Q3 2024 Arbutus Biopharma Corp Earnings Call
Today and thank you for standing by. Welcome to our beautis, BioFarma 2024, third quarter financial results in corporate update. At this time, participants are on listen only mode. After the speaker's presentation there will be a question and succession.
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Comfort Solitude: To withdraw your question, please press star one one again. Please be a Vost that today's conference is being recorded. I would now like to hand it to Comfort Solitude for a speaker today. Lisa Caperelli, Vice President of the Investor Relations, please go ahead.
Lisa Caperelli: Thank you, Antoine. Good morning, everyone. And thank you for joining our beauty's third quarter, 2024 financial results in corporate update call.
Lisa Caperelli: Joining me today from the Arbutus Executive Team are Mike McElhaugh, Interim President and Chief Executive Officer, David Hastings, Chief Financial Officer, Dr. Karen Sims, Chief Medical Officer, and Dr. Mike Sofia, Chief Scientific Officer.
Mike McElhaul will provide a corporate update, including an update on our ongoing clinical programs in HBV. Dave will then provide a review of the company's third quarter 2024 financial results.
After our prepared remarks, we will open the call for Q&A.
Before we begin, I'd like to remind you that some of the statements made during the call today are forward-looking statements.
Comfort Solitude: which are subject to a number of risks and uncertainties that may cause our actual results to differ materially.
Comfort Solitude: including those described in our annual report on Form 10-K, our quarterly report on Form 10-Q, which will be filed today, and from time to time in our other documents filed with the SEC. With that, I'll turn the call over to Mike McElhaugh. Mike?
Mike McElhaugh: Thank you, Lisa, and good morning, everyone. I appreciate you joining us today.
Mike McElhaugh: A few weeks ago, we issued a press release announcing that multiple abstracts highlighting inducer and data were accepted for presentation at the Liver Meeting 2024, which is the annual meeting held by the American Association for the Study of Liver Diseases.
Mike McElhaugh: Included in the acceptance are two late-breaker poster presentations with their inducer and data from our ongoing Phase 2a clinical trials, Improve 1 and Improve 2.
Mike McElhaugh: Since that meeting kicks off next Friday, November 15th, and the data are under embargo, we're not able to provide any updates to those trials at this time.
Mike McElhaugh: I will, however, review at a high level the data that we presented from those clinical trials earlier this year at the ESL conference.
Mike McElhaugh: Before doing so, I want to take a minute to discuss why we are focused on a functional cure for patients with chronic hepatitis B.
Mike McElhaugh: Chronic HPV remains a significant global health challenge affecting more than 250 million people worldwide despite the availability of preventive vaccines and current treatment options.
Mike McElhaugh: This underscores our mission to address the urgent need to bring innovative combination treatments with a finite duration, such as those that could include our RNAi therapeutic induceran, to patients as quickly as possible.
Mike McElhaugh: Currently, the primary treatments for chronic HPV include nucleoside analogs that suppress HPV DNA and immune modulators like interferon. These agents result in a very low functional cure rate.
Comfort Solitude: Therefore, combining new and innovative therapies to reduce surface antigen, suppress HPV DNA, and boost the immune system with current standard of care is needed to provide a more optimal functional cure rate for patients with HPV.
Comfort Solitude: If a functional curate were available for patients with chronic HPV, it could potentially significantly reduce the patient's risk of liver cirrhosis and hepatocellular carcinoma, decrease patient stigma, and eliminate lifelong treatment and burdensome health care costs.
Comfort Solitude: We are combining our RNA therapeutic imducerin with two different immune modulators in two phase 2A clinical trials.
Comfort Solitude: Our IMPROVE-1 trial, which includes short courses of interferon, and our IMPROVE-2 trial, which includes a combination of a therapeutic vaccine and an anti-PD-1 monoclonal antibody.
Comfort Solitude: At the EASL Congress in June, we reported data from our IMPROVE-1 clinical trial showing that the combination of imducer and plus interferon was generally safe and well tolerated.
Comfort Solitude: The cohort that performed the best was cohort A1, where HPV patients received six doses of Monduciran and 24 weeks of Interferon, in addition to ongoing nuke therapy.
Comfort Solitude: In cohort A1, 33% of the patients achieved surface antigen loss at the end of endoserine and interferon treatment that was sustained at 24 weeks post-end of treatment.
Comfort Solitude: We also looked at a subset of patients who had surface antigen less than a thousand international units per mil at baseline. In Cohort A1, 67% of the patients who had surface antigen less than a thousand international units per mil at baseline maintained surface antigen loss 24 weeks after completion of imdustrian and interferon treatment.
Comfort Solitude: This is a relevant population to assess because published studies have shown that patients with surface antigen loss have better long-term outcomes.
Comfort Solitude: As we think about a Phase IIb clinical trial and based on these data, stratifying the patient population to include those with low surface antigen may best position us for success while still capturing a significant portion of chronic HPV patients.
Comfort Solitude: At the time we reported the data, these four patients in Cohort A1 with sustained surface antigen loss had discontinued their nucleoside therapy.
Comfort Solitude: We've been following these patients to assess them for functional cure. As a reminder, functional cure is defined as sustained hepatitis B surface antigen loss and HPV DNA less than the lower levels of quantification, 24 weeks off treatment with or without hepatitis B surface antibodies.
Comfort Solitude: McElhaugh.
Comfort Solitude: We continue to receive positive feedback on these data from key opinion leaders in the HPV field, and we are excited to provide additional follow-up data from this trial at AASLD next week.
Comfort Solitude: In June at ESL, we also reported end-of-treatment data from our IMPROVE-2 clinical trial that is evaluating the safety and immunogenicity of a 24-week lead-in with Imduceran, followed by Barenthas Biotherapeutics Immunotherapeutic VTP-300 or placebo while continuing nuke therapy.
Comfort Solitude: In this trial, Imduceran lowered surface antigen to levels less than 100 IU per ml prior to dosing with VTP300 or placebo in 95% of the patients.
Comfort Solitude: After receiving VTP 300 and through 24 weeks post end of treatment, more patients maintain surface antigen thresholds of less than 100 or less than 10 international units per mil versus placebo.
Comfort Solitude: For patients who reach this time point, a statistically significant difference was achieved in mean surface antigen levels between the treatment arm and placebo.
Comfort Solitude: Recall that we have expanded this IMPROVE-2 clinical trial to evaluate the addition of a low dose of the anti-PD-1 monoclonal antibody Nivolumab to the Imbuceran and VTP300 combination treatment regimen, which you believe may further boost the host's immune response.
Comfort Solitude: We are on track to report preliminary data from this portion of the trial next week at ASLB.
Comfort Solitude: Caperelli, David Hastings, Michael Sofia, William Collier, Karen Sims, Michael Sofia,
Comfort Solitude: Now we'd like to move on to AB101, oral small molecule PD-L1 checkpoint inhibitor.
Comfort Solitude: We believe that the immune checkpoint pathway plays an important role in HPV-specific immune tolerance and in T cell activation, and the addition of a checkpoint inhibitor in combination with imduceran could potentially further enhance HPV-specific immune responses.
Comfort Solitude: We remain excited about the potential of AB101 in treating HPV. AB101 is liver-centric and in preclinical studies had typical small molecule pharmacokinetics, likely providing a much shorter duration of effect than long-acting antibodies.
Comfort Solitude: AV101 was designed with the goal of minimizing systemic exposure and reducing the chance of immune related adverse events that are often seen with checkpoint antibodies.
Comfort Solitude: AB101 is currently in a phase 1a, 1b clinical trial that consists of three parts starting with single and multiple ascending doses in healthy subjects and culminating with multiple doses in patients with chronic HBV.
Comfort Solitude: Last quarter, we reported data from the Part 1 single ascending dose portion of the trial showing that AB101 was generally well-tolerated with evidence of dose-dependent receptor occupancy.
Comfort Solitude: In the 25mg single-dose cohort, all five evaluable subjects showed evidence of PD-L1 receptor occupancy between 50 and 100%, indicating that AB101 is interacting with its intended target.
Comfort Solitude: Today we reported data from phase two of this trial where part excuse me part two of this trial where we have so far enrolled two sequential cohorts of ten healthy subjects.
Comfort Solitude: Each cohort received 10 or 25 milligrams of AB101 or placebo daily for seven days.
Comfort Solitude: Multiple ascending doses of AB101 were generally well tolerated with evidence of dose-dependent receptor occupancy. In the 25 milligram cohort, all subjects showed evidence of receptor occupancy, with seven of the eight subjects demonstrating receptor occupancy greater than 70% during the seven-day dosing period.
Comfort Solitude: With a favorable safety profile to date and evidence of receptor occupancy, we have now moved into Part 3, the global portion of this clinical trial, which evaluates 28 days of repeat dosing in AB101 in patients with chronic HPV.
Comfort Solitude: We expect to report preliminary data from HPV patients dosed with AB101 in the first half of next year.
Comfort Solitude: Finally, I have two brief updates on the litigation progress with Moderna and Pfizer-BioNTech around our LNP intellectual property. In the Moderna case, the trial date is now scheduled for September 24th, 2025, which is of course subject to the court's availability.
Comfort Solitude: In the Pfizer-BioNTech lawsuit, the date for the claim construction hearing, also known as the Markman hearing, has been set for December 18, 2024.
Speaker Change: I'll now turn the call over to Dave Hastings for a brief financial update. Dave?
Dave Hastings: Thanks, Mike. And good morning, everybody.
Dave Hastings: We ended the third quarter of 2024 with approximately $131 million of cash, cash equivalents and investments in marketable securities, compared to approximately $132 million as of December 31, 2023.
Comfort Solitude: During the first half of 2024, we received approximately $44 million of net proceeds from the issuance of common shares under our At-The-Market Offering Program.
Comfort Solitude: These cash inflows were offset by $54.5 million of cash used in operations.
Comfort Solitude: We did not issue any common shares under our ATM program in the third quarter of 2024.
Comfort Solitude: And we still expect our 2024 cash burn to range from $63 to $67 million.
Comfort Solitude: Importantly, our cash runway is sufficient to fund our operations into the fourth quarter of 2026.
Comfort Solitude: In closing, we have a strong financial position to advance our mission of developing our HPV assets to provide a functional cure for people with chronic HPV. With that, I'll turn the call back to Mike.
Mike: Thanks, Dave.
Mike: We look forward to providing an update next week as we intend to report additional data from our IMPROVE-1 clinical trial and preliminary end-of-treatment data from the Nivolumab arm of the IMPROVE-2 trial at ASLD.
Mike: With these planned data announcements and today's reporting of the multiple ascending dose data from healthy subjects in the AB 101-001 trial, we will have achieved all of our second half milestones.
Mike: Operator, we're now ready to open the call for Q&A.
Speaker Change: Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question, you need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while I compile the Q&A roster.
Mike: and others. Thank you. Thank you.
Speaker Change: Your first question comes from Dennis Ding from Jeffries. Please go ahead.
Dennis Ding: So, do you have any thoughts on what functional cure would look like in this arm? Would you be looking for a 20% incremental benefit?
Mike: on top when you add imduceran, just imagining if this cohort has 10, 15% functional cure, how we should interpret that data if adding imduceran gets to 20%. Thank you.
Mike: Good morning Althea, this is this is Mike. So let me let me try to try to understand where you're headed with this question. So first of all we have not presented any functional cure data related to inducer and to date. We've only presented end of treatment and post nucleoside consolidation.
Mike: The 20% functional curate that you've mentioned is sort of a stick in the mud for us, sort of a baseline of what we think is a meaningful functional curate. As you know, the current therapies
Mike: don't do very well, less than 10%, somewhere around 5%, and less for
Mike: as a goal, as an aspirational goal, that that would be meaningful and beneficial to patients going forward. So, you know, whether we're talking about cohort A1 or A2, or B1 or B2,
Speaker Change: Okay, got it. And so the bar would be 20% in either cohort.
Speaker Change: They're both interferon-induced and interferon-containing. Got it. Thank you.
Speaker Change: Thank you. One moment for our next question.
Speaker Change: Our next question comes from Roy Buchanan from Citizens JMP. Please go ahead.
Roy Buchanan: Hey, great. Thanks for taking the questions. I guess to follow up on that last question that how
Roy Buchanan: What should we consider as a denominator? So if we just take cohort A1, for example, is the denominator for functional cure going to be 12 patients? Or are you thinking about the four patients who achieved S antigen loss? And then kind of along the same lines, how are you thinking about the MDU-SARAN lead-in for subsequent studies? You can get a lot of patients below 1,000 with MDU-SARAN itself. So are you maybe thinking to screen after MDU-SARAN lead-in or at the very beginning? Thanks.
Speaker Change: Yeah, so, um...
Speaker Change: Getting back to your first question about the denominator. So, you know, each cohort, as you noted, had a denominator of around 12 or 13 subjects for the 24-week cohort, so certainly we'd be looking, you know, at functional cure across the entire population of that cohort, and we've already presented some S antigen loss data, as Mike said, at end of treatment and 24 weeks post end of treatment after the new consolidation period, looking at that denominator of 12, where we get 33%.
Speaker Change: look at the population a little differently and look at subjects who entered the study with baseline surface antigen less than 1,000, we see that percentage of surface antigen loss go up to 67%. And this is consistent with what a lot of sponsors have seen across clinical trials recently in the hepatitis B area, that subjects with lower surface antigen tend to respond better to these therapies. But I think in either situation, you know, if
Roy Buchanan: If our surface antigen loss data transfers to functional cure data, we're above that 20% bar, regardless of whether we look at the entire cohort or whether we look at the subjects with surface antigen less than 1,000. So, you know, I think we'll be looking as the data emerges and looking forward to our updated ASLD about how the functional cure data will appear looking at both of those denominators.
Roy Buchanan: In regards to your second question about the inducer and lead-in period. So, you know, obviously, we're continuing to look at all different possibilities of study designs moving forward. I think what
Hicks: Hicks, all of you.
Speaker Change: Okay, great, that's helpful. Thank you. A couple on AB 101. So the results in the first half of next year, is that likely just gonna be cohort A, so 12 subjects from that? And then do you have any plans to present the part one or two results? Thanks.
Speaker Change: Yeah, so Roy, we're still working through that.
Speaker Change: I can't give you any additional detail on what specific data set will be presented in the first half, but there will be HPV patient data in the first half. With regards to the...
Speaker Change: the MAD portion of the data. We will figure out the right forum to get that out, but of course, you know, we're pretty open with the data that we have and we like to get that in the hands of the likes of you, you know, as quickly as we typically can. So, stay tuned.
Speaker Change: All right, good, thank you.
Speaker Change: Subs by www.zeoranger.co.uk
Speaker Change: Thank you. One moment for our next question.
Speaker Change: Our next question comes from Kay Nacky from Chardon. Please go ahead.
Speaker Change: McElhaugh.
Speaker Change: Yes, thank you. So I'm wondering if you can give us any further clarity on how you're thinking about timing for phase 2b.
Speaker Change: [inaudible]
Speaker Change: Yeah, so good morning, Kay. Good to hear from you.
Speaker Change: At this point, I can't really give you any additional...
Speaker Change: timing related to the phase 2b other than to say that we're working through it as diligently as we can.
Speaker Change: We are, you know, we're looking at the data that we have on hand and what's going to be coming up.
Speaker Change: Obviously, we need to have internal discussions, talk to regulators, and figure out what the right path is for Induceran to get it to market as quickly as we can. So all I can say at this point is we're being diligent, and we will continue to do so, and we'll get there just as quickly as we can.
Speaker Change: Okay, thanks.
Speaker Change: Thank you. One moment for our next question.
Speaker Change: Our next question comes from Brian Scorney from Baird. Please go ahead.
Brian Scorney: Hey, good morning, everyone. Thanks for taking the question. I actually have one on AB101. Just going into Part 3 of this study, just wondering if you had any insight into prior looks at PD-1 or PD-L1 data in HPV. Is there any HPV specific biomarker that would be expected to move here? Not sure if you're enrolling just a mix of the antigen positives or negatives, but just trying to level set expectations on what a 28-day result could show in HPV patients with anti-PD-L1. Thanks.
Speaker Change: Sure. Good morning, Brian. Thanks for the call. Maybe I'll ask Karen or Mike to handle that one.
Speaker Change: Yeah, I can start. I mean, you know, as you probably know from following our company over the years, we tend to be very biomarker heavy, so we always like to explore biomarkers to the extent we can in any of our trials, including phase one trials. So we are doing a robust biomarker collection to look, as we've already reported, receptor occupancy and other markers. So that continues into the part three of the study, the hepatitis B portion of the study. You know, I will remind everyone that it is just a twenty eight day treatment period and eighty one on one is not a direct acting antiviral right? It's an immune modulator. So we're not.
Speaker Change: We don't have clear expectations yet on what we might see in terms of actual effects on
Speaker Change: Caperelli, David Hastings, Michael Collier, William Collier, William Collier, David Hastings,
Speaker Change: The goal with one-on-one, obviously, Brian, is to get it in combination with industry and as quickly as we can. Our strategy has always been to lower surface energy first, then add an immune booster. So, you know, unfortunately, I guess it's just the reality of drug development. You have to take it as monotherapy first and see how it performs, and then we can get it into combo as quick as we can.
Speaker Change: All right, thanks.
Speaker Change: Thank you. One moment for our next question.
Speaker Change: Our next question comes from Ed Arce.
Speaker Change: from H.C. Wainwright. Please go ahead.
Ed Arce: Are we expecting data only from the expansion cohort or can we expect updated data from the main study as well?
Speaker Change: Hi, Thomas. Yes, so the presentation will be focused on Group C of the IMPROVED-2 study, so that was the cohort with the addition of low-dose nivolumab. We did present the update on the A and B groups back at ESL in June.
Thomas: Got it. Okay, yeah, that makes sense. And then perhaps moving a little bit on the legal side, I just wonder what can we expect after declaring a construction hearing following the lawsuit against Pfizer?
Speaker Change: So Thomas, I just want to make sure I caught that question correctly. The question is what can we expect after the the claim construction, the Markman hearing for Pfizer, is that correct?
Speaker Change: Yes, both the, you know, what kind of results can we expect from that hearing and also what's the next step in the process?
Speaker Change: Sure, so as you know, as is always the case, I can say very little about the litigation. So as far as what to expect, we can wait until the hearing happens and we'll learn at the same time you do.
Speaker Change: sort of what we can expect coming out of that.
Speaker Change: The process, as far as feedback is concerned, is sort of similar to what we saw in the past. It's going to take some time after that hearing before we get some kind of report.
Speaker Change: What we are...
Speaker Change: What we are looking forward to is sort of a court schedule, right, which after the after the results of the Markman hearing get get get made available, we will also have a court schedule available to us, which will give us a little more insight into when we may move forward with the trial. And when the, you know, when the trial date may come in.
Speaker Change: all the goodies that happen in between there could take place. So, you know, stay tuned. We're not that far away from December 18th now, and then it'll be likely a couple of months before we have the outcome of that meeting in writing. But we're anxiously awaiting the results, just like you.
Speaker Change: Understood. Perhaps one more question from us, this one regarding cash runway. About 24 months from now, so I wonder if that includes any expected receipts from the APM program.
Speaker Change: I'm sorry, you tailed off at the end there. Does it include any expected proceeds from the ATM program? No, no, no, no, it does not. It assumes no financing. Sorry about that, Thomas.
Thomas: Thank you.
Speaker Change: Okay. Thank you. Thank you. Okay. Got it. Yeah. Thank you, Thomas. Thank you. Bye-bye.
Speaker Change: Thanks, Thomas.
Speaker Change: Thank you. I'm showing no further questions. I will now turn it back over to management for closing remarks.
Speaker Change: Thank you everyone for joining us this morning. We remain committed to transforming the HPV treatment landscape and providing hope to millions of patients worldwide. As always, we appreciate your continued support and confidence in our vision. We look forward to providing updates next week at AASLD on the clinical development of Imdusiran.
Speaker Change: Operator, that concludes our call.
Speaker Change: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.