Gamida Cell Ltd. Q1 2023 Earnings Call
Okay.
Ladies and gentlemen, thank you for standing by welcome welcome to the Gamete Yourselves conference call for the first quarter 2023 financial results. My name is Catherine and I'll be your operator for todays call. Please be advised.
Advised that this call is being recorded at could meet the cells request I would like to introduce your host for today's conference Mike Gostkowski of Gamete of cell corporate Communications Mike. Please go ahead.
Thank you Catherine and good evening, everyone welcome to today's call during which we will provide an update on the company and review our financial results for the first quarter of 2023.
Earlier today, we issued a press release summarizing our financial results and providing a business update which is available on our website at www dot commit yourself out.
Here with me on our call today are Abbey Jenkins, President and Chief Executive Officer, Michel Kaufman, Chief operating Officer, and Chief Commercial Officer, Rohit, Samantar, Chief Medical Officer, and scientific Officer, Shai <unk>, our Chief Financial Officer.
This call will follow a slightly different format than we have recently as we just had our our search approval call on April 17.
Shai will share brief updates Michel and really it will be available for the Q&A.
Before I begin I want to remind everyone that during the call. We may make forward looking statements about our future expectations and plans.
With respect to the timing of initiation and progress oven data reported from preclinical and clinical trials of our products and product candidates regulatory filings and commercialization planning efforts, but potentially lifesaving or curative therapeutic and commercial potential.
Give me the sales product search and product candidate <unk> hundred one and our expectations regarding our projected cash cash equivalents and investments to be used for operating activities. Our actual results may differ materially from what we projected a due to a number of important factors that scope progress and expansion of our clinical trials.
Package to the cost thereof, clinical scientific regulatory and technical developments those inherent in the process of developing and commercializing product candidates that are safe.
As human therapeutics and in the endeavor of building a business around such product candidates as well as those considerations described in the risk factors sections of our most recent annual report on Form 10-K, and other filings that we may make with the SEC from time to time. These forward looking statements represent our views only as of today and we caution you that we may not update them in the future.
Whether as a result of new information or future events, except as required by applicable law.
Now, let me turn the call over to our President and CEO Abbey Jenkins.
Thank you, Mike and welcome to our call everyone.
Today, we're providing a brief corporate update.
I know many are interested in hearing more details on how the launch has gone we will be hosting an investor day at the end of June to share more detail and offer external perspectives on what army search means to the transplant community.
Look for an announcement on the date and time of that event in the next week or two.
In terms of our update I want to pull through the thread of the last seven weeks because theres been a lot of changes and we want to make sure that the picture. We're conveying is crystal clear.
At the end of March we took several actions to strategically restructure the company's operations to focus on the approval and launch of our new search. These action as you will recall had the net effect of reducing our expenses slowing me anticipated ramp of our lunch and extending our cash runway through the third quarter. We further.
<unk> that we would be executing a two pronged corporate strategy going forward with Easter objectives, one to successfully execute our commercial plan for a targeted omni search launch in the U S aiming to onboard 10% to 15 transplant centers by year end 2023 and two.
Two to pursue strategic partnerships with biopharmaceutical companies to expand transplant center onboarding to accelerate patient access the omni search.
I am pleased to share that we are making positive progress on both fronts.
In terms of the launch our team with launch ready on April 15.
FDA approved anti surge on April 17, two weeks before it's produced to date, we were able to move swiftly to initiate onboarding of transplant centers and secure payer coverage in order to make any surge available to appropriate patients in need of a stem cell transplant.
As of today, we are on track to complete the goal of Onboarding 10 to 15 of the top 70 transplant centers in 2023. Additionally.
Excited to report that we.
Have confirmed coverage with payers that cover more than 65% of commercial lives and discussions are ongoing with other commercial payers and CMS.
We are absolutely thrilled at the progress we've made with payers.
Leaved coverage would come quickly based on our market access teams engagement with payers over the last 18 months, but these results exceeded our expectations of what could be possible within just the first month post approval.
This level of access reinforces the important role that omni search can play an allo HSBC.
It is also a credit to our experienced an exceptional cell therapy market access and medical affairs team, who has built relationships and prowess introducing other novel cell therapies to the market in recent years.
In terms of the Onboarding of transplant centers.
Now is the single most important rate limiting step for getting army searched for appropriate patients are targeted plan of transplant center engagement and Onboarding is going well. The team has reported interest from both centers that participated in our clinical studies.
As well as those that did not.
This again suggest the important role <unk> can play an allo H FCT.
No other enhanced and expanded cell therapy has been approved for use in allo HFC tea and nothing similar is on the horizon and other companies' pipelines.
We've said that we believe omni search has the potential to both increase access and improve outcomes. It is gratifying to see this belief translated into interest from the transplant community.
I also want to acknowledge though that this momentum signals a significant opportunity and it's the area, where if we have more resources, where it could secure additional investment or strategic partnership we could be doing more we could drive more education, we could onboard more transplant centers and do so much more quickly.
We know from pre and post approval market research that this is an educationally sensitive market. The more resources, we can apply to capturing the interest in the market. The more successful the launch of army search will ultimately be.
I also want to note some additional progress stabilizing the company's financial position and our press release, we noted that we recently received $22 $8 million in gross proceeds from a public offering of securities.
This funding enables us to jumpstart the launch of omni search while extending our cash runway into early 2024.
We also reduced our debt obligations through a combination of share redemptions by Highbridge capital management, and our installment payments on hybrid just December 2022, senior secured convertible term glut.
Through these actions the outstanding principal balance of this loan has been cut in half from $25 million to $12 5 million as of May 12.
In terms of the second element of our two pronged corporate strategy. We are also actively pursuing discussions with strategic partners, including potential U S and global partnership with biotech and pharmaceutical companies that can help resource our commercial efforts more robustly.
We're making progress here as well with the help of banking partner Moelis and company LLC, who are supporting the process, we've had active and ongoing conversations and there has been significant interest post approval.
So to summarize we believe we've made the right moves tightening our belt on expenses, raising equity reducing debt and extending our cash runway into 2024, we promised that we would be a more streamlined and focused company.
We are we.
We are launching omni search and seeing support from payers through their coverage and great interest from transplant centers and.
And we're confident that with the strategic partnership we can capitalize on the interest we're seeing more quickly to maximize access for patients and value for shareholders.
I'll now turn the call over to Shai to review, our Q1 'twenty three financial results.
Shai over to you.
Thank you Abby and good afternoon, everyone today, I will summarize our financial results for the first quarter of 2023.
As of March 31, 2023.
Our cash position was $46 $8 million.
This amount does not include approximately $25 million in net proceeds from our April public offering and sales we have made to the ATM facility.
Research and development expenses were $8 $8 million in the first quarter of 2003 compared to $11 3 million in the same quarter in 2002.
Decrease was mainly due to a $2 4 million dollar decrease in payments to long run for manufacturing services.
As well as the $1 3 million dollar decrease in clinical activities related to the conclusion of our phase III clinical trial offset by an increase of $1 $2 million. The GDA 201 clinical program.
Going forward, we anticipate our research and development expenses will decrease.
Developing discontinuation for engineered preclinical NK cell therapy pipeline.
Commercial expenses for the first quarter of 'twenty, three were $5 $6 million compared to $3 $9 million in the first quarter was 22.
Greece was mainly due to an increase in launch readiness activities.
We anticipate with our commercial expenses will increase over time driven by launch activities. Following the recent FDA approval of <unk> research.
General and administrative expenses for the quarter were $5 $2 million compared to $4 $1 million in the same period in 2002.
The increase was primarily due to professional services expenses to support the launch readiness activities.
Finance expenses net were $1 $4 million in the first quarter of 2003 compared to zero point $9 million in the same period in 2002 <unk>.
The increase was mainly due to interest expense from the convertible notes we issued in December 'twenty two.
Interest income from cash management.
Net loss in the first quarter of 2003 was $21 million compared to a net loss of $22 million in the first quarter of last year.
We expect that our current total cash position will support our ongoing operating activities into 'twenty four.
This cash guidance is based on our current operational plan and excludes any additional funding may be received or business development activities that may be undertaken with that I will turn the call back over to Abbe.
Thank you Shai.
To reiterate we have a two pronged corporate strategy, one execute our commercial plan around Ami do yourself onboard transplant centers secure payer coverage and <unk> to pursue potential strategic partnerships that can accelerate the omni search commercial strategy. Both activities are underway and we're making.
It's early but we're excited at the interest we're seeing from transplant centers, we believe we're well positioned and if we're able to secure a strategic partnership we can capitalize on the interest we're seeing in omni search.
Equity, we've raised and the debt we've reduced extend our cash runway into early 2024.
Now, let's open the call for question and invite Michelle Corfam, SKU, CEO , and CFO and Rohit, <unk>, CMO and CFO to join us operator.
Thank you to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw your question Press Star One again, please standby, while we compile the Q&A roster.
Okay.
Our first question comes from Edward <unk> with Piper Sandler Your line is open.
Great. Thanks for taking the time I was hoping to hear about the updates.
Especially on the reimbursement side.
Maybe if I can paint a picture for us for what it's like now for patients and physicians.
They consider.
Using omni surge and.
What is the process from here to start Onboarding patients.
Obviously, if you get them treated.
<unk>.
The manufacturing process, so maybe walk us through the steps in the short term.
Michelle do you want to take that and Ronit can chairman yeah, absolutely yeah. Good afternoon, Ted. Thank you for joining us for the question. So first let's talk about considerations for on the surge and then the next which prioritize into Onboarding. So what we have.
<unk> since we have received FDA approval for them a search is very consistent with our pre approval market insight studies, there's really two key opportunities from a search one is to improve outcomes for patients as compare to transplants experiences with other donor sources and the other is to increase access and that's especially.
For those patients right now who are eligible for transplant, who before I'm a surge of approval. Unfortunately, just couldn't find an appropriate match and as we know with the the the latter the increase access. Unfortunately, there is a help disparity in the U S, which our clinical trial demonstrated we were able to appropriately match and treat a range of patients.
From ethnic and racial disparities with over 40% of the patients in our study coming from patients were non Caucasian. So those are the considerations that would come into a transplant, there's decision making process to choose on the search the ability to improve outcomes as compared to other donor sources or to increase access for patient who otherwise would be eligible.
But couldn't find a donor source so that feedback has been very consistent with our market insights.
The key is Avi indicated to getting almost search to patients is onboarding transplant centers. We've been very encouraged and you know only a few weeks since we've been FDA approved by the feedback for centers wanting to be on boarded we do recognize onboarding is a comprehensive process, but we are confident that we are on track to reach our goal of Onboarding 10 to 15.
<unk> this year and these will be both sites that were part of our clinical trial, but also sites that were not part of our clinical trials.
So Ted let me stop there and see if I've answered. Your question. If you have any other questions or if not what would revenue.
Really clearance for ballpark I appreciate it.
Thank you.
Rohit anything you want to add to that before we move to the next question.
Not much to add just in terms of the experience for the transplants are at once a transplant center is prepared to deliver.
Or order on the surge in a transplant or would work with the be the match.
Filter unmatched source, which is the way that they choose their grasp source.
Wine and <unk> will be available to them as a choice at the site of the transplant center that they can choose for treating their patients and they will work through our <unk> portal.
Order and have the tracking and delivery of our research for the patient.
Okay.
Thank you one moment our next question.
Our next question comes from Gil Blum with Needham <unk> Company. Your line is open.
Hello, and good afternoon, everyone and congratulations on progress, especially the increased coverage Oh I have a specific question about the way that payers are viewing the label language regarding cord blood.
So when payers seek coverage at this for specific patients who are going to go on cord blood door that are broader than that.
Michelle over to you.
Excellent. Thank you Gil good afternoon, and thank you for joining us.
We actually have the opportunity to conduct blinded market insight studies with the final label right immediately before we we launched and then we've had obviously extensive discussions with payers, which we're very encouraged by payer.
Payers consistently in both the blinded insights and in our lives discussions have said that they work very closely with the fact, the credit of transplant centers and those centers are responsible and able to choose the appropriate donor source.
So that that has been very consistent with both the blinded market insight studies and then our live discussions with payers after FDA approval.
So the the feedback from payers have been has been very encouraging with the overall proposition of almost searches as Avi indicated I mean, we we've invested in our market access team. They they were very strong in their interactions with payers through the end of the year of 22 and to be able to to be just a few weeks into launch and to have confirmed.
<unk> research coverage with commercial payers, who cover approximately 65% of lives is just incredibly encouraging and it does tie into the pay you're seeing that value proposition for them a search.
Alright, and maybe just to add to what Michel said I think just to say it out loud, we don't feel that the label limits.
Obviously, I mean searches derived from cord blood you need to be appropriate for cord blood for omni search to be appropriate for a patient. So we don't feel that this limits in any way.
Okay.
And I think repairs on beverages is showing that.
I think you also have kind of answered my other question, which was have you received any negative feedback on pricing well.
If you are getting 65% of our coverage question Jessica.
Pretty amenable.
Thank you I think that is a very fair characterization. We we spent a lot of time prior to the FDA approval.
Sure we evaluated the value proposition of almost search in the context of pricing and you know the the feedback and the very quick and successful coverage that we're seeing come through I, Yeah I do.
I do say supports the value proposition.
Okay.
Last couple of things there are most of your technical so.
Are you going to say, where do you think you're going to start recognizing sales at what time.
Thank you.
Yes.
I can tell you I can take your questions.
As we just the approval last month.
We are focusing right now on Onboarding is trying to make sure that it will be ready for them.
Ready for our miscarriage.
We will be able to provide updates.
In the future, but not not today in this call.
Okay.
And one last one for you.
Because there was a convert.
Some of the debt.
I'm, having a little trouble with the share count is going to be.
<unk> shown.
There's already been shown in this quarter or is it going to show up next quarter I'm just trying to understand.
Yes, so the quarter numbers include the debt.
As of March 31.
Since then there was a significant improvement as Abbie mentioned in the prepared remarks.
Almost $6 5 million.
Well stacked were actually.
I would be able to send you the exact number can be helpful.
Okay. That's helpful. Thank you.
Thanks for taking my questions.
Yes.
Thanks Gil.
Okay.
Okay.
One moment for our next question.
Yeah.
Our next question comes from Vernon.
Bernard <unk> from H C. Wainwright your line is open.
Hi.
Hi, guys. Thanks for taking my question and congratulations on the coverage process with our commercial payers.
So you mentioned that you're on target to complete the goal of on boarding 10 to 15.
Top 70 transplant centers.
Thank you sort of alluded to it before but not necessarily.
I mentioned our goal.
When you say you're.
I'm sorry, we have to compete for growth on boarding 10 to 15.
As.
What exactly.
Is the goal.
As far as the numbers concern of those top 70, along what kind of timeline just trying to get an idea of.
Of course, whether you're making progress ahead of schedule or at some point or.
What is the go lets say bye.
Let's see.
Second quarter and the third quarter, if that's something that you could convey to us.
Sure. Thanks Vernon for your question Mr.
Michelle over to you.
Excellent. Thank you.
Thank you good afternoon. Good afternoon Vernon. Thank you for joining us so maybe I'll just I'll I'll start with the you know the definition of of Onboarding talk about what the goal is and talk about our future updates. So when we talk about Onboarding a center. It's everything is completed within the center to allow them to prescribe OMA search for their patients.
Rooney touched on a very very important point earlier in the Q&A, we have a very important partnership with be the match, we partnered with them for our phase III study and we partner with them now that we are FDA approved for almost search when a physician is onboard of D. C. Almost surge in their database for donor.
<unk>, which is excellent. So it's the same database they would be used to be using for unrelated donor. So onboarding means the center is Abel everything's in place they could prescribe on the search for an appropriate patients. Our goal was by end of 2023 to have on boarded 10 to 15 centers and we do anticipate as you alluded to those who.
Would be among the top 70 centers that make up those 70 centers make up 80% of the transplants. So today, we're not guiding on goal by quarter, we will provide more updates at the investor meeting that I'll be discuss during her prepared remarks, but what I'm very encouraged by is the enthusiasm by sites to come forward to be.
On boarded both those sites that are have been clinical trial sites, but also those that are not clinical trial sites.
And thanks, Thanks for that.
So it in detail and just to confirm the top 70 cover about 80% of transplants.
That is correct yes.
Thank you very much and congrats on the progress looking forward to the first sales numbers.
Thank you Brian .
Okay.
Thank you.
And our next question comes from Mark Redenbacher from Oppenheimer. Your line is open.
Hey, good afternoon, thanks for taking our questions just a couple from me.
Maybe Michelle you could give us an estimate of.
Proximate timeline it takes to onboard each transplant center.
If you had unlimited resources, how quickly could you onboard all 70 or 80.
Centers.
Is this a month long process is that a two month process.
Some idea would be helpful.
And then I guess the second question is sort of what metrics of launch performance you intend to be providing over the next few quarters. Besides simply.
Transplant centers on boarded and maybe.
<unk> Payor payor coverage anything else, specifically that can help us refine our models going forward. Thanks for taking the questions.
Excellent I mean do you want me to start.
Yeah.
Mark actually I'm Gonna take your second one first and thank you by the way. Thank you for joining the call the metrics for launching this we'll tie into what we're focused on at this point in time, they the key metrics for for launch, especially in the early stages. We are with almost surge are getting transplant centers onboard it.
And also the the payer coverage which is.
As I've indicated we've made great progress in the payer coverage and we're on track for those 10 to 15 centers that where our goal to be onboard this year.
Some of the other metrics that we'll talk about one is it's fairly straightforward, but important to recognize you know we are a publicly traded company. So shai indicated is as time goes on as we recognize revenue we will be certainly discussing the revenue.
That we are recognizing for almost search some of the other key metrics.
But we want to talk about is is around our manufacturing facility. You know, we historically have been able to manufacture almost search and returned it to the transplant center within 30 days from the start of manufacturing and that's something that will be critical for us to continue to monitor and discuss we were very consistent with that.
The phase III trial, and also very consistent in the EAP in Aplastic anemia study and as a reminder, we've been successfully manufacturing out of our gamete of cell facility for approximately one year for the EAP and for the Aplastic anemia study. So those are some examples of key metrics that we will be tracking and discussing.
The the timeline to onboard it does vary by center one of the benefits for almost search although.
We are seeing centers coming forward, who would like to be on board until we're not part of the clinical trial sites that the clinical trial sites did have the advantage of obscene what was required for the phase III study and having the appropriate procedures in place. So just to give you a sense.
There is going to be a variation in terms of how long. It takes the center to onboard for the following reasons. Some centers do you want to develop specific standard operating procedures for new cell therapies that come out and then some are able to edit their current desktop piece. So we were not guiding on centers by quarter.
At this point in time, but keeping the overall 2023 goal of having 10 to 15 centers onboard it by year end.
You did ask about you know what what would it be like if we had unlimited resources if you'd go back to some of our early discussions back in 2022. We originally had guided that we would have about half of the 70 centers on boarded by first quarter of 'twenty four or so it gives you a sense of additional resources.
Do come in that we would be able to accelerate beyond the 10 to 15 that we're seeing now is our goal.
Okay. That's helpful and we're looking forward to your Investor day at the end of June Thanks for the update.
Excellent. Thank you.
Yes.
Thank you and I'm showing no other questions in the queue I'd like to turn the call back to Abbey Jenkins for closing remarks.
Great. Thank you.
Thank you again for joining us this evening to recap our recent watch.
With our recent launch can meet a cell is positioned like never before to bring our mission to life and provide this potentially lifesaving cell therapy to patients with hematologic malignancies in need of a stem cell transplant.
Our two pronged strategic approach include successfully executing our commercial strategy with omni search now FDA approved and launching while pursuing strategic partnerships that will accelerate our ability to provide this important cell therapy to patients in need of a new option. Thank.
Thank you everyone for joining us on today's call and we look forward to seeing many of you at our Investor day coming in June . Thank you.
This concludes today's conference call. Thank you for participating you may now disconnect.
Okay.
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