Q1 2023 FibroGen Inc Earnings Call
Okay.
Good day, and thank you for standing by welcome.
Welcome to fiber against first quarter 2023 earnings call.
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I would now like to hand, the conference over to your Speaker today, Michael Tung.
Go ahead.
Thank you Elena and good afternoon, everyone I'm, Michael Tang Vice President of corporate strategy and Investor Relations at Barberton.
Joining me on today's call are Enrique Conterno, our Chief Executive Officer, Dr. Mark Eisele, our Chief Medical Officer.
One Graham our Chief Financial Officer Dr.
Dr. John Hunter, our Chief Scientific Officer, Tim.
Tim <unk>, our chief commercial officer.
And Chris Chung, our senior Vice President of China operations.
The format for today's call includes prepared remarks from and regain one after which we will open the call for Q&A.
I would like to remind you that remarks made on today's call include forward looking statements about five Virginia.
Such statements May include but are not limited to.
Our collaborations with Astrazeneca and Astellas financial guidance.
The initiation enrollment design conduct and results of clinical trials or.
Our regulatory strategies and potential regulatory results.
Our research and development activities.
Commercial results and results of operations.
Risks related to our business and certain other business matters.
Each forward looking statement is subject to risks and uncertainties that could cause actual results and events to differ materially from those projected in that statement.
A more complete description of these and other material risks can be found in <unk> filings with the SEC, including our most recent Form 10-K and Form 10-Q.
Robinson does not undertake any obligation to update publicly any forward looking statements, whether as a result of new information future events or otherwise in.
The press release reporting our financial results and business update and a webcast of today's conference call can be found on the investors section of <unk> website at www fiber gin Dot com.
With that I would like to turn the call over to Enrique Conterno, our CEO Enrique.
Yeah.
Very good thank you, Mike and good afternoon, everyone and welcome to our first quarter 2023 earnings call.
On today's call I'll provide a summary of important accomplishments and developments through thus far in 2023.
Kwan Graham our CFO will then review the financials.
After which we will open the call for your questions.
Starting with slide three.
Hydrogen is positioned to create significant value for patients and shareholders.
Executing on three areas of focus first.
Delivering pivotal phase III on revenue data.
In three high value indications.
Patrick pulmonary fibrosis.
<unk> seen muscular dystrophy.
And locally advanced Unresectable pancreatic cancer.
Second increase.
Increasing our research productivity by.
By advancing novel programs that leverage internal expertise.
Access external innovation for us.
Additional pipeline opportunities.
And third ensuring.
The commercial success of <unk>.
In patients with chronic kidney disease, where approved while continuing the chemotherapy induced anemia study in China.
Yeah.
Moving onto slide four.
<unk> represents an exciting catalyst rich opportunity.
With topline data expected from four phase III trials.
Through the third quarter of this year.
And an additional two by mid 2024.
Operationally, we are well prepared for various clinical trial outcome scenarios.
Which could include multiple regulatory filings and ultimately launches to expeditiously deliver these therapies to patients.
In addition.
We are progressing our preclinical pipeline.
Including potentially filing up to two <unk> near year end 2023.
We have taken steps to.
To augment.
Our strong financial position.
And continue our focus on financial discipline.
Moving on to slide five.
On May 5th we announced top line data from our Matterhorn Phase III clinical study of Rockstar booster for treatment of anemia in patients with transfusion dependent lower risk Miller dysplastic syndrome or Mds.
To our disappointment the study did not meet its primary efficacy endpoint.
The proportion of patients who achieved <unk>.
Red blood cell transfusion independence in the first 28 weeks was 47, 5% for the <unk> arm.
Compared to 33, 3% for placebo.
With a P value of zero point to 107.
The adverse event profile of <unk>.
That was observed in the preliminary safety analysis, what generally consistent with previous findings.
Safety will be further evaluated at study completion.
Now, let's move to our clinical trial timeline on slide six.
Starting at the bottom.
On slide six with Brexit this debt.
We anticipate top line data from our China Phase III study.
Patients with chemotherapy induced anemia shortly.
Moving now to <unk>.
I want to remind everybody that we have both FDA fast track.
FDA orphan disease designations.
All three of the indications in phase III development.
Idiopathic pulmonary fibrosis.
<unk> muscular dystrophy.
And locally advanced Unresectable pancreatic cancer are each diseases with significant unmet medical need and represent meaningful potential opportunities to improve the lives of patients.
Moving chronologically we expect.
Topline data from the Atlantis one.
Our phase III trial of <unk> might be non ambulatory patients with DMD.
In the second quarter of 2023.
Top line data from.
<unk>, one our phase III trial in IPF in mid 2023.
Top line data from our Atlanta stood trial in ambulatory patients with DMD in the third quarter of 2023.
Looking out to next year topline data from our LAPIS phase III study in locally advanced Unresectable pancreatic cancer expected in the first half of 2024.
Topline data from our <unk> phase III trial in patients with IPF, which completed enrollment in the first quarter of 2023 is expected mid 2024.
Finally, although not on the slides the pancreatic cancer action network's prestige.
Precision promise adaptive trial platform.
Evaluating umbrella might be in combination with standard of care for patients with metastatic pancreatic cancer continues to progress.
A common question we receive is.
Whether there is any read through through across up umbrella trials.
IPF.
DMD and <unk> are three very different diseases, all with a common feature of fibrosis.
But each with a unique pathophysiology affecting different origins.
In IPF.
Fibrosis in the lung tissue causes progressive and irreversible damage.
DMD is a rare genetic pediatric disease characterized by fibrosis into muscles.
LPC is an oncology indication in which tumor associated fibrosis is a key feature of the disease.
Given these differences in disease pathology.
We believe there is limited or no efficacy read through from one of these conditions to another.
On the safety side and <unk> has been studied in over 1000 patients and has demonstrated a favorable adverse event safety profile.
Including in patients who have been dosed for up to seven years.
2023.
Will be a transformational year for <unk>.
And we look forward to sharing the results of these studies.
I would like to extend my gratitude.
For the patients.
Givers and investigators as well as to my <unk> colleagues for their commitment.
I'd now like to spend a few minutes highlighting our view of the significant commercial opportunity, we see with umbrella them up are wholly own monoclonal antibody.
Slide seven provides a detailed perspective of the current large and growing IPF commercial opportunity.
With a diagnosed prevalence of approximately 330000 patients across the U S EU, China and Japan.
<unk> represents a significant opportunity.
The two approved IPF therapies generally together over $4 billion and global net revenue in 2022.
Despite the size and growth of the IPF market there remains important unmet medical need with the approved anti fibrotic therapies.
Which are characterized by continued disease progression and challenging tolerability.
There is sentiment in the IPF community of limitations with the current therapies and we believe from relevant has the potential to help a sizable number of patients have begun.
A relevant product for the treatment of IPF.
As we highlight on slide eight we believe that IPF patients could benefit from new therapeutic options.
<unk> is a progressive disease.
Our fibrosis in the lung tissue leaps to reversal of a loss of lung function, resulting in high morbidity and mortality.
In fact.
The median survival following diagnosis of IPF is only three to five years.
The limitations of current treatment options are world characterized.
Having a modest effect on slowing the progressive loss of lung function.
Along with a challenging tolerability profile.
This translates into a low treatment rates as.
As depicted on the right side of slide eight.
In the U S.
There is a prevalence of approximately 120000 patients with IPF.
With approximately 30000 patients diagnosed each year.
Of these 30000 newly diagnosed patients.
We estimate that only about one third of these patients are treated with anti fibrotic.
Of this roughly 10000 patients that started one of the two approved anti fibrotic given year.
Approximately 40 to 50 discontinued treatment in the first 12 months, usually the decided effects, which include severe nausea, diarrhea and photo sensitivity.
This results in a large proportion of diagnosed U S IPF patients not being treated for this progressive fatal condition.
Because of the significant unmet need we believe <unk> has the potential.
To be an important addition to current IPF treatment options, including newly diagnosed patients.
Existing patients who have not been treated with anti fibrotic.
And those patients who have stopped anti fibrotic treatment due to challenging tolerability.
I want to reiterate our confidence in the price results in our optimism.
On the likelihood of success of our <unk> Phase III program.
Moving to slide nine.
Both the.
<unk> muscular dystrophy in locally advanced and Resectable pancreatic cancer represent.
<unk> significant opportunities to meaningfully help patients.
Beginning with DMD in the left column.
Given that they have a steady nature of DMD.
And the relentless progression of the disease.
We're hopeful.
The Atlantis Phase III program can lead to a desperately needed approved therapy.
While the currently approved exon skipping sorry, I was produced an increase in dystrophin levels.
They target only a small proportion of DMD patients have yet to demonstrate a meaningful clinical improvement in symptoms or disease progression.
There is a clear need for DMD therapies that can automate disease progression by targeting the downstream.
Pathological changes to improve muscle function.
We are hopeful.
The anti fibrotic mechanism of <unk> may be a treatment that can help these patients under five years.
The lenders one enrolled nonmilitary non ambulatory DMD patients 12 years and older.
With more advanced disease.
The primary endpoint is a.
Performance.
Of the upper limb test, which measures functionality of the shoulder elbow wrist and hand.
And we expect top line data this quarter.
The lantus to enrolled ambulatory DMD patients six to 12 years old.
With less advanced disease.
The primary endpoint is the Northstar ambulatory assessment, which is a measure of ambulatory function and we expect topline data in.
In the third quarter of this year.
In the right hand column, we show a snapshot of the locally advanced pancreatic cancer opportunity.
I'm, sorry cancer represents one of the largest.
Unmet needs in oncology.
With a diagnosed prevalence of over 90000 patients across our major regions combined.
And a low five year disease free survival rates of approximately 10%.
We believe that <unk> had both <unk>.
Direct anti tumor effects.
And effects on the stroma.
And this is why we're evaluating both LPC.
And metastatic pancreatic cancer.
There have been limited treatment advances over the last two decades.
With immuno oncology.
You know oncology therapies, failing to demonstrate survival benefits over the current standard of care.
This creates a potential meaningful commercial opportunity for <unk> if.
If we can demonstrate a significant improvement in overall survival.
We expect topline data from our LAPIS study in the first half of 2024.
Moving on to slide 10.
I do want to take a moment and comment on our early stage pipeline.
We expect.
To file up to two <unk>.
Near the end of this year.
<unk> 31 65 you.
<unk> anti <unk> antibody developed to reverse immune resistant in many solid tumors and inhibit target driven cancer progression.
Acute myeloid leukemia AML.
<unk> 31, 65 has been shown preclinical to prevent guided 90 that it sells that.
Of T cell subtypes.
There are critical.
Our anti tumor immune responses.
And is undergoing characterization for its ability to directly target leukemic cell populations.
AFG 31 63.
It's an anti <unk> antibody.
Signed to selectively deplete suppressive T regulatory cells.
In the tumor microenvironment.
We saw it affecting peripheral T V.
<unk> sales.
Use of AFG 31, 63 in solid tumors has.
Growth potential.
To activate immune responses and induce tumor cell death without disrupting normal immune homeostasis.
In addition, we have undisclosed preclinical development programs.
Which leverage our expertise in <unk> and CTF biology.
Moving to slide 11.
Today, we announced the fiber didn't enter into an exclusive license with Fortis therapeutics for 446.
Fortis lead drug candidates.
446.
It represents a potential first in class opportunity.
This antibody drug conjugate target.
<unk> targets and novel Epitopes.
On CD 46, which is present on certain cancer cells, including prostate and colorectal cancers, but absent in most normal tissues.
446 is currently in phase one development.
For the treatment of metastatic castration resistant prostate cancer and.
Another CD 46 expressing cancers.
As part of the clinical development strategy for <unk> will continue to develop our pet based biomarker utilizing our radio radio labeled version of the targeting antibody for patient selection.
Under the terms of the agreement there is no upfront consideration.
<unk> will conduct and fund future research development and manufacturing of 446 and <unk> 46.
We have the option to acquire Fortis.
During the four year evaluation periods for $80 million.
Moving now to slide 12.
<unk> continues to grow nicely in China.
First quarter <unk> net sales in China by <unk> and <unk>.
Distribution entity jointly owned by <unk>, and Astrazeneca was $64 1 million.
Compared to $43 $5 million in the first quarter of 2022.
An increase of 47%.
This growth was driven by an increasing volume of other 50%.
Five or just a portion of Brookside boost our net product revenue in China was $24 2 million.
For the first quarter of 2023 on a U S GAAP basis.
John <unk> will provide more detail.
<unk> update.
I will now turn the call over to our CFO one Gram for these financial one.
Thank you Enrique.
2023 has started on a strong note on many fronts.
Renzo franchise in China continues to perform at a strong pace.
All of our phase III clinical trials for <unk> and <unk> have been enrolled.
Our early stage pipeline is growing and advancing.
In our financing efforts are enabling us to continue funding our operations, while elongated our runway.
None of this happens without the hard work dedication and leadership of our team members.
I want to thank take this time to recognize these achievements so early in the year.
As we look ahead, we have four pivotal clinical trials reading out through the third quarter of this year and two more by mid 2024.
We're both optimistic and excited about our path forward.
Moving into our financial results for the first quarter of 2023.
Total revenue was $36 2 million compared to $60 8 million for the same period in 2022.
It is worth noting that prior year comparator includes a one time $25 million payment received due to a regulatory approval or <unk> or a brand so and the risk in the Russian Federation.
As of Q1 2023, the breakdown of revenue sources is as follows.
We recorded $24 2 million of net product revenue for <unk> sales in China compared to $18 9 million in the first quarter of 2022.
This represents an increase of $5 3 million or 28% year over year.
During the quarter. We also recorded development revenue of $3 7 million associated with co development efforts for Rockford do that with our partners as compared to $11 million during the first quarter of 2022.
As we've previously stated due to the stage of development of <unk> with our partners. We expect co development revenue to be in the range of $3 million to $5 million per quarter for 2023.
We also recorded license revenue of $6 million associated with the milestone payments from our biosynthetic cornea program with Illumina X and finally, we recorded $2 1 million and drug product revenue for <unk> bulk drug.
Drug product or active pharmaceutical ingredients sold to Astellas based on the change in our estimates related to the shipments are for.
For U S GAAP.
Comparatively the drug product revenue was $7 $6 million during the first quarter of 2022, primarily related to a shipment made in that quarter.
Further financial commentary for <unk> performance in China is as follows.
Total <unk> net sales from the joint distribution entity jointly owned by Astrazeneca and fiber, Jim or J D. E was $64 $1 million this quarter compared to $43 5 million in the first quarter of 2022.
A substantial increase of 47% year over year, highlighting the strong performance of the <unk> franchise in China.
From total <unk> net sales in China fiber James met transfer price from sales to the JV was $19 3 million for the first quarter.
During this quarter, we recorded an additional $2 $1 million from the previously deferred balance due to the change in our future estimates as per U S. GAAP.
As a result fiber Gen recorded 21, 4 million and net revenue for the quarter from <unk> sales to the JV and $2 $8 million of direct to distributor sales for fibers in China.
Moving down the income statement, our operating costs and expenses for the first quarter of 2023.
$112 3 million compared to $123 $8 million for the first quarter of 2022.
A reduction of $11 $5 million year over year.
R&D expenses for the first quarter of 2023 were $74 5 million compared to $89 million in the first quarter of 2022.
The $14 $5 million reduction was related to lower R&D costs due to lower clinical trial expenses and drug supply costs associated with our Perm revenue map programs.
Of the $74 5 million spent in the first quarter roughly 55% was dedicated to prime revenue map development and CMC activities.
35% allocated to support our early stage pipeline and the remaining 10% directed towards trucks reduced the development activities in the U S and China.
SG&A expenses for the first quarter of 2023 were $34 3 million compared to $30 6 million in the first quarter of 2022.
Representing a 12% increase year over year, primarily driven by employee related costs and other expenses.
During the first quarter of 2023, we recorded a net loss of $76 7 million.
81, net loss per both basic and diluted share as.
As compared to a net loss of $63 2 million or.
Or <unk> 68 per basic and diluted share for the first quarter of 2022.
With regards to our financing efforts I want to make reference to financing events on.
On slide 13, I make reference that on May one we completed a structured loan agreement with Morgan Stanley tactical value for up to $150 million.
The initial tranche of $75 million has been funded.
The second tranche of $37 5 million.
We will be funded in the third quarter of 2023 upon achievement of certain clinical development milestones.
Finally, Morgan Stanley Tactical value have the option to fund a third tranche of up to $37 $5 million in the third quarter of 2023.
Secondly, during and subsequent to Q1, we accessed our existing ATM facility, raising net proceeds of $48 $4 million with participation of high quality long term focused investors.
In addition to strengthening our balance sheet. These financing events support the funding of our operating plan, including all pivotal Prem Revlimid <unk> and <unk> phase III data Readouts.
Initial <unk> pre commercialization activities.
And advancements and expansion of our R&D pipeline.
Moving now to slide 14.
At March 31, which includes $38 million of net.
Net proceeds raised through our ATM facility, we reported $373 $6 million in cash cash equivalents investments and accounts receivable.
With our current financing efforts and maintaining a disciplined capital allocation approach.
We expect our cash cash equivalents investments and accounts receivable to be sufficient to fund our operating plan through 2024.
Thank you and now I would like to turn the call back over to Enrique.
Thank you Kwon in closing I would like to reiterate our confidence as we progress through 2023.
We expect topline data from our <unk> pivotal China Phase III study.
Chemotherapy induced anemia shortly.
We expect data.
Four <unk> from three pivotal phase III studies for the third quarter of 2023.
Atlantis one.
In non ambulatory patients with DMD in the second quarter of 2023.
<unk> won in IPF patients midyear and.
And that led us to an ambulatory patients with DMD in the third quarter of 2023.
In our early stage pipeline, we expect to file up to two ind's near year end 2023.
For RFG.
<unk> 163, the anti <unk> antibody and APG 31 65.
<unk> nine antibody both in oncology.
The Fortis transaction.
Bolsters, our early clinical pipeline and his focus also in oncology.
<unk> continues to perform very well in China.
And our partner Astellas continued with our commercialization of <unk> study in Europe and Japan.
After additional financing initiatives, we believe we are appropriately finance.
Through key top line <unk> data releases, and we expect our cash to be able to fund our operating plans through 2024.
I would like now to turn it over to our operator.
Eleanor for Q&A.
Thank you.
At this time, we will conduct a question and answer session. As a reminder to ask a question you will need to press star one on your telephone and wait for your name to be announced.
To withdraw your question. Please press star one one.
Please standby, while we compile our Q&A roster.
One moment please.
Our first question comes from the line of Jason <unk> of Bank of America.
Your line is now open.
Hey, guys. Thanks for taking my questions.
A couple for me.
Question on your Phase <unk> study for <unk> Ics on the primary efficacy analysis could you characterize the 25 patients who dropped out of the study due to discontinuation.
For a portion of those patients actually receive their final FTC assessment at the week 48 for.
The observation on the analysis.
Then when your top line phase III that first one are resolved we plan on.
Doing the data on an observation on the basis of where you provide any other sensitivity analyses.
The regulators may care about and then lastly, if I missed it but have you refined your range for that first one I know before it was mid may to mid August .
Just wondering if you're finding that time range.
Very good that Jason. Thank you very much for your question I'm going to have.
Doctor Eisner respond to some of these questions address your questions and I'll complement us necessary.
Yes. Thanks, Jason This is mark speaking so further praise.
<unk>.
There were some patients as you mentioned 25, who didn't complete all of the follow up visits up through week 48.
But many of those completed.
Earlier study the time points and contributed FTC data to the study. This study was an annualized by intention to treat so all available data were used in the analysis in terms of the.
Topline data in the analytic methods used we will of course.
I will provide a variety of sensitivity analysis as is standard practice just to test the robustness of the results from the primary analysis.
And we are aligning with FDA on what those will look like.
Enrique maybe back to you on this effort one of the question.
Yes.
Thank you Mark on the I think your question was whether there is additional refinement.
On that.
Mid year.
Estimate that we have I think we are continuing to basically look at mid.
Mid year for these Readouts is right on the mid year.
So we are sticking with that characterization of the timing.
Okay.
Thanks, guys.
Yeah.
Thank you.
One moment for our next question please.
Please standby for our next question.
Our next question comes from the line of Andy <unk> of William Blair. Your line is now open.
Thanks for taking my question Alright.
We are coming from.
Could you sort of my voice.
First question I had.
87 ADC.
Okay. She made up by one.
A portion of patients.
Okay.
And secondly.
What radio.
We'll be using.
For the energy.
Oh portion.
Development plan and any plans to procure it.
Based on what's your plan.
So it's a question of worldwide.
Number two investigator sponsored studies.
Okay, great and cancer.
An interim analysis.
So how should we think about.
The efficacy hurdle.
HR 1.0.
So a little bit more strength.
So my question.
Very good thank you Andy.
I will have.
Sure.
John Hunter.
Address.
To your question on 446, and then I'll have mark.
Eisner.
Address the question on the metastatic cancer trial.
Hi, Andy Thanks for the questions. It broke up a little bit so if I start to veer away from the question. Please correct me.
But in terms of the percentage of patients who we expect to be eligible for <unk> six based on biomarker imaging.
Date with what we've seen we would say it would be over 50%, but we only have a very small data set to work with at this point. So we're hoping to refine it as we get more patients.
Through the trial and also as we get.
The pet imaging.
Analysis online.
Any.
So yes, and then just with regards to the I'm curious about.
Yes, we're curious about the radionuclide used the.
The imaging agent.
So yes right now.
Using 89 draconian.
For the imaging and I believe that is the plan that is what's being worked up for the clinical imaging.
And Mark if.
If you could address the question on the precision <unk> trial.
Promise and precision promise Ralph sure so the precision promise trial.
<unk>.
Versus placebo on top of backbone chemotherapy for metastatic pancreatic cancer. There were two stages stage one stage two.
There are a series of futility analysis conducted on the stage one and then there was a <unk>.
Graduation from stage, one to stage, two which is based on a pre specified criteria.
The study is ongoing and because the study is unblinded.
It's designed we are not generally privy to any further information because this study is being conducted by Pam Ken.
That's about all we can say right now about.
Status of the trial.
Okay, great. Thanks.
Thank you Mark.
Thank you.
Please hold for our next question.
Okay.
One moment please.
Our next question comes from the line of Danielle Brill of Raymond James Your line is now open.
Hey, guys. Good evening. Thanks for the question I have a couple of relating to patent rather the Mab first Ken can you just remind us how we should we thinking about Pam in combination with standard of care I know Youre dataset is limited, but I'm curious if you would consider these to be complementary therapies or is it unlikely that the combo.
We'll generate incrementally more efficacy and then also curious what we should expect in terms of Tolerability in the combo and then.
Also one more reminder, that I need what are your assumptions for discontinuation rate in that first line. Thank you.
Sure.
Yes.
Very good. Thank you I am going to have Mark address your question Danielle.
To complement.
Some of these answers.
Sure. Thanks Danielle.
Just to remind everyone that the zephyrus trials are a monotherapy trial of <unk> versus placebo patients can be either treatment experienced or treatment naive, but when the study starts there not the beyond any other.
Standard of care background therapy.
Are allowed to start background therapy.
The physicians, taking care of the patient deems it necessary on study.
So we really won't have a.
Formal test.
<unk> on top of standard of care versus standard of care alone. That's in that's really not the design of the trial, but we will have.
Indirect comparisons of our placebo corrected difference for Pam versus placebo versus <unk>.
Okay.
<unk> seen in those pivotal trials in terms of Tolerability.
We did have a small combination.
Arm of <unk> looked at primarily safety and adding Pam to either respirator OPEC was was well tolerated. So we're not anticipating tolerability issues. There and then finally and we could go into this in more detail if you like.
What our understanding from speaking to physicians, who take care of IPF patients is that.
The data set we're going to generate would enable them to.
Use <unk> as a monotherapy or in <unk>.
Combination as they see fit but to be very very clear label will be specific for the monotherapy design that we have.
At ups.
That's the first part of your question. The second part of your question has to do with the projected discontinuation rates for that first one we haven't disclosed those publicly but we're making every effort to keep patients on study, we're very pleased with how that's going.
It's been a big focus for us for both one on 195. So we are anticipating a very robust dataset at the end of the study.
Great. Thank you. Thank you Mark.
Thank you.
Please hold for our next question.
Okay.
One moment please.
Our next question comes from the line of Paul Choi of Goldman Sachs. Your line is now open.
Hi, good afternoon, and thank you for taking our questions from us first.
First.
<unk> I think in the past.
Thanks, David.
I believe that should suffer one <unk> that you could file.
Based on that study the <unk> study can.
Can you remind us what your regulatory discussions have sat on that point.
Is this something you've gotten in terms of written confirmation from the agency in terms of your previous interactions.
Yes, yes. Good good good question just to.
Recap I think what we've said is that.
If we were to have.
<unk> one <unk>.
Results.
Replicate sprays, we believe that we will be.
In a good position to have those discussions with the FDA in order for us to be able to.
File.
Utilizing the <unk> one results and yes, we could add the appraised results too.
To that.
Clearly I think thats.
That will be a very exciting.
Ah moment for us but at.
At this point in time I think until we have those we saw its I don't think we can get.
Any type of alignment of core confirmation from the FDA.
Okay got it thanks for that.
My second question is for one.
The cash run rate guidance into 2020 core.
Does your does your statement there.
The additional tranches from your recent financing with MSG D R.
Or is that exclusive of those two additional tranches.
Hi.
Sure.
Yes. Thanks for the question then.
The basically the cash guidance for that.
I mentioned basically includes the initial financing.
Or the initial tranche four four.
And for the <unk> deal the rest clearly are contingent upon certain milestones being achieved.
Yes, I think it's important to.
To understand both that as we think about our cash runway.
We are.
Projecting as part of this right of way that we will have one or more positive studies and therefore.
Our investment needs are larger and particularly in 2024.
And as Juan mentioned.
We including that the $75 million from MSR, plus the first tranche, but not the second one.
Got it okay. Thank you very much I'll hop back in the queue.
Okay. Thanks.
One moment please.
Kenny.
Thanks.
Our next question comes from the line of Michael Yee of Jefferies. Your line is now open.
Hey, guys. Good afternoon can you hear me.
We can.
Good.
Two quick questions. Thanks.
First on Pam rebel Nab I know there were some questions earlier about statistical methods.
And estimates and drop outs can you just comment on some of the investor questions around the use of estimates or amputation, but really estimates for the 25% of people that dropped out versus let's just say 75% of the people that actually fully completed this study the strength of the data in.
Those 75% of people I know that investors have looked at that and there has been various consternation or fears around that 75% of the data. So maybe just comment about that and how you feel about that and whether you're using estimates or implication in the phase III.
And then my second question is a follow up on the financing I know you mentioned that there are two different tranches based on milestones.
And.
Optionality can you just comment is that specifically related to actually having positive data in some of these studies or maybe just help us fill that out a little bit for the two tranches. Thank you.
Very good.
Mark will address your first question on one your second question.
Mark could you. Please address the question about time.
This question about the.
25% 25 patients.
Yes.
Discontinued and whether you can provide some additional color on feedback from investors and so forth sure. So I think there is a misunderstanding.
Unfortunately been propagated about the 25 patients who dropped out early.
And in that they didn't contribute any data. So the way praised with annualized it was intention to treat so patients.
We're included.
In terms of all the data they provide us. So for example, if a patient.
Within this study.
Baseline week 12 week, 24 week 36, and dropped out at week 48, where all their data until week 36 would have been used.
And an analysis that just simply throws those patients out.
We will be severely biased.
And provide incorrect estimate so we don't agree with that approach and I think if you look at.
How clinical trials are typically analyze their analyzed according to <unk> intention to treat to avoid that kind of problem and I think if you want to sort.
Sort of have a gut check of what I am saying you can look at the disease progression endpoint, which is FPC percent predicted decline of 10% or more ore depth, let me not to.
A responder definition right either either progress or you don't and if you dropout early you just.
Counter does.
Yeah.
You are kind of as a progressive so.
That allows a very simple way of incorporating <unk>.
Patients into the analysis that it doesn't really require any fancy statistical methodology.
To sum it up we think that.
Our analysis of praise followed this standard way of analyzing data, which is to include all the patient data points that we have on efficacy at all the time points.
That will be something similar done in these efforts.
If I may I would tell them by no no.
Yes.
I wanted to ask a follow up it did actually do more with the view that the dropouts were included but that the dropout estimates when they are included that the data is estimated on Puget rather than not included at all and Thats. The estimate your imputed data drive a favorable response, that's actually brought along with it.
And so again I think that's a misunderstanding the 25 patients at the point they dropped out there was no imputation done for the primary efficacy endpoint analysis.
Got it okay.
And then the financing.
Yes.
Hey, Michael this is one.
Typically related to your point I think your question is.
And second and third tranche. The second tranche is basic create an upsizing of $35 $7 million that would be available.
Upon meeting certain clinical development.
End points or milestones are.
Over the course of 2023, we haven't disclosed what those are at this point.
Then basically Morgan Stanley and sort of technical value has the option to upside upsize, a third tranche again of up to $37 5 million and this is basically at their discretion.
Hmm to upsize with no other.
Clinical milestones or any or any such items.
Got it.
Alright. Thank you very good thank you.
Thank you one moment for our next question for you.
One moment please.
Our next question comes from the line of Annabel <unk> of Stifel. Your line is now open.
Hi, Thanks for taking my questions I have a few on Pam for IPF I guess first can you talk about.
Any of the additional secondary endpoints that you are going to be exploring that could further differentiate Pam from current standard of care like time to clinical worsening worsening or exacerbations or maybe total lung capacity.
And the events in a scenario, where Pam has equivalent efficacy maybe.
Maybe better safety, but that you're trying to sort of separate from the crowd.
And then just following up.
From some earlier questions.
I know you mentioned that.
Some patients can be.
Offered standard of care, while in the study, but they are not starting on standard of care.
So I guess.
I wonder, how youre going to be treating that.
That data and why it all when all of a sudden Don.
And do you have any further details on the combination of Pam and the standard of care I know that it was for safety, but do you have any efficacy data and will you be disclosing any of it. Thank you.
Okay.
Mark.
Are you.
To address the two pump questions sure absolutely. So the first question has to do with secondary endpoints for Pam rubber Mab and I agree with you. This is going to be important to do.
Linear the full efficacy profile of <unk>.
One important efficacy secondary efficacy analysis will be the disease progression of FCC, 10% decline or doubt because we think this is a clinically meaningful.
Endpoint.
For clinicians and patients we do have time to disease progression, which is defined as the time to hospitalization for IPF for IPF exacerbation or depth and we centrally adjudicated hospitalizations in IPF exacerbation. So those should be a rigorously defined we're off.
So going to have the quantitative lung fibrosis score and of course, we'll have a tap or mortality as well, although typically in IPF trials there.
Sufficient numbers of depth.
For statistical power, but we will have a variety of <unk>.
Secondary endpoints to try to fully flush out the efficacy of Pam in terms of standard of care.
We stratify the studies both suffers one in his efforts to buy prior history of standard of care. So we'll be able to analyze by prior history in terms of patients who start standard of care on study, we expect them to be.
The distinct minority of patients and those patients who do start standard of care.
Many of those will start later on this study and as you are well aware.
<unk> per se.
Standard of care doesn't work quickly. So we're not actually anticipating this is going to have much of an effect clinically on the endpoint, but the best way to analyze it is intense.
Intention to treat by primary assignment <unk> placebo and just to clarify that.
Whether or not patients start standard of care on study. They will continue on the study drug whether thats Pam or placebo for the remainder of this study.
So we should have a very rigorous evaluation of the.
Efficacy of Pam versus placebo at the end of the studies.
Okay.
And will you be releasing any other prior data with Pam and standard of care other than the Tolerability.
Right, so you're referring to the subsidies appraise those are quite small cohorts run for a short period of time and really there wasn't.
They were really inadequately designed are powered to provide any real efficacy data and given how soon we're going to have <unk>. One at this point, we're not planning on releasing anything.
Upfront of the Z one readout.
Okay, great. Thank you.
Thank you.
One moment please for our next question.
Please standby.
Our next question comes from the line of Yaron Werber Cowen. Your line is now open.
Great. Thanks for taking my questions Mark potentially for you also have a couple on the.
The first one CTG is a unique target and as you noted obviously appraised was a positive study.
And it's supported by the power of our animal data in radiation induced in bleomycin induced models.
Some of the Kols also talk about CTG is downstream with some of the other kind of upstream intermediaries. So any sense and I don't know if you can share any more information about how central is TGF signaling as opposed to go in upstream.
And then secondly, Z tool originally as you noted.
There's obviously a secondary important endpoint in <unk>, which is the composite outcomes that was initially the primary two and recently that was changed in January to be sort of align the two studies.
Just wanted to get a sense why why the endpoints were now aligned not keeping the outcome to the primary for that study. Thank you sure. Thanks, Thanks for the.
Great question so.
The first point is the mechanistic, one around where <unk> fits in.
Pathophysiological cascade of events that cause fibrosis in the lungs and IPF.
Youre right its downstream of TNF, which is thought to be the key draw.
Driver of IP, but they are also a number of downstream pathways from CTG out, including the transition of fibroblast two mile fiber glass, which is an important step in the deposition of extra cellular matrix in fibrosis and patients with <unk>.
IPL.
It is a complex biology, we are continuing to study it and think about it from a mechanistic point of view.
So there is certainly will be more information forthcoming about about the more biological and translational information about <unk> and your second question about Jefferson two in that primary endpoint you are correct.
Initially the primary endpoint was the disease progression endpoint of efficacy, 10% decline or more or doubt, we decided to change that the FTC to harmonize. The two studies I think that it's very clear that FTC has become the global standard for phase III design.
And regulatory approval in the major regions of the World primarily FDA in the U S very very clear on this point.
And most other health authority. So we thought it was just a better.
Make it very clear that efficacy as a primary endpoint in that disease progression will be an important secondary endpoint.
Thank you operator.
Okay.
At this time I would like I would like to turn it back to Enrique Conterno for closing remarks.
Thank you.
We very much appreciate.
Your participation in today's Investor call and your interest in five region cope you're very much enjoy the rest of your day.
Yeah.
Thank you for your participation in today's conference. This does conclude the program you may now disconnect.
Okay.
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Good day, and thank you for standing by.
Welcome to <unk> first quarter 2023 earnings call.
At this time all participants are in a listen only mode.
After the speaker's presentation, there will be a question and answer session.
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Please be advised that today's conference is being recorded.
I would now like to hand, the conference over to your speaker today Michael.
Go ahead.
Thank you Elena and good afternoon, everyone I'm, Michael Tang Vice President of corporate strategy and Investor Relations at Biogen.
Joining me on today's call are Enrique Conterno, our Chief Executive Officer, Dr. Marc <unk>, our Chief Medical Officer.
One Graham our Chief Financial Officer Dr.
Dr. John Hunter, our Chief Scientific Officer.
Tim <unk>, our chief commercial officer and.
And Chris Chung, our senior Vice President of China operations.
The format for today's call includes prepared remarks from and regain one after which we will open the call for Q&A.
I would like to remind you that remarks made on today's call include forward looking statements about five Virgin.
Such statements May include but are not limited to.
Our collaborations with Astrazeneca and Astellas financial guidance.
The initiation enrollment design conduct and results of clinical trials, our regulatory strategies and potential regulatory results.
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Related to our business and certain other business matters.
Each forward looking statement is subject to risks and uncertainties that could cause actual results and events to differ materially from those projected in that statement.
A more complete description of these and other material risks can be found refurbished <unk> filing with the SEC, including our most recent Form 10-K and Form 10-Q.
<unk> does not undertake any obligation to update publicly any forward looking statements, whether as a result of new information future events or otherwise.
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