Q3 2022 Iterum Therapeutics PLC Earnings Call

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[music].

Ladies and gentlemen, and welcome to the EQM Therapeutics third quarter 2020 financial results call. My name is Maxine and that'll be coordinating the call today. If you would like to ask the question. Jamie presentation. You may do so by pressing stuff like buy one and that sort of thing can you Pat.

I will now hand, you over to Louise bought it I see P. M. He could affect weekend Louise. Please go ahead when you're ready.

Right, let's say.

Good morning, and welcome to our therapeutics.

That's cool.

A press release with our third quarter was issued earlier this morning.

It can be fun.

We're joined this morning by Quaker Smith, CEO and Judy Matthew.

Cory will provide.

Judy will provide detail.

And then bookings for Q&A.

Before we begin I would like to remind you that this call will contain forward looking statements concerning plans.

What's best for our business.

Okay.

And the third piece of it.

As Pam the timing conduct progress and results of clinical trials.

Our expectations with regard to resolve matters set forth in the complete response letter received by US in July 21.

To obtain approval.

Yeah.

The expected timing of Resubmission of our NDA its.

Term and coverage for our children.

Actual boxing day right.

Proficiency of our cash resources.

Actual results could differ materially from those.

These forward looking statements as a result of various important factors.

Did you say uncertainties inherent in the design of a patient in college or kind of a known kind of co development of computing the reassure clinical trials, a non clinical development being conducted by us with most of them see our hours in July 2021.

We have no doubt been entitling up data for the reassure clinical trials going on clinical development.

Changes in Mark to two requirements or discussion.

The timing or likelihood of regulatory filings and approvals, including the potential resubmission of our NDA.

Public policy or legislation and commercialization.

If we were to look at it with a pretty.

The actions of third party clinical research organization.

Yeah, Chris Schott patients regarding type borrowers with future cash available for our ongoing operations.

Sure.

Yes, Sir.

And in the quarterly report filed today.

In addition, any forward looking statements represent our views only as.

This call and should not be relied.

All of us are representing our views as of any subsequent date, we specifically disclaim any obligation to such statements.

We will also be less.

Financial measures during the call we have provided reconciliation.

non-GAAP adjusted acquisition press release issued earlier this morning.

And I'll turn it over a nice G. Cory for your opening remarks.

Great. Thanks Louise.

Welcome and thanks for joining us today I'd like to share some very exciting company highlights with you. This morning.

First we are thrilled to have begun enrollment in our new phase III clinical trial for uncomplicated urinary tract infections. We have named this try to reassure.

The reassure trial is designed as a non inferiority trial, comparing oral senior Pentagon row.

<unk> Augmentin.

You mentioned susceptible population.

We are conducting this trial to address certain deficiencies. The FDA noted in their complete response letter that we received in July of 2021.

The trial is expected to enroll approximately 19 866 patients and is being conducted under a special protocol assessment Spa agreement with the FDA.

The Spa agreement provides that the design and planned analysis of the trial is set out in the protocol submitted to the FDA adequately addresses the objectives necessary to support the potential resubmission of the company's new drug application for oral sema.

And the reassure trial.

<unk> will be randomized to receive either oral single tenant twice daily for five days or augmenting twice daily for five days.

Primary endpoint is the overall response, which is the clinical and microbiological combined response at day 12 of the trial.

We expect to complete enrollment in the first half of 2024, and if successful will resubmit, our NDA to the FDA in the second half of 2024.

The Resubmission addresses all deficiencies in the complete response letter we received in July of 2021 from the FDA and the FDA action should occur six months from receipt of our Resubmission.

It is important to note that there are approximately $33 million.

Your uncomplicated urinary tract infections in the U S annually and approximately 30% of those infections are caused by a quinolone non susceptible organisms.

Additionally, about 1% of all infections are caused by pathogens that are resistant to all commonly available classes of oral antibiotics and as a result, the need for new oral antibiotics in this therapy area remains very high.

On the intellectual property front interim has been granted a U S patent directed to the composition of the bilayer tablet of oral sumo, Panama, which contains pseudo Panama at Drexel and per benefit and a single bilayer tablet.

This is an incredibly important milestone as this patent will extend our existing patent protection until at least 2039.

Which provides a substantial runway to protect the long term commercial value of oral Sulu patent in the U S.

Outside the U S.

Pending patent applications, including Europe , China, Japan, and parts of South America, which were submitted following receipt of the written opinion of the international search authority, indicating that several claims directed to the composition of the bilayer tablet of oral suitable Panama or not.

<unk> and inventive.

We are beginning to explore potential new areas, where there is an unmet medical need and where <unk> could be an important potential alternative and treating those patients.

We are currently evaluating a number of potential new indications and subject to that review our planning an initial discussion with the FDA in the first half of 2023.

We will share further details.

And when this plan develops further.

On the corporate front, we regained compliance with the NASDAQ bid price rule by affecting a one for 15 reverse share split in August .

Lastly, but quite importantly, our cash position remains solid with a balance of $64 million as of September 30th.

As we have stated in our press release, we expect this existing cash to fund operations into 2024, including through the topline data readout from the reassure trial.

In summary, we are excited to have begun enrollment in the reassured clinical trial and are looking forward to potentially bringing the first new oral Panama to the market in order to help address a serious medical need in the community.

We are also looking forward to potentially expanding the utility of suitable Panama into other areas that are in need of new treatment alternatives.

Now I will turn the call over to Judy for details on our financial results.

Thanks Clay.

Operating expenses were 7 million and 22 4 million in the third quarter and year to date 2022, compared to $4 9 million and $17 7 million in the third quarter a year to date 2021.

Operating expenses include research and development expenses and general and administrative expenses.

R&D costs were $4 400 million for the third quarter of 2022 compared to one 8 million per day.

Clearly in 2021.

The primary driver of the $2 $6 million increase in R&D costs was the initiation of our reassure trial, which began in October 2022.

Year to date R&D costs were $11 8 million in 2022 versus two.

2021, as a result of the cost to support our reassert trial.

G&A costs were two 7 million for the third quarter of 2022, which is $300000 lower G&A costs $3 million in the third quarter of 2021, due primarily to lower share based compensation expense partially.

Offset by higher legal fees associated with the class action lawsuit.

In August 2021, following the receipt of the CRM from the SBA in July 2021.

Year to date G&A costs were 10 seven now.

<unk> 22, compared to $10 7 million in 2021 or flat.

Higher consulting spend on pre commercialization activity through the first half of 2021 prior to receiving this BRL were offset by higher share based compensation expense and legal fees in 2022.

Moving on to non operating items.

Interest expense was 600000 for the third quarter of 2022 compared to 800000 in the third quarter of 2021.

The primary reason for the $200000 decrease in interest expense.

Payment of our SBB loan in March 2022.

Our net loss on a U S GAAP basis with $29 1 million for the third quarter of 2022, and $39 3 million for the year to date period.

Impacting the third quarter and year to date net loss was a noncash charge of $17 4 million included in other income and expense in connection with the cancellation of share option.

In July 2020 to certain executives and employees agreed to the surrender encapsulation of previously granted share options in order to make available additional shares under the company's equity incentive plan.

<unk> right to this noncash charge with no impact of this adjustment on cash or cash runway, which I'll turn to in a moment.

On a non-GAAP basis, which exclude certain noncash adjustments.

Our net loss of $5 3 million and $16 5 million in the third quarter and year to date 2022 compared to our non-GAAP net loss of $3 7 million and $16 1 million again in the third quarter and year to date 2021.

The one 5 million and $40 million increase in our non-GAAP net loss for the third quarter and year to date, respectively was primarily a result of higher R&D expenses related to our reassured trial.

At the end of September we had cash cash equivalents and short term investments of $64 3 million.

Based on our current operating plan, we expect to have cash into 2024, which includes through top line data readout for the reassure trial.

If the reassure trial is successful.

Resubmission to the FDA of BMD April or two lower panel for the treatment of UTI.

That did in the second half of 2024.

As of September 32022, we had approximately $12 2 million ordinary shares outstanding.

As mentioned in August 2022, we effected a one for 15 reverse share split and as a result regained compliance with nasdaq's bid price rule in September 2022.

Also as of the end of September 2022, we had approximately half a million warrants outstanding at an average price of $24 90 per share.

And $12 $6 million of exchangeable notes, which can be exchanged at the option of the note holder for approximately one 3 million shares which includes accrued interest.

If the notes are not exchange, we will pay the note holders $12 6 million plus accrued interest in January 2025.

Now I will turn it back over to Corey for some closing comments.

Great. Thank you Judy.

We'd like to open up the lines for any questions now.

Thank you if you would like to ask a question. Please press star followed by one on your taking keypad now could you change your mind. Please press star followed by the team.

And to ask your question. Please ensure that your line is muted.

Our first question comes from Ed <unk>.

H C. Wainwright. Please go ahead. Your line is now open.

Hi, good morning, Thanks for taking our questions and congrats on the recent initiation of reassure.

Firstly I wanted to ask about the powering of the study.

Given its.

Roughly 2000 patients randomized one to one.

And perhaps talk a little bit about how you came to that determination given this is amar.

Doug mentioned versus.

The other comparator for the prior study.

And then I wanted to ask also about the new patents.

I know its described as a composition.

But is this actually a composition of matter patent.

For the.

The combination of solar panel and pro benefit or.

Or is it is it really a formulation.

And then I have a follow up thanks.

Great.

Thanks for the question that we will start with the powering question.

We are powering the study based on a set of assumptions, which include things like the point estimate for <unk> as well as augment them.

90%.

So we will and.

Endeavored to keep that power, we do have a.

Interim analysis at the 50% enrollment point, where the data management Committee will look at the <unk>.

Blinded data.

To assess where we are with regard to <unk>.

Potential power, but as of right now we are powering a study at 90%.

The second question you had was regarding the patent.

And our attorneys have told US that this is essentially a composition of matter patent for the bilayer tablet.

Not really a formulation patent per se it is.

Is more of a composition of matter patents.

With a combination of suitable pediment to drop so and for benefit.

So we feel pretty good about it it's not a use patent per se or anything like that and so we think that there is a.

A very strong patent situation for us that would get us out into a very.

Healthy runway, assuming we launched the product in the next couple of years.

Wouldnt expire that particular pattern wouldnt expire in the U S until at least 2039.

Great that's helpful.

And then a couple more if I may 1st just wanted to clarify the cash runway.

Given that you've.

<unk> stated you expect enrollment to complete in the first half of 'twenty four.

And if successful would be filing your NDA.

Resubmitting the NDA in the second half of 'twenty four.

It seems pretty clear that the data top line data release would be sometime around the middle of the year mid 'twenty four.

But if you state that the runway is into 'twenty four is it is it not at least.

This way or more into the year.

And then the other question is if you could just provide any.

Any commentary or details around what's going on with the class action lawsuit. Thanks, so much.

Sure. So yes, we're not trying to be clever with our words with regard to being saying cash into 2024.

It's more a factor of we we feel confident that we will have cash too.

To get through the topline data.

And that just becomes a question of when does that occur so to your point could it be mid year or a little earlier or whatever it is our general sense is that we've got cash to get through that.

And so we're not we're not being specific about a particular quarter because we just don't know that answer based on enrollment yet but.

I think what you can take away from this is we feel confident that we've got the cash to get us through the top line data at this point.

Yes.

And with regard to the lawsuit I don't think Theres any.

Any new information, we do have a conference on December 7th on the litigation matter.

And.

We're just waiting on that date, obviously, we've done a lot of work preparing for that and we're waiting on that date.

Just to see what happens there.

Great. Thanks, so much for I appreciate it.

Thank you Ed.

Thank you. This concludes our Q&A session for Pepsico, a sussman for closing remarks.

Great.

Well, thanks for joining us today, we remain confident in the value of oral suitable to treat multi drug resistant infections.

We're looking forward to completing our envelope ongoing clinical work and if successful resubmitting, our NDA to the FDA for this really important treatment option for physicians and patients in the uncomplicated urinary tract infection therapy area.

So thank you very much for attending this morning, and we wish you all a great day.

Thank you ladies and gentlemen. This concludes today's call. Thank you for joining you may now disconnect your lines.

Yeah.