Q2 2023 Celcuity Inc Earnings Call
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Good afternoon, ladies and gentlemen, and welcome to the <unk> second quarter 2020 earnings Conference call. At this time all lines are in a listen only mode. Following the presentation, we will conduct a question and answer session.
At times. During this call you are required immediate assistance. Please press star zero for operator.
This call is being recorded on Thursday August 2023, I would now like to turn the contracts over to Robert Isom.
<unk>. Please go ahead.
Thank you operator, and good afternoon to everyone on the call. Thank you for joining us to review <unk> second quarter 2023 financial results and business update earlier today. So acuity released financial results for the second quarter ending June 32023.
The press release can be found on the investors section of the company website. Joining me on the call today are Brian Sullivan, <unk>, Chief Executive Officer, and co founder Vicky Hahn, Chief Financial Officer, as well as Igor Gorbachev Scape, Chief Medical officer, who will be available during Q&A.
Before we begin I would like to remind listeners that our comments today will include some forward looking statements. These statements involve a number of risks and uncertainties, which are outlined in today's press release and in our reports and filings with the SEC actual events or results may differ materially from those projected in the forward looking.
Statements such forward looking statements and their implications involve known and unknown risks uncertainties and other factors that may cause actual results or performance to differ materially from those projected.
On this call. We will also refer to non-GAAP financial measures. These non-GAAP measures are used by management to make strategic decisions forecast future results and evaluate the Companys current performance management believes the presentation of these non-GAAP financial measures is useful for investors understanding and assessment of the company's ongoing core operation.
And prospects for the future.
You can find the table reconciling the non-GAAP financial measures to GAAP measures in today's press release and with that I would now like to turn the call over to Brian Sullivan.
Oh, a sale acuity. Please go ahead.
Thank you Robert and good afternoon to everyone joining us on today's call.
Top priority this quarter was continuing to execute enrollment activities at trial sites globally for our Victoria, One phase III clinical trial as we discussed previously.
Victoria, one is evaluating our lead compounds together to elicit combined with Sylvester with or without Pablo cyclic.
In patients with HR positive <unk> negative advanced breast cancer, whose disease progressed, while receiving a CDK four and six inhibitor.
We're pleased to report that we now have nearly 200 trial sites recruiting patients in 20 countries.
Throughout the first half of this year, our team has done a fantastic job of coordinating with regulatory authorities and individual sites to ensure our sites can begin recruiting patients as quickly as possible.
That mostly focused on keeping us on track to report the primary analysis for the <unk> non mutated patient subgroup in the second half of 'twenty four and the primary analysis for the <unk> mutated patient subgroup in the first half of 2025.
This is consistent with our previously discussed expectations.
We are seeking to improve outcomes for a patient population that receives limited benefit from current second line standard of care therapies. We estimate that this initial potential target population represents over 100000 breast cancer patients globally on an annual basis.
Current standard of care for these patients includes endocrine therapies, such as for veteran and regimens that combined for investment with an <unk> specific or Pietro <unk> Alpha specific targeted therapy.
These therapies offer only modest progression free survival periods and in the case of the approved <unk> Alpha inhibitor, a very challenging safety profile.
The significant unmet need for these breast cancer patients has led to development and subsequent investigation of a significant number of new therapies aimed at these patients on oral <unk> for patients with an ESR. One mutation was recently approved in an 8-K T inhibitor reported positive results from its phase III study late last year.
Median PFS for these two new therapies range from three 8% to five five months in our patient population.
While the availability of new drug alternatives for patients is always good news.
Based on the results reported for these drugs the unmet need for these patients will still remain.
As we've discussed previously there is a <unk>.
General consensus amongst leading breast cancer researchers that major positive her two negative breast cancer.
Involves the estrogen CDK four six <unk> pathways, each of which can cross activate the other.
Effectively treat this disease, we believe data from our phase IV studies strongly suggest that simultaneous inhibition of these three pathways as required to optimize outcomes for these patients.
And to date randomized studies have consistently shown that partial into position inhibition of the <unk> pathway with drugs that only target a single component of this pathway such as ones that target <unk> alpha or.
<unk>, one can provide only modest anti tumor effects when patients have progressed on prior CDK four six treatment.
Thus, we believe <unk> is highly differentiated mechanism of action as an equal potent pan <unk> inhibitor is uniquely suited to most effectively address this unmet need.
Especially since <unk> has demonstrated activity independent of the presence of pyxis.
Yes, our one mutations in a patients tumor.
Our confidence that get us solicit can play an important role in improving outcomes for women with HR positive <unk> negative advanced breast cancer was reinforced with the updated PFS data we reported at the ESMO breast cancer Commerce in May for first line patients from our phase <unk> study.
Treatment naive patients with HR positive <unk> negative advanced breast cancer treated with get us Elisa Paolo cyclic and Letrozole.
The median progression free survival period of $48 six months and 79% reported an objective response outcomes were comparable for patients with and without <unk> mutations highlighting the rationale for comprehensive as opposed to selective inhibition of the <unk> pathway.
These results compare very favorably to the median PFS of $24 five months and the 55% objective response rate reported in the Paloma three study for Palo cyclic plus letrozole.
We believe the data suggest that <unk> has the potential to eventually become a first line treatment option.
Last year, we began evaluating and prioritizing new potential indications forget it's Elisa.
Previous trials for other <unk> inhibitors, and characterize the activity of <unk> and other <unk> inhibitors and different hormonal driven tumor types.
Our initial results from non clinical studies in prostate cancer were presented at <unk> in February and then gynecological cancers at ACR in April .
In each of these studies get us Elisa exhibited superior activity relative to all of the other <unk> inhibitors evaluated.
Thus based on our review of prior clinical studies with <unk> inhibitors, and our assessment of the relative advantage <unk> mechanism of action provides we believe there is a significant opportunity for us to develop yet to solicit and these additional tumor types over time.
We expect to provide you with an update on our pipeline development strategy by the end of the third quarter.
Now I'd like to shift our discussion to the diagnostic side of our business that centers on self Cigna are third generation diagnostics platform.
In fact, one in fact, two trials are ongoing and enrolling patients with early stage HR positive <unk> negative breast cancer with <unk> pathway is hyperactive as detected with ourselves signaling a test we continue to expect to announce interim results from these studies in the first half of 2024.
With that I'll turn the call now over to Vicki Han to review our financial results.
Thank you, Brian and good afternoon to everyone I'll provide a brief overview of our second quarter 2023 financial results.
Second quarter net loss was $14 6 million or <unk> 66 loss per share compared to net loss of $10 million or 67 loss per share for the second quarter 2022.
Because these quarterly net losses include significant noncash items, including stock based compensation and interest expense. We also include in our press release non-GAAP adjusted net loss for the quarter ending June 32023.
Our non-GAAP adjusted net loss for the second quarter of 2023 was $12 8 million or <unk> 58 loss per share compared to non-GAAP adjusted net loss for the second quarter of 2022 of $8 3 million or <unk> 55 per share.
Research and development expenses were $13 7 million for the second quarter of 2023.
Third to $8 4 million for the second quarter of 2022.
The approximately $5 4 million increase during the second quarter of 2023.
Primarily resulted from cost supporting activities related to Victoria one.
Little trial, we expect this we expect this expense to increase over the next two quarters consistent with the increase between Q2 and Q1 of 2023.
Primarily due to activities associated with Victoria one.
At that point.
We expect.
<unk> expenses to remain roughly flat in 2024.
Yes.
General and administrative expenses were $1 3 million for the second quarter of 2023 compared to $1 2 million for the second quarter of 2022.
Net cash used in operating activities for the second quarter of 2023 was $9 7 million compared to $11 3 million for the second quarter of 2022.
This was a result of non-GAAP adjusted net loss of approximately $12 8 million offset by working capital changes of approximately $1 4 million.
And changes in cash received from interest income related to maturities of short term investments of approximately $1 7 million.
We ended the quarter with approximately $146 2 million of cash cash equivalents and short term investments.
Compared to $168 6 million at December 31.
2022.
With that I will now hand, the call back to Brian .
Thank you Vicky operator, we're ready to take questions. If there are.
Thank you, ladies and gentlemen, we will now conduct a question and answer session. If you have a question. Please press star followed by the number one on your Touchtone phone you would hear it reads on managing your request.
Your first question comes from the line of Maury Raycroft from Jefferies. Your line is now open.
Hi, Thanks for taking my questions.
I was just going to ask for the phase III. If there is any additional perspective, you can share on how enrollment is going based on the types of patients potentially.
How it relates to wild type versus mutant patients and also geographic regions.
So we're enrolling patients consistently in all the regions.
Some reasons as expect it will be more active than others, but we're not breaking that out.
Yes.
At this point in time.
But.
So far activities are proceeding as we expected.
Site Activations have gone well.
<unk> startups have gone well.
The sites are engaged.
Got it okay.
You mentioned that you are recruiting at nearly 200 sites in 20 countries are you going to open additional sites or are you satisfied with the current number of sites open and enrollment rate I guess any perspective, there. We haven't we have some additional sites in the pipeline.
And so in some ways They act as backup because not every site does exactly what you would like and so we will over.
In effect.
Activate.
We will activate more than 200 sites to anticipate that some of these sites might not be as productive as we'd like.
Got it okay and sorry, one more question and then I'll hop back in the queue. I think you said in the past.
There could be data this year supporting the three week on one week off dosing schedule, which allows for the immune system holiday.
When and in what Forum should.
Should we expect to see data from that.
Well I think what we said was that we would have some data animal data that would.
So.
Immune system activity, we think is consistent with what occurs during the one week.
Dose period with a three week on one week off schedule and we expect to cover that when we provide.
An update on our overall pipeline R&D day, or so to speak which will happen we think.
For the end of this quarter.
Got it okay. Thanks for taking my questions Youre welcome.
Your next question comes from the line of Barry Speaker from Cowen. Your line is now open.
Great. Thanks for taking my question. My first question is on the Victoria One trial.
My understanding that the army is the key.
Key triplet arm in the study, which you plan to compare to RMC I'm. Just curious is the success or failure of RMB really matter here.
So RMB is intended to serve two purposes, one is to potash.
Potentially support registration of <unk> plus will lessen.
That.
Analysis B versus C is powered.
Independently and.
And is going to be tested as a primary analysis.
Is it helps demonstrate.
The contribution of <unk>.
And allows.
Analysis of the contribution of Polish and so.
No.
We'll see.
Or you want to see some form of arithmetic.
Difference between those three arms, but they adopt statistically for purposes of supporting an a versus C comparison needs to be significant.
Great and my second question also on Victoria trial, do you have a sense of the dropout rate at this point maybe Yvonne.
On a blinded basis altogether.
We don't I mean, we have again this early in the study you get.
There's two factors right those progression and then drop out due to factors other than progression.
We made assumptions in the trial that are probably pretty consistent with assumptions other companies make and there is nothing that we've seen to date that would suggest there is anything different than what our assumptions were.
And.
In terms of that would help inform.
Rejection of primary analysis.
Great. Thanks for taking my questions.
Youre welcome.
Your next question comes from the line of Gil Blum from Needham and company. Your line is now open.
Hello, and good afternoon, Brian .
Maybe a quick one on.
You mentioned a couple of agents that had data recently.
Assuming those are potentially approved at some point could that change the therapeutic landscape for good out of illicit combos. Thank you.
So thanks for the question.
We don't think so because the the benefit that's being reported is.
Isn't substantially better than what's currently available.
In the case of the AK T inhibitor that reported data.
And this patient population.
If youre doing a cross trial comparison at least.
It appears that it's not.
Its comparable.
The data suggests maybe not as good.
As the <unk> Alpha inhibitor, that's available it has a better safety profile. So im sure. The argument will be made that it can offer comparable antitumor control.
With less toxicity.
But it may be a legitimate good alternative for patients in light of the current standard of care.
But we don't think it necessarily changes or raises the threshold of outcome for patients.
Receiving these these therapies.
Gil we can't hear you if youre still if you are asking you got another question.
Okay.
Thank you Brian .
I guess my other questions Okay.
Okay. Thanks.
As a reminder, if you have a question. Please press star followed by the number one on your Touchtone phone.
Next question comes from the line of Alex Nowak from Craig Hallum Capital Group. Your line is now open.
Hi, Good afternoon, everyone. This is Albert who on for Alex.
So.
Regarding the tour.
And with the room.
Enrollment ramping and what you guys looking at other cancer indications, what additional investments in talent and resources do you need to plan for.
Sure so we.
Close to pipe transaction late last year that raised $100 million.
Yes.
And the intention of that pipe was to fund the Victoria, One study through data readout as well as to fund.
And early phase study in another tumor type and the cost of an early phase studies is certainly relatively very modest relative to our phase III study and very modest in the scheme of things and so the guidance. We've provided about our cash runway has been through the end of 2025 and we're still.
Confident that.
That's where we will end up.
Got you thank you and.
As enrollment creeps higher what sort of recruitment protocols changes have you made or have you stuck to the same.
I'm sorry.
Did you say recruitment.
Protocols protocols, yes.
So no the activity that we've had.
Started the study with and continuing in the overall approach to.
Ensure patients are identified as early as possible.
The site.
The trial is visibility at the sites.
That patients are identified well in advance.
That's been part of our strategy from day, one and so that's what we're sticking with.
It's proven effectively we try to work as best we can with each of the sites too.
Pre screen.
Candidates are patients who are currently receiving CDK four six and that could be candidates for our study.
We asked them to quantify that so they actually we know that they have gone to the.
Chart.
<unk> patients.
And then when we try to monitor that to see if those numbers are changing and that just helps us get a sense of the flow as well as whether or not the <unk>.
Site is engaged.
Each of our sites get to visit every two weeks from.
Clinical research associates.
<unk> monitor activities in this study but also.
To assess whether.
The study site is engaged overall.
The recruitment activities or if everything is proceeding as <unk>.
And so we feel like we have.
Hey, good footprint in the site we are in regular contact we separately established contact and routine.
<unk> with the principal investigators at each of the sites.
And so far again, that's if you were to talk to.
People in this area the engagement of the principle investigator plays a very very significant role and how well our studies accrue accrues at that site as well as the engagement of the study coordinator who typically reports.
Directly to the pie or to an organization.
And so having those two individuals engaged.
Is critical and so those are among other things.
The people we.
Try to pay a lot of attention to and keep track of and ensure that to the extent they have questions or things come up that were able to respond as quickly as possible.
Got you and one last question here. So I believe you mentioned this briefly but just to reiterate in the sites that are live.
What is the cadence of enrollment and is it still tracking along well with your expectations.
Sure.
Yes.
Each site is different some sites or community side. Some sites are very large.
And some sites just are typically better at keeping track of patients and therefore getting them in the queue for screening to be considered to be evaluated as a potential candidate.
And so.
<unk>.
Each site.
Well, yes.
Youll have a distribution of <unk>.
Results across that.
Number of sites that you have and.
It's not quite the 80 20 rule, but you always have your.
Like anything in life right Youll have your accounts or <unk> accounts and Youll see accounts.
And.
And you manage accordingly.
So we've to be Frank we're very pleased with the general level of activity at all of the sites. So so far so good.
Thank you that's all my questions.
There are no further questions at this time I will now turn the call over to Brian Sullivan Chief Executive Officer. Please go ahead Sir.
Well. Thank you I appreciate it.
Attending the call I appreciate the questions and look forward to updating you in the future.
Goodbye.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.
Okay.