Q1 2023 Acurx Pharmaceuticals Inc Earnings Call
Speaker 1: Oh, 8 o'clock, Rob. Yep. See what time we act. Okay, cool.
Speaker 2: This time, all participants are in a listen-only mode.
Speaker 2: A brief question and answer session will follow the formal presentation.
Speaker 2: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad.
Speaker 2: As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rob Shawa, Chief Financial Officer. Thank you, sir. Let's go ahead and begin.
Speaker 3: Thank you. Good morning and welcome to our call.
Speaker 3: This morning we issued a press release providing financial results and company highlights for the first quarter of 2023.
Speaker 3: which is available on our website at acorexpharma.com.
Speaker 3: Joining me today is Dave Lucci, President and CEO of Acorex, who will give a corporate update and outlook for 2023.
Speaker 3: After that, I'll provide some highlights of the financials for the quarter ended March 31, and then turn the call back to Dave for his closing remarks.
Speaker 3: As a reminder,
Speaker 3: During today's call we'll be making certain forward-looking statements. These forward-looking statements are based on current information, assumptions, estimates, and projections about future events that are subject to change and involve a number of risks and uncertainties.
Speaker 3: 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 quarterly report on Form 10Q, which we filed today, Friday, May 12, 2023.
Speaker 3: You are questioned not to place undue reliance on these four looking statements, and ACRECS 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, May 12, 2023.
Speaker 3: ACR-X undertakes no obligation to revise or update any forward-looking statements 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 4: Thanks, Rob. Good morning, everyone, and thanks for joining us to review our financial results for the first quarter of 23 and to cover some recent updates. Then we'd be pleased to take any questions.
Speaker 4: In the first quarter, we continued to enroll more patients in our Phase IIb clinical trial of our oral Ivezapulostat, our lead antibiotic candidate for the treatment of patients who had C. difficile infection. The 2b trial is a randomized one-to-one, non-inferiority, double-blind trial.
Speaker 4: of oral ibesimplostat compared to oral nicomycin, the standard of care to treat C. difficile infection. The primary endpoint is clinical cure at the end of treatment, and the secondary endpoint is sustained clinical cure measured at the day 38 follow-up visit.
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 blind and observed data has been exceptional.
Speaker 4: The Phase IIb trial protocol includes an exploratory endpoint comparing the impact on the microbiome between our iphone and vanco.
Speaker 4: In the event non-inferiority of a mesopulostat to the vanco is demonstrated, further analysis will be conducted to test for superiority.
Speaker 4: Due to slower enrollment than expected during COVID-19 and its aftermath, we expanded the number of clinical trial sites participating in the 2B trial from the initial 12 sites to now we have a total of 28 trial sites. Most importantly, in March 2023, the FDA accepted our protocol amendment.
Speaker 4: trial as we had done with the 2a trial you may recall or alternatively continue enrolling.
Speaker 4: We anticipate completing enrollment of the 36 patients in the second half of 23.
Speaker 4: The company intends to report available data properly after the IDMC conducts this interim review.
Speaker 4: The company has, we remain particularly excited about the dual impact of Ibiza-Pulstat to treat C. diff infection while appropriately managing the long-term care of each patient's microbiome, which we believe is exceptional for antibiotic therapy.
Speaker 4: Other key highlights from the first quarter of 23 or in some cases shortly thereafter include the following.
Speaker 4: In April 23, two presentations were made at the 33rd annual ECMIIT conference in Copenhagen, Denmark. First, a scientific poster entitled, Novel Pharmacology and Susceptibility of Avesopulstad against C. difficile isolates with reduced susceptibility.
Speaker 4: to C. difficile directed antibiotics.
Speaker 4: was presented by Dr. Kevin Gary, Professor and Chair of University of Houston College of Pharmacy and Principal Investigator for microbiome aspects of our Saint Petersburg2065, president and
Speaker 4: Dr. Gary's work demonstrated that Idesocollosat's mechanism of action is not only bactericidal to C. diff, but also inhibits some of its virulence mechanisms, meaning its capability to cause disease. Dr. Gary also noted that C. difficile strains with reduced susceptibility.
Speaker 4: to metronite as old, vancdl, and phytaxomycin were in fact susceptible to what a bug againuj?c tooth pain.
Speaker 4: Ibesopulostat's anti-virulence effect, namely reduced flagellar movement of the C. diff organism was a positive, unexpected finding reflecting the unique mode of action in inhibiting DNA PAL3C.
Speaker 4: The second of the two EMC presentations was by our Executive Chairman Bob DeLucia.
Speaker 4: who presented an update regarding the company's preclinical systemic oral and IV program for treatment of other grand positive infections caused by MRSA, VRE, and DRSP at the Pipeline Corner featured session at ECMID organized by Dr. Ursula Tharizbacher, a world-renowned microbiology expert.
Speaker 4: in antibacterial research. Following the clinical validation of a PAL3C bacterial target in our phase 2A trial, showing 100% cures with no reinfections, we've made significant improvements in cytotoxicity, solubility, and protein binding in vitro.
Speaker 4: and in vivo safety and have demonstrated oral and IV efficacy in a number of mouse infection models.
Speaker 4: Both the poster and the presentation are available on our website. Additionally, we wanted to mention Dutch sponsorship. The company is continuing its R&D collaboration with Leiden University Medical Center in Holland under a previously awarded grant from the Dutch government of approximately a half million dollars to further evaluate the mechanism of action of our inhibitors against the DNA defect.
Speaker 4: successful collaboration.
Speaker 4: We're hoping to receive an additional two-year grant for more research in this regard, which if it comes through, we're expecting in the middle of the year, and it would be in the range of $800,000 for this second component.
Speaker 4: Let's now turn to Carvex.
Speaker 4: We remain in the running for funding our second antibiotic candidate.
Speaker 4: targeting the treatment of MRSA infections by CARB-X. And we expect the final decision no later than October of this year.
Speaker 4: Just to reflect on how this came about in October of 22, we applied the car back for a non-deludive grant of up to $11.3 million, which, if approved, would provide funding for our second antibiotic program targeting MRSA infections for a period of five years.
Speaker 4: up to the start of phase two clinical trials.
Speaker 4: CARB-X recently informed us that our application is in the active review pool and a final decision is to be rendered by CARB-X no later than October 23.
Speaker 4: We believe that based on our recent development progress and the unique nature of having a new class of antibiotics
Speaker 4: Together with our understanding that Carvex already made final decisions on most candidates, we remain under active review. For these reasons, we believe we have a strong possibility to gain Carvex approval for funding later in the year.
Speaker 4: If approved, CARB-X would fund the $11.3 million of a $16 million project, and that would cover oral and IV formulations of our second antibiotic candidate, ACX375.
Speaker 4: Now just looking ahead a bit, the AMR Congress later this year in September , the World Antimicrobial Resistance Congress will convene its annual meeting in Philadelphia.
Speaker 4: where experts in the field from both public and private sectors weigh in on the latest innovations to address AMR.
Speaker 4: Our executive chairman Bob DeLucci was invited to and will speak.
Speaker 4: at the innovative showcase section of the conference and we'll present an update entitled Novel DNA PAL3C Inhibitors for Gram-positive bacterial infections.
Speaker 4: preparing for the next pandemic.
Speaker 4: After the presentation, it will be available on our website.
Speaker 4: Also, looking ahead a bit, we'd like to mention the PASTEUR Act.
Speaker 4: Last month, U.S. Senators Michael Bennett from Colorado and Todd Young reintroduced the Pestor Act, pioneering antimicrobial subscriptions to end up searching resistance.
Speaker 4: to encourage innovative drug development targeting the most threatening infections, improve the appropriate use of an antibiotic and ensure domestic availability of antibiotics when needed.
Speaker 4: According to Senator Bennet, the bipartisan Pasteur Act is the strongest bill ever written to strengthen antibiotic development and use.
Speaker 4: It will fix our market failures, expand the pipeline for next generation antibiotics, and save lives.
Speaker 4: If approved, Pestuar has the potential to enhance the commercial prospects for our antibiotics by providing funding for our Phase III clinical trials and stoppiling our antibiotic at public health facilities in the U.S.
Speaker 4: each year for five to ten years. As currently drafted, designation as a critical need and a microbial under the pastoral, if approved, will apply to the sponges of antibiotic candidates which are new class of antibiotics and that target the treatment of serious or life threatening infections. As is the case with an elite antibiotic candidate, as opposed to that.
Speaker 4: Accordingly, we're quite enthusiastic about the prospects of the past nor acting past its law.
Speaker 4: Now back to our CFO Rob Schallow to guide you through the highlights of our financial results for the quarter. Rob?
Speaker 5: Thanks Dave.
Speaker 3: Our financial results for the first quarter ended March 31, 2023, were included in our press release issued earlier this morning.
Speaker 3: The company ended the first quarter with cash totaling $7.2 million.
Speaker 3: Compare it to 9.1 million as of December 31, 2022.
Speaker 3: Research and development expenses for three months ended March 31, 2023 were $1 million.
Speaker 3: compared to $800,000 for a three-month ended March 31, 2022.
Speaker 3: the increase was due to face to be trial related costs. General and administrative expenses for the three months ended March 31 were $1.9 million.
Compare to $1.9 million for three months ended.
to $1.9 million for three months ended March 31, 2022.
The company reported a net loss of $2.9 million.
of $2.7 million or 26 cents per diluted share.
For the three months ended, Mark Shurley won 2022.
The company had $11,671,795 shares outstanding as of March 31, 2023.
With that, I'll turn the call back to date.
Thanks Rob, and to all of you joining us today, as you've heard, we've kicked off 2023 with advances in several areas that we believe will spur continued growth and momentum to build on our strong fundamentals.
We look forward to sustaining this momentum even during these challenging times and sharing future updates in the coming months. I'm now open to call for questions. Operator?
Thank you. We will now be conducting a question and answer session.
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One moment please, while we pull for questions. Our first question comes from Ed Ars with HC Wainwright. Please proceed with your question.
Hi, good morning everyone. This is Thomas, you are asking a couple questions for Ed.
The first question. Good morning regarding the good morning. I want to see continual progress in the PCB study. So and that is our first question. The interim analysis that will be triggered with the enrollment of the various six patient as you mentioned earlier.
It was previously expected in mid-year and now is second half of 2023. Can you discuss what are some major factors behind this change?
Well, thanks, Thomas. I appreciate the question. We're really putting our finger in the air. You know, if you will, as we see here today, it's you know, close to mid-year right now, right? It's, you know, May 12th.
So, are we going to be done by the 4th of July ? You know, could very well happen. Our chairman would say, you know, it's definitely going to be done in the 3rd quarter. But he's the one that's in charge of R&D. So I like to take its second half and this way we have a nice conservative cushion.
Okay, that's that that makes sense and can you talk about other than the
The primary efficacy endpoint, what other efficacy can investors look for in this interim analysis?
Well, I mean, we'll know when we see the data, but you know, we're...
You know, fairly certain we're going to see something between 90 and 100% efficacy out of our side of the study, given that we were 100% in the 2A. It's one to one randomized, so based on 60 years of data, we're going to expect to see something around 85%.
in that area for oral vanquemiesin on the primary endpoint end of treatment.
And that we expect it to slip possibly significantly from there at the follow-up visit.
You know, what I can also say is for the first time that we've seen, we're testing a portion of the patients for all the way out to 90 days after the end of treatment. We expect to see that our drug is not going to be having any reinfections.
even that far out.
All right, thanks, thanks, thanks for the additional detail. That's definitely important considering the microvarion aspects.
Thanks, thanks, thanks for the additional detail. That's something important, considering the micro-viron aspects of these patients.
And then perhaps one more question from us, regarding the COPICS grants, I recall previous year position was expected in April . And now it's October , but that means you've advanced to the next round and what type of announcement should we expect?
Well, we understand that their decision will be rendered no later than October .
pending the outcome of their omnibus capital call. If they reference, basically their annual fundraising effort.
So what we're told is that most of their decisions have been made already.
And as you may expect, most of those decisions were rejections. And sure, a handful, I'm sure, got through. But we're still in the actively pending pool.
So we're really excited by that. I mean, for folks that thought that perhaps it was...
you know, a small possibility, you know, going into the last conference call.
You know, I think our chances are a lot higher than maybe people originally thought. Of course, we were uniquely advantaged by knowing how much development had happened.
So we were particularly enthusiastic going into the process because we're real close with lead optimization now.
That's a little of the color behind it.
Okay. Thank you so much for taking our questions and looking forward to the interim analysis and best of luck on the topic position as well. Thank you so much, Thomas.
Our next question comes from Jim Malloy with Alliance Global Partners. Please proceed with your question.
Thank you. Good morning. Thank you. Good morning, David. When it comes to your prepared remarks was the blinded data is exceptional. Do you expand a little bit on that? The blinded data? How exceptional it can be? All right.
Yeah, I mean, we have, you know, almost all cures that we see. It's blinded data, so, you know, we don't know which patients are in which baskets.
But, you know, so for people that are thinking that one of the possibilities at the interim review could be futility, you know, the answer to that is if every last remaining patient, you know, is a negative outcome from here forward, I don't see futility, you know, having any possibility.
So it's all really good and the patients that are cured are going out 90 days without reinfections. So it's data that we haven't seen the likes of in this space.
as we've reviewed it over the past few years. And I guess the patients have been in to date. It's been one to one active verse of ancho. And they've been holding true to that. Or did you know the ratio?
It's one to one gym, but it's one to one randomized at the clinical trial site level.
So, you know, as you kind of boil that all the way up to, you know, the...
You know, the data center, it may be one or two patients different than that.
So, you know, when we get the 36, it could be that we're 2016 or 1917.
It just really depends on, you know, if we have say a trial site that enrolls five patients.
You know, they're going to have 3 in 1 and 2 in the other.
So if you have the same disproportion in one other site, maybe that's 6 and 4.
So it could be a little off of the 18 and 18, but it would be close.
So I just try to get to the heart of this is what you're meeting when you're saying that it looks exceptional. As far as you guys can tell, everyone's getting cured. So assuming that the 1-1 randomization is pretty true or close enough to true, it would seem unlikely that you're not having an effect.
Oh, yeah, there's no chance that we're not having an effect. There's a real, real lot of cures. I can tell you that.
It would seem like the vanco is doing pretty well as well. Is this traditional cure rates for vanco? Well, there's about 60 years of clinical data on vanco. I've seen it as low as 79% and as high as 92%.
So, you know, that's why we expect something in the mid-80s and...
You know, I haven't seen anything to you know shake my confidence that it's going to be in the mid 80s.
Got it. And then, can you speak to the unique challenges on the Phase 2B recruit? Pick the Phase 2A. I think you started that in March 2020 at the top line data at the end of the year. Maybe I have that timeline correct. What are the challenges on the 2B that you guys are up to avoid in the 2A for recruiting? Yeah.
Well, you know, as time has gone by, you know, the culture of clinical trials has changed.
So, you know, there's more telemedicine, there's less people that are, you know, deciding to go to the doctor at the trial sites. You know, you have, you know, varying degrees of physical presence in the at the site, with the site administrator and the principal investigator on the same day.
And, you know, you also have patients that uniquely with a C. difficile trial need to get to the trial site within 24 hours of being diagnosed.
So if the patient is at a referring physician site,
in Fort Lauderdale for example, Monday at noon they are diagnosed with C. diff. They have to be willing to go to Miami by noontime Tuesday and then they have to agree to go back to Miami 10 times over a 2 month period.
So that's because of the trial design, in part largely due to COVID.
Interestingly, Jim, I should say, you know, there have been a number of patients who could have gotten in, but after the last minute, you know, they qualified, but they had COVID and decided not to participate. Understood.
All right, great. Then maybe the last question on my end. What does, well, let's go to a question. What does active review mean? And what other things have CARB-X funded, you know, offhand what they've already approved or agreed to fund? Well, they're not. I look at the CARB-X website, which, you know,
but you can imagine it's like probably over 90% get rejected.
But those that get approved, the approval is subject to negotiation and execution of definitive agreements.
which usually will take a 30 day period. So if you check that website, the Carvex website in about a month, I think you'll probably see.
Perfect. And then what should we be looking for on the Past Direct? I know it's in the Senate and I can sort of be slow. What are you guys watching for as you're trying to see if this thing gets through?
You know, it's the government and you know how those things go. For our position in the Antimicrobial Working Group,
The expectation is at the end of the third quarter.
they expect it to be included in a piece of legislation.
Now, my first question is, oh, no problem. Just to clarify a little bit more, my personal view, because of the budget battles and stuff like that that are going on, even though this is bipartisan supported. What about me?
in both houses of Congress. I think they are going to come through with Pasteur Lite which would be instead of $750 million to $3 billion for the sponsor over 10 years, I think it will be approved as more like $375 million to $1.5 billion over 5 years.
That's just my educated guess. Certainly good numbers either way.
From where we sit today, it's...
Irrationally exceptional for us and great for public health. Indeed. Thank you again for taking the questions. No problem, Jim. Thank you. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad.
Our next question comes from Nick Meyer. Please proceed with your question. Good morning, Nick. Good morning. Hi. I'm Aaron David. Hi.
and the COVID restrictions and the pandemic is officially, unquote, came to the end? No, no, we haven't, I mean, what we've seen tick up is more pre-screening. So we have more patients that were able to get into the pre-screening process. So it's probably about the same in terms of the patients that get through pre-screening successfully and choose to be in the study.
and our the COVID restrictions and the pandemic as officially, I'm called, came to the end. No, no, we haven't. I mean, what we've seen tick up is more pre-screening. So we have more patients that we're able to get into the pre-screening process. So it's probably about the same in terms of the patients that get through pre-screening successfully and choose to be in the study. Okay.
It's the same included. Okay, one thing that we are, I wondered is the Phase 2 A rate seemed to have been a lot faster than what we've seen in Phase 2 B and I just wanted to know, and that was during COVID, so I just want to know what the disparity was, but it seems like it's still just COVID-related.
Yeah, it's still COVID related and you know, as people's, I mean COVID, the aftermath of COVID I guess we could call it, you know, is such that less people are still going to the doctor, to the hospital. There are more people Ok.
focused on things like bacteria and avoiding it. There's more telemedicine and a lot of the sites are operating remotely, like the rest of the world.
operates remotely instead of kind of going into the office all the time.
So these are all challenges which are heightened by our trial design, which by necessity the patient has to get into the study within 24 hours because they have a life-threatening infection. So it would be medically unethical.
you know, to have them hanging out with C. difficile that could kill them for a long period of time without being treated.
out with C. difficile that could kill them for a long period of time without being treated.
Yeah, thank you. That's the only question I have. Excellent. Well, thanks for the question then. We have reached the end of our question and answer session. This concludes today's conference. Thank you for your participation.
You may disconnect your lines at this time. Thanks, Maria. Thank you.
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