Q4 2022 X4 Pharmaceuticals Inc Earnings Call
Speaker 2: Thank you for standing by. This is the conference operator. Welcome to X4 Pharmaceuticals 4th Quarter and Full Year 2022 Earnings Conference Call. As a reminder, all participants are in listen-only mode and the conference is being recorded.
Speaker 2: After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. It's now my pleasure to introduce your host, Dan Ferri from LifeSci Advisors. Please go ahead.
Speaker 3: Thank you, operator, and good morning, everyone. Presenting on today's call will be X4's Chief Executive Officer, Dr. Paul Regan, and Chief Financial Officer, Adam Mustafa.
Speaker 3: Following prepared remarks, we will open up the call to your questions and we'll be joined by Interim Chief Medical Officer, Dr. Murray Stewart, Chief Commercial Officer, Mark Baldry, Scientific Officer, Dr. Art Taveras, and Chief Operating Officer, Dr. Mary DiBiase.
Speaker 3: As a reminder on today's call, the company will be making forward-looking statements regarding regulatory and product development plans, as well as research activities.
Speaker 3: These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted.
Speaker 3: A description of these risks can be found in X-Force filings with the SEC from time to time, including the company's latest 10Q filing on November 3, 2022, and then the 10K for 2022, which is expected to be filed after the market close today. I'd now like to turn the call over to X-Force President and CEO ,
Speaker 4: Dr. Paula Reagan. Paula? Thanks, Dan, and thank you, everyone, for joining us on the call. As we mentioned in the press release this morning, we could not be more pleased with the progress we made in 2022, advancing our lead candidate, Maverick Saphore.
Speaker 4: towards commercialization and most importantly, towards helping patients in need.
Speaker 4: We believe our clinical trial data continue to speak volumes, unequivocally demonstrating maverick sephora's ability to chronically raise circulating levels of neutrophils, lymphocytes, and monocytes. We believe our clinical trial data continue to speak volumes, overwhelmingly demonstrating
Speaker 4: As you may be aware, following our strategic announcement last July when we tightened our focus to advance MAVIRXA4 in chronic euchipenic disorders, we achieved two significant development milestones, announcing positive clinical results from both our pivotal Phase III trial of MAVIRXA4 and WIMP syndrome.
Speaker 4: and people with WIM syndrome, with the study meeting its primary endpoint and first key secondary endpoint, achieving statistically significant and clinically relevant longer times above threshold for both absolute neutrophil counts and absolute lymphocyte counts versus placebo. For more information, visit www.wim.org
Speaker 4: MAVERIX-IV also demonstrated good tolerability in this robust, 52-week, randomized, placebo-controlled, double-blinded trial.
Speaker 4: Note that MAVERX 4 is the first and only oral therapy to demonstrate
Speaker 4: durable improvements in severe chronic neutropenia and lymphopenia, the hallmarks of WIMP syndrome, which is a rare combined immunodeficiency for which there is no approved treatments.
Speaker 4: Since the November data announcement, we have continued to analyze the clinical results from the Phase III WHIM trial and expect to be able to present additional data from the trial at one or more medical conferences in the second quarter of 2023. We plan to host an investor call around the time of the first presentation.
Speaker 4: and we'll update you as we have more information on the exact schedule.
Speaker 4: Importantly, these results are expected to include additional secondary and some exploratory endpoints, including assessments of infection rate, severity, duration, and types of infections, as well as the effect on patients' wart burden and certain vaccine titer data.
Speaker 4: We now have scheduled a pre-NDA meeting with the US regulatory authorities in Q2 to discuss next steps in advancing Maverick's 4 towards an NDA submission.
Speaker 4: Tending input from the FDA, we continue to anticipate submitting the NDA early in the second half of this year, which we hope will lead us to our first product approval in the first half of 2024.
Speaker 4: Also last year, back in September , we presented positive data from our Phase 1b clinical trial in chronic utropenic disorders.
Speaker 4: The study demonstrated the ability of a single oral dose of maverick before to normalize absolute neutrophil counts, or ANC, in those with the most severe forms of neutropenia and across all chronic neutropenic disorders studied, which included idiopathic,AMP,Number 4 Jenner Audio muchheet
Speaker 4: cyclic and congenital neutropenia.
Speaker 4: Normalization of ANC was demonstrated with maverick sephor as a monotherapy and in combination with the only approved treatment for severe neutropenia, Injectable Granulocyte Colony stimulating factor, or GCSF.
Speaker 4: Impressively, 100% of patients responded. We could have not hoped for more in this initial study.
Speaker 4: This early trial has now been expanded into a phase 2 clinical trial to assess the long-term durability, safety, and tolerability of oral MAVERX IV more broadly in those diagnosed with idiopathic, cyclic, or congenital chronic eugeneopenia.
Speaker 4: Participants are currently being enrolled in the Phase II CN trial, and we expect to be able to report clinical data from the study in Q2 or Q3 of this year.
Speaker 4: The timing of this will obviously be dependent on the rate of enrollment, and we do plan to present a robust dataset when we announce the first results from this trial.
Speaker 4: These proof of concept data we are generating in our phase 1-2 trials aim to unlock an even broader potential of mavericks of horror, one where we could potentially offer a differentiated oral and well-tolerated treatment option to upwards of 50,000 people diagnosed with CN disorders in the US.
Speaker 4: We also expect to be able to provide clarity on both the scope and the possible timing of our planned Phase III clinical program for MAVRAXA4 and chronic enziopenic disorders in the second or third quarter of this year. At this time, we expect the Phase III trial will likely be a randomized trial.
Speaker 4: placebo-controlled trial studying the safety and efficacy of Mavericks IV on top of standard of care.
Speaker 4: with likely a primary endpoint measuring changes in neutrophil counts, and secondary endpoints related to reduction in infections.
Speaker 4: But we expect to know a lot more following a meeting with the FDA to specifically discuss the path forward of Mavericks for these certain chronic eugenic disorders.
Speaker 4: Throughout 2022, through both our clinical and scientific research programs, we were able to gain much greater insights into Maverix-4's ability to address the unmet need in chronic neutropenic disorders, including Whim syndrome.
Speaker 4: We are particularly pleased that almost all of our submitted abstracts were accepted for either oral or poster presentations at prominent medical conferences during the year, including the Quad-AI meeting early in the year, the CIS Annual Meeting in the spring, EHA, the NICER Symposium.
Speaker 4: and ESID over the summer, and the National Organization for Rare Disease Summit in the fall.
Speaker 4: We also had quite a large presentation at the annual meeting of the American Society of Hematology, or ASH, in December and garnered strong interest both at our presentations and our X4 booth.
Speaker 4: Throughout the year, our presentations not only highlighted new insights into the breadth of genotype and phenotype of people with WIM syndrome, helping to identify both additional patients and helping to educate treating physicians.
Speaker 4: but also demonstrated new understandings into MAVRIC-SCORE's mechanism of action.
Speaker 4: principally its ability to induce maturation and mobilization of white blood cells from the bone marrow into blood circulation and enabling immune surveillance and response. Our research also deepened our understanding of the diverse and significant needs of the patient community through interviews and survey engagements.
Speaker 4: and helped us define what is turning out to be a larger than expected U.S. population of patients living with chronic neutropenic disorders. These milestones throughout the year, along with the continued support of our investors and analysts, helped us successfully complete two large financings.
Speaker 4: raising gross proceeds of more than $120 million, despite continued challenging biotech market conditions.
Speaker 4: Currently, we have a strong balance sheet to help us propel our pre-commercial efforts for MAVERIX 4 and WIM and further advance our mission to deliver MAVERIX 4 to help those across a range of chronic neutropenic disorders.
Speaker 4: I'll now turn it over to our CFO , Adam Mustafa, to review the fourth quarter and full year 2022 financials. Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam? Adam?
Speaker 5: Thanks, Paula, and thanks to all of you for being on the call with us today.
Speaker 5: As Paul mentioned, we were able to strengthen our balance sheet significantly in 2022 and particularly in December . When we completed a public offering that yielded gross proceeds of approximately 65M dollars.
Speaker 5: That left us with $123 million in cash, cash equivalents, and restricted cash as of December 31st.
Speaker 5: We expect that our cash will fund our operations into the second quarter of 2024.
Speaker 5: In addition, as a result of the positive top line results from the 4-WIM clinical trial, the covenant under our loan agreement with Hercules Capital, requiring that the company maintain minimum cash of $30 million was lowered to $20 million. We've actively Been on Centers for its Cancelers,
Speaker 5: On January 6th of this year, we also entered into an agreement with Hercules that amended and restated all prior loan and security agreements.
Speaker 5: And that included an extension of the interest only payment period through the 3rd quarter of 2024. And to further extend the interest only period to the 1st quarter of 2026. If certain milestones are achieved.
Speaker 5: R&D expenses were $19 million and $61.1 million for the 4th quarter and full year ended December 31st, 2022 respectively as compared to $12.2 million. And $50.6 million for the comparable periods in 2021. And note that R&D expenses included half a million dollars and 2.5 million dollars for the 4th quarter.
and $24.7 million for the comparable period in 2021.
And note here, SG&A expenses included 0.6 million dollars and 2.7 million dollars of certain non-cash expenses for the 4th quarter and full year ended December 31st respectively. Finally, we reported a net loss of 25.8 million dollars.
and $90.5 million for the fourth quarter and full year ended December 31st, as compared to $30.2 million and $88.7 million for the comparable periods in 2021.
Net losses include 1.1M dollars and 5.2M dollars of non-cash expenses for the 4th quarter and full year respectively.
And with that, why don't we open up the call for your questions? And then will open again for the operator.
Thank you. We will now begin the question and answer session. To join the question queue, you may press star then 1 on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys.
To withdraw your question, please press star then 2. We'll pause for a moment as callers join the queue.
Our first question comes from Steven Willie of STIFL. Please go ahead. Hi, guys. This is Tulian for Steve. Can you raise your hand? Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay.
Yes, thanks.
Okay great. So I have just two very brief questions on my end. So very first one is related to timing of chronic dystrophy data. Can you give us a little bit more color on...
shift in the timing, what are you actually planning to disclose when you disclose this data? So that's my first question. And second question would be related to the partnering front. Can you give us If you are reporting bodies of groups you can contact us for a short while.
more color on the progress you've made so far on partnership front. And lastly, maybe like R&D cost. I think if I'm not correct, there is a increase, there's a peak in R&D costs. So maybe if you could provide a little bit more.
that we have intended to, you know, it's an open label phase two study in chronic neutropenia where we'll be presenting anywhere from a handful of patients or more on at least a few months of chronic dosing. We want to see durability as we have consistently seen across all of the patient populations tested with chronic maverick before.
So we're certainly on track to do that. Obviously more data is better. So we're giving ourselves some flexibility. We saw the very positive response last year to 25 patients worth of fan data. So we're pushing ourselves as hard as we can to deliver the most robust data set for the investor community and of course, for the patients and physicians who support us. And that additional flexibility on the Q3 timeframe enables that to happen.
So I hope that helps and I will turn that over to Adam now around the partnering and the R&D call.
Yeah, thank you. So, with respect to partnering, we continue to explore discussions. We don't have any significant update for today and don't obviously want to speak on behalf of any potential partners. But it is an area that we are considering in terms of moving our drug forward and capital raising activities in the future.
With respect to R&D, you did notice an increase year over year likely that relates to clinical operations costs in the cryo-neutropenia trial, which in part led to the data that we revealed back in September that Paula mentioned. It also relates to additional clinical operations and CMC costs that support both cryo-neutropenia and the WIM trial leading up to our top-line data.
Hi, thanks for taking my question. Since Divya on for Mark, I guess on the trial in CN, do you guys expect to run the pivotal in all cases in all kinds of chronic neutropenia or do you expect to run separate trials for those? And I have one other question.
Sure, Marie, would you like to take that?
Yeah, so I mean in this phase one we were able to look at the different populations congenital, idiopathic, and cyclical and for a big registration study we'd hope to be able to include similar groups and you can include them in the one study by stratifying so in other words you get balance across the different groups so rather than do three separate studies you can do
them all in one study by accounting for stratification. Okay, that's helpful. And then I guess in terms of the secondary endpoints that you plan to present from the phase three trials sometime in Q2, I guess what inspection rates do you think physicians and patients will be clinically meaningful?
I'll start and then certainly ask Marie and others to chime in. But our phase two data, which aligned with breakthrough therapy designation in WIM syndrome demonstrated a reduction of infection rates of about 50% after a year.
We're certainly hoping that that type of direction continues. We're extremely excited about the phase two data. We designed a robust study for the phase three. And not only, of course, infection rates, but there's a whole host of things that we've mentioned in terms of duration, severity, type. We look forward to sharing the totality of the data. But...
Marie or Art, if you want to chime in any further, that would be great. The only thing to add in, so in the wind population, you might expect people to have an annualized infection rate of about four. And that's a mean. Some people get more than five infections and some people get two or three infections, but the mean is about four.
And obviously from our phase two we saw about a 40% reduction.
Bear in mind that the study we did was under COVID, and there have been concerns about would we see less infections in COVID. But when we present the data, we'll be presenting the data looking at the annualized infection rate, the field where it's active, and we'll look at the different components of infection, including, as Paula mentioned in the call, severity, duration, repeated infections.
as well as works vaccine, tectors, quality of life and safety.
as works, vaccine tactics, quality of life, and safety. That's helpful. Thank you.
Our next question comes from Ted of Piper-Samar. Please go ahead.
Great. Thank you very much. Shaping up to be a very exciting year. Two quick questions, and I'm assuming that maybe you're waiting for acceptance, but what are the conferences you anticipate presenting data at for the Phase 3 data in the second quarter? And when it comes to the chronic neutropenia readout...
Is it more likely that's going to be a press release than followed up by a medical meeting, or are you targeting a specific medical meeting? Thank you so much.
Hi Ted, thanks for the great question. So we're currently aiming to present either at CIS, which is in the second or third week of May, or EHA, which is in the second or third, second week or so of June . We are still waiting to hear, so we're looking forward to kind of refining that type of information. So please stay tuned and we'll try to update it.
not likely links to it to an individual conference but perhaps an investor or R&D day on behalf of X4.
That's very helpful. Looking forward to the data and the regulatory filings. Thank you very much.
very helpful looking forward to the data and the regulatory filings. Thank you very much. Thanks so much, Ted.
Our next question comes from Mayank Mumtami of B. Riley Securities. Please go ahead..
Hi, good morning team. This is a couple quick questions from us. 1st, can you remind us how you're thinking about the timeline for potential EU filing for Maverick score as well and when syndrome.
Sure, Murray, can you take that? Yeah, so obviously we want to use the same data set, so within the next 6 to 12 months we'll be filing in Europe following on from the NTA filing.
Okay, perfect and then maybe as we switch to the US launch here, can you give us an update on any commercial or launch preparation activities, including how you're thinking about the sales force, engaging with different patient advocacy groups, et cetera. Thank you very much.
Sure, thanks Mark. Would you like to take that?
Sure, thanks. Yeah, while we progress against our regulatory timelines, on the commercial side, we're starting to, I'm a pretty pragmatic guy, so we're starting to prepare the market, prepare the product, and prepare the company for a successful launch.
So we're out with a small field team right now learning about the physicians and where we might be seeing WIM patients. We're educating on WIM disease and really trying to encourage earlier diagnosis as we know that the earlier patients are diagnosed the better outcomes for them.
So that's where we are right now. And then maybe one quick follow up. How much of that work is there overlap with the chronic neutropenia population? You know, as you think about the future, obviously acknowledging a little bit earlier days in that program.
Yeah, well, you know, WIM syndrome is a form of chronic neutropenia, so everything we're learning today is really helpful foundation for us as we think about our strategies in chronic neutropenia and other primary immunospecificians. So teaching
Everything we're doing now, I think, is teaching us about the unmet need in primary inimitancy. And this can all be helpful for us as we build our plans.
Excellent. Thanks so much for taking our questions. Our next question comes from Kristin Kluska of Cantor Fitzgerald. Please go ahead.
Hi, good morning, everybody. Thanks for taking our questions. So, sounds like you're planning to have a potentially robust conference attendance this year with data, but similar to how we learned new insights on WIM syndrome, genotype, phenotype, patient identification, unmet need, and other factors for both CN and WIM, do you think we're going to be able to get a better understanding of the data? And if so, what are some of the things that we're going to be looking at in the next few weeks?
We've done some excellent work on ICD-10 codes with respect to chronic neutropenia. And as we generate even more deep and more refined analyses along those lines, we'll certainly look forward to publishing that data. No specific plans yet, but the team is working very hard to make sure we are defining the right population for treatment and that unmet need and align it, of course, with the right
potential in the CN program.
I definitely think there is crosswalk for excitement but I will turn that over to Murray to expand on that.
Yeah, I know the investigators, the PIs have been seeing the data and they're very excited by the data in WIM and already they're thinking about wanting to enroll in the CN studies so I think they can see the link between
neutropenia between WIM and CN and they're excited about mavrixper. I mean historically they've got GCSF which has its limitations and I think they're excited to see a potential oral therapy for WIM and CN.
Thank you. Looking forward to seeing some of the presentations this year. Thanks, Kristin. Our next question comes from RK of HC Wainwright. Please go ahead. Hi.
Thank you. Good morning, Paula. I think most of my questions have been answered. I'm going to go to the next question. I'm going to go to the next question.
Just trying to understand, you know, in this next meeting that you want to have with the FDA before you file, what sort of clarifications are you trying to get so that you're well equipped when you file?
Thanks, RK. Murray, would you like to take that?
Yeah, so this is a standard pre-NDA meeting. So most companies, well I think all companies, have to have a pre-NDA meeting and we make sure we clarify the most appropriate things. So we cover all areas, are they comfortable with the non-clinical data, are they comfortable that the data actually shows the drug is effective and safe and has a positive impact on the
This concludes the question and answer session. I would like to turn the conference back over to Paula Reagan for any closing remarks.
Thank you, operator. Well, as you can hopefully hear from all of our tones today, we're very excited about the year ahead and the road beyond. We thank you again for joining us today and hope you all have a wonderful day. Thank you. This concludes today's conference call. You may disconnect your lines.
Thank you for participating and have a pleasant day.
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