Q2 2023 Mineralys Therapeutics Inc Earnings Call
Greetings and welcome to the minerals second quarter 2023 earnings call.
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Brief question and answer session will follow the formal presentation.
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It is now my pleasure to introduce your host Dan Ferry lifestyle Advisors. Please go ahead Sir.
Thank you operator, good afternoon, everyone and welcome to our second quarter 2023 conference call.
Today after the market closed we issued a press release, providing our second quarter 2023 financial results and business updates.
A replay of today's call will be available on the investors section of our website approximately one hour after its completion after.
Our prepared remarks, we will open the call for Q&A.
Before we begin I would like to remind everyone that this conference call and webcast will contain forward looking statements about the company.
Actual results could differ materially from those stated or implied by these forward looking statements due to risks uncertainties associated with the company's business.
These forward looking statements are qualified by the cautionary statements contained in today's press release interest to SEC filings.
Including our annual report on Form 10-K, and subsequent filings.
Please note that these forward looking statements reflect our opinions only as of today August 7th.
As required by law, we specifically disclaim any obligation to update or revise these forward looking statements in light of new information or future events.
I would now like to turn the call over to Jon Congleton, Chief Executive Officer of minerals Therapeutics John .
Thank you Dan Good afternoon, everyone and welcome to our second quarter 2023 financial results and corporate update conference call I'm.
I'm joined today by Adam Levy, our Chief Financial Officer, and Chief Business Officer, and Dr. David Rodman, Our Chief Medical Officer.
I'll begin with a brief overview of the business and recent milestones followed by David <unk>, who will discuss our clinical programs and then Adam will review, our second quarter financial results before we open up the call for your questions.
And our Atlas is focused on addressing the aldosterone do you have any cardio renal disorders that now include both hypertension, and chronic kidney disease or CK D.
We believe the growing prevalence of abnormal aldosterone levels is linked to the rising obesity epidemic.
This shift in the underlying biology of hypertension, and we believe in CK two years, well requires new therapeutics that reduce circulating aldosterone.
Based on our preclinical phase one and phase two data. We believe we have a highly selective effective and well tolerated aldosterone send patient care in the Rhondda staff to address this growing need and make a meaningful difference in the lives of millions of patients.
The first half of the year has been a very productive one for the morale is cheap and we're expecting this momentum to continue through the second half of 2023 and then into 2024.
Significant amongst our recent milestones is the initiation of patient dosing for the advanced H T trial during the second quarter.
This is the first of two clinical trials under the planned pivotal program to evaluate the safety and efficacy of little under stat for the treatment of uncontrolled or resistant hypertension.
And we expect to have topline data in the first half of 'twenty 'twenty four.
Pivotal trial launch H T N, which will enroll a larger population of uncontrolled or resistant hypertension subjects is expected to begin in the second half of 'twenty to 'twenty three.
We expect data from the launch H T trial in mid 2025.
Addition, after completing either of the pivotal trials subjects will be offered the opportunity to participate in an open label extension trial, which has already begun enrollment.
This trial will contribute to our long term safety dataset.
Last month, we announced the expansion of our clinical development of lunar understand as a potential therapy to treat patients with stage two to stage four chronic kidney disease.
Roll them out to Australia, and the progression of chronic kidney disease is well established.
This study is anticipated to begin enrollment before the end of this year.
We'll have top line data readout in Q4, 'twenty 'twenty four to Q1 2025.
More than 35 million adults in the United States suffer from chronic kidney disease, and we believe our run their staff has the potential to provide significant clinical benefit for many of these patients given the role that abnormally elevated aldosterone plays in the progression of this disease.
Let me now turn the call over to Dr. David Rodman, Chief Medical Officer, Minerality Therapeutics, who will provide additional details on our ongoing clinical program for Lamar understaffed.
Hey.
Thank you John and good afternoon, everyone. Today I'll provide an overview of the pivotal clinical program for La Rondure stats that as John touched on earlier has commenced enrollment.
I'll then provide a summary overview of the planned phase two trial of the round your staff for chronic kidney disease.
Since the initiation of the advanced HCM trial, we remain on track.
During this time, we have continued to onboard additional sites and randomized subjects into the trial.
As a reminder, it is a randomized double blind placebo controlled pivotal trial that will enroll up to approximately 300 adult subjects with uncontrolled or resistant hypertension.
Patients failing to achieve their blood pressure goal on two to five antihypertensive medications are eligible for the trial.
One third of subjects will be randomized to placebo one third to 50 milligrams Lorenzo stat once daily and one third to 50 milligrams of Laura understand once daily and then increased to 100 milligrams at week four it's the blood pressure goal has not yet been achieved and if they meet certain safety criteria.
Yeah.
The primary I'm one of the trial will be changed in systolic blood pressure as measured by 24 hour ambulatory monitoring at week 12, and the two active arms versus placebo.
We anticipate having top line data from this trial in the first half of 'twenty 'twenty four.
The second part of our pivotal program thriller understand is the larger launch H T. M trial, which is expected to be initiated in the second half of 'twenty twenty-three. This randomized double blind placebo controlled three arm trial is planned to have a similar design as the advanced H T N pivotal trial, except <unk>.
Up next we'll remain on their previously prescribed background regimen of two to five antihypertensive, including a fireside or fires I'd like diuretic.
And the launch HTS trial randomization will be stratified by body mass index is less than 30 kilograms per meter squared pursues greater or equal to 30 milligrams per meter squared or approximately 1000 subjects will be randomized one to one to one to either placebo.
So once daily 50 milligrams, that's around your stat or once daily 50 milligrams, if we're understaffed with the option to titrate in a matter of man or similar to the advance HTM trial.
Top line data from the launch H T and trial are expected in mid 'twenty 'twenty five.
In addition subjects from both pivotal trials will be offered the opportunity to roll over into an ongoing open label extension trial.
So as John mentioned earlier, we recently announced plans to initiate an expanded phase two trials under stat alone and in combination with an S. G. L. T. Two inhibitor as a potential therapy to treat patients with stage two to three a chronic kidney disease.
Trial will be conducted in two parts part a will be a proof of concept trial with the primary outcome measure being change in proteinuria.
At week 12 compared to placebo.
Very good surrogate for the registration endpoint, which is reduction in the rate of decline in Glu Mary alert filtration rate.
Part a is a randomized double blind placebo controlled trial that will consist of two treatment periods. We plan on enrolling up to 100 subjects with mild to moderate kidney disease and persistent proteinuria, despite treatment with an ace inhibitor or an angiotensin receptor blocker.
<unk> will receive either a once daily combination treatment with 50 milligrams isn't there understand plus 10 milligrams as far as Sega or placebo for 12 weeks.
Followed by a second 12 week treatment period during which subjects in the active arm will receive 50 milligrams, if Lorenzo stat alone.
I mentioned part a of the trial will evaluate the benefit as Lorenzo stat in combination and alone on proteinuria in this population.
Part B of the trial will be for profiling subjects with lower kidney function is second part of the trial is an open label single arm dose escalation trial that will enroll approximately 28 subjects with moderate to severe chronic kidney disease with or without hypertension.
Despite treatment with an ace inhibitor or an arb.
<unk> will receive four weeks of treatment once daily 25 milligrams La Ronde. Your stat, followed by an increase in dose of 50 milligrams of Lorenzo staff for another four weeks.
Part B of the travel characterized the safety profile, they're under stat more reasonably compromised population.
This is an exploratory trial, we may conduct interim analyses of the data at one or more time points. We expect to have top line data from this trial between the fourth quarter of 2024, and the first quarter of 2025.
The progress we continue to make this year speaks directly to the quality of our cross functional team members.
Equally important teams at our trial sites and most importantly trial subjects, who anxiously wait for a new approach to treating their hypertension and associated aldosterone mediated complications like chronic kidney disease and heart failure, we look forward to keeping you appraised.
The.
Status of our pivotal program as progress on our journey to transform any hypertension landscape unfolds.
Now I'll turn the call over to Adam who will provide a financial review for the second quarter of 2023 Adam.
You, Dan and good afternoon, everyone today, I will discuss select portions of our second quarter 2023 financial results. Additional details can be found in our Form 10-Q, which will be filed with the SEC later today.
We ended the second quarter with cash cash equivalents and investments of $282 $8 million compared to 110 quite $1 million as of December 31, 2022. The company believes that its cash cash equivalents and investments as of June .
<unk> 2023 will be sufficient to allow the company to fund its planned clinical trials as well as support corporate operations through mid 2025.
R&D expenses were $11 $9 million for the three months ended June 30th 2023, compared to $5.6 million for the same period last year.
The increase in R&D expenses was primarily due to increases of $4 million in preclinical and clinical costs driven by the initiation of pillar under Stat capital program in the second quarter of 2023.
$1.3 million and higher compensation expenses as a result of additions to head count and $1 million and clinical supply manufacturing and regulatory costs.
G&A expenses were $3 $9 million for the three months ended June 30th 2023, compared to zero point $9 million for the same period last year.
The increase in G&A expenses was primarily due to $1 $4 million and higher compensation expenses as a result of additions to head count $1.1 million and higher professional fees associated with operating as a public company zero point $3 million of higher insurance.
<unk> expense associated with new director and officer insurance policies, and zero point $2 million and other administrative expenses.
Total other income was $3 $6 million for the quarter ended June 32023, compared to $0 for the same period last year, which was primarily attributable to interest earned during the three months ended June 32023 on the company's investments in money market funds and.
U S treasuries.
Loss was $12 $1 million for the quarter ended June 30th 2023, compared to $6 $5 million for the same period last year. The increase was primarily attributable to the factors described earlier with that I'll ask the operator to open the call for question.
Greater.
Thank you.
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Our first question comes from Michael just purely with Evercore. Please go ahead.
Hi, guys. Thanks, so much for taking my questions and congrats on all the progress a two for me.
Just the first one regarding the phase III launch hypertension trial. Its again the design similar to phase to accept that and this phase III trial patients could be on as much as five background meds instead of the three that are they're capped in phase two so could this non standardized background regimen that could include up to five drugs closet.
Greater placebo effect and how should we think about.
The placebo effect here versus the much smaller more tightly controlled phase II trial, and then I have a follow up.
Yes, Mike.
Try to give you a background and then some boat.
Advanced HTS and launch HTS allow patients on two to five background Meds now we know in advance HTM and we're taking them off of their prescribed treatment and putting them on a standardized treat them.
As it regards.
[noise] launch HTS, they could be on two to five meds.
We will.
Stabilize them on that prescribed background through a two week placebo run in period, and we believe that two week placebo run in period should largely take care of what.
Your question points out.
So whether they're on two or three or four or five meds, we'll make sure they're compliant and we will use our AI cure smart technology to ensure that compliance and if at that point complying on whenever the regimen as from two to five.
They no longer hit the criteria of being a hypertensive then they would not be randomized.
Think that stabilization on their background will give us a true sense of their blood pressure and they continued to be above 135 millimeters of Mercury then they'd be randomized so we're.
We're not overly concerned about the number of meds, causing a cadre.
Todd reaction within the placebo group.
Yes.
Got it very helpful.
And Mike I'd be remiss, if I didn't say that.
Very similar to what we had with target target was.
Greater than two background meds, and so we know that we had patients and target on 234, even five background meds. So it's very similar construct and it's at the end of the day, Mike It's kind of the real world.
Or or tightly curate and advance HCN generating class one evidence launch HTS, probably has a little bit more of a real world field.
Got it Super helpful. Second question is more of a big picture one.
With the recent update to the CK D trial, it seems as if you're no longer 100% certain that you'll be pursuing a separate dedicated CK D indication that it will be dependent on how this phase two goes.
And that this phase twos primary purpose is to support the hypertension indication.
Just what led to the sudden change in in an expansion wanting to expand the C.
C J D trial.
Yeah, Mike I appreciate the question I'll go back to really the Genesis of the company and our focus has been from the beginning.
How do we bring a targeted solution to both hypertension and beyond and beyond for US was broadly cardio renal indications.
In the case of <unk>, that's our first step into that beyond world of cardio renal.
And the reason is <unk> is such a natural fit is that we know the change in proteinuria is a really good marker to predict clinical response and four of CK D indication that clinical response as you heard Dave say is slowing the rate of decline and gloom area alone.
Filtration rate. So it's a really good marker for us to get a keen sense for the benefit that <unk> can add.
I'll also point out that the CCD proof of concepts that he really serves two purposes and one is to give us a derisked view of what Laura understand can do N C. J D.
We know that aldosterone plays a role there based on the therapeutics based on research and we know that Laura I understand does you know, 65% to 70% reduction in circulating aldosterone, so it'll give us an indication of the pot.
Potential value in chronic kidney disease, but it will also shows the value in reducing proteinuria for the hypertension population writ large because we know there's significant overlap.
One qualitative research with physicians from Endocrinologists Nephrologists cardiologist.
And really.
Next to the reduction in blood pressure and safety, probably the third rated attribute is benefit on proteinuria.
And so this study basically serves two purposes I think it really bolsters the attribute some of them understand as an antihypertensive, but it also gives us a real clear sense of what the benefit would be in the <unk> population to inform future development in chronic kidney disease.
Got it very helpful. Thank you.
Yeah absolutely.
Our next question comes from Greg Harrison with Bank of America. Please go ahead.
Hey, good afternoon, thanks for taking the question.
One on CK D with.
With that trial starting.
And getting some interim looks.
A little over a year from now hopefully.
What are you looking for in terms of proteinuria reduction that you think would be meaningful and how that could translate.
Anti Egfr benefit and then.
Kind of related to that.
How would you expect the efficacy that you see there and CK D to be affected by.
And how would that affect your later stage development.
Yes, let me Greg I appreciate the question.
Let me answer the first part and maybe I'll have Dave talk about the BMI component for it.
You know and I'm not going to guide to a range I think there's a lot of evidence out there that says if you can mitigate aldosterone you see a benefit.
Hey, rich.
<unk> circulated aldosterone as more complete way to do it.
You typically see with an S. G. L. T. Two inhibitor is a 30% to 40% reduction in proteinuria over at <unk>.
Weak period, which is the duration of our proof of concept studies. So we're looking for a clinically meaningful reduction beyond that.
Don't know that I'd want to guide to that just yet as far as how that would directly translate to benefit in Egfr I think it's premature to opine on that as well.
But we're clearly looking to.
To find a meaningful addition, we think there's significant need that remains even though the <unk> two inhibitors are quickly.
Being adopted in the treatment of CK D. There remains a lot of unmet need even with their advances that let me turn it over to Dave and he can address your question on BMI sure. So your question was do we expect to see something similar to hypertension, where larger BMI results in more aldosterone and better response.
Yeah.
It's a it's an interesting question now typically people who have proteinuria in this group of patients are often going to have type two diabetes, which is a product of <unk>.
The city and so I think the majority of subjects are gonna be obese and therefore, we probably wont have much of an opportunity to test. It is statistical level, whether they're non obese patients have a very different response also the mechanisms that increase our das drone in crown.
Renal disease are often related to it but it's just volume through the more classical pathways as opposed to.
Obesity. So good question, we'll be looking for that.
And we will let you know.
Great. Thanks for taking my question.
Yes.
Our next question comes from Jack <unk> with Stifel. Please go ahead.
Hi, This is Jack on for Annabel, Thanks for taking our question.
So firstly the advance HTM that he doesn't necessarily in a rich for BMI, but in target HCN, a lower BMI patients had less of a benefit in systolic blood pressure reduction.
Do you have any pre specified analyses to identify better efficacy in patients with BMI over 30.
Are you sufficiently powering the trial to reach Scott Big even if the 25 to 30 BMI patients turned out not to have that hyperaldosteronism link.
Well another great question say, where your question was since we're not stratified for BMI are we going to be able to look at the BMI effect.
So just for clarification were stratified for two drugs versus three and the reason we chose to do that is because it's critical in understanding whether this drug has a place.
Third line agent for hypertension, and we believe it will in people with high Aldosterone, who as you mentioned are often obese. So we do have pre planned analyses looking at PMI is a categorical again, BMI less than 30 versus greater than or equal to 30.
<unk> kilogram per meter squared and we'll be looking for that now. Your last question is a great question, which was are we powered for that and that has as much to do with effect sizes. It has to do with the size of the trial. So if we see a similar effect size difference to what we saw in target H T and yes, we're powered for that.
But it's not a primary it's a secondary.
Got it and then a follow up if I may.
On a more broad scale can you talk about the level of monitoring you might anticipate will be required for the run just that compared to mras regarding hyperkalemia.
Would you anticipate that to be a burdensome for physicians to monitor their patients.
No it won't be any more burdensome than the mras and we'll be looking to see whether there is any evidence that our strategy, which is to instead of blocking aldosterone production for the entire day.
Hey, with 50 milligrams, we do have a bit of a window. So that subjects can excrete potassium later in the 24 hour period. So there's reason to be optimistic that it will be.
Hello burden.
What we are what we're thinking will happen is that.
That patience will be put on this drug and as standard of care they'll come back in two to four weeks for a blood pressure.
And at that time, they will have another serum potassium checked them. They can be titrated and the same thing will happen is that after that unless there's a change or unless they have a very low egfr I think the burden would be pretty small and certainly no worse than an MRI.
Got it thank you.
Our next question comes from Mohit Bansal with Wells Fargo. Please go ahead.
Great. Thank you for taking my question and congrats on all the progress I have two questions. So first one.
What is the overlap between <unk> and hypertension.
I'm asking this because if having some level of proteinuria data ahead of your hypertension launch.
Could be helpful in the market place.
Yeah, there's no I appreciate the question and as you can imagine there's a lot of different cuts of data I think the data that we've reviewed and kind of the position. We look at broadly for the market, It's probably 25 call. It a quarter to a third of the hypertension population to have some.
Form a C J D.
And then Conversely, probably 60% to 80% of the <unk> population to have hypertension.
So pretty significant overlap either way and I think that's why as we did our initial target product profile research with physicians.
<unk> on hypertension.
An area was an asset that was very critical to them because of the significant overlap.
Got it this is very helpful and then.
Just wanted to touch.
That's based on the enrollment progress so far, especially in the advanced <unk> trial.
Could you comment something on the on that front.
And how comfortable do you feel about the plus 24.
Data read out at this point.
Okay.
Yes, we can.
Continuing to feel good about.
First half 2020 for topline results from advanced age 10.
We continue to feel confident about mid 2025 for launch.
Yes things are progressing as we anticipated and that's why we're continuing to guide to data readout in the first half of 2024 for advanced H T M.
Awesome. Thank you very much and congrats on the progress again, thank you John .
Yes, absolutely.
Our next question comes from Rich Valera with Credit Suisse. Please go ahead.
Hey, guys. Good afternoon, I have a couple of questions.
Based on your discussion with the FDA so far.
What do you need to demonstrate in order to get approval for the higher dose.
And also what is the comparator arm.
Based on your design and I also I have a couple more questions.
Say that last part of your question so based on that discussion.
Be required for what for the 100 milligram dose approval.
Yes, so far 100, Megs does approval and also what's the comparator arm for that dose.
So the way we're doing it is everybody is going to get dose escalated with either placebo or drug depending on which arm there and so they won't know what arm therein and if they're on placebo at four weeks they'll get dose escalated to two placebos and the same thing.
For the 50 milligram group and only in this third arm will they get 50 milligrams active so that's how we blind it.
The second part of your question was.
Is there a specific set of guidelines for registering that.
Arm as opposed to the 50 milligram arm.
And.
There isn't and this is a very common label to do this sort of thing and the reason is it's always benefit risk and.
C N.
Dennis It obviously can be greater when the exposures greater and the because you start at 50 milligrams anyone who develops say mild hyperkalemia.
Of the normal range won't be dose escalated. So the safety profile will essentially be similar if not the same to 50 milligrams it won't be.
As are the same as we saw in the target.
Trial, where we started everybody on 100 milligrams because some of those people would have also responded to 50 milligrams and so those people will no longer go up to 100, so it'll be.
Same rules and I think.
More than safety will be similar to 15 milligrams is what is our thought we don't know for sure of course.
Okay got it so just want to confirm so you guys would have to have two different placebo arms, one with a 50, making than 115.
Guess up titrated to another placebo so.
So basically there's two.
Yeah.
So let me so let me explain it I'm sure I didn't I didn't explain it clearly theres only three arms.
Everybody in this study is on one tablet that looks the same for four weeks.
And then they all go to two tablets that look the same for the last eight weeks or so.
Same people are on one tablet with placebo and then go to two tablets of placebo, but it's the same placebo group. The same thing happens in the other arms. So it's one arm.
All the way along its one pill in each arm for four weeks and then two pills each arm for the last eight weeks.
Yeah.
Okay any better.
Yeah, No I got it.
And then a couple more other questions too.
How important is the second dosing the commercial strategy, how many patients a proportion of patients that you think we'd get to Stoke in commercial or clinical trial setting.
Yes.
Rich.
John .
I think it's important slides and what we saw in target H Tien and we know that it is subject variability level.
Exposures.
You know from one individual to next week that some patients at 50 milligrams.
Was it was a great dose give them a great clinical response, both from an efficacy and safety standpoint, we believe that for other patients.
Just because of how they metabolize the drug and react to it that theyre going to need a higher dose and so it becomes important to address that patient variability.
And frankly to fitted with you know what.
The existing paradigm in hypertension that is to titrate the dose and so we think it's providing clinicians and patients that flexibility.
Is invaluable to really acknowledge the individual individuality of the subject.
The latter part of your question Rich remind me again.
Uh huh.
Proportion that they can.
Yes, it's hard to say right now rich and I think well with the size and scale of the pivotal program will be able to obviously communicate that well see that rise to that third arm for patients who are on <unk>. They got to goal safely and those that required a higher dose, but right now.
Wouldn't even want to hazard, a guess and I don't know that fundamentally.
It will matter the key for US is just getting the right dose for the right patient to get the right response.
Okay got it. Thank you and then just one last question for me.
I think you guys mentioned, particularly <unk> partner or combo partner is there like how do you guys feel like this agent and then is there any potential to do other agents.
Yeah, It's a good question.
We worked with our Kols rich it became really evident to us that there's a.
A high level of similarity you know, whether it's epic will emphasize <unk> zone canticle lets us on there the responses have been seen and.
<unk> have been very positive, but very consistent and so for us. It was just a matter of let's take the molecule that.
It has.
A good safety profile.
<unk> has a good.
Body of evidence and CK D and so <unk> was the one for us.
And we also needed to make sure that we picked one to standardize the background response.
<unk> studies that may become more open field to be on an <unk> two inhibitor writ large so it could be any of them that'll be something we'll evaluate down the road, but for this proof of concept and to hold something constant like background meds.
<unk> has done.
Great. Thank you so much.
Absolutely.
Yeah.
There are no further questions at this time.
Like to turn to floor back over to Jon Congleton for closing comments. Please go ahead Sir.
Thank you operator, and thank you to everyone for joining us today.
Very excited about the progress we've made thus far in 2023 and advancing our clinical programs and we remain enthusiastic about the upcoming milestones for the rest of the year. We look forward to updating you as our pivotal program for <unk> or understand continues to advance.
That will close the call have a nice day everyone.
This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.
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