Q4 2023 Celcuity Inc Earnings Call
Good afternoon, ladies and gentlemen, and welcome so acuity fourth quarter and year end financial results conference call at this time.
Andy listen only mode.
During the presentation, we will conduct a question and answer session.
Instructions will be provided at that time for you to queue up for a question.
If anyone has any difficulties hearing the conference. Please press star zero for operator assistance at any time.
I would now like to turn the conference over to Murray Asia Husky with ICR.
Please go ahead.
Speaker Change: Thank you operator, and good afternoon to everyone on the call. Thank you for joining us to review, so acuity fourth quarter and full year 2023 financial results and business update.
Earlier today, So acuity released financial results for the fourth quarter and full year ending December 31st 2023.
The press release can be found on the investors section of the website joining.
Joining me on the call today are Brian Sullivan, So acuity, Chief Executive Officer, and co founder Vicky Hahn, Chief Financial Officer, as well as Igor Gorbachev's E 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.
Forward looking statements and their implications involve known and unknown risks uncertainties.
And the 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 operations and prospects for the future you can find a 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 CEO of so acuity. Please go ahead.
Thank you Maria and good afternoon, everyone.
In 2023, we made significant progress advancing development of <unk>, Elisa, while strengthening our balance sheet and adding to our leadership team.
Our phase III, Victoria, one trial remains on track to report topline data from the victory see a wild type patient subgroup in the second half of this year and topline data for the picture, we see a mutated patient subgroup in the first half of 2025.
We were also excited to begin development of <unk> for patients with metastatic castration resistant prostate cancer this past year.
Enrollment has begun in our phase <unk> trial evaluating <unk> in combination with <unk>.
And we look forward to sharing preliminary data from this trial in the first half of 2025.
Our Victoria, one phase III clinical trial designed to evaluate <unk> combination with sylvestris with and without Pablo cyclic.
Patients with advanced hormone receptor positive <unk> negative breast cancer.
<unk> has progressed after treatment with the CDK <unk> inhibitor.
We're seeking to improve outcomes for those patient populations, which today receives only 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.
Standard of care for these patients includes endocrine therapies, such as full veteran.
And regimens that combined for investment with an <unk> specific or <unk> alpha specific targeted therapy.
These therapies are only offer modest progression free survival periods.
And in the case of the approved <unk> Alpha inhibitor, a very challenging safety profile.
Cigarette because a significant unmet need for these breast cancer patients has led the development and subsequent investigation of a significant number of new therapies.
<unk> for patients with an <unk> mutation and <unk> inhibitor for patients with <unk>.
<unk> mutation.
Was recently approved.
Median progression free survival or PFS for these sooner therapies ranged from three eight to $5 five months, respectively. In the same patient population in our phase III trials enrolling.
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.
To further elucidate the different therapeutic effects of <unk> versus other <unk> and Tor or Pam inhibitors.
We performed a series of non clinical studies using breast cancer cell lines, we have.
Presented the results of these studies during a poster session at the 2023, San Antonio breast cancer Symposium.
And a panel of 28 breast cancer cell lines.
<unk> was found to be more cytotoxic and at least 300 fold more potent on average compared to the single node Pam inhibitors.
Mechanistically get us solicit decreased cell survival, DNA replication protein synthesis glucose consumption lactate production and oxygen consumption more effectively than the other Pam inhibitors.
Tumor cell growth more effectively than single note inhibitors in breast cancer patient derived xenograft models with and without Pam pathway mutations.
We believe get us solicit as highly differentiated mechanism of action as an equal potent <unk> inhibitor is uniquely suited to most effectively address this unmet need, especially since <unk> has demonstrated activity independent of the picks VCA or ESR, one mutational status of the patients tumor.
The results from a phase one b study in patients receiving the phase III dose and schedule forget it's Elisa in combination with palisade club and so that trend was very promising median PFS was 12 nine months and the objective response rate was 63% both of which compares very favorably to published data for current standard of care regiments.
Another important goal for us in 2023 was to begin development of Gatto solicit been a new tumor type.
In the fourth quarter, we initiated a phase <unk> clinical trial to evaluate <unk> Elisa in combination with <unk>. So it is a potent androgen receptor signaling inhibitor in patients with metastatic.
Castration resistant prostate cancer.
We enrolled our first patient in the study in February and we expect to report preliminary data in the first half of 2025.
Treatment options for these patients are limited and there is an urgent need for new drugs to treat them.
Numerous preclinical studies have demonstrated interaction between the androgen receptor and Pam pathways, suggesting that combining a pan inhibitor with an androgen receptor inhibitor <unk>.
May induce a synergistic antitumor effects in patients with prostate cancer is also compelling clinical evidence with an earlier generation Tam inhibitor, providing a proof of concept of our hypothesis that combine and get it solicit with an androgen receptor inhibitor may be efficacious.
Speaker Change: And finally, as we get closer to having data for the picture you see a wild type patients in our phase III breast cancer study, we need to begin laying the commercial and marketing groundwork necessary to bring data to listen to the clinic.
It head up our commercialization efforts Eldon Mayer joined our management team as our Chief commercial officer in February Eldon.
Eldon has over 30 years of Biopharma commercial experience and companies ranging from early stage biotechs to full scale pharmaceutical companies across many therapeutic areas, including oncology.
Eldon and exceptional leader with a proven track record of building commercial organizations from the ground up to support the launch of a biotech companies first drop.
And with that I'll turn the call over now to Vicki Hahn, our Chief commercial officer to review our financial results.
Thank you, Brian and good afternoon, everyone I will provide a brief overview of our financial results for the fourth quarter and full year 2003.
I invite you to review, our 10-K, which will be filed later today for a more detailed discussion.
Our fourth quarter net loss was $18 8 million or <unk> 65 per share compared to $11 6 million net loss or <unk> 69 per share for the fourth quarter of 'twenty two.
Net loss for the full year of 2023 was $63 8 million or $2 69 per share compared to $40 4 million net loss or $2 64 per share for the same period in 2022.
These quarterly and full year net losses includes significant noncash items, including stock based compensation compensation and noncash interest. We also included in our press release non-GAAP adjusted net loss for the quarter and full year ending December 31 2023.
Our non-GAAP non-GAAP adjusted net loss was $17 6 million or <unk> 61 per share for the fourth quarter of 'twenty three.
<unk> to non-GAAP adjusted net loss of $10 3 million or <unk> 61 per share for the fourth quarter of 'twenty two.
non-GAAP adjusted net loss for the full year 2023 was $57 8 million or $2 44 per share compared to non-GAAP adjusted net loss of $35 million or $2 27 per share for the full year 2022.
Speaker Change: Research and development expenses were $18 1 million for the fourth quarter of <unk> 23, compared to $10 6 million for the fourth quarter of 'twenty two.
Speaker Change: R&D expenses for the full year 2003 were $60 6 million compared to $35 3 million for the prior year.
Speaker Change: Of the approximately $25 3 million increase in R&D expenses year over year.
Speaker Change: $22 9 million was related to activities supporting the Victoria, one phase III trial and.
Speaker Change: And the initiation of the phase one b two clinical trial.
Speaker Change: The remaining $2 4 million increase in R&D expense is related to increased employee and consulting expenses.
Speaker Change: General and administrative expenses were $1 6 million for the fourth quarter of 2003 compared to $1 million for the same period in 2002.
G&A expenses for the full year of 23 were $5 6 million compared to $4 1 million for the prior year.
Of the approximately $1 5 million increase in G&A expenses $1 1 million was related to increased employee related expenses and <unk> 4 million related to professional fees and other expenses associated with compliance related activities that support financing and clinical operations.
Net cash used in operating activities for the fourth quarter of 'twenty, three was $18 5 million compared to $9 5 million for the fourth quarter of 'twenty two.
This was the result of non-GAAP adjusted net loss of $17 6 million plus approximately 900000 of working capital changes.
Net cash used in operating activities for the full year 23 was $53 8 million compared to <unk>.
Compared to $36 million for the full year 'twenty two.
This was the result of non-GAAP adjusted net loss of approximately $57 8 million offset by working capital changes of approximately $3 9 million.
We ended the year with approximately $180 6 million of cash cash equivalents and short term investments compared to $168 6 million on December 31 2022.
The increase in cash year over year is the result of two financing activities that occurred in the fourth quarter of 'twenty, three and yielded gross proceeds of $65 million, which was offset by cash used in operating activities of $53 8 million in 'twenty three.
The first financing activity included a private placement offering through a pre funded warrant arrangement, which generated $50 million in gross proceeds.
Second financing activity generated gross proceeds of $15 billion by accessing our at the market offering.
We expect cash cash equivalents and investments and.
And available funds under our debt facility to provide adequate capital to fund current operational activities into the first half of 2026, I will now hand, the call back to Brian.
Thank you Vicky operator could you. Please open the call for questions.
Yes. Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the one on you touched on Colin you'll hear three each on pump technology will request questions will be taken in the order received should you Mr. Ken.
Your request please press the star followed by the channel.
Using a speaker phone please lift the handset before pressing Andy Jones.
Your first question is from Tara Bancroft from TD Cowen. Please ask your question.
Hi, Good afternoon, I was wondering if you could tell us more about the overlap of ESR, one and pick three eight mutations and <unk>.
FDA still considers RMC or full restaurant alone.
The best comparator for arms, a and B now.
A year into the launch of <unk>. So I'm, just basically trying to gauge your level of confidence in the RMB versus see endpoint or even the chances that you might go for an ASR one wild type labeling for that subset are thank.
Thank you.
Thanks for the question Sarah.
Have not seen any.
Variation in output outcomes for patients.
Associated with ESR one mutation.
With the combination therapy that we're evaluating in the study.
And so we don't anticipate.
<unk> on that front.
We.
Closely collaborating with the FDA when we.
We're developing the design of our study.
We've reviewed the study with them on an ongoing basis through a series of type a meetings, where we are collaborating with them and then close contact to review.
Not only the clinical development, but also work associated with what we hope is a future NDA.
As far as changing the control there is no discussion or consideration of that.
The drug was recently approved capital or assets or that use full veteran as the control just this past few months.
And so we'll certainly have data available to us to report potential.
Outcomes in patients according to their mutational status, but we don't anticipate it as bad as I said earlier to find any differences.
Clinically meaningful differences.
Great.
Thank you.
Have you said.
HR, you're powering too for the B versus the endpoint.
You commented on that.
We haven't commented on that but.
Okay.
We are powering the study sufficiently to support regulatory.
Approval.
Okay. Thanks, so much.
Are you.
Thank you. Your next question is from Maury Raycroft from Jefferies. Please ask your question.
Hi, Thanks for taking my questions.
It seems like the data timing is intact and on track.
The thing else Youre seeing wide enrollment rate I think at one point you mentioned.
To enroll 50% of the wild type patients by the end of the first quarter.
I'm wondering if you achieved that milestone.
Is that something that you could announce for the wild type cohort.
You'll have milestones associated with one of the terms of our debt facility and we did achieve that milestone during this quarter.
And so we remain on track that is consistent with the guidance, we provided about having data on the second half of this year.
Okay great.
For the phase III readout can you provide an estimate for how much follow up do you think you will have by the time of the data readout.
Yeah.
The final number that we'll disclose at this point.
We anticipate obviously reporting the topline data.
And the data readout will be triggered by achieving sufficient events and that factors in follow up period necessary to.
Get a fulsome.
Mature.
Speaker Change: Set of data.
Okay, yes that makes sense.
Lastly, another question on <unk>.
Mutations when you analyze the phase.
Phase one b data you reported similar efficacy in patients with or without <unk>.
<unk> mutations, but can you remind me if you looked at other mutations in the Bath way.
ATK.
<unk> loss and.
For the phase III have you had discussions with FDA on how you would evaluate patients with other non Panther <unk> mutations.
We've done analysis of.
Patients with these other mutations, but the numbers are small and so we didnt feel that reporting those results would be guess scientifically rigorous enough to really discuss but we have evaluated them in and.
Based on at least the heart's reputation of the small sample size as we we haven't seen anything that is concerning or were inconsistent with the comparable.
Results, we saw with wild type <unk> versus mutated picture.
And as far as other mutations.
<unk> and how that might.
Interact with the FDA essentially when you design a clinical trial.
Phase III clinical trial, you have a very detailed protocol with statistical analysis, it's well prescribed.
And.
Essentially.
They interact with the agency quite a bit or at least we did too.
To get their feedback and to ensure that our assumptions in the statistical analysis plan.
That would be satisfactory.
Subject to review to support an NDA and nothing on that front has changed in the primary.
Biomarker that we're using is primarily to assign patients to our.
A study thats focusing on fixed <unk> mutated patients and the study that's associated with.
A randomized patients who lack ethics, we see a mutation.
And we're using what.
The picture you see mutations that have supported.
Approval of.
Victory <unk> Alpha inhibitor. So again, we're relying on an approved.
Pick three CA tests and have confidence that that test will support.
Subject to review by the FDA and.
An NDA submission.
Got it that's helpful. Thanks for taking my questions.
Welcome.
Thank you. Your next question is from Hillson from Needham. Please ask your question.
Gil I think that was for you.
My name was butchered pretty severely there sorry.
So.
Okay.
A quick question.
On.
The prostate.
Prostate cancer so.
Just to understand.
First patients are a little far from us.
What kind of signs of early efficacy with the company. We're looking for in that study I mean, I'm talking responses here Psa activity. Thank.
Thank you.
Sure.
The study is primary endpoint is PFS.
CFS rate at.
After six months of treatment and then there are a number of secondary endpoints, which include PFS at nine and 12 months as well as evaluating Psa changed.
The most important milestone rather endpoint is related.
To radiographic progression free survival since that's the regulatory endpoint that we would use for evaluation in a registrational study and so we will be.
I think.
Consistently reporting that number and.
As that number matures with number of patients who've achieved that six months milestone nine months or 12 months milestone.
Well.
Conductor will that will be a rhythm that we will have four reporting data.
That's very helpful. Maybe another detail.
Enrollment here, so it sounds like the well type cohort is enrolling well.
Thoughts on.
The mutant cohort thank you.
Enrolling tandem essentially we're enrolling screening patients who have had prior CDK four six.
Criteria screening criteria.
That includes assessment of their picture status. They then get randomized so essentially the enrolment of wild type and mutant.
Our occurring concurrently.
So if our wild type is on track then are mutant population is on track just.
<unk> of the way the trial enrollment is.
Designed.
Okay, Great. That's a very helpful clarification, thanks for taking my questions.
Youre welcome.
Thank you. Your next question is from Brad <unk> from Stifel. Please ask your question.
Hi, Good afternoon I wanted to ask is there any way you have been able to attract adherence with the prophylactic mouthwash for stomatitis mitigation in Victoria.
Well, we do one of the primary advantages we have in managing that and monitoring compliance is when the patients come in for their.
Three week on one week off infusion and so.
The treating physicians or the.
Associated nurses are.
Evaluating.
But including <unk>.
Compliance with that prophylactic and.
Standard questionnaire and so we have a high degree of confidence based on that.
If patients aren't compliant will find out but also we reinforce the value of that prophylaxis and just as a reminder, that prophylaxis is only used in prescribed for the first two cycles of treatment.
Data is fairly clear that.
For patients who may be prone to development mucositis its moat in almost all cases likely to occur in the first two cycles of treatment and so that if you.
Are you able to provide that prophylaxis for that first two cycles of that the manifestation of mucositis is much much lower.
After that.
After that period, so it's not.
So.
Our requirement for patients to remain on that prophylaxis beyond those first two cycles.
Okay.
And then I'll try to ask another enrollment question, maybe in a slightly different way because I think the continued reiteration of topline guidance for Victoria, one is going to be important for investors.
Based on the enrollment pace you see is there anything you can share about a time point that could be passed this year, where you had reached sufficient enrollment to fully secure the second half guidance for the wild type using the right assumptions you've got for events.
Yes, I think again, we provided the guidance for the second half of this year, obviously as we get closer to that we can get more.
Granular and I think we'll update that.
That each.
Each quarter and so the closer we get I think the more more descriptive we can be.
But so far again, where monitor enrollment we're monitoring the event rates.
Speaker Change: And you make certain assumptions about the event rate.
And we're tracking to what our assumptions are so far.
None: Thanks for the question.
Youre welcome.
Thank you. Our next question is from Swayam for Kola Roman <unk> from H C. Wainwright. Please ask your question.
Thank you this is our acuity from Pennsylvania.
Good afternoon, Brian.
Good afternoon, most of my questions have been answered.
So then when the data when you are ready to.
Yeah.
The data from the royalties in the second half.
And with that.
I'm just trying to figure out how would you disseminate that information would that be.
And medical meeting or do a press release, and then follow up with a medical meeting at the appropriate time.
It is somewhat situational depending on the timing of meetings and when.
The data will be.
Cleaned and able to be released publicly and so when the event threshold.
Is triggered will understand whether what the.
Gross.
Gross but what the data is telling us.
And.
We would finish up data cleaning at that point, obviously, that's going on on an ongoing basis.
But it would be our expectation that we would announce the topline results, meaning whether or not we.
That's statistical significance, whether its trial was positive.
And probably characterize.
Of.
How clinically relevant those results are.
But I think it would.
Typical that you present the results of our phase III study at a medical meeting.
That is our would be our current desire, but again.
Depending on.
The timing of when the data is available we may reconsider but will follow I think practice, that's been used with other other drugs, but I think its fairly typical that.
A major meeting isn't scheduled.
Coincident with the availability of data that people will provide that top line and then wait until a medical meeting to provide the more fulsome description.
A description of the results.
Thank you thanks for taking my question.
Youre welcome.
Thank you once again, please press star one should you wish to ask a question.
None: Our next question is from Alex Nowak from Craig Hallum Capital. Please ask your question.
Hey, Greg Good afternoon, everyone as we're getting close to the first Victoria readout here you brought on a new chief our Chief commercial officer Thats great.
Are there additional investment in the commercial talent commercial resources do you need to plan for here over this year.
Sure.
You start to build out the team underneath Eldon.
Which I think typically includes a person who would head up your market access person, who was head up your marketing in a person's wood head of commercial operations.
And with that team you can do the planning that's necessary to lay the groundwork for obviously a lot more significant efforts once the data reads out.
And you really marching towards a specific date for launch.
And so we factored that into the.
The assumptions are in our budget for this year, we've incorporated that in our forecast of cash requirements.
And.
<unk>.
There.
<unk>.
Extraordinary there are appropriate relative to what needs to be done.
And when.
Okay that makes sense and then can you remind us of the IP position of gather within breast cancer, and then the potential to expand that that length within breast or potentially other cancer indications.
Alright, so we have 11 different patents that have been approved for getter.
We have several that are pending.
The.
Active pharmaceutical ingredient patent.
Is would provide an exclusivity period.
Through December 34, but because that is formulated and because the formulation actually is critical to being able to.
Deliver the drug administered.
We think that that will be very relevant in that pattern would have an exploration date of December 39.
And so we think we will have.
Extended exclusive period that would potentially carry for.
More than 15 years post launch or is that is our plan.
Excellent I appreciate the update thank you.
Youre welcome.
Thank you there are no further questions at this time. Please proceed.
Well, we appreciate your attendance for the call and we look forward to updating you in the future.
Thank you.
Ladies and gentlemen, the conference has now ended thank you all for joining you may all disconnect.