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spk02: First quarter 2022 financial results conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Mr. Robert Ewell with ICR Westwick. Please go ahead.
spk01: Thank you, Operator. Good afternoon, everyone, and welcome to the Atomos Pharmaceuticals First Quarter 2022 Financial Results and Corporate Update Conference Call. Thank you for joining us today for the update, and welcome to our shareholders, analysts, and anyone interested in Atomos. Joining me today is Atomos' President and CEO, Dr. Dennis J. Carlo, Chief Medical Officer, Dr. Ron Moss, Chief Business Officer, David Margulio, and Chief Financial Officer, David Bendicto. The format for this call will consist of prepared remarks from management followed by Q&A. This call is being webcast and will be available for replay in the Investors section of our website, AtomosPharmaceuticals.com. In today's call, we will make certain forward-looking statements regarding our business based on current expectations and current information. Those statements speak only as of today, and except as required by law, we do not assume any duty to update in the future any forward-looking statement made today. Of course, any forward-looking statements involve risks and uncertainties, and our actual results could differ materially from those anticipated by any forward-looking statements that we make today. Additional information concerning factors that could affect our business and financial results is included in our most recent annual report on Form 10-K with the Securities and Exchange Commission and in other subsequent filings that we make with the SEC. These are available at the SEC's website. With that, I will now hand the call over to Dr. Dennis Carlo, President and CEO.
spk06: Thank you, Robert, and thanks to all of you for joining us today. It's not been that long since our last call, so today's call will be brief, but I will attempt to highlight a few important advancements. First, I'll begin with Zimhi, our naloxone product. Drug overdoses took more lives than ever before in 2021. Approximately 108,000 people died of drug overdoses, according to the CDC, two-thirds of these involving fentanyl. Drug overdose remains a significant problem that affects all sectors of our society. As we updated you on our last call, our commercial partner, U.S. World Meds, launched ZimHi at the end of March. In a few minutes, David Margulio will provide more information, but we are very pleased with the market reception of ZimHi and the update in both the retail and non-retail sectors of the market. U.S. World Meds has had some early wins among both commercial and government customers, and the next six months should reveal the sales trajectory we can expect for ZimHi. I'll now move on from Zemi to Symgepi. On March 21, 2022, Adams announced a voluntary recall of certain lots of Symgepi epinephrine injection, 0.15 milligrams and 0.3 milligrams, pre-filled single-dose syringes. Affected Symgepi product lots were recalled due to the potential clogging of the needle, preventing the dispensing of the drug product epinephrine. I'm happy to report that we believe that the investigation of the affected lots is nearing completion, that a root cause relating to a particular batch of syringe needles has been identified, and that corrective and preventive actions have been and will be taken. We anticipate a resolution and resumption of manufacturing after the investigation is completed and issues are satisfactorily addressed. We expect that this will occur in the near future. With that, I will turn it over to our CFO, David Benedicto, to provide some highlights from our recently filed financials. David.
spk05: Thank you, Dennis. This afternoon, we were pleased to file our firm thank you for the quarter ending March 31, 2022. I only intend to highlight a few parts of our financials in this discussion, and I encourage you to thoroughly review the thank you for additional details and disclosures. I should point out that our financial statements presentation for the fiscal quarters is different from last year's presentation. That is due to our sale of assets relating to our compounding pharmacy business, formerly conducted by our U.S. compounding subsidiary, and our decision to wind down that business and sell or dispose of the remaining related assets. As a result, revenues and expenses related to that business and those assets and liabilities are reflected in the continued operations items in our income statement and our balance sheet. Revenues for the quarters ending March 31, 2022 and 2021 were $1.2 million and $1.4 million respectively. Revenues for the quarter ended March 31, 2022 consisted mainly of 1.1 billion of sales of Zemhyde to our commercial partner, U.S. World Meds, in anticipation of the commercial launch of Zemhyde announced at the end of March. Revenues for the quarter ended March 31, 2021 consisted mainly of Zemjepi injection sales. Due to SEMGEPI manufacturing hold and the voluntary recall, no revenues relating to SEMGEPI were reported for the first quarter of 2022. Selling, general and administrative expenses for the quarters ending March 31, 2022 and 2021 were $3.4 million and $3.5 million, respectively. The selling general and administrative expenses in 2022 reflected the decrease in legal and compensation expenses, offset by an increase in accounting and finance related expenses. Research and development expenses were $4.2 million and $2.2 million for the first quarter of 2022 and 2021, respectively. The increase was primarily due to increased expenses relating to the ongoing clinical trial of Temple. Net loss from discontinued operations for the three months ended March 31, 2022 and 2021 was $165,000 and $1.5 million respectively. The decrease in loss was primarily attributable to the winding down and cessation of USC's U.S. compounding operations. Cash and cash equivalents at March 31, 2022 totaled $17.8 million. This year, we expect to receive additional proceeds resulting from amounts payable to us pursuant to our sale of certain USC assets to Fagran and from the disposition of the remaining USC assets, which includes the land, the building, and the machinery and equipment. Once again, please see our form 10Q for the quarter ended March 31, 2022 for additional details and disclosures. I will now turn it over to our chief medical officer, Dr. Ron Moss, for an update to product development.
spk04: Thank you, David. Our phase two, phase three clinical trial to evaluate Temple as a treatment for COVID-19 is continuing. Our planned interim analysis is anticipated to occur in late May or early June, as we're currently confirming the statistical programs and data sets. This trial is double-blind, which means only the Data Safety Monitoring Board, or DSMB, knows what treatment a subject may be getting during the trial. At the trial's interim analysis, the DSMB carefully reviews this data and can stop or continue a trial and also make a recommendation to modify the trial or even request additional meetings of additional clarification is required. The trial is designed to have adequate statistical power when it reaches 248 evaluable subjects. If the study continues, we don't anticipate releasing any data resulting from the interim analysis in order to maintain the blinding and the integrity of the data as is done in other clinical trials. The time to completion of the trial depends among other factors on both COVID infection rates, which are increasing, enrollment in the DSMV's recommendations. If the trial is successful, we will also submit a clinical study report and request a meeting with the FDA as soon as possible. Finally, we are looking at other potential clinical uses of Temple, continue to seek government non-diluted funding, and have recently applied for government grants. At this time, I'd like to turn it over to David Margulio.
spk03: Thanks, Ron. I'd like to provide a quick update on how the ZMHI commercial launch is proceeding. As with any launch, there's a ton of work going on behind the scenes that precedes any significant uptick in sales, and that includes establishing brand awareness, market access, contracting, et cetera. ZMHI has been undergoing formulary review by commercial, federal, and state formularies, and it has already been added to many plans as either non-restricted or as a preferred brand. A few of those plans include the Veterans Administration, many of state Medicaid plans, including several of the largest, Blue Cross Blue Shield plans in Massachusetts, Michigan, and Tennessee, Highmark Blue Shield plans in Delaware, Ohio, Pennsylvania, New York, and West Virginia, and all of Humira's top commercial formularies. ZMHI is available for more than 83% of physicians using electronic health records and U.S. World Meds is pushing to grow that number. After loading the wholesaler distribution channel at the end of March, U.S. World Meds began direct promotion to healthcare practitioners with a team of 20 plus regional account managers. Although we are still just weeks into this launch, feedback from the commercial team has been quite favorable for the product the size and intuitive nature of the device, and the overall value proposition among stakeholders in both the retail and non-retail market sectors. So in summary, although early, we are very pleased with the activity to date and the trajectory for the product. Both Atomos and U.S. WellMeds remain bullish on Zimhi's long-term value in the market. And with that, I'll turn it over to Dennis.
spk06: Okay, thank you, David. This will conclude our call, and we will now open it up to questions.
spk02: Thank you. We will now begin the question and answer session. To ask a question, you may press star, then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key. To withdraw your question, please press star, then 2. At this time, we will pause momentarily to assemble our roster. Thank you. There are no questions at this time. I'll now turn the conference back over to Mr. Ohl for any closing remarks.
spk01: Okay. That will conclude our call today. I thank you for participating and for your interest in Atomos Pharmaceuticals. Have a good evening, everyone.
spk02: That does conclude our conference for today. Thank you for attending.
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