Q4 2024 DiaMedica Therapeutics Inc Earnings Call
[inaudible] Dr. Paul Kellen, Dr. Paul
Unknown Executive, Lorianne Masuoka
Unknown Executive, Lorianne Masuoka
Thank you, operator. Hello, everyone, and welcome to our full year 2024.
[inaudible]
Speaker Change: Good morning ladies and gentlemen and welcome to the DiaMedica Therapeutics full year 2024 conference call. An audio recording of the webcast will be available.
Speaker Change: Shortly after the call today on DiaMedica's website at www.diametica.com in the Investor Relations section.
Speaker Change: Before DiaMedica proceeds with its remarks, please note that the company will be making forward-looking statements on today's call. These statements are subject to risks and uncertainties that could cause actual results to differ materially from most projected in these statements.
Speaker Change: More information, including factors that could cause actual results to differ from projected results appears in the section entitled
Speaker Change: cautionary note regarding forward-looking statements in the company's press release issued yesterday and under the heading risk factors in DiaMedica's 2024 annual report on form 10K filed yesterday.
Speaker Change: Please also note that any comments made on today's call speak only as of today, March 18, 2025, and may no longer be accurate at the time of any replay or transcript rereading.
Speaker Change: Following the prepared remarks, the full lines will be open for questions. I would now like to turn you over to your host for today's call, Mr. Rick Pauls, DiaMedica's President and Chief Executive Officer, Mr. Pauls.
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Dr. Pranois Brisebois, Dr. Pranois Brisebois
Speaker Change: Thank you operator. Hello everyone and welcome to our full year 2024 conference call. I'm joining this morning by Scott Kellen, Archie Financial Officer and Dr. Lorianne Masuoka, Archie Medical Officer.
Speaker Change: We're happy to be here today to update you on the progress of our two main clinical development programs.
Speaker Change: Seeing that our next expected clinical milestone is for our pre-campsia study, author Lorianne to start with an update on our pre-campsia program and then we'll turn to our stroke study.
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Speaker Change: Thanks, Rick. Starting with Priya Clansia, we are very pleased with our progress in this clinical program.
Speaker Change: Less than a year ago, our collaborators submitted the first draft of the protocol to the Tigerburg Hospitals Ethics Board.
Speaker Change: Since then, we have obtained ethics approval, clearance from the South African Health Product Regulatory Authority, South Africa's equivalent of the U.S. FDA, and have begun dosing pre-eclantic mothers.
Speaker Change: This marks the first study of DM-199 in a pregnancy-related condition, a vulnerable setting where both the mother and fetus are considered patients. We believe these significant accomplishments within a short time frame underscore DM-199's potential as a treatment for this serious condition.
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Speaker Change: All of this was made possible by the strong collaborations we've built with leading care wealth and trialists.
Speaker Change: Our partners at the University of Melbourne and Stalin-Bosch University were immediately drawn to DM-199 for its promising safety profile, its ability to produce nitric oxide and its potential to lower blood pressure.
Speaker Change: In contrast, malmolecule anti-hypertensis passively diffuse across the placental barrier and some are contraindicated in pregnancy because they cause fetal harm.
Speaker Change: We have repeatedly demonstrated that DM-199 can lower blood pressure in humans and believe that this supports the hypothesis that DM-199 can lower blood pressure in pregnant women.
Speaker Change: Compared to other therapeutic areas like oncology, which have advanced more rapidly in recent years, the treatment of pregnancy complications remains outdated. No FDA approved treatments exist for preeclampsia, despite the growing burden of this disease.
Speaker Change: To our knowledge, DM-199 is the only novel agent currently being dozed in pregnant women with preeclampsia.
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Speaker Change: Existing blood pressure medications used in preoclampsia do not enhance nitric oxide signaling, which is critically impaired, leading to reduce blood flow to the fetus. Nor do they improve preoclaptic endothelial dysfunction, they merely manage symptoms.
Speaker Change: Prioclampsia is a progressive disease, and these outdated treatments lose effectiveness or fail over time.
Speaker Change: By augmenting nitric oxide signaling, we hope that DM-199 can not only lower blood pressure, but also improve underlying endothelial dysfunction, offering benefits such as increased blood flow to the fetus, and reduction of dangerously high blood pressure in the mother going beyond symptom management.
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Speaker Change: For context on the limitations of existing hypertension treatment, the preserved one study of early onset preeclampsia in the United States found that approximately 50% of women delivered within five to six days of study enrollment due to refractory or uncontrolled hypertension despite receiving maximal intervention.
Speaker Change: On average, participants delivered before 30 weeks of gestation, exposing the baby to significant risks.
Speaker Change: This highlights the aggressive and progressive nature of preeclampsia and underscores the urgent need for therapies that can successfully manage symptoms and ultimately go beyond this to target the underlying endothelial dysfunction.
Speaker Change: At these early gestational ages, every additional day of prolonging pregnancy is crucial.
[inaudible]
Speaker Change: Each dose cohort consists of three patients. If no safety concerns arise, we proceed to the next cohort at a higher dose.
Speaker Change: Part 1A may include up to 10 cohorts with the lowest IV dose starting at 0.1 microgram per kilogram, and the highest at 2.5 microgram per kilogram. For reference, our IV dose in the stroke program is 0.5 microgram per kilogram.
Speaker Change: Once a dose is identified in Part 1A, that achieves clinically meaningful blood pressure reductions without causing hypotension. We will advance to Part 1B, an expansion cohort of 30 additional patients designed to confirm the optimal dose.
Speaker Change: We are pleased to report that multiple dosing cohorts in part 1A have been completed, with DM-199 appearing to be well tolerated and no serious adverse events.
Speaker Change: or signs of pathological hypotension being reported. We look forward to sharing results from part 1A which we anticipated in the second quarter.
Speaker Change: Turning to our Stroke Program, we are pleased to announce that we have activated 30 clinical sites which we describe as our critical mass to generate a more steady stream of enrollments.
Speaker Change: Increasing overall activity levels and communications between sites is important in creating that healthy, professional competition to keep our study front of mind amongst our study sites.
Speaker Change: I would also note that the bulk of these sites are operating under our latest protocol, version 5.0. This version of the protocol, among other things, allows DM-199 to be stored at refrigerated temperature and expands the eligible population to include patients not responding to thrombolytic treatment.
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Speaker Change: Refrigerated storage enables the study drug to be sent with the participant when they leave the hospital potentially simplifying the logistics of the participant receiving their subcutaneous injections for the entire three week treatment period.
Speaker Change: And for patients who haven't improved for at least six hours after thrombolytic treatment providing the remaining enrollment criteria are met, they may be enrolled in our trial.
Speaker Change: This change in addition to increasing the number of potential patients for remedy to brings in a patient population that can be a good group for evaluation in our trial.
Speaker Change: In our initial stroke trial, Remedy I, post-talk analysis of similar participants showed the most favorable improvement in the rate of full or nearly full recovery.
Speaker Change: The protocol also elapses for enrollment of patients with occlusions of the M2 segment of the middle
Speaker Change: This is a very significant change given the recent negative results of three mechanical thrombectomy of middle-sized vessel occlusion studies announced that the IST conference last month. I can share with you that sites are very positive about version 5 of the protocol.
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Speaker Change: Building on this, our clinical and medical affairs teams continue to work on ensuring that once activated...
Study sites feel comfortable and well supported to enroll participants in the event.
Speaker Change: In particular, they need to be comfortable that any participant they enroll will be able to receive treatment through the three-week dosing period as participant moves from the hospital to any intermediate care facility and ultimately home.
Speaker Change: Developing this comfort level requires a great deal of personal contact between our clinical team and the study sites.
Speaker Change: By the end of last year we had a wide variety of resources available to provide any assistance the site might require and open lines of communication to ensure that the sites are aware of such options.
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Speaker Change: Complimenting these efforts, our medical affairs team has been investing time meeting in person with study teams to discuss the potential benefits of DM-199 and the importance of the remedy to trial.
Speaker Change: This is done in a lunch and learn format to maximize the number of site personnel that can hear and engage with us on the trial.
Speaker Change: The team has also been coordinating peer-to-peer calls between study coordinators so that these professionals can share directly with each other thoughts and ideas on the things that work and don't work in managing participants through the study. Members of senior management have also been visiting the sites projected to be high enrollers. The team has also been visiting the sites projected to be high enrollers. The team has also been visiting the sites projected to be high enrollers.
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Speaker Change: As we look back on the progress we've made to date, we note that even with highly interested position investigators, it has been and is taking significantly more time to get applied through the engagement, planning and setup process.
Speaker Change: We believe this is related to lower staffing levels in research units in this post-COVID world. In hindsight, our expectation that restoring support for research at study sites would have been a higher priority, but in the end, we underestimated the required startup time.
Speaker Change: As I described, we've increased our level of engagement to overcome these issues and though we're very encouraged by the uptick and enrollments in 2025, we've updated our expectations for the Intermin analysis to the first half of 2026.
Speaker Change: We'll provide a further update after we hit enrollment of 25%.
Speaker Change: In other remedy-to-related developments, we've had a great experience at the February 2025 International Stroke Conference. This was held in Los Angeles and our booth received considerable attention and we hosted a reception for our current and potential study sites, which was very well attended.
Speaker Change: At this conference results from three studies in mechanical thrombectomy and medium vessel occlusions were announced.
Speaker Change: Many of the studies reported success. These results have the potential to benefit Remedy II enrollment in that these patients are candidates for our trial. The European Stroke Conference is coming up in May and we look forward to another opportunity to build awareness of the M199 and our Remedy II trial.
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Speaker Change: And as we announced yesterday, the scheduled safety review of the new IV dosing rates implemented upon resumption of our trial was completed in January .
Speaker Change: Also in February , a paper providing an analysis of the mechanism of action of DM-199 and its potential benefit for AIS patients appeared in a peer-reviewed publication entitled Recombinant Human Tissue Calacrion 1 for treating acute ischemic stroke and preventing recurrence.
Speaker Change: This publication is now available online and was published in the February 2025 issue of stroke. This paper provides scientific insight into DM-199's mechanism for increasing collateral circulation and salvaging brain tissue at risk from infarction following an AIS.
I'll now turn the call back to Rick [inaudible]
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Rick Pauls: Thanks, Lorianne. I want to take a minute to thank Mr. Dan O'Connor for recently joining our board. He's a tremendously accomplished leader in biotech and in particular in building companies. We're grateful to have his wisdom and guidance as we move DiaMedica and DM-19 forward, and we'll take every opportunity to learn from his past successes.
Rick Pauls: Before I turn the call over to Scott, I'd like to add that our team, really believe DM-19, will be an effective treatment for both stroke and pre-claimcy of patients.
Rick Pauls: I would also like to recognize our team's hard work and accomplishments over the past year and I look forward to continuing working with the team as we advance our clinical programs.
Rick Pauls: We know that we are fully committed to moving both clinical programs forward as we have an important opportunity to provide options for patients who currently have no therapeutic treatment options today.
Speaker Change: Now, I'd like to hand the call over to Scott Kellen to review this quarter's financial results.
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Speaker Change: Thanks, Rick, and good morning everyone. As the operator mentioned, we announced our full year 24 financial results and filed our annual report on Form 10K yesterday. These documents are both available on either the DiaMedica or the SEC website.
Speaker Change: As of December 31, 2024, we've reported a total combined cash and investments of $44.1 million.
Speaker Change: Current Liabilities of 5.4 million and working capital of 39.2. This compares to a total combined cash and investments of 52.9 million, 2.8 million in current liabilities, and 50.9 million in working capital as of the end of December 31, 2023.
Speaker Change: The decrease has been combined cash and investments, and in working capital, we're due primarily to the cash used to fund our operations. Partially offset by net proceeds received from the approximately $12 million private placement, we completed in June of 2024.
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Speaker Change: Netcash used in operating activities for the Folier 24 was 22.1 million, compared to 18.7 million for the Folier 23.
Speaker Change: These were partially offset by changes in operating assets and liabilities during 2024, particularly the increase in accrued liabilities related to our remedy to trial and ongoing manufacturing development activities as of December 31, 2024.
Speaker Change: We anticipate that our current cash and investments provide us a runway into Q3 of 2026.
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Speaker Change: Turning to the Income Statement, our research and development expenses increased to 19.1 million for the year end of December 31, 2024.
Speaker Change: Partially offsetting these increases were cost reductions related to the completion of prior clinical and non-clinical trial work in 2023.
Speaker Change: We expect that R&D expenses will increase moderately relative to recent prior periods, as the company expands remedy to globally and continues our site activation and enrollment activities.
and as we continue to pursue our DM-199 clinical development program into Priet Clampsia.
Speaker Change: Our general and administrative expenses were $7.6 million for the full year of 2024, down from $8.2 million to the full year 2023.
Speaker Change: This decrease was driven primarily by the combination of decreased legal fees, incurred in connection with our lawsuit against PRA Netherlands, and reductions in directors and officers liability insurance premiums.
Speaker Change: These decreases were partially offset by increased personnel costs associated with expanding our team and increased non-cash share-based compensation costs.
Speaker Change: DiaMedica expects GNA expenses to remain steady compared to prior periods.
Speaker Change: Our net other income for the full year of 2024 was $2.3 million compared to $1.9 million for 2023. This increase was driven by our higher level of interest income being recognized related to higher average marketable security balances during 2024 just compared to the prior year.
Speaker Change: With that, let me ask the operator to open the lines for questions.
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Speaker Change: Thank you so much, ladies and gentlemen. We'll now begin the question and answer session. Should you have a question, please press star, followed by one on your touchtone phone. You'll hear a prompt that your hand has been raised.
Speaker Change: Should you wish to remove yourself from the question and answer session, please press star followed by two. If you're using a speaker phone, please lift the handset before pressing any keys. Just a moment for your first question.
Dr. Nowak, Dr. Nowak, Dr.
Dr. Pranois Brisebois, Dr. Pranois Brisebois
Speaker Change: And your first question comes from Thomas Flaten with Lake Street. Please go ahead.
Speaker Change: Good morning, I appreciate you taking the questions. Lorianne, a couple for you on Remedy 2 of the 30 sites that are activated. How many of those are the 15 top sites that you've previously identified and how many of the 30 are actively enrolling versus being activated?
Dr. Nowak, Dr. Nowak, Dr. Nowak, Dr.
Lorianne Masuoka: So of the 30 active, or sorry, of the 30 sites that we've identified and activated the top 15.
Speaker Change: Comprise about 13 or so. So the vast majority of the top 15 are activated and many of them are currently enrolling.
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Speaker Change: Got it. And then with respect to the DSMB review that you said, I believe you said it was completed in January . How much, how much data did they have on those patients? Was it just from the, from the very acute phase, or did they have a full treatment period to review for safety?
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Speaker Change: So they had the entire database which means that all of the data that had been entered for those patients.
Speaker Change: We're available to the DSMB. What we do is we establish a cut-off date.
Speaker Change: and then after that cut-off date, we look at all of the data for that patient, so it's their entire experience that they have gone through up until that cut-off date.
Speaker Change: Manchester, excellent. Thank you for taking the questions. I'll get back in the queue.
Chase Knickerbocker: Thank you. Your next question comes from Chase Knickerbocker with Craig Hallam. Please go ahead.
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Unknown Executive: Just maybe relative to kind of the last kind of updates we received. I mean, what are your expectations around?
You know, Enrollment Rate Diet
Unknown Executive: and as we look at these 30 centers, I mean what is kind of your ultimate expectation for trial sites activated and thanks, start there.
So, I think that-
C-go-go Lorianne.
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Speaker Change: So we have 30 sites that are currently active in the United States but please remember that we are going to also that we also have five centers that are very active in Georgia. We are going to be opening sites in Canada in the next few weeks and we're also going to be moving into Australia and into Europe .
So, we'll have more than 30 sites
Speaker Change: and with a 364 patient population. With the 200-interm analysis, we have the possibility of we see that same.
Speaker Change: Efficacy Rate of having only 300 patients. So we anticipate that the internal analysis, although delayed as compared to the original internal analysis in large part due to increasing the sample size for the internal analysis, could overall save us time and money by reducing the sample size.
Unknown Executive, Lorianne Masuoka
Dr. Nowak, Dr. Nowak, Dr. Nowak, Dr.
[inaudible]
Speaker Change: On the overall number of sites, how do you expect to go at this point, and then on the kind of enrollment rate, can you just kind of help us out how we should think about it with kind of existing sites and kind of your experience kind of ramping these up now as far as kind of what gets us to that first half 26-inch room.
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Speaker Change: Yeah, so we're anticipating doubling the number of sites that we are going to be having enrolling, and we currently are targeting sites that can enroll about one to two patients per month.
Unknown Executive, Lorianne Masuoka
Dr. Pranois Brisebois, Dr. Pranois Brisebois
Speaker Change: And of the sites that we've enrolled so far, you know, kind of what number of those are kind of at that kind of rate of one to two per month at this point, and kind of, is there an idea of kind of how long it takes at this point to kind of get them to that rate?
Speaker Change: It generally takes about six to 12 months to get a site up and running, and once they're up and running it takes several weeks for them to start activating and enrolling because they need to get...
Speaker Change: Everything ready for enrollment into the trial. We're not at the moment disclosing how many of those sites are enrolling how many patients will give you a fuller picture when we hit 25% enrollment.
Great. Thank you.
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Dr. Pranois Brisebois, Dr. Pranois Brisebois
Speaker Change: Thank you so much. Your next question comes from Francois Brisebois with Oppenheimer. Please go ahead.
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Speaker Change: Hi, this is Dan from Frank. Thanks for taking our questions. Since the amendments from that were disclosed last time, particularly with the regard to the TPA non-responders, are you starting to see an improvement in the enrollment rate in this particular subpopulation among the activated sides?
Um, yeah, and I have Montauro.
[inaudible]
Dan: Sure, Dan. Yeah, so since the beginning of the year, we have seen [inaudible]
Dan: You know, a very encouraging increase in terms of enrollment. It's still not, you know, kind of where we wanted to be at.
but definitely a significant increase.
that has been driven in part with this protocol amendments.
Dan: where we are including patients that receive TPA that do not respond.
Dan: M2 Patients, and so keep in mind that for the Protocol Version 5
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Speaker Change: Thank you, and just in regards to the recent ISD conference that you highlighted, could you give us a more color on like the KOL speedback on DM199 in light of the other studies that were reported there at the conference. [inaudible]
Unknown Executive, Lorianne Masuoka
[inaudible]
Speaker Change: Sure. I mean, as Lorianne mentioned in the prepared remarks is that the big takeaway was that there was a lot of excitement before the conference on mechanical thrombectomy for these mevo study patients. So these are medium vessels, typically the M2s.
Speaker Change: and most of the physicians had thought that those studies would be very positive.
Speaker Change: and would have potentially had a negative impact in terms of our trial and our patient population. The fact that three of those studies failed, one of them actually showed some safety concerns.
Speaker Change: was very encouraging for our scientific advisory board. Beyond that there really wasn't anything exciting at the conference and so that was really the big take away and so because of this
Speaker Change: Academic Research Perspective, I think that's going to be very positive and positive.
Speaker Change: for additional capacity for sites to be able to enroll a trial like ours, both those sites that are currently activated and those sites that are coming on board for our trial.
Dr. Pranois Brisebois, Dr. Pranois Brisebois
Great. Thanks for taking our questions.
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Speaker Change: Thank you so much, your next question comes from Matthew Caufield with H.W. Wainwright, please go ahead.
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Matthew Caulfield: Hi, good morning guys. Thanks for the updates. For the preliminary top line in preeclampsia, expected in second quarter, is there a meaningful threshold for impacting maternal blood pressure that would offer the best read-through or deep risk gain for heading in?
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Yeah, we're looking forward to it.
Yeah. Okay.
What we're looking for is throughout A.E.
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What we're looking for is about a 10-20
Matthew Caulfield: Drop in Sustolic Pressure, we want to get Sustolic Pressure down to about 140 so that they're safely in a good range.
Matthew Caulfield: and we are also anticipating that on the safety side there won't be any evidence that DM-199 passes the percental barrier, and we're also looking at dilation of the intrauterine arteries using Doppler measurements.
to measure something called Pulse Utility Index.
which assesses resistance to blood flow in the uterine arteries.
Matthew Caulfield: We're looking for a lower pulse activity index, which suggests that there's lower resistance and better placental perfusion. So those are the three things that we're going to be looking at primarily in the Phase IA trial. And if we see positive signals in those three areas, then that's a huge...
Dignal for us to move forward.
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Speaker Change: Great, very helpful, I appreciate that. And then just one final question from us. For Remedy 2, with the inclusion of the thrombolytic noun responders, has the amended statistical analysis plan been finalized with the FDA with this page?
Thanks for the guest it has.
Okay, great. Thank you guys.
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Speaker Change: Thank you so much. There are no further questions at this time. I would like to hand the call back over to Rick Pauls for closing remarks.
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Rick Pauls: Thank you, Marissa. So we'd like to thank everyone for joining us this morning and for your continued support. We are particularly excited about the momentum that we're building in both our stroke and pre-clampsia programs as we advance DM-19, potentially transformative therapy, for patients who do not have a treatment option today.
Rick Pauls: The dedication of our team, combined with your support, positioned us strongly for a very meaningful progress in 2025, we look forward to sharing updates with you soon. Thank you again with us, this concludes our call.
Speaker Change: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.
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