Q3 2022 Protalix Biotherapeutics Inc Earnings Call

Greetings and welcome to defer to Alex Biotherapeutics third quarter, 'twenty, 'twenty, two financial and business results Conference call.

At this time.

Participants are in a listen only mode. A brief question and answer session will follow the formal presentation.

If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.

As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Mr. Chuck put a lot of lifestyle advisors Investor Relations for Photonics, Sir you may begin your conference.

Thank you operator, and welcome to the Portola expired Therapeutics third quarter 2022 financial results and business update conference call.

With me today are dwarfed, Sean President and CEO of <unk> and I, All Rubin Senior Vice President and Chief Financial Officer.

A press release announcing the results in the update was issued this morning and is available on the Portola website.

Please take a moment to read the disclaimer about forward looking statements in the press release.

The earnings release and this teleconference include forward looking statements.

These forward looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from the statements made.

Factors that could cause the actual results to differ are described in the disclaimer ended the Porta Alex filings with the U S Securities and Exchange Commission.

Now I'll turn the call over to Mr. Dror be shocked door.

Thank you Chuck and welcome everyone to our third quarter of 2022 financial results and business update call. It will.

I will begin with a review of our progress and accomplishments over the quarter, along with our plans for the coming months.

Following my remarks, John will provide a more detailed review of our financial results and.

And well then open the line for questions I'll begin with the significant milestone risks recently achieved we are pleased to report that last week, we together with our development and commercialization partner. He is a global road diseases resubmitted.

Logic license application or BLA to the U S. FDA for pier rigs, one or two or the proposed treatment of it does we separate disease.

The data package.

Campaign in the BLA Resubmission includes in addition to the phase one two studies.

And there are two years' analysis of all phase III balanced clinical trial and the final phase III Open label Bright study report. In addition, we have provided that all.

From a long term open label extension studies.

Achieving this milestone is a testament to the dedication of fatalities in GSE teams to delivering this potential new treatment to patients with fabry disease, and we are grateful for their hard work and commitment to our program.

We anticipate that the FDA will complete its review of the Resubmission BLA within six months of foresee.

With respect to the Pra's MMA submission to the European Medicines agency, the EMA LDL D C or the EMEA EMA. He's currently reviewing go obligation, though dialogue with the EMA is ongoing.

As we approach year end photonics is entering into an exciting time as well moving closer to a potential.

Approval rates, one or two for the treatment of adult patients with Fabry disease. We believe the Prereqs, one or two has significant potential for patients and families affected by fabry disease, and we remain committed to continued collaboration with the FDA and EMEA to work towards our goal of successfully bringing these much needed treatment to this.

Patients in need.

Turning to our own earlier stage program pipeline, we are continuing to develop additional programs expressed through our proprietary protein expression system prosthetics Pra's 115 is a novel Pegylated you regarding development for treatment of severe go we are on track to initiate the first in human.

Phase one clinical study of <unk> 115 in the first quarter of 2023.

And their support for this first in human study will finally, Sangamo toxicology pictures.

In addition, we continue to make progress on Pra's 119 to percolate at recombinant human DNA was one protein designated designed to elongate the housewives and stipulation for treatment of <unk>.

Smith related diseases, we have conducted preclinical studies to demonstrate feasibility opioids 119, and we look forward to providing updates on these two and other programs as we progress.

Finally, our buying on his cheek provides us with sufficient sufficient cash runway to the fourth quarter of 2023 enough to support the company through the potential approval. In addition to continuing to develop our early stage pipeline programs.

I will now turn to a young to review our financials. Yeah go ahead.

Thank you Dror and thank you everyone for joining today's call. Let me. Please review our third quarter 2022 financials.

The company recorded revenues from selling goods of $8 8 million. During the three months ended September 30 of 2022, an increase of $4 3 million and 96% compared to revenue of $4 5 million for the three months ended September 32021, and.

An increase of $3 4 million in sales Pfizer, resulting from timing difference and an increase of $2 4 million shades Kinsey was partially offset by a decrease of 1.5 million tests in Brazil, resulting from timing differences.

Revenue from license and R&D services for the three months ended September 30 of 2022 were $5 4 million.

A decrease of $2 1 million or 28% compared to wherever you are $7 5 million for the three months ended September 30 of 2021 evidence.

Revenues from licensing and R&D services are comprised primarily of revenues.

Recognizing connection with the kids.

Cost of goods sold was $7 1 million from the three months ended September 30 of 2022, an increase of $3 4 million or 91% from cost of goods sold $2 7 million for the three months ended September 30th 2021 the increase in cost of goods sold was primarily the result of the increase in sales.

Good.

For the three months ended September 30th 2022 our total research and development expenses were approximately $7 4 million comprised of approximately $4 9 million and subcontractor related expenses, approximately $1 $7 million of salary and related expenses of approximately <unk> 2 million on materials and extensive and.

<unk> 6 million of other expenses.

For the three months ended September 32021, total research and development expenses were approximately $7 2 million comprised.

Oh, approximately $4 8 million in subcontractor related expenses, approximately $1.6 million of salary and related expenses.

When they put $1 million of material related expenses and approximately $8 million of all of the expenses.

Total decrease in research and development expenses were $21 million or 1% for the three months ended September 30th 2022 compared to the three months ended September 32021.

Selling general and administrative expenses were $2 8 million for the three months ended September 30 of 2022, a decrease of <unk> 2 million or 7% compared to 3 million for the three months ended September 30th 2021.

The decrease was primarily due to the decrease in salary related and selling costs.

And there were some expenses nets were <unk> 4 million for the same months ended September 32022, compared to financial expenses net of $2 3 million for the three months ended September 30th 2021.

The decrease resulted primarily from lower interest and debt amortization costs due to a decrease in our outstanding notes from an aggregate principal amount of $57 92 million of 2021 notes to an aggregate principal amount of $28 75 million was 2024 notes.

And an increase in exchange rate to the new Israeli shekel for U S dollars over the period.

Cash cash equivalents and short term bank deposits were approximately 28 million at September 30th 2022.

As Joe mentioned, we believe that our current cash position provides us.

With the sufficient cash runway through the first quarter and fourth quarter of 2023.

Now I'll turn the call back to usual.

Yeah.

Thank you with that should we now open the floor for questions.

Yeah.

Yes. Please.

Thank you ladies and gentlemen.

We will be conducting a question and answer session.

If you would like to ask a question. Please press star one on your telephone keypad.

A confirmation tone will indicate your line is in the question queue.

You May press star two if you'd like to remove your question from the queue.

For participants using speaker equipment, it may be necessary to pick up your handset before pressing the stock east.

One moment. Please why we poll for questions last question. Please press star one now.

We have our first question from the line of mobile and.

<unk> with H C. Wainwright. Please go ahead.

Hi can you hear me okay.

Yes, good morning, Alright, great.

Congrats on the BLA submission. This is great news for Calix shareholders.

Couple of questions from us. So firstly some investors are curious to know at what point you will be able to share. The full details of the agreement between Photonics and Kids me with respect to one directly.

Okay.

Yeah, you would like to reset.

Yeah, given the agreement between the parties, we will not make the.

Agreement public and he gave me says reduction for an honest illegally reasons and Nic will they stay this way as soon as they will hit the relevant milestone where they are.

Gonna be commercial and regulatory or the royalty is obviously is going to be disclosed as part of the financial reports or the relevant required if required P. R's.

Okay, Alright understood Hum.

The 2115, so I was wondering if you could talk about maybe in a preclinical level what kind of efficacy are you seeing and also are you seeing any 80 as our desired immune response.

So you know I wouldn't say the following that they think that the with the data that we have with fragrance. We we are we feel comfortable to continue of course.

And since you recall does not exist in the human body, we it's better that we would speak once we will have final results of the phase one study with.

The human beings of schools and this would be by far more substantial due to discuss upon and not just to say things, which all you know from preclinical studies so.

You know the data that we have support and gives us the comfort to continue of course.

But you know to do I don't want to.

To put hopes before we get the results from human.

Human beings that we do.

Hopefully participate then find that out in the study as we planned.

This will be felt better.

Yeah.

Okay understood and then maybe within their exponent sticking.

Thinking about our excellent competitive landscape.

You probably know our eyes on that the drug.

And that's also a company that would be colored called Selecta Biosciences and they're currently in basically in the readout is expected.

Corner of 20th weight. So I'm just curious how your P. Erik Moreno I Gulped program is differentiated from KRYSTEXXA.

Exxon fell to one two.

So I think that you know once we receive results it will be far more.

Easier to explain where we see the differentiation clearly the intent is not to develop a drug which would be a you know identical to the intent is to differentiate either through the frequency of the infusion and and also Immunogenicity and the you know before we.

You know I wouldn't say much more than most because it's a big secrets is because he says it'll be based on data and we prefer to basically don't even early stage.

Clinical data from Phase one to then you know preclinical and science only.

Yeah.

Alright. Thank you so much for taking my questions.

Cool.

Thank you.

Your question Gentleman. Please press star one on your touched on for now we have next question from the lineup.

John vendors Boston with Zacks. Please go ahead.

Hey, they're drawing al how are you guys doing why don't I start off with a question on Brazil are they recently had an election, which changed the government there and I'm wondering if you might expect any differences due to that change maybe a little bit more.

Liberal demand for pharmaceutical products.

I don't foresee I don't think there will be any major changes at present.

Hum.

This drug existing Brazil for full couple of good years already.

Jim.

You know I I I don't foresee we though we we said in the competitive prices of schools.

First of all to Sanofi and others and I think right no real fine, but we will see.

Okay very good and then also on Pfizer sales do you know if I have any sales in Europe or not I think we had discussed last.

Previous call about the exclusivity for a bit for us and I think that was August 30th.

Were they able to penetrate that market the European market at all with.

With the with the drug.

Firstly the question too about the I'm not aware that they have launched in Europe .

Okay.

Okay.

And let's see.

And then I guess, we've got I was going to ask I was.

Can I ask about 115, and just the competitive environment. There I think you know we already addressed that I think it's about $1 billion market.

Hum.

Is there any kind of.

A portion of the market that youre pursuing in particular I mean, there's always since there are already products. There. It looks like you know is being dominated by about three you know how do you see yourself fitting in into.

And to the current set of products that are available.

So I think you know first skills he's responsible for the marketing of falls, but we believe that in light of the safety Immunogenicity and efficacy data. The two potential regimens. We have a if I may say it go deeper in a very good alternative for the patients for you know for all these aspects and by the end of.

They either drug for the patient.

The patients I mean, and I think Oh, I hope that the <unk> excuse me, we're doing a good job and they'll clearly taking care of all Sweden preparing himself willing we will do fair on the market.

Alright, and then you know on T. A Z in there.

The combination of the safety and Immunogenicity.

And the efficacy that.

The robustness of the program.

And of course, the potential two regimens ease of use.

He's a very good alternative potentially of course.

Great Yeah, I guess I'll keep an eye out for that phase one data and just on that phase one data from 115, I guess, we would expect that to come out somewhere around midyear next year does that sound about right I believe something like <unk>.

It's about 12 months from the initiation of the study I assume.

Oh next year or beginning of Q1 than your roster I mean to speak about the final results.

Okay, maybe I have like some kind of topline prior to that just to get a sense of.

We would see all year long.

Okay, and then just a last one for me on Casey's rare disease subsidiary here in I guess, it's I think it's in Boston right or have they started.

<unk> marketing any products, yet and I'm, just wondering kind of where they are in terms of ramping that up I know that there are some other products. Some other rare disease products that you know are still in development, but I wasn't quite sure where they are in terms of commercialization activities. How are they looking on that side of things.

So Kim.

They have established their disease division already couple of years ago.

And they both coupled of rare disease assets, though they have I seen couple of drugs on the market actually they have their own site of course.

It's not a secret.

Right now for the last year I believe though.

Since we were supposed to get approval in the U S. But also in Europe today.

Ready to go so we have four teams right.

Preparing themselves and the activity.

And you know ready for launch hopefully.

Great.

Alright, well congratulations on the the BLA submission and look forward to your new good news back from the FDA and EMA in the near term. Thank you. Thank you looking forward to that.

Yeah.

Thank you again.

Again, if you have a question. Please press star one on your thought strong for now.

Okay.

As there are no further questions from the participants I would now like to turn the call back over to Dror, Boston, President and CEO for closing remarks over to you Sir.

Thank you. So thanks again, everybody for joining our call.

Looking forward to speak with you next time thank you.

Thank you.

This concludes today's conference you may disconnect your lines at this time. Thank you for your participation.

[music].