Q1 2024 Celcuity Inc Earnings Call
Operator: Good afternoon, ladies and gentlemen, and welcome to the Celcuity First Quarter 2024 Financial Results Conference Call. At this time, all lines are in a listen-only mode.
Good afternoon, ladies and gentlemen, and welcome Michelle Qi <unk> first quarter 2024 financial results Conference call.
Operator: Following 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 Maria Yonkoski with ICR Westwick. Please do so.
Speaker Change: At this time all lines are in a listen only mode.
Speaker Change: Following the presentation.
Speaker Change: We will conduct a question and answer session.
Speaker Change: Instructions will be provided at that time for you to queue up for a question.
Speaker Change: If anyone has any difficulties hearing the conference. Please press star zero for operator assistance at any time.
Speaker Change: I would now like to try to conference over to Mario <unk> with ICR Westwood.
Speaker Change: Go ahead.
Maria Yonkoski: Thank you, operator, and good afternoon to everyone on the call. Thank you for joining us to review Celcuity's first quarter 2024 financial results and business update. Earlier today, Celcuity released financial results for the first quarter ending March 31, 2024. The press release can be found in the investor section of the website. Joining me on the call today are Brian Sullivan, Celcuity's Chief Executive Officer and Co-Founder, Vicky Hahne, Chief Financial Officer, as well as Igor Gorbatchevsky, Chief Medical Officer, who will be available during Q&A.
Mario: Thank you operator, and good afternoon to everyone on the call. Thank you for joining us to review the acuity first quarter 2024 financial results and business update earlier today. So acuity released financial results for the first quarter ending March 31, 2020 for the press release.
It can be found on the investors section of the website joining me on the call today are Brian Sullivan, <unk>, Chief Executive Officer, and co founder Vicky Heim, Chief Financial Officer, as well as Igor Gorbachev Ski Chief Medical Officer, who will be available during Q&A before I begin I would like to remind listen.
Maria Yonkoski: Before I 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 because 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.
Speaker Change: 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.
Speaker Change: 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.
Maria Yonkoski: 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 company's 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 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, CEO of Celcuity. Please go ahead.
Speaker Change: Forecast future results and evaluate the company's current performance management believes the presentation of these non-GAAP financial measures is useful for investors understanding and assessment of the Companys ongoing core operations and prospects for the future you can find a table reconciling the non-GAAP <unk>.
Speaker Change: 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 <unk>. Please go ahead.
Brian F. Sullivan: Thank you, Maria, and good afternoon, everyone. We appreciate your interest in Celcuity. Our Phase 3 trial, Victoria 1, remains on track to report top-line data for the PIC3CA wild-type subgroup in the second half of 2024. Enrollment continues to proceed well. During the first quarter, in conjunction with an update related to our debt facility, we reported that the wild-type subgroup was more than 50% enrolled. Achieving this enrollment threshold during the first quarter gave us the right to draw down an additional $10 million tranche from our current debt facility.
Brian F. Sullivan: Thank you Maria and good afternoon, everyone. We appreciate your interest in cell acuity.
Brian F. Sullivan: Our phase III trial, Victoria, one remains on track to report topline data for the <unk> Wild type subgroup in the second half of 2024 enrollment continues to proceed well during the first quarter in conjunction with an update related to our debt facility. We reported that the wild type subgroup was more than 50% enrolled.
Brian F. Sullivan: Achieving this enrollment threshold during the first quarter gave us the right to draw down an additional $10 million tranche from our current debt facility.
Brian F. Sullivan: The patients we're evaluating in this study have HR positive, HER2 negative, advanced breast cancer whose disease progressed while receiving treatment with a CDK4-6 inhibitor and an aromatase inhibitor. Patients are eligible for enrollment if they've received up to two prior lines of endocrine therapy, but we anticipate that most of those enrolled will be receiving second-line therapy. And these patients typically remain on their first-line CDK4-6 inhibitor plus electrogel regimen for a median of 18 to 22 months, depending on the CDK4-6 inhibitor.
Speaker Change: The patients were evaluating in this study have HR positive <unk> negative advanced breast cancer, whose disease progressed, while receiving treatment with the CDK four six inhibitor and an aromatase inhibitor in patients who are eligible for enrollment if they've received up to two prior lines of endocrine treatments, but we anticipate that most of those enrolled.
Speaker Change: You'll be receiving second line treatment in these patients typically remain on their first line CDK four six inhibitor plus letrozole regimen for a median of 18 to 22 months, depending on the CDK <unk> inhibitor and this compares to the 13 months medium duration of prior treatment reported for patients enrolled in the comparable arm.
Brian F. Sullivan: And this compares to the 13-month medium duration of prior treatment reported for patients enrolled in the comparable arm of our Phase I B breast cancer study that evaluated gattatulisib combined with palvocyclob and fulvestrin. However, patients who received prior chemo in the advanced setting are not eligible for our Phase 3 study, unlike the comparable arm of our Phase 1B study. This is relevant since the prognosis tends to be worse for individuals who have previously undergone chemotherapy for advanced breast cancer compared to those who are chemo-naive.
Speaker Change: Our phase one be breast cancer study that evaluated <unk>, Elisa combined with Palo cyclical and four restaurants.
Speaker Change: Patients who received prior chemo in the advanced setting are not eligible for a phase III study. Unlike the comparable arm of our phase one B study.
This is relevant since the prognosis tends to be worse for individuals who have previously undergone chemotherapy for advanced breast cancer compared to those who are chemo naive.
Brian F. Sullivan: Another difference in the Phase 3 eligibility criteria relative to our Phase 1b study is the allowance of patients with bone-only disease. Based on data from other Phase 3 trials, we expect that roughly 20% of the patients enrolled in our Phase 3 study will have bone-only disease. The Phase 1B study did not allow bone-only disease. Only those with visceral disease were enrolled.
Speaker Change: Another difference in the phase III eligibility criteria relative to our phase <unk> study is the allowance of patients with bone only disease.
Speaker Change: Just on data from other phase III trials, we expect that roughly 20% of the patients enrolled in our phase III study will have bone only disease.
Based on this study did not allow bone only patients only those with visceral disease were enrolled and this is relevant since patients with not only disease generally have worse prognosis than those with bone only disease.
Brian F. Sullivan: And this is relevant since patients with non-bone-only disease generally have a worse prognosis than those with bone-only. By not allowing patients who have received prior chemotherapy in the advanced setting and by including those with long-only disease, we're eliminating two factors in our Phase III study that correlate with worse outcomes. As we begin preparing to get a solicitor's potential position in a future treatment landscape, we will take into account the criteria oncologists use to select a cancer therapist. We think these criteria, in order of importance, are efficacy, then safety, then mode of administration.
Speaker Change: By not allowing patients who have received prior chemotherapy in the advanced setting and by including those with the disease.
Speaker Change: We're eliminating two factors in our phase III study that correlate with outcomes.
Speaker Change: As we began preparing forgot to solicit potential position in the future treatment landscape.
Speaker Change: We will take into account the criteria oncologist used to select the cancer therapy. We think these criteria in order of importance, our efficacy and safety than mode of administration.
Brian F. Sullivan: And this is consistent with guideline recommendations, which are based on efficacy and safety considerations, not motive administration preference, especially in advanced breast cancer. The current second-line treatment paradigm for ER-positive, HER2-negative patients with advanced breast cancer is selective estrogen receptor degraders, or SERDs, like fulvestrin or elastitrin, as single agents, or one of three approved PAM inhibitors combined with Fulve However, each of the PAM inhibitors only targets a single PAM node, such as PI3K-alpha, AKT, or mTORC1, which is suboptimal because the uninhibited PAM nodes can induce compensatory resistance in patients who have received prior treatment with a CDK and 4, 6 inhibitor.
Speaker Change: This is consistent with guideline recommendations, which are based on efficacy and safety considerations not motive administration preference, especially in advanced breast cancer.
Speaker Change: The current second line treatment paradigm for ER positive <unk> negative patients with advanced breast cancer.
Speaker Change: Selective estrogen receptor degraders or search like full vestron or Alaska as single agents or one of three approved <unk> inhibitors combined with full vesting.
Speaker Change: However, each of the Pan inhibitors only targets a single Pam no such as PFS UK Alpha.
Speaker Change: Or him talk one.
Speaker Change: Which is sub optimal because the uninhibited Pam nodes can induce competent Tory resistance.
Speaker Change: And patients who have received prior treatment with the CDK <unk> inhibitor.
Brian F. Sullivan: None of these drugs have demonstrated efficacy in patients who have PIK3CA wild-type tumors, while only the PI3K-alpha and AKT inhibitors have reported benefits in patients with PIK3CA mutations, and these results are consistent with non-clinical data.
Speaker Change: None of these drugs has demonstrated efficacy in patients who are fixed we see a wild type tumors, while only the <unk> Alpha and AK T inhibitor have reported benefit in patients with <unk> mutations and these results are consistent with the non clinical data.
Brian F. Sullivan: This shows these single node inhibitors are three to four times less potent in breast cancer cells without PIK3CN mutations than in those with them. This is in sharp contrast to the non-clinical and preliminary efficacy data we've reported for Geta Thalassa and Studies Evaluating Breast Cancer and Prostate Cancer Cell Lines. Gattat's elicit was found to be equally potent and efficacious in cell lines with and without PIK3CA mutations and at least 300 times more potent on average in breast cancer cells than the improved single node PAM inhibitors.
Speaker Change: These single note inhibitors of three to four times or less potent and breast cancer cells without <unk> mutations than those with them.
Speaker Change: This is in sharp contrast to the non clinical and preliminary efficacy data we've reported forget it's Elisa.
Speaker Change: And studies evaluating breast cancer and prostate cancer cell lines.
Speaker Change: Got it for US it was found to be equally potent efficacious in cell lines with and without <unk> mutations and at least 300 times more potent on average in breast cancer cells than the approved single node Pam inhibitors.
Speaker Change: Consistent with these non clinical results.
Brian F. Sullivan: Consistent with these pre-clinical results, preliminary efficacy we reported in our Phase 1b breast cancer study that evaluated GERD2-elostib combined with palocyclib and either leprosal or filvestrin was comparable in both treatment nave and second and third-line patients with and without PIK3CA mutations. And we think these results demonstrate that, along with the estrogen receptor and CDK4-6 pathways, the PAM pathway plays an intrinsic role as a disease driver in HR-positive, HER2-negative advanced breast cancer that's independent of the presence of an activating mutation like PIK3CA.
Speaker Change: The preliminary efficacy we reported in our phase one of the breast cancer study that evaluated get up to the list of combined with policy glib in either left resolved for investment was comparable in both treatment naive and second third line patients with and without <unk> mutations.
Speaker Change: These results demonstrate that along with the estrogen receptor and CDK four six pathways. The Pam pathway plays an intrinsic role as a disease driver and HR positive <unk> negative advanced breast cancer, that's independent of the presence of an activating mutations like <unk>.
Brian F. Sullivan: And that's why we believe development of an optimized PAM inhibitor, like Dietitilisib, that targets all class 1 PI3K isoforms and mTORC1 and 2, represents one of the most important opportunities to improve the standard of care in HR-positive for 2-negative advanced breast cancer. Now, obviously, the foundation of Geta Thalyssib's potential future positioning will require that Geta Thalyssib report The current median PFS benchmarks for patients pre-treated with a CDK4-6 inhibitor are modest. Published reports of median PFS for the surge range from two to 3.8 months, and patients with PIK3CA mutations. 5.5 to 7.3 months for the AKT and PI3K alpha inhibitors, respectively.
Speaker Change: And that's why we believe the development of an optimized Pam inhibitor like get to solicit the targets all class one <unk> isoforms <unk> wanted to represents one of the most important opportunities to improve the standard of care in HR positive <unk> negative advanced breast cancer.
Speaker Change: Obviously, the foundation of <unk> potential future positioning will require the caterpillar reported clinically meaningful <unk> PFS benefit. The current median PFS benchmarks for patients pretreated with the CDK <unk> inhibitor are modest published.
Speaker Change: Published reports of median PFS for the surge range from two to three eight months.
Speaker Change: Patients with <unk> mutations.
Speaker Change: Five 5% to seven three months for the <unk> inhibitors, respectively.
Brian F. Sullivan: The two most recently approved therapies for this patient population reported 2 to 3.5 months of incremental PFS benefit, the threshold KALs generally consider to be clinically meaningful. In addition, we've consistently heard from oncologists that they lately prefer to delay the use of chemotherapy or ADCs until the benefit from endocrine backbone regimens is exhausted. And this perspective was actually recently echoed by senior management from an ADC sponsor that characterized ADCs as creating a third pillar in the treatment landscape for HR positive HER2 negative breast cancer that sits between endocrine therapy-based regimens and classical chemotherapy.
Speaker Change: The two most recently approved therapies for this patient population reported 2235 months of incremental PFS benefit the threshold gave us generally consider to be clinically meaningful.
Speaker Change: In addition, we've consistently heard from oncologists that slightly prefer to delay use of chemotherapy or adcs.
Speaker Change: Until the benefit from endocrine backbone regimens is exhausted.
Speaker Change: Perspective was actually recently echoed by senior management from an ADC sponsor the characterized adcs as creating a third pillar and the treatment landscape for HR positive <unk> negative breast cancer. That's just between endocrine therapy based regimens and classical chemotherapy and these comments are consistent with the sponsors drug development strategy in breast cancer.
Brian F. Sullivan: And these comments are consistent with the sponsor's drug development strategy in breast cancer, which includes developing an oral CERD and AKT inhibitor. We also think Geta-Telisib's safety profile may favor its potential positioning in a future treatment landscape. Geta-Telisib's treatment-related discontinuation rate was only 4%, and the Phase I-B arm with the Phase III intermittent dose schedule, which is comparable to the 6 to 8 percent discontinuation rates for CDK4-6 plus fulvestment regimen.
Speaker Change: Which includes development of an oral surgery and AK T inhibitor.
Speaker Change: We also think get it for less of safety profile may favor its potential positioning and future treatment landscape.
Speaker Change: Hello subs treatment related discontinuation rate was only 4%.
Speaker Change: Phase one of the arm with the phase III intermittent dose schedule, which is comparable to the 6% to 8% discontinuation rates for CDK four six plus divestment regiments and these results compare favorably to the treatment related discontinuation rates reported in the phase III studies for <unk> plus <unk>.
Brian F. Sullivan: And these results compare favorably to the treatment-related discontinuation rates reported in the Phase III studies for opalypsin plus fulvestrin, where 26% of patients discontinued, and Everolimus plus Exemestan, where 24% of patients discontinued. The results for Gettifolisib are especially encouraging, given that patients in the Phase 1b study did not receive prophylactic treatment for stomatitis. Since we're prescribing stomatitis prephylaxis in our Phase III trial, we would expect fewer stomatitis-related adverse events, which would further enhance Gettysill's already promising safety profile.
Speaker Change: Or 26% of patients discontinued and Everolimus, plus <unk> were 24% of patients discontinue.
The results, we get a solicit were especially encouraging given the patients in the phase <unk> study did not receive.
Speaker Change: Prophylactic treatment for stomatitis.
Speaker Change: Since we're prescribing stomatitis prophylaxis in our phase III trial, we would expect fewer stomatitis related adverse events, which would further enhance <unk> already promising safety profile.
Brian F. Sullivan: And finally, in-office administered therapies, such as an infused therapy like ethylalicin, have several key advantages relative to orally or self-administered drugs. However, in a real-world setting, convenience is only a meaningful consideration when the efficacy and safety profile of the alternative drugs are comparable or when a patient lives a significant distance from the treatment site. Otherwise, a well-tolerated therapy that offers a clinically meaningful PFS benefit will be overwhelmingly preferred by oncologists relative to one that offers less efficacy but is more convenient, and office-administered therapies such as gadathalicib fall into the medical benefit category, which has a far more streamlined reimbursement process than orally-administered drugs, which fall into the pharmacy benefit category. And this has several
Speaker Change: And finally.
Speaker Change: In office administered therapy, such as and it's used therapy like get to solicit have several key advantages relative to orally or self administered drugs.
Speaker Change: I mean, a real world setting convenience is only a meaningful consideration when the efficacy and safety profile of the alternative drugs are comparable or when a patient leaves a significant distance from the treatment side.
Speaker Change: Otherwise well tolerated therapy that offers a clinically meaningful PFS benefit will be overwhelmingly preferred by oncologists relative to one that offers less efficacy, but it's more convenient.
Speaker Change: And office administered therapy, such as get Us Elisa fall into the medical benefit category, which is a far more streamlined reimbursement process than orally administered drugs, which fall into the pharmacy benefit category.
Speaker Change: It has several applications.
Brian F. Sullivan: First, oncologists can recover additional costs associated with treating their patients. Second, oncologists have more autonomy to select therapies, and the care management process is much less burdensome. And third, pair contracting is less frequent, which results in fewer price discounts for this pharmaceutical company.
Speaker Change: <unk> oncologists can recover additional costs associated with treating our patients second oncologist more autonomy to select therapies and payer management process is much less burdensome.
And third payer contracting is less frequent which results in fewer price discounts for the pharmaceutical company and fourth patients typically incur lower out of pocket costs with an infused therapy, which is an important consideration for most patients.
Brian F. Sullivan: And fourth, patients typically incur lower out-of-pocket costs with an infused therapy, which is an important consideration for most patients. Beyond our breast cancer program, we're excited about the opportunity to develop Geta-Felicit for patients with metastatic castration-resistant prostate cancer, or CRPC. This past February,
Speaker Change: Beyond our breast cancer program, we're excited about the opportunity to develop yet a solicit for patients with metastatic castration resistant prostate cancer or.
Speaker Change: <unk>.
Speaker Change: This past February.
Brian F. Sullivan: We dosed our first patient in a Phase 1B2 trial evaluating getapolysis, in combination with darolutamide, an androgen receptor inhibitor, in CRPC patients previously treated with an AR inhibitor. Like HR positive breast cancer, prostate cancer involves both the hormonal pathway and the PAM pathway. The role of the PAM pathway plays in prostate cancer. It's been well characterized non-clinically, and in two since gets continued PAM inhibitors, which showed compelling proof-of-concept clinical trial data in two randomized studies and each of the clinical trials for these other PAM inhibitors.
Speaker Change: Also our first patient in our phase <unk> trial evaluating <unk> and.
In combination with our <unk> and androgen receptor inhibitor and <unk> patients previously treated with <unk> inhibitor.
Speaker Change: Like HR positive breast cancer breast cancer prostate cancer involves both a hormonal pathway and the Pam pathway. The role of Pam pathway plays in prostate cancer, it's been well characterized non clinically and in two since guest continued Pam inhibitors.
Speaker Change: Which showed compelling proof of concept clinical trial data and two randomized studies in.
Speaker Change: In each of the clinical trials for these other Pam inhibitors.
Brian F. Sullivan: Clinical Meaningful Treatment Benefit was reported relative to the androgen receptor inhibitor control arm in patients with CRPC. This is especially encouraging since gadotilicib is significantly more potent and efficacious than these PAM inhibitors in vitro. Primary objectives of the Phase 1b portion of the trial include assessment of the safety and tolerability of getatelicib in combination with darolutamide and determination of the recommended Phase 2 dose of getatelicib, anticipate reporting initial preliminary data in the first half of 2025. And with that, I'll turn the call over now to Vicky Hahne, our Chief Financial Officer, to review our financial results.
Speaker Change: Clinically meaningful treatment benefit was reported relative to the androgen receptor inhibitor controller in patients with <unk>.
Speaker Change: This is especially encouraging since scattered solicit is significantly more potent and efficacious and these pam inhibitors in vitro.
Speaker Change: Primary objectives of the phase one portion of the trial include assessment of the safety and Tolerability of <unk> in combination with <unk> and determination of the recommended phase II dose of <unk>.
Speaker Change: We anticipate reporting initial preliminary data in the first half of 2025.
Vicky Hahne: That I will turn the call over now to Vicki Hahn, our Chief Financial Officer to review our financial results.
Vicky Hahne: Thank you, Brian, and good afternoon, everyone. I'll provide a brief overview of our financial results for the first quarter of 2024. Our first quarter net loss was $21.6 million, or $0.64 net loss per share, compared to $11.9 million net loss, or $0.55 per share, for the first quarter of 2023. Because these quarterly net losses, included in our press release, non-GAAP-adjusted net loss for the quarter ending March 31, 2024. Our non-GAAP-adjusted net loss was $19.9 million, or $0.59 per share, for the first quarter of 2024, compared to a non-GAAP-adjusted net loss of $11.9 million, or $0.55 per share. Research and development expenses were $20.7 million for the first quarter of 2004 compared to $11.3 million for the first quarter of 2003.
Vicky Hahne: Thank you, Brian and good afternoon, everyone I'll provide a brief overview of our financial results for the first quarter 2024, our first quarter net loss was $21 6 million or 64 net loss per share compared to $11 9 million net loss or <unk> 55 per share for the first.
Vicky Hahne: Of the approximately $9.4 million increase in R&D expenses, $7.9 million primarily related to activities supporting the Victoria I Phase III trial and the initiation of the Prostate Phase I B2 clinical trial, and $1.5 million was related to increased employee and consulting expenses. General and administrative expenses were $1.8 million for the first quarter of 2024, as compared to $1.3 million for the first quarter of 2023. Employee-related expenses accounted for $0.3 million of the increase.
Vicky Hahne: Quarter of 2023.
Vicky Hahne: The remaining increase of approximately $0.2 million resulted from professional fees and other administrative expenses. Net cash used in operating activities for the first quarter of 2024 was $17.1 million, compared to $12.9 million for the first quarter of 2023. We ended the quarter with approximately $177.7 million of cash, cash equivalents, and short-term investments, compared to cash and cash equivalents of $180.6 million at December 31, 2023. The decrease in cash quarter over quarter of $2.9 million is primarily the result of a non-GAAP adjusted net loss of approximately $19.9 million, offset by a warrant exercise yielding $14 million in proceeds and working capital adjustments of approximately $3 million. I will now hand the call back to Brian. Thank you, Vicky.
Vicky Hahne: Because these quarterly net loss loss includes significant noncash items, including stock based compensation and interest. We also included in our press release non-GAAP adjusted net loss for the quarter ending March 31 2024.
Vicky Hahne: Our non-GAAP adjusted net loss was $19 9 million or <unk> 59 per share for the first quarter of <unk> 24, compared to non-GAAP adjusted net loss of $11 9 million or <unk> 55 per share for the first quarter of 2023.
Research and development expenses were 20, $20 7 million for the first quarter of <unk> 24, compared to $11 3 million for the first quarter of 'twenty three.
Vicky Hahne: Of the approximately $9 4 million increase in R&D expenses, $7 9 million primarily related to activities supporting the Victoria, one phase III trial, and the initiation of the <unk>.
Vicky Hahne: Prostate phase one b, two clinical trial and $1 5 million was related to increased employee and consulting expenses.
Speaker Change: General and administrative expenses were $1 8 million for the first quarter of 2024.
Speaker Change: That compared to $1 3 million for the first quarter of 'twenty three.
Speaker Change: Employee related expenses accounted for $3 million of the increase.
Speaker Change: Meaning increase of approximately 2 million resulted from professional fees and other administrative expenses.
Speaker Change: Net cash used in operating activities for the first quarter of 2024 was $17 1 million compared to $12 9 million for the first quarter of 'twenty three.
Speaker Change: We ended the quarter with approximately $177 7 million of cash cash equivalents and short term investments.
Speaker Change: Compared to cash and cash equivalents.
Speaker Change: $180 6 million at December 31, 2023.
Speaker Change: The decrease in cash quarter over quarter of $2 9 million is primarily the result of non-GAAP adjusted net loss of approximately $19 9 million.
Speaker Change: Set by a warrant exercise, yielding $14 million in proceeds and working capital adjustments of approximately $3 million.
Brian F. Sullivan: I will now hand, the call back to Brian.
Brian F. Sullivan: Thank you, Vicky. Operator, could you please open the call for questions?
Brian F. Sullivan: Thank you Vicky operator could you. Please open the call for questions.
Operator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press the star followed by the 1 on your touch-tone phone. You will hear a three-tone prompt acknowledging your request. Questions will be taken in the order received. Should you wish to cancel your request, please press the star followed by the. If you are using a speakerphone, please lift the handset before pressing any key.
Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session.
Speaker Change: Have a question please press star.
Speaker Change: Followed by the one on you touched on filings you'll hear three ton trumped acknowledging your request.
Speaker Change: Jens will be taken in the order received.
Speaker Change: Should you wish to cancel your request. Please press the star followed by the tail.
Speaker Change: If you are using a speaker phone please lift the handset before pressing any tools.
Operator: Once again, that is Star 1 should you wish to ask a question. Your first question is from Mary Raycroft from Jefferies. Please ask your question.
Speaker Change: Once again that is star one should you wish to ask a question.
Speaker Change: Your first question is from Maury Raycroft from Jefferies. Please ask your question.
Yao Ang: Hi, good afternoon. This is Yao Ang speaking for Morrie.
Gil: Hi, Good afternoon. This is gil.
Maurice Thomas Raycroft: Maury, Thanks for taking our questions.
Yao Ang: Thanks for taking our questions. So for the phase three study, can you remind us how the primary analysis is going to be triggered in terms of events and maturity? And what were the PFS assumptions for treatment and control that went into the guidance of a, Second half, 24 top-line data?
Maurice Thomas Raycroft: So for the Phase III study can you remind us how the primary analysis is going to be triggered in terms of events and.
Maurice Thomas Raycroft: And maturity.
Maurice Thomas Raycroft: And what are the PFS assumptions for treatment and control.
Speaker Change: That went into the guidance.
Maurice Thomas Raycroft: Yes.
Maurice Thomas Raycroft: Second half 'twenty topline data.
Brian F. Sullivan: Sure. Well, the study's primary analysis will be triggered by hitting an event threshold number of events. And that's independent of follow-up, although there are assumptions made about the follow-up period. Unknown Executive, Unknown Attendee, Swayampakula Ramakanth, Boris Peaker, Vicky Hahne, Lance, Two to three and a half months would be the most likely in that range, probably centering around 2.7 for full coverage.
Maurice Thomas Raycroft: Sure well the.
Maurice Thomas Raycroft: Study primary analysis will be triggered by hitting.
Maurice Thomas Raycroft: An event threshold number of events.
Maurice Thomas Raycroft: And that's independent of follow up although there are assumptions made about the follow up period.
A derive an estimate of the timing.
Maurice Thomas Raycroft: We would expect those events to occur in which informed the sample size assumptions.
Maurice Thomas Raycroft: Haven't.
Maurice Thomas Raycroft: Published.
Maurice Thomas Raycroft: The assumptions, we used to do that analysis, but we have presented data.
Maurice Thomas Raycroft: And there is publicly available data, particularly fruitful veteran that suggests that.
Maurice Thomas Raycroft: Yeah.
Maurice Thomas Raycroft: Two to three five months would be the most likely in that range, probably centering around two seven for peripheral vascular.
Yao Ang: Maybe a quick follow-up. You recently said some KOLs think the bar for well-type patients is 8-month PFS or 5-month Delta versus Vastrin. And there is one, uh, erroneous study in post-CDK46 patients that showed PFS in that ballpark. So, how does the current trial compare to the erroneous study, and what in the current trial gave you confidence that you should show better PFA? Thanks.
Maurice Thomas Raycroft: Maybe a quick follow up.
Maurice Thomas Raycroft: You recently set.
Maurice Thomas Raycroft: Some kols think the bar for wild type patients as eight months PFS or five months Delta versus just a quick question.
Maurice Thomas Raycroft: There is one at <unk> steady and post CDK four states patients that showed PFS in that ballpark.
So how does the current trial compared to the Everolimus trial and what in the current trial gave you confidence that you should show better PFS.
Brian F. Sullivan: So all the numbers for PFS should be on a relative basis because obviously it's relative to the control. And I think, you know, generally, KOLs think or would consider a clinically meaningful benefit to be about three months, or certainly more is better. But that's the threshold.
Maurice Thomas Raycroft: Thanks.
Speaker Change: So all the numbers for PFS would be on a relative basis, because obviously, if you are relative to the control.
Speaker Change: And I think generally kols think or would consider clinically meaningful benefit to be about three months certainly more is better but.
Yao Ang: If, you know, if you're referring to, I'm not sure whichever line of study you're referring to, could you tell me which study you're referring to? Oh, it's just, I think you recently said, One of the erotoma studies in the post-CDK-4-6 patients that showed PFS in the... I think maybe six to eight months.
Speaker Change: But thats the threshold.
Speaker Change: Yes, if you're referring to.
Speaker Change: I am not sure whichever line of study referring too.
Speaker Change: Could you tell me what <unk>.
Speaker Change: The study you're referring to.
Speaker Change: Oh.
Speaker Change: I think you recently said.
Speaker Change: One of the.
Speaker Change: <unk> study post CDK four six patients that showed a PFS.
Speaker Change: I think maybe six to eight months.
Speaker Change: That's why I asked if that's not correct. So theres been some retro retrospective analyses.
Speaker Change: I've ever lineups that doesn't break out what their activity is between PFS between <unk> wild type and mutant.
Brian F. Sullivan: Patients. But those are retrospective analyses. There are three of them.
Speaker Change: Patients, but those retrospective analysis there are three of them if you aggregate the data.
Brian F. Sullivan: If you aggregate the data and weight it for the number of patients in each study, the median PFS was 4.2 months. But again, given the non-clinical data which suggest everolimus is more likely to be more effective in patients with mutations than not with mutations. You know, I think there's an open question about how effective everolimus is in the wild, that is, in patients who are not treated with CDK-46. And as I mentioned, there's been no randomized data that provide any informed information or credible data about the activity of the drug in patients who've received prior CDK-46.
Speaker Change: And waited for the number of patients in each study.
Speaker Change: The median PFS was four two months.
Speaker Change: But again given the non clinical data would suggest that <unk> is more likely to be more effective in patients with mutations that not with mutations.
Speaker Change: I think there is an open question about how effective ever lineup is.
Speaker Change: The wild type pictures, a wild type patients and as I mentioned theres been no random.
Speaker Change: Randomized data.
Speaker Change: Yes.
Speaker Change: Provide any.
Speaker Change: Informed information are credible data about the activity of the drug in patients who have received prior CDK four sixes.
Yao Ang: Oh, I see. Thanks for the clarification. That was really helpful. And thanks so much for taking our questions.
Speaker Change: Oh I see thanks for the clarification that was really helpful and thanks.
Speaker Change: Thanks, so much for taking my questions again.
Speaker Change: Youre welcome.
Operator: Thank you. Your next question is from Tara Bancroft from TD Cowen. Please ask your question.
Speaker Change: Thank you. Your next question is from Tara Bancroft from Judy Cowen. Please ask your question.
Tara A. Bancroft: Hi, good afternoon. I have one clarifying question. Can you explain the reasoning that you have behind stratifying patients by six months prior therapy versus 12? You know, as these are chemo-naive patients, and that essentially implies that many will have a longer time on prior therapy. And do you expect that the prior therapy will be almost entirely prior CDK-4-6, or will it be including others like ephedralimus or SIRDS, too, if it's appropriate? You know, as you know, the time on prior CDK-4-6 specifically is important for outcomes, so it'll be helpful to know. Thank you. Sure. So,
Tara A. Bancroft: Hi, Good afternoon, I have one clarifying question can you explain the reasoning that you have behind stratify patients by six months prior therapy versus 12.
Speaker Change: As these are these are chemo naive patients and that essentially implies that many will have a longer time on prior therapy and.
Do you expect that the prior therapy will be almost entirely all prior CDK <unk> or will it be including others like I Miss or third too if it's appropriate.
Speaker Change: As you know the time on prior CDK four six specifically is important.
Speaker Change: For outcomes, so it'll be helpful to know thanks sure.
Brian F. Sullivan: So, um, the stratification factor for prior treatment duration was based on As well as ESMO guidelines, which define endocrine resistance in the advanced setting as patients receiving less than six months of treatment. PFF, endocrine therapy.
Speaker Change: So.
Speaker Change: The stratification factor.
Speaker Change: For prior treatment duration was based on.
Asthma guidelines, which define.
Andrew: Andrew can resistance in the advanced setting as lesson of patients receiving less than six months.
Andrew: PFS.
Brian F. Sullivan: So we felt that was a validated way of defining a patient population. There's a clear demarcation between, Uh, responsiveness to, subsequent rounds of chemotherapy, which is why, you know, the benchmark or that guideline identified six months as the threshold, to the extent that people want to look at more than 12 months. I would say the bulk of the differentiation, uh, and outcomes probably occurs in, in six months. And, and so what you'll see is a bit of a.
Andrew: And endocrine therapy. So we felt that was validated.
Andrew: Way of defining a patient population.
Andrew: There is a clear demarcation in.
Andrew: Responsiveness to subsequent rounds of chemotherapy, which is why the benchmark or if that guideline deidentified six months is the threshold to.
To the extent that people want to look at more than 12 months I would say the bulk of the differentiation and outcomes probably occurs in six months and so what youll see is a bit of a.
Brian F. Sullivan: The Upward Sloping Curve, you know, that correlates highly with prior treatment that is much more gradual than the curve for patients who have progressed in less than six months. And what you'll see when you're looking at some data uh... for therapies under development, particularly the SIRDs, it appears the strategy for the patient population they're going after, at least that's who they're enrolling in some of their studies are patients who uh... have uh... they're only enrolling patients who've had more than six months of benefit, PFS, on their prior endocrine therapy
Port sloping curve.
Andrew: Correlate highly with prior treatment that is much.
Andrew: More gradual than the curve for patients who are.
Andrew: Progress on less than six months and what Youll see when you are looking at some data.
Andrew: For therapies under development, particularly the surge.
Andrew: It appears the strategy or the patient population they are going after really who they are enrolling in some of their studies are patients who.
Andrew: Have they are only enrolling patients who have had more than six months of benefit PFS.
Andrew: On their prior endocrine therapy, so essentially they are selecting out patients who were endocrine resistant.
Brian F. Sullivan: So essentially, they're selecting out the patients who are endocrine resistant. In our study, since that's a meaningful and important group of patients to treat, we are including those patients. The stratification variable factor, though, allows us to do an analysis and make sure the arms of the study are well-balanced.
Andrew: In our study since that's a meaningful and important group of patients to treat we are including those patients stratification variable factor, though allows us to do an analysis and make sure that the.
Andrew: Arms of the study are well balanced.
Tara A. Bancroft: Okay, thank you so much. Perfect.
Okay. Thank you so much perfect.
Operator: Thank you. Your next question is from Brad Canino from Staples. Please ask a question.
Speaker Change: Thank you. Your next question is from Brad <unk> from Stifel. Please ask your question.
Bradley Patrick Canino: Thank you and good to see you. The reiteration of the second half 24 top line guidance. Brian, maybe another timing question to layer on top of that. I'm just wondering how important it is for your strategy to be able to report the full data for the wild type cohort at the San Antonio breast cancer meeting in December.
Brad: Thank you and good to see the reiteration of the second half of 2004 topline guidance.
Speaker Change: Brian maybe another timing question a layer on top of that I'm. Just wondering how important is it for your strategy to be able to report the full data for the wild type cohort at the San Antonio breast cancer meeting in December.
Brian F. Sullivan: You know, again, what's going to be most important is what the data says. And it'd certainly be nice if the data was available so we could present it.
Speaker Change: Yes.
Speaker Change: Again, what's going to be most important is what the data says.
Speaker Change: And it certainly would be nice if the data was available we could present it.
Brian F. Sullivan: I don't think it's essential, to be frank. I think it's a very secondary consideration. And we don't control the timing of that. And there are other complicating factors that you have to weigh. So we'll see, basically. But I don't think it's a... It's a nice-to-have, not a need-to-have, and certainly what's more important is the
Speaker Change: I think it's essential to be Frank I think it's very secondary consideration.
Speaker Change: And we don't control the timing of that and there's other complicating factors that.
You have to way so we'll see.
Speaker Change: Basically, but I don't think it is.
Speaker Change: It's a nice to have not a need to have and certainly what's more important is the data itself.
Bradley Patrick Canino: Okay, and then you also mentioned in your comments about the prior chemo and bone only patient factors between your phase two and phase three. Could you point us to any data that might help quantify the degree of impact these factors can have on durability and PFS or any other comments and what you think about the potential directional impact?
Speaker Change: Okay and then you also mentioned in your comments about the prior chemo and bone only patient factors between your phase II and phase III could you point us to any data that might help quantify the degree of impact. These factors can have on durability and PFS or any other comments and how you think about the potential.
Speaker Change: Central directional impact thank you sure sure.
Brian F. Sullivan: Thank you. Sure. So there's
Brian F. Sullivan: So there's data across many tumor types that will show patients who've received chemo and then are subsequently treated on target therapy will have a worse outcome than patients who hadn't had prior chemo. In the breast cancer space, I guess the data that's probably most meaningful, uh, was reported in the Bileave study. Cohort A enrolled kind of a first-line, second-line population, no chemo, the chemo-naive patient. And then cohort C of that study enrolled or allowed patients who had prior chemo to enroll.
Speaker Change: So.
Speaker Change: There is data across many tumor types that will show patients who've received chemo.
Speaker Change: And then R. Subsequently treated on targeted therapy will have a worse outcome than patients who haven't had prior chemo and the breast cancer space I guess the data that's probably most meaningful.
Brian F. Sullivan: And so it was more of a second or third line study. The cohort A, you know, which is more similar to the patient population we're enrolling reported 7.3 months; cohort B about 5.5 or 5.6 months. So essentially, a 30% delta, you know, in favor of the patients who are chemo-naive. And that's probably a relevant benchmark just because, you know, they're hitting a similar pathway.
It was.
Speaker Change: Reported out of the <unk> study.
Speaker Change: Cohort enrolled.
Speaker Change: <unk> kind of a first line second line population no chemo chemo naive patients and then cohort C of that.
Speaker Change: Study.
Enrolled or allowed patients who had prior chemo to enroll.
Speaker Change: And so it was more of a second third line study.
Speaker Change: The cohort.
Which is more similar to the patient population. We are enrolling reported seven three months cohort be about five five or five six months, so essentially a 30% delta.
Speaker Change: In favor of the patients who are chemo naive and that's probably relevant benchmark just because they're hitting a similar pathway.
Brian F. Sullivan: As far as bone-only goes. Uh, impact or, and essentially, when you say vote only, there's two, one qualification. Patients who are enrolling are bone only, but they have to have a measurable lytic lesion so you can measure it. Uh, PFS and, uh... But in the PLOMA-2 study for polycycline, they did a follow-up analysis and found that patients with bone-only disease had 38 months or 50% greater. PFS than patients who had only, that had visceral disease, not bone-only disease, which, you know, suggests obviously that there's a much greater, much more favorable prognosis for bone-only patients who are more likely to get a favorable response to targeted therapy, at least one that includes CDK4-6.
Speaker Change: As far as bone only.
Speaker Change: Impact or and essentially when you say bolt on like this to the one qualification.
Speaker Change: Patients were enrolling a bone only but they have to have a measurable lytic lesions. So you can.
Speaker Change: <unk>.
Speaker Change: PFS.
Speaker Change: <unk>.
Speaker Change: But in the Paloma two study.
Speaker Change: For Pollo cichlid.
Speaker Change: They did a follow up analysis and found it.
Speaker Change: Patients with bone only disease.
Speaker Change: Had 38 months or 50% greater.
Speaker Change: PFS than patients who had only.
Speaker Change: This will disease, not only disease, which suggest obviously, there's a much greater much more favorable prognosis.
Speaker Change: For bone only patients who are more likely.
Speaker Change: To get a favorable response to subs to targeted therapy at least one that includes the CDK four six inhibitor.
Speaker Change: Thank you.
Operator: Thank you. Your next question is from Chase Knickerbucker from Cragnell. Please ask your question.
Speaker Change: Thank you. Your next question is from Chase Knickerbocker from Craig Hallum. Please ask your question.
Connor: Good afternoon, everyone. This is Connor on for Chase. Thanks for taking my question. I just have one here today.
Speaker Change: Hey, good afternoon, everyone. This is connor on for Chase. Thanks for taking my question I just have one here today.
Speaker Change: Last quarter, you brought on Eldon Mayer to prepare for a commercial launch of data. Since then what initiatives has implemented.
Speaker Change: We're planning on implementing to prepare for the launch on your own.
Connor: Last quarter, you brought in Eldon Mayer to prepare for a commercial launch of data. Since then, what initiatives has he implemented or plans on implementing to prepare for the launch on your
Speaker Change: Thanks for the question so no very happy to have <unk> onboard.
Speaker Change: As folks who have invested in the space now.
Speaker Change: Yeah, the preparation time for a launch it is quite long.
Speaker Change: And I think launch preparation it takes place in two time buckets.
Speaker Change: I would say those the T minus 12, you'll launch minus 12 months bucket.
Speaker Change: Which is the most intense and expensive.
Speaker Change: Time and time, it can be gated or really begun once you have your phase III data essentially when you can really fully flesh out your.
Speaker Change: In your product profile.
Speaker Change: And be much more specific when youre doing research and.
Speaker Change: Characterize your positioning and your overall messaging.
In the marketplace and be able to put together associated et cetera for payers and so we're in the T. Minus 24 timeframe right where in between month 12, T minus 12, and let's say T minus.
Speaker Change: 20 or so.
Speaker Change: And so the work that we're focused on now is it a building the initial team you need to bring on.
Speaker Change: People, who can lead the marketing effort business operations effort.
Speaker Change: The <unk>.
Speaker Change: Managed market effort.
Speaker Change: We're on track with identifying and getting those people on board and Thats. Those are individuals those those are not teams.
Speaker Change: Then you start to do research, which lay out.
Speaker Change: Overall plan, so I would say the main focus.
Speaker Change: For us.
Speaker Change: The end of this quarter was to essentially develop a preliminary plan.
Speaker Change: Which would identify organizational structure.
Speaker Change: Will be required and particularly by month over the next lets say 20 months or so the budget that's associated with that.
Speaker Change: During that timeline as well as post launch the first year of <unk>.
Speaker Change: Commercialization.
Speaker Change: We've identified the cross departmental.
Speaker Change: Dependencies.
Speaker Change: <unk> will require <unk>.
Speaker Change: Support of the launch.
Speaker Change: It's it or administrative support.
Speaker Change: Clinical operation support medical affair support et cetera.
Speaker Change: And so.
Speaker Change: And then making sure.
Speaker Change: That all of that work is aligned with.
Speaker Change: <unk>.
Speaker Change: The landscape as we see it today or as we see it evolving down the road.
Brian F. Sullivan: Uh, you know, thanks for the question. So no, I'm very happy to have Eldon on board.
Speaker Change: Awesome. Thanks for the question.
Speaker Change: Youre welcome. Thank you.
Speaker Change: Thank you once again should you have a question. Please press star one on your telephone keypad.
Speaker Change: Your next question is from Gil Blum from Needham <unk> Company. Please ask your question.
Brian F. Sullivan: You know, as folks who've invested in the space know, the preparation time for a launch is quite long. And I think, you know, launch preparation takes place in two time buckets. I would say there's the t minus 12, you know, launch minus 12 months bucket. Uh, which is the most intense and expensive time, and that time, you know, can be gated or, or really begun once you have your phase three data, essentially when you can really fully flesh out your product profile and, you know, be much more specific when you're doing research to characterize your positioning and your overall messaging in the marketplace and able So we're in the T minus 24 time frame, right? We're in between month 12, T minus 12, and let's say T minus 20 or so.
Brian F. Sullivan: And so the work that we're focused on now is building the initial team; you need to bring on people who can lead the marketing effort, business operations effort, the, uh, uh, managed market effort. And we're on track with identifying and getting those people on board. And that those are individuals; those are not teams.
Gil Joseph Blum: Hi, everyone and thanks for taking our question.
Brian F. Sullivan: And then you start to do, you know, research, and layout the overall plan. So I would say the main focus for us by the end of this quarter was to essentially develop a preliminary plan, uh, which would identify organizational structure. Out will be required, you know, in particular by month over the next, Let's say 20 months or so, the budget that's associated with that, during that timeline as well as post-launch, you know, the first year of commercialization.
Brian F. Sullivan: We've identified the cross-departmental dependencies that will require support for the launch, whether it's IT or administrative support. Clinical Operations Support, Medical Affairs Support, etc., and so on and then making sure that all that work is aligned with, you know, the, Uh, you know, the landscape as we see it today or as we see it evolving, uh, down the road.
Connor: Awesome. Thanks for the question.
Speaker Change: So maybe a bit of a rewarding them on a couple of previous ones. Here. So given you are enrolling patients with better expected outcomes that shouldnt Miss overall extended timelines for a study readout.
Operator: Thank you. Once again, should you have a question, please press 411 on your telephone keypad. Your next question is from Gil Blum from Atom & Company. Please ask your question.
Gil Joseph Blum: Hi everyone and thanks for taking our question. So, maybe a bit of a rewording on a couple of previous ones here. So, given you're enrolling patients with better expected outcomes, shouldn't this overall extend timelines for study readout? I mean, increased benefits should be evenly spread across the treatment arm. But I'm assuming this went into your calculations. Thank you. Uh, it did, but I would say, though...
Speaker Change: Increased benefits should be.
Speaker Change: Evenly spread across the treatment arms.
Speaker Change: I am assuming this went into your calculations.
Speaker Change: It did but I would say, though.
Brian F. Sullivan: There's a cap on the potential for fulvestrum. If you look at the data, I don't think there's any data that would, that has been reported in this patient population that suggests, Excuse me. Uh, that Bovashin can do more than
Speaker Change: There is a cap on the potential for <unk>, if you look at the data.
Speaker Change: I don't think Theres any data that would that has been reported and this patient population that suggests.
Speaker Change: Excuse me.
Speaker Change: Well, that's and can do more than three seven months.
Brian F. Sullivan: 3.7 months. Um, you know, if you aggregated the data that's been reported, you'd see it's about 2.7. If you look at the error bars on the data that has been reported, you know, the upper bound of the 95% confidence interval is around 3.8. You know, you can nudge that up and round it to four. But just given the mechanism and those results, we think that there's much less upside, I guess, due to a more favorable patient population than there is by treating an untreated disease mechanism, which is what, you know, we're doing with Getapolis. All right. Thank you.
Speaker Change: Aggregate the data that's been reported you'd see it's about $2 seven if you look at the arrow bars on the data that has been reported.
Speaker Change: The upper bound of the 95% confidence intervals around three eight.
Speaker Change: You can nudge that up in round it to four.
But just given the mechanism.
Speaker Change: And those results, we think that there is much less.
Speaker Change: Upside yes.
Due to a more favorable patient population than there is by treating untreated disease mechanism, which is what we're doing with <unk>.
Gil Joseph Blum: All right. Thank you. That's very helpful.
Speaker Change: Alright. Thank you that's very helpful.
Operator: Thank you. There are no further questions at this time. Please proceed.
Speaker Change: Thank you.
Speaker Change: No further questions at this time. Please proceed.
Brian F. Sullivan: Well, great. Well, thank you again for participating in our call today and for your ongoing support and interest in our company. We're participating in a number of conferences in the coming months and look forward to interacting with many of you soon. I hope you have a great evening. Goodbye.
Speaker Change: Okay, well. Thank you again for participating in our call today and for your ongoing support and interest in our company, we're participating in a number of conferences in the coming months.
Speaker Change: Look forward to interacting with many of you soon I hope you have a great evening Goodbye.
Operator: Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining us. You may all disconnect.
Speaker Change: Thank you ladies and gentlemen, the conference has now ended thank you all for joining you may all disconnect.