Q3 2023 Virios Therapeutics Inc Earnings Call
Good day and welcome to the various Therapeutics, Inc. Third quarter 2023 earnings update.
At this time, all participants have been placed on a listen only mode.
Please be advised that today's call is being recorded at the company's request.
At this time I'd like to turn the call over to Angela Walsh Senior Vice President Finance and Treasurer for various therapeutics. Please proceed Angela.
Thank you good morning, everyone and thank you for joining us on today's conference call.
We're pleased to be with you today to discuss various therapeutics third quarter financial results and to give you a corporate update. Please note that our financial results press release is now available on our website.
Before we begin I'd like to remind everyone that statements made during this conference call.
Include forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.
Which involve risks and uncertainties that could cause actual results to differ materially from the information expressed or implied by these forward looking statements.
For more information regarding such risks and it starts with Gs. Please.
Please see the risk factors outlined in the company's filings with the U S. D C.
Any forward looking statements are made only as of today and we disclaim any obligation to update these forward looking statements.
Other than as required by law. Please see the forward looking statements section in our financial results press release issued this morning for more information.
Now it is my pleasure to turn the call over to our CEO, Greg I'll get Greg.
Thank you very much Angela and good morning, everybody and thank you for joining today's quarter three 2023 earnings update.
We'll be going through several slides over the course of the next 15 or 20 minutes and then we'll open it up to questions and answer you go to slide two please.
You'll note during the course of today's presentation, we'll be making several forward looking statements that are subject to risks and uncertainties you should read the documents we have filed with the SEC for more complete information about various.
Next slide please.
The first thing I'd like to mention relative to the past quarter is one of our absolutely key achievements and that is securing FTA guidance and agreement on our planned progress IMC one to phase III development.
Potential treatment for patients with fibromyalgia.
As you May recall, the phase <unk> study clearly identified patients that are most likely to respond to IMC, one therapy and as such will be enriching the phase III program to target new to fibromyalgia search patients only.
That said these patients represent the vast majority of the opportunities in the U S territory.
The proposed phase III program is comprised of four parts.
Also the pharmacokinetic and food effect study as a precursor to the 301, three or two and three of nine studies.
This pharmacokinetic and food effect study will be focused on the dose formulation.
We'll be using to commercialize IFC, one presuming success in phase III.
The second key component of the program is the 301 study. This is a head to head study comparing <unk> to placebo with.
With patients randomized one to one and groups of $1 60 for a total of 320 patients treated over 12 weeks.
Primary endpoint for this study will be the same endpoint, we used in our phase two a phase two b and is consistent with the end point required by FDA to gain approval starting with several hours of treatment.
The second program will be affecting will be the 302 study. This is a multi factorial trial.
This is comparing IMC Wanna placebo again, but in this study will be adding in the independent components systems cyclic there reference drug and Celecoxib reference drug.
These patients will be randomized into one of the four groups again targeting $1 60 per group for a total of 640 patients in this multi factorial trial.
Very consistent with the 301 study the primary endpoint in this trial is reduction in pain again, using the key end points required for approval patients will be assessed at 12 weeks of therapy.
Patients in both the 301 and 302 study have the opportunity to be enrolled at all long term extension. This is a requirement of the phase three program patients completing three a 103 or to have the opportunity to roll into this long term safety extension.
These will be patients treated for up to one year effectively the requirements. We have agreed with FDA on 300 patients will be treated in the three of them on study for six months.
The total of 100 or more will be treated up one year Dave.
Data from the 301, 302, and 309 study will be rolled into the NDA or new drug application.
That will be submitted to the FDA at the end of the Phase III program will be happy to discuss this proposal in further detail during the question and answer next slide please.
As you can see on slide four the various research team has worked diligently over the third quarter to submit the briefing materials to the food and drug administration for a proposed investigation on new drug application or I N D. As it's called for IMC too.
Same with prolonged Covid IFC two is a little different than I am she wants it compares.
I'll stick with it and Celecoxib, whereas I M. C. One is fantastic with her and Celecoxib.
This is a very exciting program.
Recent center for disease control prevalence estimates suggest somewhere between seven 5% and upwards of 41% of patients not hospitalized adults who have covered you want to develop long covered sequela or symptoms.
There is very significant disability associated with long COVID-19.
In fact, a study in Australia in 2000 and in 'twenty, one and 'twenty two found that 74% of total disability associated with Sars koby to or the Covid virus is actually attributed to long COVID-19. So.
So effectively three quarters of all of the disability in this patient cohort was due the long COVID-19, whereas only a quarter of it was due to the acute infection highlighting the very significant morbidity associated with this particular illness.
I will tell you there are no treatments presently approved by the FDA to treat long tobit sequela.
Our goal for this R&D submission.
It was to identify with the F D H alignment the regulatory requirements for this potential first in class medicine.
We have filed new provisional method of abuse intellectual property protection associated with this particular Carmelo combination, which are granted provides coverage to at least 2043 before extensions.
We'll provide feedback on this potential first in class with search opportunity.
In what we projected the next four to eight weeks what makes this program so exciting.
If we can transition to the next slide.
Slide number five.
You'll note that the recover less mechanistic pathways task force.
As identified activation of secondary viruses as a potential cause prolonged COVID-19 sequela.
Just to back up a second you may know that the recover initiatives was created to address <unk>.
A widespread and very diverse impacts of both COVID-19 and non COVID-19.
This work is done under the umbrella of the National Institute of Health.
And one of the working groups within this broader recover initiatives as recover mechanistic pathways task force. They are really looking for what is the ideology or the catalyst for developing both COVID-19 how long COVID-19.
Covid acute infection. They have determined activates a very significant immune response, which I think we all know.
Importantly, severe COVID-19 infections can lead to an exhaustion of the immune response, which in turn because of the debilitating nature of the immune response can lead to reactivation of latent herpes viruses.
<unk> latent herpes viruses and the activation of those viruses are the target of both by M. C. One and I am so too.
Latent viral reactivation can lead to further dysregulation of the immune system very significant inflammation and the development of long Covid symptoms.
Potently for our purposes Covid patients exhibit significant Epstein Barr reactivation as compared to non COVID-19 patients why is that important but not everybody knows but where he would tell you at steamboat is actually a herpes virus and is a target specifically about sick with her.
And that is very important because data generated by the abatement Horn center actually identify this as a potential cause of long covered sequela. If we can go to the next slide please.
Slide number six you'll see data that were generated.
And unrestricted investments investigational grant.
Two the Bateman Horn center, Dr. Abatement requested a grid to assess the potential combination of balsa Colbert and celecoxib as a treatment for long Covid sequela.
In this open label.
Florida Towry law Cobot trial, we compared patients that were treated with valves stick with you and those who were control patients. These are patients matched for gender age and in particular the level of fatigue that they were exhibiting as a result of their long code and assist those patients after 14 weeks of treatment.
As you can see for each one of the Roes demonstrated on the table on page six.
L. Celecoxib treatment group delivered very statistically significant improvements and a whole host of different disease to qualify.
Specifically the primary endpoint DNI H promised fatigue score. This is a validated instrument generated through NIH.
Statistically significant reductions in peak at a P value of 0.008 highly statistically and clinically relevant.
The several other assessments in this study pain.
Patient global impression of change, which has an overall health status and then measures of orthostatic intolerance and both depression and anxiety will also assessed and if you take a look at the P values for virtually every one of those particular disease to quality, you see highly statistically and clinically relevant improvement for those patients.
Treated with Bell Celecoxib combination.
Versus those matched controls in fact every one of these measures is statistically significant including anxiety, including orthostatic intolerance with the exception of depression.
This particular assessment was only statistically significant at the 0.059. So we think this was moving in the direction of significance in a larger sample size may be able to figure it out.
Statistically significant impact with a larger sample size.
These data are particularly compelling because first of all sick live here in silicon or in combination with generally very well tolerated.
There were no serious adverse events in this particular trial the most common adverse events in both the routine care groups and in the balsa kudos Celecoxib group or headaches and muscle pain.
We're particularly encouraged by these data because.
These patients on average in both the treatment and matched control group.
Loan covered for a period of two years. This is particularly important because this is not something that just popped up and then was treated with this particular combination. These patients were suffering the morbidity and mortality not going to work not getting out of bed in the morning for a two year period. So this is a very significant illness that's respond.
And quite well in this open label exploratory trial.
We're really excited because moving forward, we're going to test. This thesis again in fact, Dr. Abatement requested a second investigational.
Grant and an investigator initiated unrestricted grant.
<unk> expanded our research program in this particular area and then the second trial. We are funding through this investigator initiated but Dr. Abatement and her team will be targeting 60 patients in three cohorts two doses of the Val Celecoxib combination and placebo. These patients will be assessed over the course of 12 weeks.
With consistent measures for assessing both fatigue, orthostatic intolerance et cetera.
And we believe the results from this trial will help guide our planning assumptions things like the I M seed treatment effect size whats. The overall sample size required in the next stage of development for our planned phase two b trial, assuming we reach alignment with FDA on the requirements for the investigational new drug application.
We're very excited about it.
This potential opportunity.
And look forward to those results sometime in the middle of 2024.
The final key topic I'd like to update you on before we turn to financial highlights for the quarter or is the idea of partnerships next slide please.
As you can see on slide number eight we are actively exploring as we've communicated partnership for both IMC one for fibromyalgia.
As well as I M C. Two prolonged COVID-19 updates on long cobalt will likely follow a feedback from the F. D. A.
In addition, we wanted to make it clear that we're also assessing complementary therapeutic interventions to build.
Sirius shareholder value, specifically, we're looking at opportunities in the pain and anti infective space Android unique opportunities that can create value under varies expert research and development leadership as complements to IMC, one and I am so too.
As you probably know, but just for the sake of reiterating partnership discussions include a very thorough review of our fiber allowed to face to be data timing and details for the proposed phase III program and deep analysis of the commercial opportunity all of these things take time.
We will report material progress on any proposed partnership.
In a very timely manner.
With that background relative to operational highlights, let me turn it over to our senior Vice President of Finance Angela Walsh once again to summarize our quarter three financial highlights Angela.
Thank you Grant. Please proceed to the next slide.
First of all we would like to express that day to our prudent management of cash we have the capital to fund operations into the third quarter F 2024.
We operate in a virtual model with less than four full time equivalents. This streamlined approach allows us to maximize the use of our capital for value creating research.
That said, let's turn our attention to the third quarter financial results.
As you can see on slide eight there were no sales for the three months ended September 30th 20, twenty-three or Darren the year ago quarter.
We reported research and development expenses, a point $4 million for the third quarter F. 'twenty twenty-three as compared to $1.6 million for the third quarter F. 2022.
The 1.2 million dollar decrease was primarily due to a decrease in clinical trial expenses of $1.1 million.
Associated with our fortress study in Q3 of 2022 and a decrease in drug development and manufacturing cost at point $1 million.
In addition, we reported general and administrative expenses, a point $9 million for the third quarter of 2023.
As compared to $1 million for the third quarter of 2022.
The point 1 million dollar decrease quarter over quarter was attributable to a decrease in expenses associated with being a public company.
Finally, we reported a.
A net loss of $1.2 million for the third quarter of 2023 as compared to a net loss of $2 $6 million for the year ago quarter.
But while our net loss was primarily due to the decreases in R&D and operating costs that I just discussed.
As of September 30th 'twenty, 'twenty, three we had $4 $8 million in cash as compared to $7 million as of December 31, 2022.
As I just mentioned, we expect this cash to fund operations into the third quarter of 'twenty 'twenty four.
At this time I will turn the call back over to Craig who will moderate the Q&A session at the call.
Right.
Thank you very much Angela and maybe just to progress to slide number nine.
To summarize the key highlights from quarter three before we open it up to questions and answers are as we mentioned we have secured FDA guidance and agreement to our proposed plan for our M. C. One in phase III development or enriching for patients new to fibromyalgia research.
We have submitted briefing materials to the food and drug administration for our submission of a potential new drug application or I N D for IMC too as a treatment prolonged COVID-19 and look forward to the results from the second study at debate Mcglaun Center, which are due out in the early part of 2024 or latest mid 2024.
We're actively exploring partnership opportunities on three levels I M. C. One for fibromyalgia IMC to prolonged Covid and then any complementary therapeutic interventions to continue to build shareholder value as complements to both land and sea, one and I am so to.
And as Angela just reviewed through continued prudent expense management running a virtual model the company expects to have capital to support operations into Q3 of 'twenty 'twenty four.
With that background.
Let's move towards a question and answer session.
I will turn it back to the operator Matthew.
Your host that particular Q&A Matthew back to you.
Certainly everyone. At this time, we'll be conducting a question and answer session. If you have any questions or comments. Please press star one on your phone at this time, we do ask that while posing your question. Please pickup your handset if you're listening on speaker phone to provide optimum sound quality.
Once again, if you have any questions or comments. Please press star one on your phone.
Your first question is coming from David Bautz from Zacks small cap research your line is live.
Hey, good morning, everyone. Greg first of all about the the phase III program in <unk>.
I'm curious if you can comment why the F. D. A wanted a famciclovir and celecoxib only arm in that study.
Thank you David and good morning, and I appreciate you joining us.
So it's pretty standard protocol to do a combination study.
From FDA guidelines to secure regulatory approval under the 505 B two pathway.
Is unique here is that we will be doing one multi factorial study, but we were able to negotiate a second study, which is just the head to head study of of items here one versus placebo. So we thought that was a very good outcome because it wasn't too multifactorial studies, but specifically.
This was one multifactorial plus the head to head, so a little bit more efficient way to get to potential approval presuming success correctly.
Okay now if I M. C. One does not beat either arm in that study does the FDA view that as a failed trial then.
So we don't believe we need to show statistical significance versus.
FEMSA Colbert was celecoxib independent components.
What this regulatory requirement is focused on is effectively showing the contribution of.
Of both components as you are well aware I'm sure David Celecoxib actually is used for pain in things like osteoarthritis and so what they're looking to assess is what is the relative cumbent contribution of both components as we roll up to a combination therapy versus placebo as the primary endpoint. So the data will dictate that.
Obviously over time, if there's not a lot of separation between M. C. One in the independent components I don't think that would be viewed favorably, but we do believe if we show statistical significance versus placebo and we see replication of data that has been generated prior to our research showing and says don't really move the needle on fibromyalgia anti virals.
Independently don't really move the needle on fibromyalgia, we have a very good chance of success moving forward.
Okay. So you talked about partnership opportunities in this morning, and I guess is the company prepared to move ahead with the phase III program and fiber all on their own or are you going to have the partner that keep tuned.
To initiate that program.
What we're looking at both options are but we do think partnership.
<unk> offers us the opportunity to scale less capital.
And then probably.
Needless to say, but I'll articulate it if you can find the right partner with an interest that already has commercial operations you obviate the need for scale and capital in the future.
To fund the commercialization of the asset. So we think that's probably the most efficient way to progress.
And that is the primary way, we think is the best way if you will to move forward, but obviously if you do not secure partnership then we will consider scaling the capital to do this as an independent entity, but that is a secondary objective.
Alright, and then lastly about both the long Covid program.
So I missed the the size of the study that the debate in center is going to be running for the second study could you go over that again.
Sure the Bakeman Horn Center.
In the second investigator initiated grant a run via the vacant home center. So they are in control in conducting the study recruiting et cetera is targeting roughly 60 patients 20 per arm two doses of a cyclical and celecoxib combination.
And a placebo arm.
Draft of the study.
Okay, Great I appreciate you taking the questions.
Sure.
Thank you. Your next question is coming from Sean Lee from H C. Wainwright, Sean Your line is live.
Oh, Hey, good morning, guys and thanks for taking my question.
A question on the.
The long Covid plan.
Would you be initiating a company sponsored study anytime soon on that and would you be testing additional doses and regimens and that study. Thanks.
Sure and good morning, Sean Thank you for joining.
The plan will be to secure FDA guidance as.
As I mentioned during the course of today's presentation we.
We have developed the briefing book.
You, probably know Charlotte, but just to be edification of others, when you're opening up and I N. D. You submit questions to the FDA, you'll get the feedback about things like whats. The primary endpoint. We think fatigue for example should be the primary endpoint. It's the most dominant symptom alone COVID-19 what are the sample sizes.
Et cetera required two advanced development, and we should get feedback sometime.
In the next four to eight weeks, we hope to have it in 2023, but there's not a timeline per se on getting specific alignment with FDA here, so that could bleed into the early part of 2024.
Once we have those are requirements in hand.
Well, we will do two things one has begun planning the proposed phase <unk> study and secondarily, we will open up.
The partnership discussions on a more fulsome basis, because now we know what the target is moving forward presuming again alignment with FDA on the on the next steps of the regulatory pathway, such always big endpoints duration et cetera.
And then we will likely use the outputs.
The treatment effect size of sample size etcetera that will be generated by the B a C study.
That is ongoing which we expect to read out sometime in early 2024 as the basis for finalizing the study design for the next phase of the <unk> study in non Covid.
Does that answer your question Joe.
Yes, that's very helpful. Thank you.
Of course of course.
Okay.
Thank you once again, everyone. If you have any questions or comments. Please press star then one on your phone please.
Please hold while we poll for questions.
Thank you that concludes our Q&A session I will now hand, the conference back to you Greg Duncan for closing remarks. Please go ahead. Thank.
Thank you very much Matthew hopefully you get a sense that these are very exciting times for various therapeutics.
We're on the cusp of forget progressing to very novel programs IMC, one for fibromyalgia and IMTT for long Covid is a two very novel potentially game changing new therapies to advance care for patients suffering the debilitating effects of both fiber mileage and long Covid and.
And we really think with continued success.
We have some very exciting value appreciation for the stockholders, we as we always do we'll commit to very timely update on progress on both research regulatory on the partnership front as we progress through the balance of 2023 and into early 2024, we thank you for attending today's call.
Thank you everyone. This concludes today's event you may disconnect at this time and have a wonderful day. Thank you for your participation.