Q3 2024 Addex Therapeutics Ltd Earnings Call
Yeah.
Speaker Change: Good day, and thank you for standing by welcome to the IDEXX Therapeutics third quarter 2024 financial results and corporate update conference call. At this time all participants are in listen only mode. After the speaker's presentation. There will be the question and answer session to ask a question. During this session. If you need to press star one bond on the telephone.
Speaker Change: You wouldn't get unless my math is math that you'd bother you had this waste.
Your question. Please press star one again I think it can be you can submit your questions why the webcast.
Speaker Change: Please be advised that today's conference is being recorded.
Speaker Change: I would now like to hand, the conference over to first speaker today, Tim di Please go ahead.
Tim di: Hello, everyone.
Tim di: I would like to thank you all for attending all third quarter 'twenty 'twenty four financial results conference call.
Here with me cattle Kalinihta asphalt head of translational science, who will provide an update on our R&D programs.
Tim di: I draw your attention to the press release and the financial statements issued earlier today, which are available on our website.
I also call your attention to our disclaimers.
Tim di: We'll be making certain forward looking statements are based on the knowledge we have today.
Tim di: I will start this conference call by giving a quick overview of our recent activities and achievements before reviewing our pipeline I will then hand over to Michelle who will review in more detail I'll Gaba Pam.
Michelle: Preclinical program.
Michelle: I will then review our third quarter 2024, and actual results alright.
Michelle: All right and that we will open the call for questions.
Michelle: Okay.
So we have made excellent progress in our Gaba positive allosteric modulator program with the completion of the R&D phase delivering multiple drug candidates.
Michelle: Partner and digital has selected the compounds for development and substance use disorder and has started I N D enabling studies.
Michelle: Under the terms of the agreement Alex Alex is eligible for payment of up to U S. Dollar $330 million of successful achievement of Prespecified regulatory clinical and commercial milestones as well as.
Michelle: Royalties on the level of net sales from high single digits up to low double digits.
Speaker Change: Also under the terms of the agreement we have the right to select compounds for development in a pre defined list of reserved indications we have selected our compounds to advance our own independent Gaba Pam program for the treatment of chronic calls.
Speaker Change: We have some exciting data in culp, which Michele will be sharing with you later in the presentation.
Speaker Change: So now for a quick review of our pipeline.
Speaker Change: We continue to believe in that backlog are executing our plans to reposition the development for brain injury recovery following the disappointing results in epilepsy with.
Speaker Change: With AVX separate Muslim 49, we are watching with all partly outs and to evaluate a path forward for this program.
As mentioned our partner in Japan has selected a drug candidate for development and substance use disorders and have started R&D, enabling studies.
Speaker Change: We are advancing an independent Gaba Pam program for chronic cough and expect to start enabling studies in 2025 subject to securing financing.
Speaker Change: Okay.
Speaker Change: Our spin out company nearest derek's has made excellent progress in advancing its pipeline, including starting our IND, enabling studies for <unk> and full time programs.
Michelle: Now I will hand over to Michelle who will give you some more details about our exciting portfolio.
Michelle: Thanks, Jim and Hello, everyone.
Michelle: Let me now speak about our Gaba positive allosteric modulator program, which is partnered with <unk> to give you.
Michelle: The aim of this collaboration is to deliver a better back listen for substance use disorders.
Michelle: As a reminder, Gaba b receptor activation has been clinically validated in a number of disease areas using buckles, Gaba B Ultra series agonist.
Michelle: <unk> is FDA approved for treatment of spasticity and is widely used off label to treat numerous diseases, including substance use disorder. However.
Michelle: However, backwards it has a short half life and it comes with significant side effects hampering its wider use.
Michelle: Thus there is a strong need for a better box.
Michelle: We believe this can be achieved with positive allosteric modulators and they are differentiated pharmacology heading the efficacy of barco sudden but longer half life and improved side effect profile.
Michelle: Our partner in give you art has selected a Gaba Pam drug candidate for development in substance use disorders and expect to start enabling studies in H, one and 2025.
Michelle: As part of our agreement with <unk>.
Michelle: <unk> has exercised its right to select our compounds to advance its own independent Gaba Pam program for the treatment of chronic cough I will now present this exciting opportunity.
Michelle: There is a strong rationale for developing upgrade paths for chronic cough chronic.
Chronic cough is a persistent cold that lasts more than eight weeks and can be caused by a variety of factors, including respiratory infections asthma allergies and actually that reflects but also positively by overactive cough reflex.
Michelle: There is a large unmet medical need in Novo <unk> drugs as current standards of care are ineffective, 30% of patients or only moderately effective in up to 60% of patients.
Michelle: In addition, the current treatments carry risks of serious side effects.
On the next slide we show that the <unk> are likely to have a superior tolerability profile in comparison to the current standard of care and show no taste related side.
S seed was a newly approved pizza extra inhibitor.
Michelle: Support for using double the time in treatment of chronic cough comes from the clinical evidence that <unk> <unk>.
Michelle: August is used off label in cough patients and from the anatomical evidence that the Gaba B receptors are strongly expressed airways and in the neuro pathway regulating costs.
Michelle: Therefore, we believe that <unk> could offer a superior efficacy in cough patients.
The pre R&D activities, including in vivo proof of concept known GOP talks and CMC has been completed in and our clinical candidate has shown favorable efficacy tolerability and developed ability profiles our clinical Kennedy.
Michelle: <unk> has demonstrated a consistent minimum effective dose of one <unk> and <unk> of $6 a keg in cough frequency.
Michelle: No signs of tolerance were seen after subprime dosing and more than 30 fold safety margin was demonstrated based on Tolerability biomarkers.
Michelle: R&D, enabling studies are planned to start in 2025.
Michelle: Yes.
Michelle: The next set of slides describe.
Michelle: The in vivo proof of concept studies in models of course.
Michelle: In our model of citric acid. It just coughing Guinea pigs acutely administered compound age delivered a robust.
Michelle: Antitumor activity profiles reduced simply cough number and increasing the latency to first cost.
Michelle: The antitrust.
<unk> in the same model was more was more modest as called legacy remained largely unchanged.
Michelle: In the same experiment compound day was better tolerated the backhaul side as there were no marks changes in respiratory rate for the temperature in plasma concentration of growth hormone at up to 60 mixed per kick.
Michelle: In contrast, <unk> suppress respiratory rate reduce body temperature by near two degrees Celsius and the increased growth hormones concentrations in plasma starting screen mixed.
Michelle: Thus, we believe we achieved our goal to discover at Badger Baxter said before costs.
Michelle: In a model of Citral guesses at this coffee Guinea pigs sub chronically administered compound a showed signs of improved efficacy and potency and no signs of tolerance in comparison to I think should treatments.
Michelle: Okay.
Michelle: As expected.
Signs related to safety and Tolerability to compound a remained largely unchanged under sub chronic versus acute treatment regimens.
Michelle: And the model of ATP potentiate, its citric acid cost indeed, it peaks in a head to head comparison experiment.
Michelle: Q3 administered compound a and a P to excrete inhibitor had similar efficacy and Tolerability profiles.
Michelle: In summary, we have selected our clinical candidate for chronic cough with a robust reproducible antitumor efficacy of one make fatigue and the good PK PD.
Michelle: Compound showed a favorable develop ability profile in non GOP Tox studies performance in rats dogs and non human primates.
Michelle: We are on track to start IND, enabling studies early <unk> 'twenty 'twenty fives.
Speaker Change: This concludes our prepared remarks on the progress of our R&D programs now I hand, it back to chip.
Now for a review of our Q3 'twenty straightforward financial.
Chip: Paul in the nearest Derrick transaction, we were required under the IRS to identify continuing operations, whereas to our retained business and continued operations related to the divested business salts nearest erik's all income and expense items related to the discontinuing operations have been re class.
Chip: The specific line comprehensive loss called net profit or loss from discontinued operations.
Chip: So starting with the income statement, which relates to continuing operations. We recognized point to 1 billion of income in Q3 2024 compared to <unk> 3 million in Q3 2023.
Chip: Primary source of revenue as research funding from a collaboration with individual which is recognized as the associated research costs are incurred.
Chip: Continuing R&D expenses of $1 2 million primary or merrily relate to our Gaba Pam program and decreased by <unk> 3 million in Q3 2024 compared to Q3 2023, mainly due to completion of the research phase in June of this year.
Continuing G&A expenses of <unk> 5 million, primarily related to corporate development activities and decreased $5 1 million in.
Chip: In Q3, 24 compared to Q3 2023.
Chip: The finance results in Q3 is primarily related to foreign exchange losses on U S. Dollar.
Chip: All our cash balances.
Chip: The share of net loss of associates at <unk> 9 million and relates to our investment in Euro stacks group.
Chip: Under a stress we are required to recognize our share of their results.
Chip: So now to the balance sheet.
Chip: Our assets are primarily held in cash when we competed Q3.
Chip: 2024 were $3 3 million Swiss francs of cash held in Swiss francs in U S dollars.
Chip: Other current assets amount to <unk> 7 million, primarily related to prepaid retirement benefit.
Chip: Obligations annually paid at the beginning of the year.
Chip: Due to nearest tax transaction, we expect <unk> 4 million to be reinvest in the short term.
Chip: Current liabilities of <unk> 9 million as of September 30th 2024 decreased.
Chip: By $2 million compared to December 31, 2023, and primarily relate to CRA related accruals and payables.
Non current liabilities.
Chip: 2 million.
Chip: As of 30 September.
Chip: <unk> decreased by <unk> 4 million compared to December 23.
Primarily due to staff.
Derrick: Yes Derrick.
Chip: Yeah.
Speaker Change: Now to summarize we have made excellent progress in all gather the patent program without power or individual selecting compounds for development and substance use disorders, and starting IND, enabling studies.
Speaker Change: In H two of this year.
Speaker Change: <unk> has made excellent progress with their lead and for Pam drug candidate starting IND, enabling studies in Q3 of this year.
The plant is ready to restart clinical development for brain injury recovery.
Our Gaba B Pam cough program has demonstrated excellent preclinical efficacy and tolerability of R&D, enabling studies ready to start.
Speaker Change: We are validating partnerships industry support of investors and a strong balance sheet, which puts us on a solid position to deliver.
Speaker Change: On our strategic objectives.
Speaker Change: This concludes the presentation and we will now open the call for questions.
Speaker Change: Thank you Jim participants as a reminder, if you wish to ask a question. Please press star one bond on the telephone keypad and Lake Finance will be announced to withdraw. Your question. Please press star one again Alternatively, you can submit your questions why the webcast.
Speaker Change: And now we're going to take our first question over the phone.
Speaker Change: And it comes from from the line of Laura.
Speaker Change: Okay.
Speaker Change: Your line is open please ask your question.
Speaker Change: Good afternoon.
Speaker Change: So two financial questions. The first relates to <unk>.
Speaker Change: Milestones for <unk>.
Speaker Change: Could you tell us what would be the next key triggers for.
Speaker Change: These milestones so he knows the words should we expect and niche trigger preclinical.
Speaker Change: <unk>.
Speaker Change: For the clinical stage anything after completion of phase one.
Speaker Change: The second question relates to narrow as generics.
Speaker Change: T D.
Speaker Change: Uh huh.
Speaker Change: Mostly it yourself know restricts increasing on a quarterly basis quarter on quarter, which is not unusual considering the phasing of the R&D expense at neurosurgery.
Speaker Change: Watch would be.
Speaker Change: Cash autonomy for neurosurgery consider rings of $63 million, what they have got an exception.
Thank you.
Speaker Change: Thanks for the questions so starting off with <unk> and so we're not at liberty to disclose the detail.
Speaker Change: Around the the milestones and what I can say is they are pre <unk> pre specified.
Speaker Change: And there are clinical milestones.
Speaker Change: And there are commercial milestones in the 330.
Speaker Change: And what I have indicated in the past.
Is they all.
Speaker Change: Roughly 50 50 between clinical.
And our commercial milestones.
Now the second question the nearest Derek so as you rightly point out nearest eric's is capitalized with $63 million in financing.
Speaker Change: You correctly point out we are recognizing under the accounting rules.
Speaker Change: Rules.
Speaker Change: Our share of that net loss.
Speaker Change: <unk> is moving forward a portfolio of very exciting programs.
Speaker Change: Cash burn is ramping up as those programs move forward into later stages of preclinical development and then into the <unk>.
And as I've indicated the <unk> four.
Speaker Change: Positive allosteric modulator program has started IND, enabling studies.
Speaker Change: And fingers crossed.
Speaker Change: We will be filing an IMD and moving that program into the clinic.
Speaker Change: In the coming 12 months.
Now the cash autonomy of nearest derricks.
Speaker Change:
IDEXX is a passive shareholder.
Speaker Change: And therefore IDEXX is not at Liberty to disclose.
Speaker Change: Information about it.
Speaker Change: All details about the financials all.
Speaker Change: Off the private entity nearest eric's.
Speaker Change: Maybe a related question do you see risks for IDEXX to be diluted.
Speaker Change: Over the coming three four years.
<unk>.
Speaker Change: Do I see addax being diluted.
Speaker Change:
Speaker Change: Well clearly as nearest eric's moves its a its programs forward.
Speaker Change: Later stage clinical development.
Speaker Change: Should it need to raise additional capital.
Speaker Change: And then as a as a private entity.
Speaker Change: IDEXX would be free to participate in any capital increase.
Speaker Change:
Speaker Change: As it felt fit.
Speaker Change: And if it decided not to participate because then it would clearly be diluted.
Speaker Change: But with 63 million on the balance sheet of nearest derricks.
I don't see them.
Speaker Change: Alex are being subjected to a dilution risk in the near future.
Speaker Change: Thank you.
Speaker Change: Thank you.
Speaker Change: Yeah participants as a reminder, if you wish to ask a question. Please press star one on the telephone keypad.
Speaker Change: Alternatively, you can submit your questions via the webcast.
Speaker Change: Dear speakers with just give me a moment toilet participants to Presto bonbon, we'll just write down any questions just give us a moment. Thank you.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Thank you ladies and gentlemen, this brings the main part of our conference to a close and I would now like to hand back to Jim <unk> for closing remarks.
Speaker Change: Okay.
Jim: Thank you everyone for attending our third quarter 2020 full conference call and we look forward to speaking to you all again soon.
Jim: That does conclude our conference for today. Thank you for participating in all my all disconnect have a nice day.
Jim: Okay.
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