Q4 2022 Nyxoah SA Earnings Call
Speaker 2: Thank you for standing by and welcome to the NCSOA fourth quarter 2022 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentations, there'll be a question and answer session. To ask a question at that time, please press star one one on your telephone.
Speaker 2: As a reminder, today's call is being recorded. I will now turn to Call for Duty host, Makayla Kirkwood, Strategy and Investor Relations Manager. Please go ahead. Azure
Speaker 3: Good afternoon, and good evening, everyone, and welcome to our earnings call for the fourth quarter of 2022. I am Mikayla Kirkwood, Strategy and Investor Relations Manager at Nixxela. Participating from the company today will be Olivier Talman, Chief Executive Officer, and lamite Moreau, Chief Financial Officer.
Speaker 3: During the call, we will discuss our operating activities and review our fourth order financial results released after U.S. market closed today, after which we will host a question and answer session. The press release can be found on the investor relations section of our website. This call is being recorded and will be archived in the investor relations tab of our website.
Speaker 3: Statements involve material risks and uncertainties that could cause actual results or events to materially differ for those anticipated or implied by these forward-looking statements.
Speaker 3: All seller looking statements are based upon current available information and the company assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risk and uncertainties associated with our business, please refer to the risk factors section of our Form 20F file.
Speaker 4: of the Securities and Exchange Commission on March 22nd, 2023. With that, I will now turn the call over to Olivier. Thank you, Michaela. Good afternoon and good evening, everyone. Thank you for joining us for our fourth quarter 2022 earning call.
Speaker 4: I'm extremely excited to announce we have implanted all 115 patients in our US Pivotal study DREAM and filed the first module in our modular PMA submission.
Speaker 4: With the clock node ticking to our 12-month data, our focus shifts to strong patient follow-up.
Speaker 4: What pleases me even more is to see the first 34 dream patients completing 12 month follow-up, showing a 65% AHI respond rate and a 76 ODI respond rate and safety in line with our expectations.
Speaker 4: This is reporting what we have already demonstrated in studies and European commercial patients.
Speaker 4: We have submitted this data as a late-breaking abstract to the SLEAP 2023 conference in June .
Speaker 4: While these data are preliminary and not conclusive for final dream success, they are highly encouraging.
Speaker 4: Commercially, our European sales and marketing organization continued its strong execution with sales of 1.3 million euros in the quarter.
Speaker 4: In Germany we are exiting the year with roughly 34% market share and with 38 active accounts, up from 12 at the end of 2021.
Speaker 4: Finally, we continue to expand our commercial presence in Europe , as we expect to record our initial sales in Austria during the first quarter.
Speaker 4: As a reminder, 2022 was the first full year of reimbursement in Germany, and I'm extremely proud to see how leading German clinicians have embraced the Genio technology.
Speaker 4: driven by a single incision, a leadless system offering bilateral stimulation, powered by an external battery and a full body MRI compatibility.
Speaker 4: While it strongly resonating with patients is the ability for Genio to always be upgraded to the latest technology without the need for another surgical intervention.
Speaker 4: We received clearance for our Belgium manufacturing facility, adding a second manufacturing site and thereby strengthening our supply chain.
Speaker 4: This is an important milestone in securing capacity to meet growing demand in Europe ahead of our US launch. As for excess study for complete concentric collapse patients, we have implanted the first patient.
Speaker 4: CCC patients, once refractory to CPAP, have currently no hypoglossal nerve stimulation treatment options in the US.
Speaker 4: These patients represent roughly 30% of the moderate to severe OSA population.
Speaker 4: With the CCC label in the US, we would remove the important hurdle of a drug-induced sleep endoscopy so patients will have simpler and faster access to our hypoglossal nerve stimulation therapy. From an R&D perspective, we continue to innovate.
Speaker 4: Last year we received regulatory approval for Genio 2.1 and we made further progress on the Anca Cervicalis project in collaboration with Transbilt University.
Speaker 4: We anticipate initiating a feasibility study in 2023.
Speaker 4: Now I would like to share our three key objectives for 2023.
Speaker 4: First is to focus on patient follow-up in the dream study, resolving and reaching the primary endpoints. The next step is to focus on patient follow-up in the dream study, resolving and reaching
Speaker 4: Next is beginning preparations to enter the US market with regulatory manufacturing and market access readiness.
Speaker 4: And last, his driving further revenue growth in Germany and opening new European markets.
Speaker 4: Before I turn the call over to our CFO Louis Moreau, I would like to invite all those on the call to join us for our first investor and analyst meeting tomorrow, March 23rd in New York beginning at 4pm Eastern Time. Registration details can be found on our investor relations website.
Speaker 4: a full week. Thank you, Olivier.
Speaker 5: Thank you for joining us today.
Speaker 5: Revenue for the fourth quarter ended December 31, 2022 was 1.3 million euro, more than tripling from the fourth quarter of 2021.
Speaker 5: The average selling price in the fourth quarter was 20,300 euros
Speaker 5: Total operating loss for the fourth quarter was 9.1 million euro versus 6.5 million in the fourth quarter of 2021, driven by an acceleration in clinical, commercial and R&D activities.
Speaker 5: As of December 31, 2022, cash and financial assets totaled €94.9 million compared to €135.5 million in December 31, 2021.
Speaker 5: This represents a monthly cash burn of 3.4 million euro.
Speaker 5: Based on our current cash position, we have a runway into the second half of 2024.
Speaker 5: With that, I will turn the callback over to Olivier.
Speaker 4: Thank you, Lubix. I would like to re-iterate our key objectives for 2023.
Speaker 4: which are focusing on patient follow-up in the DREAM study, resulting in reaching the primary endpoints.
Speaker 4: beginning preparations to enter the US market with regulatory, manufacturing and market access readiness and driving further revenue growth in Germany while opening additional European markets.
Speaker 4: 2023 will be a pivotal year for Nixoa, which I look forward to reviewing in more detail during our investor analyst meeting tomorrow. I look forward to seeing many of you there. With that, I will open the call to Q&A.
Speaker 2: Thank you.
Speaker 2: Again, ladies and gentlemen, if you'd like to ask a question, please press star 11 on your touchtone telephone. Again, to ask a question, please press star 11. Our first question comes from the line of Adam Mader of PSC. Your line is open. I'd like to give a shoutout to Adam Mader of PSC and this is the start of a new year. Any questions? Are you having questions? Questions? You.
Speaker 6: Congrats on the progress. A couple from me and maybe just to start, wanted to ask about the announcement on the 12 month data that...
Speaker 6: you submitted for a late breaker at sleep. I think I heard 34 DREAM patients. Can you put the 65% AHI responder rate, the 76 ODI responder rate in context with the broader DREAM trial design and kind of what's needed for success? I guess that's my first question and I had a follow up or two, thanks.
Speaker 4: Thank you Adam, thank you for the question. So just to put it in the right perspective, for the trial, the DREAM trial to be successful out of 115 patients at least 63% of patients need to be AHI and ODI responders at the 12 month follow up. Thank you everyone for taking the time today again and we'll see you in the next session.
Speaker 4: the result is 65% AHI for the 34 patients and an ODI of 76%.
Speaker 6: Okay, perfect. That's very helpful. Thank you for that. And also wanted to ask about DREAM and congrats on finishing implants there. Can you put a finer point on when you did the last patient implant and the DREAM study? Just trying to get a sense for kind of exactly when that 12-month follow-up clock started.
Speaker 6: Yeah, any color there, Olivier. Thanks.
Speaker 4: Yes, yes Adam definitely. So the last patient was implanted in the first week of March.
Speaker 4: Next to this, we plan on completing the final PMA module submission soon after the data is released in the first quarter of 2024.
Speaker 4: That said, we do not want to predict the exact timing of FDA decision given it will be subject to variables we cannot influence, but we do expect FDA approval before the end of 2024. Okay. That's helpful. I think on the Q3 call last quarter, you were kind of
Speaker 6: Aiming for Q2 2024 approval, so it sounds like a little bit of a. A push out there, but before end of 24, did I did I hear that correctly? Olivia.
Speaker 4: Yes, correct. Mainly due to difficulties in scheduling PSG and dice procedures, due to long waiting lists in the sites that we are active with, in combination with some of it in the holiday period, the final implants took longer to complete than expected. That is correct. But no, we have officially started the clock and that's why we are really confident with the timelines that I just disclosed.
Speaker 6: Okay, perfect. Thank you for the clarification there. If I can just squeeze in one last question, maybe on the Q4 results.
Speaker 6: Can you kind of just talk about, I think you had some carryover from Q3, some orders that were
Speaker 6: impacted by supply issues that ended up in Q4. So maybe just talk about kind of.
Speaker 6: the Q4 results, how much of that was kind of organic revenue in Q4 versus catch-up revenue, and help us think through just broad strokes, the pace of commercial sales going forward in 23. Thanks so much for taking the questions.
Speaker 4: So also on this one, we had to push implants from Q3, Q3 into Q4 and I'm really happy to see that we did not lose any patients and the underlying demand remained high. Despite limited work capacity in some of the German sites that we were active in combination with Christmas season, Q4 still was our strongest quorum of the year.
Speaker 4: We remain, and I'm going to the second part of the question about 2023, we remain highly confident in expanding Gini adoption and strong commercial execution.
Speaker 4: That being said, Adam, as you know, we are not providing guidance and would note that the first quarter is impacted by seasonality.
Speaker 2: One moment, please, for our next question.
Speaker 2: Our next question comes from the line of John Block. Steve, your line is open. Thanks guys. Good afternoon. I'm Olivia, maybe the first one in Germany, I think you may have cited.
Speaker 7: 34% market share exiting the year and that, you know, arguably might have benefited from
Speaker 7: Some of the push that we saw around the third quarter and the 34% I think is below ambitious plans that you had to exit north of 50%. Maybe you can just talk about why you think you didn't quite reach the 50% you still have the label expansion with triple C.
Speaker 7: Maybe just you know talk to us on what prevented that exit rate from being a little bit higher than you would initially expected.
Speaker 4: So it's clear, John , that when we started.
Speaker 4: We immediately have to have a high result in 30% market share. No, exiting the year with 34% I can only be very complimenting the team in Germany to achieve this result. So we do see this as really a strong result. No, being very ambitious and also saying that we would like to become market leaders and even have the high market share.
Speaker 4: That being said, if you look at the performance in the top 10 accounts that we have in Germany, there we do see that we managed to become market leaders in really high volume accounts. This again is giving us a lot of confidence that the physicians are really embracing our technology and that it's also clearly illustrating from a patient's perspective that there is a need for a second technology available so that patients and physicians have an option to choose.
Speaker 7: You know, you completed all 115 patients, and I think in the PR from a week ago, whenever it was, you also said the first module had been submitted. Obviously, the last module will come in with the data, but the next two, Olivia, I think I have that correct, are there two more before the clinical data call, and will those two be built?
Speaker 7: be submitted in 2023? I guess maybe walk us through the timing for the next couple of modules that you expect to submit and then I've just got a final question to ask. Thanks.
Speaker 4: In total there are four modules. So the first one we have submitted. The next two modules to your point will be submitted before we have the 12-month DreamSafe inefficacy data. So they will be submitted this year. And our last module will be submitted of course upon 12-month DreamData. To go a little bit more in depth...
Speaker 4: is also what the module one is containing, product overview and preclinical data. In the second module is the remaining preclinical data. In the third module, we have a manufacturing validation. So those three modules will take place in 2023. And then the last module of the final one is the clinical data review and the IFU labeling.
Speaker 7: Okay, great. Thanks for that, Colin. The last question, let me see if I can get it across clearly on the phone. I think it's an important one. And you had the helpful footnote in the release that says, for the trial to be successful of the 115 patients, at least 63% of the patients need to be AHI and ODI responders at 12 months following.
Speaker 7: for those first 34 patients, are all of those ODI responders so that we could think about for the first 34 patients, you hitting the threshold that seems to be necessary for the trial to be successful. And let me know if that made sense. And hopefully it did and it can give us some color. Thanks.
Speaker 4: Definitely, John , and I hope to welcome you tomorrow as well during the analyst day because I'm sure that there we have more time to go more in depth on this with our vice president and clinical also going more into depth on the abstract. But let me already start answering. So the AHI.
Speaker 4: responders and the ODI responders do not need to be the same patients.
Speaker 4: So you can, we have to show out of the cohort of 115 patients that will at least showing 63% HIs response.
Speaker 4: And then in the cohort of one out of 15, we also have to show patients that are at least showing a 63% ODI response. But it does not need to be the same patient.
Speaker 7: I hope this is answering your question. It is. In other words, got it. So you hit both criteria in the first 34. You're sort of well above on ODI and slightly north on AHI. But to your point, that is an apples to apples when we think about the 34 versus the 115. Is that fair?
Speaker 7: That is completely correct. Okay, I'll see you tomorrow and look forward to it. Thanks very much guys. Same, likewise.
Speaker 2: Thank you. One moment, please. Our next question comes from the line of Siraj Kalea Bapatamri. Your line is open. Your line is open.
Speaker 8: Olivier, can you hear me alright?
Speaker 8: can you hear me all right? Perfectly, Siraj. Hello, good afternoon.
Speaker 8: So Olivier, congrats on dream enrollment. A few questions from my side Olivier. When the final data set is presented next year?
Speaker 8: Would there be cohorts or subgroups where the learning curve
Speaker 8: impact would also be assessed. Specifically what I'm trying to understand is, most physicians are pretty well worse with INSPIRE, right? And now this is something different. So is there a learning curve part of the equation?
Speaker 8: that different subgroups of patients would need to go through, that we can analyze the data? Well, so guys, the short answer is no. When we look at the DREAMS study design, this is not part of the study design.
Speaker 4: So that being said, of course, we will further analyze the data and we will also incorporate the learnings. And then if I understand the question also correct, I think what you are referring to is the fact that when a surgeon starts doing the first implant, they are going through a learning curve. And once they reach... We are doing material ram indeed.
Speaker 4: and we saw already in commercial patients and also in previous study patients that after four implants, that they really passed the learning curve and that the placement and also the speed of the implant is only increasing. So,
Speaker 4: repeating a little bit of some of the adding method. No, it's not part of the study design but we will definitely take the learnings and also incorporate them going forward and we see that surgeons only get better after they pass the learning goal of 3-4 in that.
Speaker 8: Fair enough. Olivia, in terms of compliance, i.e., they have turned on the Genio and all, how is that being maintained in Dream? Because again, Inspire is an internal pacemaker, right? And you guys are not. So I'm just curious if that is a variable that we need to be cognizant of.
Speaker 8: you know, in the final data analysis.
Speaker 4: Now, Suga, as you can understand, I cannot comment on compliance in the DREAM trial.
Speaker 4: But based on historical, clinical and commercial compliance data, we know that we are reaching a 91% compliance reporting using the Genio system more than five days a week and minimum five hours a night.
Speaker 8: Got it in Germany, Olivia, and I'll, I'll keep this as the last question in Germany. On our apples to apples basis for the same site.
Speaker 8: It may be somewhat unfair, forgive me, Olivia. I know it's early in the game, but let's say Siraj walks into Tübingen Hospital, right, and he needs a hypoglossal nerve stem. How is the decision matrix made between, let's say, Inspire versus Genio?
Speaker 8: all other things remaining equal. Thank you for taking my question.
Speaker 4: Yes, and it's a very interesting question, Siraj, that you are asking. So what we learned and what we noticed is that the influence of the voice of the patient is really important in the selection of the technology that they will get. And also therefore we are really increasing our efforts.
Speaker 4: In DTC we are freezing the effort that we are doing in having a patient helpline. And of course we are also increasing our efforts in interacting not only with ENT surgeons that are doing the implant but also with sleep physicians.
Speaker 4: So if you would enter the hospital, I'm sure that first of all the surgeon would inform you what is available and there are two systems at this moment. And then second, I'm sure that you as a patient would also have a clear say in the selection of which technology you will go.
Speaker 4: And that's one of the reasons why we feel very confident. Because if you explain a positional system as being a single incision, fast procedure, always benefiting from the latest and greatest technology update, I think not having to undergo a die, let's not forget, in Germany we have the label expansion, the path to getting a treatment solution of hypoglossal norexplen.
Speaker 4: is much faster if you choose for genial than if the surgeon of the patient would go for the competitor.
Speaker 4: faster if you choose for genial than if the surgeon of the patient would go for the competitor.
Speaker 2: Thank you. I'm showing no further questions at this time. I'd like to turn the call back over to Oliver Kalman.
Speaker 4: Chief Executive Officer for any closing remarks. Yes, thank you, and I just can say thank you for joining us today. We look really forward to welcome as many as possible on the analyst day and investor day that we're hosting tomorrow. And we are really excited of 2023 because as I mentioned before it will be a great year for Nixa. Thank you.
Speaker 2: Thank you. Ladies and gentlemen, this does conclude today's conference. Thank you all for participating. You may now disconnect. Have a great day. Thank you.