.
That's all for me.
Oh well.
In addition to that we mentioned that we're expecting marketing.
And so finding India.
Are we starting to see a first order then kind of a forecast for next year.
And I believe that should be.
No one from $5 million to $10 million range.
It's probably kind of the key milestones that we should look at.
<unk> phone you know very shell and you know they haven't yet.
If you're doing your forecast, but you know expecting launching.
Yeah.
First half of 'twenty two.
In addition to that you have your so you.
You should think that's it.
Like.
Yeah.
In the last few years.
Lots of consistent growth and additional marketing machine.
Anthony that can contribute to that.
That's right.
Yeah. That's helpful. Thanks, so much.
Absolutely that was great. Thank you.
And our next question will come from our friends at Great Boys with Oppenheimer. Please go ahead.
Alright, Thanks for taking my question. So just in terms of the update that you'll you'll give on the design with the end of phase II coming up here is there any big questions or.
Should this be kind of a no surprise similar maybe design as a successful phase two and then just on that note is there any debate about how many pebereau's youre going to need.
Mhm.
Excellent question.
So oh regarding debates you know we are going to we are we are trying to have seamless.
Similar phase III study to the phase two study that we succeeded in a very robust manner.
This is what we aim for.
Discussing it with the agency and hopefully it will be very clear once we once we provide you with an update about the regulatory path going forward definitely our aim is that this study design will be very close with the one that we already succeeded.
The next question.
Just in terms of the number of potential number of pivotal trials.
And then just on that note if there sorry, I'll, let you take that yes.
Yeah.
And.
So as they say.
Said.
We are going through the development cost of <unk>.
<unk> territories other than the United States our margin. So we decided to go for a global full but.
So in Europe . It is very clear cut in Europe , you need to do one pivotal study.
Guidelines are very clear, we don't need anything other than a single phase III study.
Based on the SBA guidelines and the fact that Nexobrid and S. Correct contain the same API we.
Same products are intended use both for debridement.
Leave that the single phase III because.
This being available that that would be the basis of basketball.
Okay, Great and then you mentioned <unk>.
This leg ulcers any discussion about maybe the market maybe if you can help remind us via I'll use versus D F used and.
You know why why it used to go with the G. L used in the phase II design here.
Okay. This is also a very good question, we have the data supports it.
Both the V in the U N D. If you use the phase III study.
You know that escalate works for the broadband the same for both indications.
Having said and the markets are almost similar where you have $1 1 million eligible patients would be an inappropriate use and 117 million for the issues with the markets are quite the same.
The unmet medical need full value is much bigger because the deal you won.
Very painful you can't even tell you can't even get close to them. So sharp debridement is not a solution.
And B, if you don't see the patients do not feel the deluxe field. The one that's also you can be bright.
With a knife so the unmet medical need for you is extremely big and it could be a few.
Add to that.
If you look if you go into clinical trials Gov, you will see that there are something like 100 clinical trials now.
And B, if you Ah patients not for debridement, all kind of.
Biases in appliances.
As opposed to ease their pain or to make it quicker.
Quicker and ask for the deal you you can see that there is also nothing out there.
So we believe that we will be able to recruit patients quicker and the unmet medical need is bigger.
After having been via new indication approved moving to the <unk> population will be easier.
Excellent that's very helpful. Thank you very much.
Okay.
And our next question will come from.
Cool.
With H C. Wainwright. Please go ahead.
Thank you. This is RK from H C. Wainwright, good morning, Oh for them.
So congratulations.
Getting thus far on the.
On the next one Brett.
No approval situation.
And getting getting FDA inspections.
It's a good sign.
In terms of.
The the EAP program, you know Radian said that there are 183 patients have been treated so far.
How do you see this.
You know in terms of launching the product.
Oh it was.
Yes.
Expedient, helping both southern yourselves in terms of.
Oh, how to manage detailing and now what are you learning from that process itself.
So.
Thank you for that question out there and I suppose it's nice seeing you last week.
D. Our next program with some extended access program it's.
Quite the standouts there.
Hey program that enable clinical sites to treat.
Patients with our drugs that are currently in a in the FCA review.
So.
As we can see keeps on enrolling patients in a very good pace.
And you get a lot of feedback from patients and physicians.
And that makes us believe that this is going to.
Could be the standard of care in the United States, We don't see anything.
We didn't see in Europe .
The reported results from the Saturday you know, it's not a clinical trial, but it is actually treating patients. The results that we see are very consistent with what we see in the 11000 patients already treated worldwide.
And I think that's the most important aspect that we have now assuming that you are going to be approved in the United States in January .
We keep on collecting the data.
Population, which is also a very significant market in the United States. So we are going to accelerate the EF 14, United States to make sure that Nexobrid is going to increase substantially. This is one of the reason that we said that we expect that after the BLA a cool thing.
The revenues from Mexico, with we'd become meaningful for them anymore.
Very good and then in terms of.
On the approval.
India and Japan.
India is a market with just kind of.
Spread and probably not as clear as either U S or you know it goes.
So how are you planning to manage that market in a sense you know.
Do you have distributorships in place.
You have one.
What how are you going to manage that.
That market in Japan.
Rent as well.
It probably has a different strategy there.
If you can highlight.
And there's still markets that would be helpful.
Yeah, so and thinking.
Thinking that we mentioned.
You mentioned in the past.
So more to follow.
Darren.
In Japan <unk> pharmaceuticals.
Health care company.
And I must admit.
You know given the demand already.
And she'd something for next year.
Yeah.
I'm pleased with what we've seen in the Japanese market exit next to me is if you read.
As for India I believe you also there was a company.
Yeah.
That's our vaccine it's also <unk>.
Some companies are walking worldwide.
Also in the U S and Germany.
Well established.
Pharmaceutical company.
Also.
We're expecting an excited about nexobrid.
I think there's no more.
To learn about the Indian market on the one hand there.
Probably the biggest amount of severe burn patients given the size of the population.
The culture.
But not all of them are on their medical care.
I think it's too premature to give a number you know assuming that together.
India and Japan both of them.
Then next year, we're looking to one subsequent media.
But once we get more data and working together with DSV in Cancun.
So you will be able to provide more detail going forward into 2024 and one of them.
Okay. Thank you for that and then on that's correct.
Suddenly.
Hum.
Larger potential compatible with Mexico, but could have.
And then in terms of thinking about potential partnerships I just said.
We're already.
We started receiving hum.
Actually its strict lewisville conversation on the product so what's what's the type of collaboration.
Rich or coming to the table at this point.
And you know how do you plan to.
Get through that and also make sure that you can initiate your study.
The pivotal study and within the next six months.
So this is also a very good question. So as I told you that our strategic players are very interested they just cannot ignore.
The our topical debridement agent such qualities that was demonstrated.
With demonstrated in our phase two studies.
So we have all kinds of options you know that all of them are in the textbooks life.
Licensing collaborations.
Licensing from all kinds of.
Companies are.
At this stage since we were very lucky to be able to finalize financing.
We are very flexible because we have the we have the capital to do everything by our own.
And I'm very proud to have maybe one that succeeded.
Date.
<unk> outlook 15 clinical trials, so definitely the operational team in maybe one is capable of succeeding in the map.
Very significant trials.
Partners are the potential partners are aware of that.
There is they look at the competition around maybe one but currently we have we are flexible and we think we have a winner in hand, we are not going to be very picky.
And what partner, we're going to choose.
Great. Thank you very much for bus duct tape brookstone.
Thank you.
And at this time there are no further questions in the queue I would like to turn the call back over to management for any closing remarks.
Okay.
Yeah.
Okay. So thank you everyone for joining us today, we look forward to updating you again on our next call.
Goodbye.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.
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Uh huh.