Q4 2022 Acurx Pharmaceuticals Inc Earnings Call
Speaker 2: Greetings and welcome to the Acurex Pharmaceuticals 4th Quarter and Full Year 2022 Financial Results and Business Update. At this time, all 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 do so.
Speaker 2: 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, Robert Shawah, Chief Financial Officer. Thank you, Robert. You may begin.
Speaker 3: Good morning. Thank you and welcome to our call.
Speaker 3: This morning we issued a press release providing financial results and company highlights for the fourth quarter and fiscal year 2022.
Speaker 3: This press release is available on our website at acorexpharmaceuticals.com
Speaker 3: Joining me today is Dave Lucci, President and CEO of Acorex.
Speaker 3: We'll give a corporate update and outlook for 2023.
Speaker 3: After that, I'll provide some highlights of the financials from the quarter and the year ended December 31, 2022, and then turn the call back to Dave for his closing remarks.
Speaker 3: As a reminder, during today's call we'll be making certain forward-looking statements.
Speaker 3: These forward-looking statements are based on current information, assumptions, estimates, and projections about future events.
Speaker 3: that are subject to change and involves a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements.
Speaker 3: Investors should consider these risks and other information described in our filings made with the Securities and Exchange Commission.
Speaker 3: including our annual report on Form 10K, which we filed on Wednesday, March 15, 2023.
Speaker 3: You are cautioned not to place undue reliance on these forward-looking statements and AccraX disclaims any obligation to update such statements at any time in the future.
Speaker 3: This conference call contains time-sensitive information that's accurate only as of the date of this live broadcast today, March 16, 2023.
Speaker 3: ACR-X undertakes no obligation to revise or update any forward-looking statements.
Speaker 3: to reflect events or circumstances after the date and time of this conference call.
Speaker 3: I'll now turn the call over to Dave Lucci. Dave?
Speaker 2: Thanks, Rob. Good morning, everyone, and thanks for joining us on this conference call to review our financial results for the fourth quarter and year-ended 12-31-2022. It also covers some recent updates, and then we'd be pleased to take any questions.
Speaker 4: In the fourth quarter of 2022, we continue to enroll more patients in our Phase IIb clinical trial of ibesopulstat, our lead antibiotic candidate for the treatment of patients with C. difficile infection, or CDI, as we call it. The Phase IIb clinical trial is a randomized one-to-one, non-inferiority, double-blind trial.
Speaker 4: Since 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 and the blinded observed data has been exceptional.
Speaker 4: The Phase IIb trial protocol includes an exploratory endpoint comparing the impact on the microbiome between idesoprolostat and the standard of care, vancomycin.
Speaker 4: In the event non-inferiority of ibesoprolsats of VENCO is demonstrated, further analysis will be conducted to test for superiority.
Speaker 4: As we previously discussed, due to slower than expected enrollment during and possible resurgence of COVID-19 infections, we expanded the number of clinical trial sites participating in the Phase 2b trial from the initial 12 sites to a total of 28 trial sites.
Speaker 4: This project was commenced in July 2022 and completed in the fourth quarter.
Speaker 4: We remain particularly excited about the dual impact of using Ibezopulstead to treat acute CDI while appropriately managing the long-term care of each patient's microbiome, which we believe is exceptional for antibiotic therapy.
Speaker 4: Details of the impact on the microbiome were presented in oral and poster presentations.
Speaker 4: at ID Week in October 2022 and are available on our website.
Speaker 4: Most importantly, based on the blind and observed data from the ongoing phase to the clinical trial today.
Speaker 4: In January 2023, the company filed a protocol amendment to its investigational new drug application or IND with the FDA to allow for an independent data monitoring committee to
Speaker 4: or IDMC to review interim clinical data.
Speaker 4: If acceptable to the FDA, the IDMC will review the clinical data upon enrollment of 36 patients.
Speaker 4: I repeat 36 patients, not 64 patients, in the face to be clinical trial. The company currently has 25 patients in the trial.
Speaker 4: today.
Speaker 4: The IDMC will determine and recommend to the company whether the most appropriate course of action forward is To early terminate the 2b trial as we did previously with our phase 2a clinical trial
Speaker 4: or to continue patient enrollment. The company intends to report available data properly after the IDMC conducts this interim review.
Speaker 4: the company assembled its IDMC, Independent Medical Committee, in the first quarter of 2023 solely for this purpose.
Speaker 4: Other key highlights from the fourth quarter of 2022, on some cases shortly thereafter, include the following.
Speaker 4: The company has continued its R&D collaboration with Leiden University Medical Center in Holland to further evaluate the mechanism of action of Acorex's inhibitors against the DNA PAL3C enzyme.
Speaker 4: which is the bacterial target of our antibiotic product pipeline for the systemic treatment of other grant-positive bacterial infections. Data generated from this program was critical to include in a recent non-dilutive grant application, which I will describe in more details in a minute.
Speaker 4: This grant application was submitted by the company in the fourth quarter of 2022.
Speaker 4: based on this successful collaboration with LUMC, has proposed a second stage two-year project to further analyze chemical structure relationships of new Acarex compounds with a propensity for reduced antimicrobial resistance.
Speaker 4: At this point, this new project proposal is subject to review, approval, and funding by the Dutch government, but the grant is expected to be for about $500,000 in total, similar to the original grant amount that was provided by the Dutch government for the initial project. The grant is updated to alignsawins tarot folder with the motorcycle and it is a
Speaker 4: The company completed certain portions of its laboratory study at the University of Houston comparing the killing effect of ibesopulstad to vancomycin, vedaxomycin, and metronidazole using both in vitro and ex vivo analyses.
Speaker 4: Certain results were presented at the Interrupt Society of America annual scientific conference and results demonstrated that I, as opposed to that, has favorable killing can have as comparative vancomycin to treat Tiga Feseel infection at standard and high bacterial concentrations.
Speaker 4: supporting continued development of this first-in-class antibiotic to treat C. disinfection.
Speaker 4: comparisons of the killing effect of I bezipuls that to fit out some medicine and metronidazole are ongoing.
Speaker 4: In October 2022, the company filed for a non-deludive grant of up to $11.3 million which it approved would provide funding for ACX-375, our second antibiotic program targeting the treatment of nurse infections.
Speaker 4: for a period of five years of drug development, right to the start of phase two clinical trials.
Speaker 4: The company is now in a third and final round of consideration for this non-delative grant, and a decision is expected in April 2023.
Speaker 4: just a few weeks from now. If approved, the company would need to pay approximately $5 million of the total project cost of approximately $16 million.
Speaker 4: total over a five-year period and the grant would pay the other 11.3 million.
Speaker 4: Next month, the European Congress of Clinical Microbiology and Infectious Disease
Speaker 4: One of the most comprehensive and influential scientific conferences in clinical microbiology and infection will hold its 33rd session in Copenhagen. An abstract entitled novel pharmacology and susceptibility of a besid pulse that, against the divine colitis being reduced contain the disc?? Emb This is in an individual skill
Speaker 4: susceptibility to see this directed antibiotics.
ability to see this directed antibiotics has been accepted.
Dr. Kevin Gary, professor and chair, University of Houston College of Pharmacy, and the principal investigator for microbiome aspects of our IEPA as opposed to that clinical trial program will be presenting on our behalf. Additionally our executive chairman Bob D'Lucci has been invited to present the company
Ursula Thuritz-Backer, a world-renowned microbiology expert for antibacterial drug research discovery and development strategies and policies for clinical and public health needs.
More details on these presentations will be announced prior to the meeting date.
Now back to our CFO , Rob Schala, to guide you through the highlights of our financial results for the fourth quarter in year end 2022. Rob!
Thanks Dave, our financial results for the fourth quarter and full year ended December 31, 2022 were included in our press release issued earlier this morning.
The company ended the year with cash totaling $9.1 million, compared to $13 million as of December 31, 2021. Research and development expenses for a three months ended December 31, 2022 were $1.4 million. The company ended the year with $1.2 million.
Compared to $0.7 million, who were three months ended December 31, 2021.
The increase was due to an increase in Phase IIB trial-related costs.
For the 12 months ended December 31, 2022, research and development expenses were $4.8 million versus $2 million for the 12 months ended December 31, 2021.
The increase was due primarily to Phase IIb trial-related costs.
General administrative expenses for the three months ended December 31, 2022 were $1.8 million, compared to $1.9 million for the three months ended December 31, 2021.
The slight decrease was primarily due to a decrease in professional fees.
For the 12 months ended December 31, 2022, general and administrative expenses were $7.3 million versus $10.8 million for the 12 months ended December 31, 2021.
The decrease was primarily attributable to a decrease in professional fees.
and stock-based compensation expense partially offset by an increase in insurance costs.
The company reported a net loss of $3.3 million, or 28 cents per diluted share, for the three months ended December 31, 2022.
compared to a net loss of $2.6 million, or $0.26 per diluted share, for the three months ended December 31, 2021.
and a net loss of $12.1 million, or $1.12 per share, for the 12 months ended December 31, 2022.
compared to a net loss of $12.7 million or $1.49 per diluted share for the 12 months ended December 31 2021 all for the reasons
previously mentioned. The company had 11,627,609 shares outstanding as of December 31, 2022.
With that, I'll turn the call back 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 AcreX's progress in the fourth quarter of 2022. We look forward to building on this momentum in coming months.
even during these most challenging times and to update you as we do so.
I'd now like to open up the call to questions. Operator? Thank you. We will now 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 review a question from your queue.
For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. One moment please while we poll for questions.
Thank you. Our first question is from Jason McCarthy with Maxim. Please proceed with your question. Good morning, David. Thank you for taking the questions. When do you expect an outcome or a response from FDA on the IND for the IDMC? Hoods Society tall new
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No problem. Thanks for joining us today, Jason. We expect in the coming days or weeks, certainly in the month of March, a response from the FDA on the amendment. But we're sure that there's going to be no issue with.
our, you know, taking the interim look at the data. You know, this is a phase two, not a phase three, registration trial. And, you know, there's plenty of precedent supporting it, and no precedent we found that would suggest that we won't be able to take the look. So, we're confident we'll be able to take the look. It is a protocol amendment, so it's a, as you know, a highly...
technical scientific documents, so we're sure to get comments, whether they're substantive in nature or language, linguistic type of comments.
But the overall theme of taking the interim look is something that we're certain is, you know, we're highly confident it's going to be just fine.
Do you think that, will the interim look be predicated on non-inferiority or would you be looking for superiority kind of like you saw in the phase 2a?
And would it be reported?
would you report that data or would you just get a halt to trial for efficacy or discontinuous planned outcome?
No, you know, so we've always said that when we get to the end of the trial, and in the end may very well be 36 patients, after testing for non-inferiority, which is the primary endpoint, we do have an exploratory endpoint to go ahead and test for superiority as well. So that process isn't changed by taking the interim look.
I think what we'll probably do is get out as soon as possible the top line data from the IGMC when we receive it with the understanding that we'll get out another press release with a full data set down the line when the database is locked and the data is scrubbed.
I think what we'll probably do is get out as soon as possible the top line data from the IDMC when we receive it with the understanding that we'll get out another press release with a full data set down the line when the database is locked and the data is scrubbed and we get the final study report. So, we'll be able to get a full data set down the line when the database is locked and the data is scrubbed and we get the final study report.
Just last question with the
With the increase in the number of trial sites, have you seen enrollment start to tick up? And if so, how long do you expect it to take to get to the 36 patients for the IDMC?
You know, the enrollment's definitely ticked up a bit, but we're focused more, we can get the patients all the way through the prescreening process, and then it's almost a question of physiology and patient consent.
So just yesterday, there was a patient that qualified out west, and they just didn't want to consent to being in the trial. They changed their mind.
And, you know, we can't control that, but what we can control with all of the efforts we've done with adding all these trial sites is we're seeing an average of five to seven patients being pre-strained every week.
So the question that we ask is, how long does it take to have five to seven prescreen patients per week turn into eleven enrolled patients?
And the answer to that question, you know, everyone, it's like a fingerprint. Everyone's going to have a different opinion, but it could be a couple of months, it could be a few months.
But it's certainly not a very long period of time.
Just quickly, can you just review your thoughts on...
what treatment guidelines could look like with Inabezibolstat getting to approval. Would Fidaximycin, Vancomycin kind of go in the rear-view mirror and they would move to whatever comes out next.
because radimulazole seems to be out, right? Ibediopulseth seems to be kind of the only game in town, new antibiotic that's out there.
Yes, well you know, subject to the data, if the data holds the way the I-BESA pulls that data has been trending, you know, the people that write the guidelines, the IDSA treatment guidelines suggest that the data is being used to
The next approved drug to treat C. diff that comes out that makes the recommendation list is going to kind of mean the twilighting of oral vancomycin similar to how Unidazole was twilighted a couple of years ago and is no longer recommended
So that's kind of where the intelligentsia is in the C. diff space.
You are quite right. Regional Azole didn't make it. There have been a number of things that haven't made it, down the line, you know, sequel transplants, stuff like that.
But we think that we would be used front line. Fidaxomycin isn't a bad drug. In my view, it's better than oral vancomycin in a lot of ways.
but it's so prohibitively expensive and with the Medicare and Medicaid reimbursement rules it's therefore used last line.
And we don't expect that to change. And remember that that's not a QIDP drug, phenaxamycin, it was approved before QIDP was a law. And therefore, it wouldn't qualify for things like the DISARM Act.
which would put branded antibiotics on equal footing with generics so that hospitals could use the best antibiotic frontline instead of the cheapest antibiotic frontline. Okay, thank you for taking the questions.
put branded antibiotics on equal footing with generics so that hospitals could use the best antibiotic frontline instead of the cheapest antibiotic frontline. Okay. Thank you for taking the questions. No problem. Thank you, Jason.
Our next question is from Ed Arce with H.C. Wainwright. I'm going to start with your question.
Hi, good morning. Thank you for picking up questions. This is Thomas. You're asking a couple of questions for Ed. So first, regarding the Phase 2B study, just wondering will patient screening and enrollment continue while the interim review is ongoing?
No, I don't think it will. We'll put a pause. In other words, we won't terminate the trial. We'll put a pause on further enrollment while the evaluation is happening. But we don't expect the evaluation to take a long period of time. It should take a few days, not an extensive period of time.
Right, got it. Okay, thank you for clarifying. And then another question on the Phase 2B, specifically for the IVMC. Can you tell us how large is this group and what are their backgrounds? Does it include anyone with regulatory experience?
Oh, absolutely. It's folks in microbiology, statisticians, significant clinical development. It's quite a star-studded team. If you'd like to find out more details about their CV information, we can certainly...
have an offline conversation about that. I'm sure we can make you comfortable. It's a powerful group.
Okay, sounds good. And then perhaps one last question. For most, you outlined the 11.3 million grants that were found over. Is this a Carvex grant and if not, can you give us any other details where it is based?
Yes, it is a CARB-X grant. Okay, got it. Thank you so much for taking our questions and looking forward to the Phase 2B update. Awesome. Well, thank you for participating this morning.
Thank you. Our next question is from James Malloy with Alliance Global Partners. Please proceed with your question. Hey guys, good morning. Thanks for taking my question. Post the interim look, I guess presuming things go well in the interim look and it's an early stoppage for success.
What's the thinking on timing for going forward with the non-inflatory CRE trial or or sort of the next steps post post that interim look?
So after the interim look, we would promptly release top line data and then wait for the database to be locked, data scrubbed, final study report.
And that will be then put into an FDA post-Phase II meeting package. And we would meet the FDA to kind of outline and...
kind of negotiate what Phase 3 will look like.
And, you know, that whole process from the time we get the final study report to the time we have the FDA's concurrence is probably a 90-day process. And during that time period, we'll also be going out to kind of recruit more clinical child centers.
probably at least 50 or 75 trial centers to start with, just to get us off the ground for phase three. And then phase three would formally start sometime in the first half of 2024.
Excellent, thank you. And then, I'll be able to take a picture. Has there been any updates on the PASTEUR Act and anything going on there you can talk about? Well, we signed on to a letter from dozens of members of the Antimicrobial Working Group who are actually speaking about March Time, of SARS.
who are in our space, to Congress just about two weeks ago.
And as we find out through our affiliation with the Antimicrobial Working Group, there are 60 U.S. Senators now that approve of the content of the PASTEUR Act.
So it having passed the House, one would think that it is extremely close.
We know that Patty Murray, the Democrat that's been leading the charge from the state of Washington is very supportive. I don't know where President Biden is honest conceptually, but I do know that there's now a budget battle in Washington.
I don't know exactly how that's going to turn out generally or specifically with regard to whether Pasteur will be included in some component of that massive piece of legislation.
So it's percolating, it was days away from being approved twice in 2022, so you just never know. I agree. And then, I can't remember my last question, looking at OPACs here, you guys are stewards of shareholder capital. Are these the sort of levels that we should anticipate OPACs being in?
in 2023. And then for I guess, changing pen in the phase three starting and what what's your current run rate with the 9 million in cash.
So we're spending on average about $2.2 million per quarter currently.
It would certainly be nice for the CARB-X grant to be approved.
And we'll find out in April if that is approved. That will be a nice shot in the arm for us. It's about a dollar a share in value.
in April if that is approved that'll be a nice shot in the arm for us. It's about a dollar a share in value, non-dilutably.
So clearly we have enough money to get through the end of the year. You know, phase three obviously is going to be an expensive endeavor. And our objective is, you know, let's...
Let's get through the study. Let's see if we get the Carvex grants and we'll go from there if we can opportunistically add it.
a nip or a tuck here or there, capital-wise. We will. It wouldn't be anything.
tremendously large, but at some point, we'd probably do a little something. Keep in mind our original business plan from day one is to get through the Phase IIB clinical trial and explore strategic alternatives.
We certainly love what we're doing and phase three would be you know quite exciting, but you know since our job is to deliver Shareholder value, we'll give it an honest look.
Thank you for taking the questions. Thank you, Jim. Thank you. There are no further questions at this time. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.