Q3 2024 Iterum Therapeutics PLC Earnings Call
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Hello, everyone and thank you for holding.
Welcome to the <unk> Therapeutics reports third quarter 2024 financial results. My name is right now it will be your coordinator today, if he would like to ask a question. Please press star followed by one on your telephone keypad now.
If you change your mind. Please press star followed by two I will now hand, you over to your host Luis Barrett Senior Vice President legal Affairs.
Luis Barrett: Louise Please go ahead.
Luis Barrett: Thank you Andrea.
Speaker Change: Good morning, and welcome to interim Therapeutics third quarter, 'twenty 'twenty, four financial results and business update conference call.
Speaker Change: Yes release with our third quarter results was issued earlier this morning and can be found on our website.
Speaker Change: Are joined this morning by our Chief Executive Officer, Corey Freshmen, and our Chief Financial Officer, Judy Matthews.
Speaker Change: Cory will provide some opening remarks, Judy will provide details on our financial results and then we will open the lines for Q&A.
Speaker Change: Before we begin I'd like to remind you that some of the information presented on this conference call today will contain forward looking statements concerning our plans strategies and prospects for our business, including the therapeutic in America potential Linda the sufficiency of our cash resources to fund our operating expenses into 2025, including through the repayment.
Speaker Change: Days of exchangeable notes the lifting of patents for Ireland in the Fda's Orange book, the protection provided by our patents for Arlinda, and our strategic process to sell license or otherwise dispose of our rights to arlinda.
Speaker Change: Actual results may differ materially from those indicated by these forward looking statements as a result of various factors outside of our control, including but not limited to risks and uncertainties concerning the outcome impact effects and results of our evaluation of strategic alternatives, including the terms timing structure value benefits.
Speaker Change: Cost of any strategic transaction.
Speaker Change: Our ability to complete a strategic transaction, our ability to successfully prepare and implement commercialization plans for Orlando with a commercial partner are directly if we are unsuccessful at entering into are completing a strategic transaction the market opportunity for on the potential market acceptance of our Lindbergh.
Speaker Change: The accuracy of expectations regarding how far into the future our cash on hand will fund our ongoing operations.
Speaker Change: Our ability to maintain our listing on the NASDAQ capital market and other factors discussed under the caption risk factors in our quarterly report on Form 10-Q filed with the SEC. This morning.
Speaker Change: In addition, any forward looking statements represent our views only as of the date of this call and should not be relied upon as representing our views as of any subsequent date, we specifically disclaim any obligation to update such statements.
Speaker Change: We will also be referencing non-GAAP financial measures during the call. We provided reconciliations of GAAP reported to non-GAAP adjusted information in the press release issued this morning with that all said and I will turn you over to Cory for your opening remarks.
Speaker Change: Thank you Louise.
Good morning, and thanks for joining us today.
Speaker Change: As we previously announced we are very excited to have received FDA approval for Orlando.
Speaker Change: Oral so what kind of product last month for the treatment of uncomplicated urinary tract infections caused by the designated micro organisms co long klebsiella pneumonia.
Speaker Change: Sure.
Travelers and adult women.
Speaker Change: Have limited or no alternative oral anti bacterial treatment options.
Speaker Change: Our approval marks the first U S approval of World product chemical class of drugs, which is a very potent and food class of drugs.
Speaker Change: Currently only delivered intravenous therapy.
Speaker Change: Having an approved oral program enables treatment for appropriate patients and the community.
Speaker Change: New effective agents are desperately need it.
As a potential treatment for patients with uncomplicated urinary tract infections that have limited or no other oral treatment options.
Speaker Change: <unk> has the potential to not only effectively treat these patients.
Speaker Change: Also has the opportunity to help combat the growing health crisis, a rising anti microbial resistance by offering a new treatment alternative.
Speaker Change: We have received formal communication from the FDA of five additional years of exclusivity under the gain act, meaning that our Lindbergh has market exclusivity for 10 years from the date of approval or until October 23 2034.
Speaker Change: Additionally, our U S patent portfolio provides protection for oral sema pattern into 2039.
Speaker Change: Issued U S patents covering both the method of use and composition of matter.
Speaker Change: We have also submitted patents information before U S patents for Orlando that will be listed in the Fda's Orange book.
Speaker Change: Drug products with therapeutic equivalents evaluations.
Speaker Change: Overall, we are very pleased with the amount of protection that are Linda should have in the U S market to capture value without competition from a potential generic product.
Speaker Change: Now I'll provide a few comments on why we are so excited about the potential oral lindbergh.
The uncomplicated urinary tract infection market in the U S has not had a new oral treatment launched in about 25 years.
Speaker Change: The leading product in the uncomplicated urinary tract infection market Nitrofurantoin was approved in 1953.
Speaker Change: And the majority of the other oral products in the market were approved in the 19 seventies and 19 eighties.
Speaker Change: The use of these products over time have led to rising resistance rates, resulting in the most widely used products, having resistance rates approaching 20% and those rates can run as high as 30% or more.
Speaker Change: He has most prescribing for uncomplicated urinary tract infections occurs empirically this very high and oftentimes increasing resistance rate creates a challenge we're practicing physicians since the efficacy of these products are continuing to be eroded over time.
Speaker Change: Additionally, almost all of the widely used oral products in this therapy area have some safety concerns that again create challenges for treating physicians as to their choice of agents to use.
Speaker Change: Unfortunately, with almost no innovation in decades.
<unk> had been forced to use agents that may not work as well as they would like for their patients.
Speaker Change: With the <unk> approval there now it could be an alternative treatment option for those patients who have limited or no other oral treatment options available.
Speaker Change: We believe that there are many patients that fall into this category specifically at risk patients.
Speaker Change: We defined at risk patients as women that fall into any of the following categories.
Speaker Change: Women, who are 65 years or older.
Speaker Change: Women, who have diabetes women with a history of recurrent or drug resistant infections are women that have other comorbidities that negatively impact their immune system.
This group of patients are most at risk given their profiles and many physicians are challenged to treat these patients with existing oral options that have substantial resistance as well as safety hurt.
Another key group of patients that are in significant need of a new efficacious and safe oral treatment alternative are the patients that have pathogens resistant to all commonly used oral antibiotics.
Speaker Change: In our reassure uncomplicated urinary tract infection clinical trial.
Speaker Change: We did earlier this year and conducted exclusively in the U S. Over almost 1000 patients. We found that approximately 1% of these patients had an isolate that was resistant to all available oral antibiotics.
Speaker Change: Orlando could play an important role in treating these patients as well.
Speaker Change: We firmly believe that our limber has a very important place in the uncomplicated urinary tract infection market for appropriate patients.
Speaker Change: As we look at our operating plan and go forward cash runway.
Speaker Change: We expect to be able to fund our operations into 2025, including through the repayment date of our exchangeable notes due January 31 2025.
And now I'll turn the call over to Judy Matthews for an update on our financial performance.
Judy Matthews: Thanks Carl.
Judy Matthews: Operating expenses were $4 $9 million in the third quarter of 2024 compared to $67 million in the third quarter of 2023.
Judy Matthews: Operating expenses include research and development expenses.
Judy Matthews: And general and administrative expenses.
Judy Matthews: R&D costs were $3 $1 million for the third quarter compared to $14 9 million with the same period in 2023.
Judy Matthews: Primary driver of the 11 $8 million decrease in R&D expense for the third quarter with primarily due to higher cost incurred in 2023 to support our reassure trial, which began enrollment in October 2022, and completed enrollment in October 2023.
G&A costs were $1 $8 million for the third quarter of 2024, which is flat to G&A costs were $1 8 million in the third quarter of 2023.
Judy Matthews: Our net loss on a U S. GAAP basis was $6 $1 million for the third quarter of 2024 compared to $3 9 million for the same period in 2023.
Judy Matthews: On a non-GAAP basis, which exclude certain non cash adjustments, our net loss of $4 $8 million in the third quarter of 2024 compared to our non-GAAP net loss of $15 million in the third quarter of 2023.
Judy Matthews: The $10 $9 million decrease in our non-GAAP net loss for the third quarter was primarily a result of lower R&D expenses related to a reassuring trial.
Judy Matthews: At the end of September we had cash cash equivalents and short term investments of $14 $5 million.
Judy Matthews: And including warrant exercises and amounts raised under our ATM subsequent to quarter end, we expect to be able to fund operations into 2025, including through the repayment date of the exchangeable notes on January 31 2025.
Judy Matthews: As of November four 2024, which includes the shares issued under our ATM and warrant exercises. We had approximately 2500 5 million ordinary shares outstanding.
Judy Matthews: Also we currently have approximately 11 $1 million of exchangeable notes outstanding which can be exchanged at the option of the note holder for approximately one 9 million shares.
Judy Matthews: The notes are not exchange, we are obligated to pay the note holder at $11 $1 million plus accrued interest in January 2025.
Judy Matthews: Further upon approval of Orlando, we owe Pfizer, a 20 million dollar regulatory milestone, which has been deferred for two years for issuance of a promissory note as permitted under the terms of our pipe our life and now we will take questions.
Speaker Change: Thank you very much if you would like to ask a question. Please press one on your telephone keypad now.
Speaker Change: Please ensure your devices and muted Lucky if you change your mind or your question has already been answered. Please press star two.
Speaker Change: We will pause momentarily.
Speaker Change: Collect the questions.
Speaker Change: Our first question comes from Ed.
Arc with H C Wainwright.
Ed Your line is now open. Please go ahead.
Speaker Change: Hello. Good morning, everyone. This is Thomas Yip asking a couple of questions for Ed. Thank you. So much I think there are no questions.
Speaker Change: So first as you outlined.
Earlier in the call. So now 10 years of market exclusivity broker probably 34.
Discuss how for this.
No problem.
Portfolio provide coverage.
Speaker Change: So it goes both in the U S and maybe in the Europe as well.
Speaker Change: Sure Thomas Thanks for the question.
Speaker Change: So the gain act provides the incremental five years of market exclusivity.
Speaker Change: And so Thats 10 years in total from the date of approval so that goes into 2030.
Speaker Change: For the.
Speaker Change: The patents we have.
Speaker Change: The latest stage of exploration in $220 39 in the U S.
Speaker Change: And they would be the same in other territories.
When theyre granted assuming their grant so we have patents in the U S and a couple of other territories, we do not have them yet granted in Europe. So.
Speaker Change: So we have U S coverage into 2039 with patents and a couple of other territories, including Japan, and Australia, but we have not yet been granted European patents.
Thank you Sir.
Speaker Change: And then.
Speaker Change: Can you.
Speaker Change: Perhaps with this that's.
Speaker Change: Poland.
Speaker Change: Our label was approved.
Speaker Change: Other media and further expectations in terms of how broad it is and also other restrictions anticipated.
Speaker Change: Im sorry, Thomas I Couldnt hear that.
Speaker Change: Okay.
Speaker Change: I was asking with.
Speaker Change: Great.
Speaker Change: While we moved label that was approved.
Speaker Change: Did they meet your.
Speaker Change: Internal expectations in terms of how broad that is and then also are there any restrictions anticipated.
Speaker Change: Yeah.
Speaker Change: Yes sure. It's a good question. Thanks again, we were very pleased with the label.
Speaker Change: And I'll tell you exactly what our thoughts were and I think everyone who has been part of the interim story knows that we have always been very consistent in saying. This product. We believe is best suited for folks who are at risk or elevated risk.
Speaker Change: And having the label that we have we believe gives us the opportunity to treat those patients. Unfortunately in this space in the uncomplicated urinary tract infection space.
Speaker Change: Our belief is that we're already at a place where most patients have limited oral options available due to resistance due to safety profiles of the existing drugs.
Speaker Change: And that is really kind of.
Speaker Change: Our what we've thought about and we believe is very appropriate for suitable kind of patients. So we're very very pleased with the label. We don't have any other unusual restrictions.
I think we mentioned last time, we don't have any unusual post marketing requirements standard pediatric studies as well as surveillance, which are standard for all.
Companies is an antibiotic companies all have surveillance studies to do so we're very pleased that we feel like this is a very very competitive label and given all the dynamics of the market. We believe it's got an opportunity to do very well.
Speaker Change: Okay.
Speaker Change: Got it.
Speaker Change: Then perhaps one last question from us.
Yes.
Speaker Change: So whether it be can discuss what's your impression so far on your discussion on the strategic options to.
Speaker Change: To date.
Speaker Change: Sorry, one more time Thomas P D with talking about BD, yes, so we have.
Speaker Change: We have.
Speaker Change: We renewed our process along with our financial adviser.
With regard to outreach to companies in an effort to achieve a strategic transaction.
Speaker Change: And.
That process obviously.
Speaker Change: Just getting the approval, we just kicked it off in terms of renewing that effort and we will be monitoring that as we go forward.
Speaker Change: Okay.
Got it.
Speaker Change: Therefore, no questions looking forward to.
Speaker Change: Based on your acquisition options.
Speaker Change: Thank you Thomas.
Speaker Change: Thank you. The next question comes from Jason Mccarthy with Maxim Group, Jason. Your line is now open. Please go ahead.
Hi, good morning, Thanks for taking the questions.
Speaker Change: On that partnering or acquiring a perspective given that you are.
<unk> phase III.
Speaker Change: Only in the U S.
What they need.
Speaker Change: Another trial.
Speaker Change: <unk>, China, Japan, or some other region.
Speaker Change: Extend approval ex U S.
Speaker Change: Or is the data sufficient with what you're saying.
Speaker Change: Yeah. Thanks, Jason for the question appreciate it good question.
Speaker Change: Our understanding is that in the EU.
Speaker Change: You go down that regulatory pathways, you can file with the current data package.
Speaker Change: They have a very standard process with check endpoints and.
Speaker Change: 120 questions and day 180 questions et cetera. So it's a it's kind of a very regulated process much like it is here.
Speaker Change: And you do not need another study.
Speaker Change: My understanding is in China in mainland China as well as in Japan, you would need an additional study in the local population.
Speaker Change: So I think you have.
Speaker Change: <unk> everywhere for that but it would require a little bit more time in China, and Japan I think the majority of the rest of the world has.
Speaker Change: The ability to use the FDA data.
Speaker Change: And.
Speaker Change: Those are the two bigger countries that I believe are requiring local a local clinical trial.
Or for potential approval.
Speaker Change: And thank you and just one more for any potential partner or sooner or otherwise you.
Speaker Change: You did have I know the trial missed and complicated.
Speaker Change: In surgical but the data is still very good kind of vary in a similar vein to the uncomplicated.
Speaker Change: UTI.
Speaker Change: Thanks.
Would potentially make this more attractive could de leverage that data and do just another steady like you did to get approval for UTI is that a part of the discussions that youre, having or is it just really theyre interested potentially in uncomplicated all day.
Speaker Change: Yeah, I think it's a great question and I do think there is some interest in complicated UTI as a step down drug.
Speaker Change: Again, we obviously didn't hit that endpoint, but to your point now that you're approved in order to get a formal approved indication you would need to do only one study.
Speaker Change: And I believe based on the data that we generated we have a very good understanding of what that study would look like who the comparator would be and I think we would have a very good chance of hitting that endpoint and I do think counterparties might be very interested in that because again I think that's where the value is.
Speaker Change: In the world, it's not so much to have another IV because there are lots of ivs out there, but theres very few oral that I think physicians are feeling comfortable not only in the community, but in the hospital to send patients home.
Speaker Change: So I do think that that could be another area of interest for companies depending on what their portfolios look like.
Speaker Change: Got it thanks for taking the question.
Speaker Change: Thanks, Jason.
Speaker Change: Okay.
Speaker Change: Thank you very much Jason.
Speaker Change: One boy participating in the question and answer session that marks the end of our question and answer session I will now hand back over to <unk> for any closing remarks.
Speaker Change: Thanks very much. So we appreciate you all joining us today.
Speaker Change: We want to reiterate that we're very excited to have received approval of our Lindbergh.
Speaker Change: And along with our financial advisors as I just mentioned, we have renewed our process of outreach to potential partners in an effort to achieve a strategic transaction with the goal of maximizing value for our stakeholders and that process is underway and ongoing. So we appreciate your interest and your.
Speaker Change: Your time and thanks, very much and have a great day.
Speaker Change: Okay.
Speaker Change: Thank you very much quarry and thank you everyone for joining.
Speaker Change: Today's conference call you May now disconnect your lines.
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