Q2 2019 Earnings Call
Welcome to chorus call leasehold and operator will be with you shortly.
Welcome to the chorus call leasehold and operator will be with you shortly.
Welcome to chorus call leasehold and operator will be with you shortly.
Welcome to the chorus call leasehold and operator will be with you shortly.
Well, it's called Mary, which correlates to tolling.
Hi, I like <unk> joined the Selectica buyers find Q2 earnings.
Your name.
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Rachel Literature company.
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Thank you.
Ability of results 10 form future trials.
Our collaboration with bio our collaboration with tier CN that development and market potential for our products. The sufficiency of the company's cash cash equivalents and short term investments constitute forward looking statements for purposes of the safe Harbor provisions under the private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed in the risk factor section of select those most recent quarterly report on Form 10-Q filed with the SEC, which can be accessed at select a bio dotcom.
In addition, any forward looking statements represent the company's views only as of today August eight 2019 and should not be relied upon as representing the companys views as of any subsequent date.
Well, so let them may elect to update these forward looking statements at some point in the future. It specifically disclaims any intention to do so even if managements views change and now let me introduce Carsten Bruni, who will kick things off today.
Thank you Laura and good morning, everyone.
This quarter, we continued to gain traction and momentum for immune tolerance platform into core and we are particularly excited about its potential interpreted bellatrix enzymes and baby gene therapy.
The current challenge for drug development in these areas is the limitations caused by the bodys own immune response.
Many biologic therapies when administered will trigger the immune system to develop neutralize antibodies that counteract the therapeutic benefit.
Our answer to this challenge is our internal platform, which promotes selective immune tolerance of the therapy, allowing that to their critical to be achieved.
For our lead development program as CFO to Htwo for the treatment of chronic refractory gout. We have made good progress in patient enrollment is progressing.
Six months had to have compare trial designed to evaluate FPL to htwo compared to KRYSTEXXA in adult patients with chronic refractory gout.
If successful this trial will give us an opportunity to demonstrate the superiority of SGL 212, Steven will talk in more detail about this program in a moment.
We are extremely thrilled by our recently announced strategic partnership with a separatist Biopharmaceuticals also known as asked bio a proven leader in next generation gene therapy development and scaled manufacturing to jointly develop manufacture and commercialize a broad portfolio of Avi gene therapies.
As Bio's gene therapy platform includes a robust pipeline of potentially curative gene therapies.
An extensive captain library, a flexible and scalable manufacturing process and several advanced Avi initiatives under development.
The EPS by a platform also was used in the development of two of the FDA approved therapies available today.
So again small and looks during Uh huh.
This partnership will combine our unique into a platform with apt biotechnology for human proof of concept trial.
To validate our joint portfolio of products and the potential for re dosing in patients.
Currently the ability to re administered systemic Avi gene therapy is limited by the development of neutralizing antibodies against the Avi capsid.
We believe that our platform has the potential to increase the proportion of patients who achieve and maintain their pretty benefit for example, the ability to safely we dose would benefit patients who are initially under dosed or help restore trenching expression in patients who may lose expression overtime.
This is particularly important in pediatric patients for whom transient expression may wane over time as they grow four in patients who experienced organ damage such as liver inflammation, which can adversely affect transgene expression.
Additionally, last year, we announced a collaboration with the European consortium fewer C. M for the use of our into a platform in combination with their Avi gene therapy, including a jar syndrome, a rare genetic disorder characterized by an inability to properly convert and clear Billy Rubin from the body.
We are continuing to advance this collaboration and expect fewer CN to obtain scientific advice from the German drug regulatory authority in the second half of 2019.
We expect this guidance will inform the clinical trial design.
We remain focused on partnerships for our income platform to realize our vision for gene therapy, we believe that into or has the potential to transform gene therapies recurring intravenous administration by more effectively targeting systemic diseases, such as inherited metabolic disorders, and muscular dystrophies enrich multiple vector administrations unlikely needed to achieve full therapeutic efficacy.
We believe that strategic partnerships can provide us with a portfolio of differentiated and durable gene therapy solutions to patients and their families.
And before I hand, it over to Steven to go into more detail on our chronic refractory gout program I would like to highlight some recent corporate updates.
In July 2019, we grew our team as we welcomed Dr. Alison sector as Chief Medical Officer.
Allison was most recently the Bluebird project had rare diseases at Sanofi.
And we look forward to benefiting from her extensive experience in drug development as we continue to advance our programs.
Additionally in June Scott Meyers hovering near Therapeutics join our board of Directors, Scott is an accomplished and strategic leader with significant prior CEO experience.
As you can see we've built a lot of momentum in developing both our Avi gene therapy program and building our team to support continued advances in our into our platform.
With that I'll hand, the call over to Stephen to talk more about SGL 212.
Thank you Carsten.
Chronic refractory gout represents the most severely affected subpopulation of gout patients, who suffer from debilitating pain and disability.
These patients experience higher morbidity and mortality and other gout patients as Kirsten mentioned, we continue believe that FPL to 12.
Has the potential to address several unmet needs in chronic refractory gout patients.
Including sustained superior gas reduction reduce painful flares.
And more convenient once monthly dosing.
As a reminder, FPL to 12 is a combination of into or a novel new talents platform impact after case, our proprietary Pegylated your case.
Recently, you are we presented the full data from our completed phase two trials FPL to 12.
We continue to be encouraged by what we saw as the data show that 66% of the valuable patients maintain serum uric acid levels of less than six milligrams per deciliter. After five once monthly treatments at FPL to 12 that dose of 0.1 or 0.15 milligrams per kilogram of IMTT or in combination with 0.2 milligrams per kilogram of pick advocates.
Additionally, reduced tissue, Larry bird logo flare rates and security players were observed.
Only 35% of patients treated with five doses of SQL 212 experienced outflows during the first month of treatment with continued reduction of Gov, where rates over months two through five.
SCR to 12 has been generally well tolerated a clinically active doses.
We repeated administrations in the trial.
In March of this year, we announced the initiation of our six month head to head compare clinical trial against the current FDA approved your case therapy perspective.
Which is designed to compare the efficacy and safety of FPL to 12 to perspective.
In adult patients with chronic refractory gout.
Patient enrollment in the trial is ongoing and we expect to enroll 150 patients.
The primary endpoint is the maintenance of serum uric acid levels below six milligrams per deciliter at six months and secondary endpoints include flares quality of life Health assessment questionnaire is until by resolution.
We anticipate providing interim data analysis in the fourth quarter of this year as well as full statistical superiority data analysis in the second quarter 2020.
In terms of the market potential.
Roughly 160000 patients in the U.S. with chronic refractory gout.
Chronic refractory gout is a painful in severe form of inflammatory writers that can lead to phone erosions and joint deformities, resulting loss of function and disability.
Only a small percentage of these patients are currently being treated.
As we develop a sale through 12, we're looking for consistent issue a control over six months and low flow rates. We believe this clinical profile along with its more convenient monthly dosing makes us feel to 12, a very compelling product for patients and their providers.
In fact, we recently conducted third party market research, which showed the SPL to 12 product profile was very positive received and rheumatologist sprint actually control low flare rates once monthly dosing along with low incidence of infusion reactions as product characteristics that would allow them to increase the duration of treatment and potentially treat more patients.
Based on our data and market research, we firmly believe SGL 212 has the potential to address many currently identified unmet needs in this patient population and represents over a 1 billion dollar market opportunity.
With that let me turn the call back over to Carsten to discuss our second quarter 2019 financial results.
Thank you Steven revenue recognized for the second quarter of 2019 was less than 8.1 million under our collaboration agreement with spark, which compares to no revenue recognized for the second quarter of 2018.
R&D expenses for the second quarter of 2019 were 12.1 million, which compares with 14.4 million for the second quarter of 2018.
The decrease was driven by reduced salaries and benefits as a result for head count reduction at the beginning of fiscal 2019.
There were further reductions in costs year over year as a result of the completion of our work on discontinued programs.
These cost reductions were offset by timing of cost incurred for both our phase two and phase three clinical programs.
<unk> expenses for the second quarter of 2019 were 4.1 million, which compares with $4.4 million for the second quarter of 2018.
The reduction in cost was primarily the result of reduced legal fees offset by increased professional fees.
For the second quarter of 2019, we reported a net loss of 16.4 million or 37 cents per share compared to a net loss of 18.8 million or 80 for 84 cents per share for the same period in 2018.
As of June Thirtyth, 2019, Selecta had 42 million in cash cash equivalents restricted cash and short term investments as compared to 48.7 million as of March 31st 2019.
We believe our available cash cash equivalents and restricted cash will be sufficient to meet its operating acquirements into the first quarter of 2020.
In summary, our unique platform truly has broad potential.
Based on our clinical data market research and feedback from physicians, we're particularly enthusiastic about a late stage asset for chronic refractory gout and look forward to announcing the interim compared data in the fourth quarter.
Additionally, we're eager to unlock the value of our platform with the potential to read those in a beach in therapy and further progress our platform to partnerships, particularly with our new strategic partnership with ask viral.
That concludes our formal remarks now open the line for your questions operator.
Thank you.
We will now begin the question and answer session.
A question you May Press Star then one on your telephone keypad. If you are using a speakerphone. Please pick up your handset for pressing the keys to withdraw your question. Please press Star then team.
At this time, we will pause momentarily to assemble our roster.
[noise] and the first question.
The first question comes from Chad Messer from Needham and company. Please go ahead Sir.
Oh, great. Thanks for taking my question good morning, and congratulations on on your partnership with that bio sounds like a.
High quality group.
Details are a little light on what the terms of the partnership are which I have to assume is for you know strategic and competitive reasons, but I was hoping you could help me understand a couple of things a little bit better one would be the impact on your on your financial situation in particular in the near term and the other would be your ability to to do other partnerships or we're going to basically be what have you retained that that's not in the partnership you talked about a broad portfolio that you'll be working on with them. Any help you can give on those two would be much appreciated.
Jeff. Thank you. Thank you for the question. So indeed, we are very excited to partner with ask bio because we think they're a partner of choice. They have a proven track record.
In gene therapy, having spun out to companies their technology was involved in both approved if the product so.
So were extremely excited.
Yes, we kept the detail slide we've just announced the partnership.
The plan, obviously is for us to get into the clinic as quickly as possible and I think all I can share at this point is going to be a liver directed disease and we plan to go into the clinic in 2020.
And we would partner in a number of indications.
Which we have not disclosed yet, but we'll share more details over time.
In terms of financial impact, we believe that the partnership will have little impact actually in 2019.
Well, we'll guide for next year, what the cost will be but I think for now and there will be a little impact on our financial runway and so I think what's important as well and we talk about this that we obviously as a platform company look at additional partnerships. So it just does not look us up in any way you know we partner with ask bar in a number of indications and we disclose those but this does not limit us from a further partnerships in the future.
All right great. Thanks, Thanks for that.
Handed information and congrats again and looking forward to the 212 data next quarter.
Thank you Jeff.
Your next question comes from Garik Marcela from Stifel. Please go ahead.
Hey, Thanks, guys. This is actually.
I've been on the line.
Just wondering if you guys have heard an update from spark about them.
Opting in.
And that's it for us thanks.
Thank you. So we obviously are in contact with our partner spark and they still have the opportunity to opt into four.
Additional indications in addition to the hemophilia indication, which they already have.
And we will update you once we hear more news from them.
Okay. Thank you.
Thanks.
The next question comes from Nike Yang from Mizuho Securities. Please go ahead Sir.
Hi, good morning, and thanks for taking my questions too.
I'm sorry. The question is around two entities HM two totally if you will start to see three four to one two ahead of the interim read outs or after the interim readout.
[noise] before that's a good question and I think what's important to remember is that.
The reason.
We started the compare.
Trial was basically for financial reasons, we had the initial plans to do both the phase three.
And compare in parallel.
But at this point nothing prevents us from going into phase three except the fact, we don't have to funding at this point so.
We still have plans to start the phase three yes, we see it kind of independent off compare but it's somewhere driven whether we are able to raise additional funds for that so the plan is still to start the phase three in Q4 and that is still possible.
Okay. Thank you.
For the clarification and then with regards to the interim read out how many patients what is the range of the.
Number of patients stay there that we should be spent team.
It is good question as well Difei. So we have not guided to this and we will not guide to this but we commit to an interim read out towards the end of this year, which I think will give good guidance actually on what to expect for to find read out as well.
Okay. Thank Keith so maintaining subject to the to the Retreatment piece of of the development.
HM two on the very high level make comments with regards to financial arrangement, not specifically related to ask us to buy all but in general what is the typical upfront you would be looking for and what's the typical right T. SEC then following up on that what's your thoughts to spark is there a deadline for spark too.
Until our E.
Well additional programs.
[noise].
Another good question Difei, obviously, we don't comment on potential Upfronts and royalties.
So unfortunately I can't answer that question in terms of spark, we actually have not you know disclosed the expect time, but you can expect towards the end of Q4, they will have to opt in the additional four indications that are still outstanding in addition to hemophilia, which they opted in already.
Yeah. Thanks, so much for taking my question.
Thank you anything.
The next question comes from young young from Janney. Please go ahead.
Hi, Thanks for taking the questions and the first one is on the interim data readout.
Fourth quarter or is it possible that there can be some statistical analysis, depending on potato the quality of data and also will it be in the format like you did for the phase two.
With some projection.
Patients, who have not completed stuff <unk> follow up period.
Oh, Thanks for the question you and.
So as Weve guided we will do a numerical to read out in Q4.
And then we'll we'll plan to do the statistical analysis for the final read out I think what's important we don't take a penalty I'm doing a readout as it's an open label trial.
Okay and then the next question I think usually have to internal gene therapy programs and I understand that the focus right. Now is on account program and also the collaborations.
It's a good way to.
To take advantage of the platform that you have but do you still have planned.
If you have sufficient resources to develop your internal gene therapy programs.
You ask an excellent question and indeed, we have two internal gene therapy programs.
We have an eight and a and otcs and we actually plan to put the M&A program into the partnership with ask bio acid Lipper directed disease.
We'll share more details once we have a detailed clinical plan developed with ask bio but.
I think that's one of the areas that we bring into the partnership.
In addition to him tour.
I see okay, great. Thank you.
Thank you.
The next question comes from John Newman from Canaccord. Please go ahead.
Hi, Good morning. This is actually Justin going on for John Newman I'd like to congratulate you on the partnership agreement with BASF bio, it's a very exciting.
I was just curious if the partnership agreement contains plans to add additional development programs. In addition to your mess them a lot of capacity in your program and I have a quick follow up.
Can you repeat the question please doesn't.
Yeah. The question was if you have.
Planned to have additional development programs with the partnership agreement with AST bio.
In addition to your M&A program.
The answer is a clear yes, there's a number of indications we are going to pursue together with ask bio.
The first of all we'll be lippert directed disease, but we'll have additional indications absolutely and little guy to those overtime.
Okay, Great and I noticed the agreement has a profit.
<unk> share of provision agreement, what the percent breakdown with us might be 50, 50 split or will that kind of depend on how much costs are put into the program.
Yeah. Thank you I think one of the reason for us so excited to partner with with ask bio <unk>. I said has proven track record of success is that it is a partnership of equal to actually where we share costs, but also profits and really it's a it's a true partnership where we jointly develop manufacture and commercialize products and I think thats whats extremely excited about this for us I'd ever equal partners in this in a 50 50 partnership.
Excellent congrats again on the deal and thanks for taking my questions.
Thank you.
This concludes our question and answer session.
I would like to turn the conference back over to Carsten brains, Chief Financial officer for any closing remarks.
[noise]. Thanks, so much thanks for your attention for all the questions and I just want to reiterate that our platform has truly broad potential and that we're particularly excited about late stage asset for chronic refractory gout.
We look forward to announcing the interim compare data in the fourth quarter.
And Additionally, we're very eager to unlock the value of our platform.
With the potential to read those maybe gene therapy and for the progress or partnerships, particularly with our new strategic partnership with asks viral. Thanks again for your questions and your attention.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect enjoy the rest of your day.