Q3 2024 BioXcel Therapeutics Inc Earnings Call
Good morning, and welcome to the Biolife cell Therapeutics third quarter 'twenty 'twenty four earnings conference call. At this time, all participants are listen only mode.
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After the formal remarks, there'll be a question and answer session.
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Just to remind everyone certain matters discussed in todays conference call and our answers that maybe given to questions asked are forward looking statements are subject to risks and uncertainties.
Related to future events, and or the future financial or business performance of the company.
Actual results could differ materially from those anticipated in these forward looking statements.
Risk factors that could affect future results are detailed in the company's quarterly report on Form 10-Q for the call.
Totally period ended June 30th 'twenty, 'twenty, four which can be found at www Dot bio works how therapeutics dotcom.
Or at Www SEC Gov.
And what should be updated in its quarterly report on Form 10-Q for the quarterly period ended September 30th.
2024.
Speaker Change: As a reminder, today's call's being recorded.
Speaker Change: Speaking on today's call are Dr. Merton, Chief Executive Officer, and Richard Steinhart, Chief Financial Officer will.
Speaker Change: It will be joining the Q&A session by Dr. Vince O'neill chief of product development and medical officer.
Speaker Change: Yeah.
Speaker Change: Dr. Frank Yakov.
Speaker Change: Scientific officer.
And got to Rob Risinger, Chief Medical officer of Neuroscience.
Speaker Change: My pleasure to turn the call over to Dr. Mehta.
Dr. Mehta: Thank you operator.
Good morning, everyone and thank you for joining us.
Dr. Mehta: This past Tuesday, we announced important milestones with our two favorite does he see times, we'd be again five or what.
Dr. Mehta: These stars.
Dr. Mehta: Education associated with bipolar disorder.
Schizophrenia in the home setting and for agitation associated with Alzheimers dementia.
Dr. Mehta: We believe <unk> 501 could potentially be a much needed.
And then Sharon walk in millions of patients who do not have FDA approved therapy for these challenging conditions.
Dr. Mehta: Our goal is to transform the treatment paradigm.
Dr. Mehta: Starting with all what I'm, saying in India as a long time to evaluate and final one for the acute treatment of bipolar schizophrenia.
We believe this indication represents a near term growth opportunity.
Dr. Mehta: A major focus area.
Dr. Mehta: We designed this study leveraging our substantial clinical expedia and you'd be XD and fiber one pardon ducting Patton double blinded placebo controlled trials.
We are particularly excited to advance this trial.
Dr. Mehta: Marks the first evaluation of <unk>, five or one in the home setting.
Dr. Mehta: The phosphates, Sharon why nobody loves late last week, and we look forward to add one thing enrollment.
Dr. Mehta: So I'm duration is expected to be nine to 12 months from the September initiation as we previously communicated.
Dr. Mehta: We are also continuing our planning we're triangulating in canton.
Graduated DXP and fiber, one and the potential that can't be men's wearhouse related agitation.
Dr. Mehta: This represents a much larger longer term growth opportunity.
We recently received feedback from the FDA on our board.
Dr. Mehta: Post protocol.
Dr. Mehta: All of which will be our second ever done phase for this kind of nature, and which are largely made up of some of our tranquility to phase III study.
Dr. Mehta: In addition to acute agitation, we are pleased with the potential chronic deep learned opportunity with VX 501 through externally funded <unk> study currently being conducted by leading I can't make it hedging situation.
We recently announced a department of Defense Guy to fund a phase III efficacy and safety study of VX, Seattle, probably with one party acute stress disorder, and the University of North Carolina.
Dr. Mehta: This marks the second externally funded.
Dr. Mehta: Definitely a good Oh VX 501.
Dr. Mehta: Just to remind everyone. We just got word b, a T and fiber one using our AI platform and are pleased to see Florida validation offered broad pet I predict prevention.
Dr. Mehta: Yes.
Dr. Mehta: Why I'm focusing on clinical development, we are continuing to maintain our approved product in the market than many of our listeners.
Dr. Mehta: We are committed to making the drug available to patients while maintaining our brand equity.
Dr. Mehta: To support our ties with the goal of reaching data read out we are working to strengthen our balance sheet at the same time, we continue evaluating strategic financing alternatives.
Dr. Mehta: In summary, we are pleased with the progress of our entity and tranquility program.
Dr. Mehta: We believe we have attacked our attractive opportunities to address substantial unmet medical needs, while expanding the market potential for <unk> and firewall what.
Dr. Mehta: This belief is reinforced by our growing intellectual property portfolio that provides long term patent protection from which we aim to build a leadership position in the treatment of agitation.
I would now like to turn the call over to Rich, who will review our financial results for the third quarter of 2020 before rich. Thank you demo net.
Rich: Net revenue from they'll gummy was $214000 for the third quarter of 2024 compared to 341000 for the same period in 2023.
Rich: The decrease in sales was primarily due to the timing of reorders from existing customers How's.
Rich: However for context, it's important to point out that net revenue of $1.9 million for the nine months ended September 30th 2024, representing 89% increase from $1 million. The same period in 2023 the.
Rich: The increase in new customer acquisitions and increased sales activity reflects rising utilization.
Rich: Cost of cost of goods sold for the three months ended September 30 of 'twenty, 'twenty, four and 'twenty twenty-three or.
Rich: Our $1 2 million and $512000 respectively.
Rich: Cost of goods sold as it related to the cost to produce package and deliberate el gummy to customers.
Well as costs related to excess or obsolete inventory.
Rich: The increase in cost of goods sold for the three months ended September 30th 'twenty 'twenty. Four is the result of higher noncash charges or reserves for excess or obsolete inventory compared to the same period in 2023.
Rich: Charges for reserves for excess or obsolete inventory were $1 2 million and 495000 for the three months ended September 30 of 'twenty, 'twenty, four and 'twenty twenty-three respectively.
Research and development expenses were $5 1 million for the third quarter of 2024 compared to $19 6 million for the same period in 2023.
Rich: The decrease in expenses were primarily due to decreased clinical trial expenses professional fees as well as personnel and related costs, resulting from the company's re prioritization.
Rich: August of 2023 and reduction in force in May 2024.
Selling general and administrative expenses were $7 7 million for the third quarter of 2024 compared to $24 3 million for the same period in 2023.
Rich: The lower expenses were primarily due to decreased personnel and related costs, resulting from the company's re prioritization in August 2023, and further reduction enforced in May 'twenty 'twenty four and that's why it has decreased professional fees and commercial expenses.
Rich: Biologics cell therapeutics had a net loss of $13 7 million for the third quarter of 2024 compared to a net loss of $50 5 million for the same period in 2023.
Rich: Company used $16 3 million in operating cash during the third quarter of 2020 for cash.
Cash and cash equivalents totaled $44 million as of as of September 30th 'twenty 'twenty four.
Speaker Change: Now I'd like to turn the call back to them.
Speaker Change: Thank you rich zero.
Speaker Change: We would now like to open the call for questions operator.
Speaker Change: Thank you and I'll be conducting a question and answer session if you'd like to be placed in the question queue. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue.
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Speaker Change: Our first question today is coming from Alec Stranahan from Bank of America. Your line is now live.
Alec Stranahan: Okay, Great Hey, guys. Thanks, Thanks for taking our questions just two quick ones from us.
Alec Stranahan: I guess first how has the launch of the Serenity study gone so far maybe walk us through the process of getting the first patient on the study and whether you expect that the rate of enrollment could could be similar or maybe accelerate for the other 200 or so patients on the study.
Alec Stranahan: Got a follow up.
Alec Stranahan: Yes.
Alec Stranahan: Sure Alex this is Vince here.
Alec Stranahan: I'll start that and then I'll hand over to Rob to get a bit more detail if he feels I'm missing anything.
Alec Stranahan: So essentially as you.
Speaker Change: You know the studies kicked off the.
Speaker Change: The first patient randomized relatively recently.
Speaker Change: We're in the ramp up phase right now that will be totally typical for a study like this.
Will mentioned, we're coming into the holiday season, and so that would typically involve a little bit of a slowdown at the sites. But then we would typically see a rebound in the January timeframe. So this is the.
Speaker Change: Our approach to the study and what we've seen so far is absolutely standard I'll. Just mentioned lastly, we have a large number of sites. So tend to patients and I think the final number is 26 active sites. So that's a large number of sites for the number of that Ah patients our target enrollment. So we're very comfortable with the timeline and I'll just state it again.
Speaker Change: Anticipated nine to 12 months.
Speaker Change: Okay.
Speaker Change: Anything to add to that Rob.
Speaker Change: No. We're we're right on track and the ramp up is occurring at the moment.
Speaker Change: So we're tracking in rolling this out across multiple sites and coordinating all of these activities. So it's truly integrated across sites.
Speaker Change: Okay that makes sense and then I'm the randomization.
Speaker Change: Could you just remind us if if rescue medications are allowed especially thinking about you know that the placebo arm and whether this might actually be a helpful data point.
Speaker Change: You may be measuring over the.
The 12 week study period right.
Speaker Change: Yeah right rescue medications are allowed in the trial patients may receive a rescue if necessary.
Speaker Change: And as you said that half with literally one half of the patients 100 versus 100 will be receiving placebo. So it's a sort of safety measure and yes, we are tracking that as a sort of a surrogate.
Speaker Change: Ian efficacy, we'll call it an indicator of in efficacy for those patients on placebo.
Speaker Change: Got it thanks for the color.
Speaker Change: Mhm.
Speaker Change: Thank you as a reminder, that star one to be placed in the question queue.
Speaker Change: Our next question is coming from Greg Supervisors from Mizuho Securities. Your line is that a lot.
Speaker Change: Hey, good morning, Thanks for taking my questions I've got two first just I might've missed this earlier, but I'm on the tranquility trial protocol what was the specific feedback that you got from FDA. If you could provide any color on that and then secondly, which has helped.
Speaker Change: If you could provide an update on where you are with the cash runway and optionality or options that you are.
Speaker Change: Sintering with regards to funding the company. Thanks.
Speaker Change: Sure. Good morning, Greg This is Vince I'll take the first part of that question. So I mean, we don't typically give a blow by blow blow by blow M details of FDA comments, what I can say, though very comfortable in saying this the feedback was.
Speaker Change: Direct actionable and really very concise. So we're actually very happy with the feedback we received.
Speaker Change: Did you want to handle the second part of it.
Greg do you have any more feedback you'd needed on the FDA feedback because we have already outlined.
Speaker Change: That's what that trial design is and.
Speaker Change: What are the key elements of the design of their trial is there anything else. We can embellish why you all that's good enough and so thank you very much.
Speaker Change: That's very good okay.
Speaker Change: Sure sure regarding the.
Speaker Change: Strengthening our balance sheet as in my prepared remarks, we.
Speaker Change: We are working on all options.
Speaker Change: That we have previously outlined.
And we worked with our strategic partner also so that a we can get to the data that you do and that the company's key focus how to get to the data read out and it strengthens our balance sheet.
Speaker Change: Maybe just a follow up here with the trial.
Speaker Change: Under way of sorts can you provide color as to whether the car right.
Speaker Change: Lansing or cash to habits.
Patients to the trial to completion again my apologies if I may have missed it before.
Speaker Change: We have not provided any guidance are gregg, but we initiated the trial with the view that we wanted to get to that data to eat out and work with all the stakeholders. So that we can get to the data readout, which is not that far off from where we are and we initiated this trial in September and our guidance in 90 days.
Speaker Change:
Speaker Change: Thank you.
Thanks, Craig.
Speaker Change: Thank you. Your next question today is coming from Sumit Kulkarni from Canaccord Genuity. Your line is now live good morning. Thanks for taking my questions I have two one financial and one trial related.
Speaker Change: One is how would you characterize your latest negotiations with your large investors on your ability to keep financial covenants would be and second.
Speaker Change: How important is the successful completion of citizens at home to the company in terms of that child's ability to potentially unlock partnership opportunities for the larger at home education market.
Speaker Change: Hi, good morning, some of this is remo.
Speaker Change: As I mentioned that we are continuing and speaking with all our stakeholders, including our it.
Speaker Change: Strategic partners and as you know they've been very collaborative.
Speaker Change: And we are very pleased with that we are continuing on that path and.
Speaker Change: <unk> continues to be that we can strengthen our balance sheet at the same time, we can get to the data readout and a photo entity coming back to your question regarding does at any day at home.
Speaker Change: The partnership now if we think about the company. We are very advanced in wherever you are last year, we already see the need to at home trial in progress and we are expecting that data read out.
Speaker Change: Like in on next year.
Speaker Change: The quality and care, which is our second phase three trial, which mirrors the tranquility to where we had positive data.
Speaker Change: And efficacy and safety. So that is really to start to come to me from a clinical dialed those back they've been moving up.
Speaker Change: These trial forward, which can be huge value drivers are for all the stakeholders like particularly patients caregivers healthcare providers and all our other stakeholders. We are pursuing every pad that.
Speaker Change: That will allow us to maximize the value for our shareholders and that continues to be the focus of the company.
Speaker Change: Thanks.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: Thank you. Our next question today is coming from Sameer Giovanni from Rx Securities. Your line is that life.
Speaker Change: Hi, guys. Thanks for taking my questions.
Speaker Change: The first one was just on I think last time, we spoke yeah, you mentioned that the tranquility trial would have a.
Speaker Change: A cohort of 20 patients, Indiana title setting. So I just wanted to confirm following the FDA feedback with that that was still the case I guess that's question one.
Yeah.
Speaker Change: Yeah, Hi, there. This is Vince here so yeah at the end of the day after discussion internally, we took that pilot out of the protocol. So currently lifestyle part.
Speaker Change: Okay, and then I guess the second question is just really on Seattle, 701, and whether you've had made any progress in terms of options. So progressing that product thanks very much.
Speaker Change: Sure. So I can give you the following update so but we're still in the process. I think is that maybe you mentioned on the last quarterly.
Speaker Change: Probably a longer process than at least I personally had anticipated, but we're still within that that process working with our firm who has expertise in this area and with potential partners diligence room activities et cetera. So it's still an ongoing process.
Speaker Change: Great and maybe if I could just sneak one more in intensive they stopped right down and could you just confirm that.
Speaker Change: Oh give us any indication of what sort of inventory, you'll still holding up well and what may be at risk going forward. Thanks.
Rich: Sure. This is rich. Thanks, I think we're in pretty good shape now with that with that write down we should have enough product to sustain us for the next couple of years and remember that you know this is a noncash charge and as sales pick up we'll have plenty of inventory to sell them with that.
Speaker Change: Yeah, It's just looking at where we are today and projecting out so I think we're in pretty good shape with inventory.
Thanks Richard.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: Thank you we've reached end of our question and answer session I'd like to turn the floor back over for any further or closing comments.
Speaker Change: Yeah.
Speaker Change: Thank you everyone for joining us today and for your continued interest in by a cell therapeutics have a great day.
Speaker Change: Thank you that does conclude today's teleconference and webcast you may disconnect. Your line at this time and have a wonderful day, we thank you for your participation today.
Speaker Change: Okay.