Atea Pharmaceuticals, Inc.

Q1 2024 Earnings Conference Call


spk09: Good afternoon, everyone, and welcome to the ATA Pharmaceuticals First Quarter 2024 Financial Results and Business Update Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open the call up for your questions. I would now like to turn the call over to Janae Barnes, Senior Vice President of Investor Relations and Corporate Communications at ATA Pharmaceuticals. Ms. Barnes, please proceed.
spk07: Thank you, and good afternoon, everyone, and welcome to Atea Pharmaceutical's first quarter 2024 financial results and business update conference call. Earlier today, we issued a press release which outlines the topics we plan to discuss. You can access the press release, as well as the slides we'll be reviewing today, by going to the investor section of our website at With me today from Atea are our Chief Executive Officer and Founder, Dr. John Pierce-Somedosi, Dr. Arantxa Horga, Chief Medical Officer, Chief Development Officer, Dr. Janet Hammond, Chief Financial Officer and Executive Vice President of Legal, and our Chief Commercial Officer, John Veverica. They will all be available for the Q&A portion of today's call. Before we begin the call, and as outlined on slide two, I would like to remind you that today's discussion will contain forward-looking statements that involve risk and uncertainties. These risk and uncertainties are outlined in today's press release and in the company's recent filings with the Securities and Exchange Commission, which we encourage you to read. Our actual results may differ materially from what is discussed on today's call. With that, I'll now turn the call over to Jean-Pierre.
spk00: Thank you, Jolette. Good afternoon, everyone, and thank you for joining us. 2024 is off to a strong start with the tremendous clinical progress we have made across our program for COVID-19 and HCV. can see on slide three. I will begin first with an overview of our Benefits Review Program for the treatment of COVID-19. Trends observed in 2024 provide further evidence that COVID is endemic and is here to stay. Variants continue to evolve, and this winter we experienced a surge of infections caused by the variant GN1. Our strong operational execution led to the rapid and successful enrollment of the only global phase three trial exclusively conducted in high-risk patients ahead of our guidance. We randomized 2,221 patients into the supportive care monotherapy cohort and only 74 patients into the combination therapy cohort with 77% of total patients enrolled in the United States. Strikingly, the clear preference by the investigators to enroll high-risk patients in the monotherapy cohorts highlights the continuing unmet medical need for new oral COVID-19 treatment options for these high-risk patients. We believe that Benefosavir has the potential to address many of the key limitations or current COVID-19 therapies, including safety, durability, and drug-drug interaction. We look forward to potentially delivering benifosavir to millions of patients for whom the current standard of care is not an optimal option. We anticipate top-line results from Sunrise III in the second half of 2024. Turning now to our Phase II program for hepatitis C, Building up the positive 98% SVR4 rate from the lead-in cohort of 60 patients, we look forward to multiple key near-term milestones for this program. We are very excited about the upcoming presentation at EASL next month, which will showcase preclinical and new Phase II efficacy data from this lead-in cohort. We also look forward to reporting complete SVR12 results from this ongoing study during the second half of 2024. In addition, we are preparing for the initiation of a Phase III study, which we anticipate around the end of this year. We are currently finalizing the selection of the fixed-dose combination tablets, which will be used in the Phase III program as well as for commercialization. Benifazovir is the most potent nucleotide inhibitor for hepatitis C treatment, and Rizosvir is a highly potent NS5A inhibitor. We believe that the demonstrated synergistic effect of this combination can substantially improve upon the current standard of care for all patients infected with hepatitis C, including those who are the hardest to treat. and I will review our HCV program in greater detail next. Importantly, we are in a strong financial position to execute our strategy with $541.5 million of cash, cash equivalent, and marketable securities at March 31st, with our runway now anticipated into 2027. This is based on completing patient enrollment for Sunrise III ahead of schedule, and our ongoing financial discipline. Andrea will provide a detailed update on Atea's financial position during today's call. With that, I will now turn the call over to Ransom for an update on our global Phase II HCV program.
spk02: Thank you, Jean-Pierre. Turning to slide five, despite the availability of treatment options, HCV continues to be a healthcare crisis in the U.S. HCV is a viral disease with unmet medical needs, including the need for a shorter treatment duration, fewer contraindications, and less potential for drug-drug interactions. New and reinfection rates annually exceed cure rates in the U.S., where over 2 million individuals are estimated to be infected. Moving to slide six, We believe that the combination of benifosfovir and rusosvir has the potential to be a best-in-class treatment regimen by being protease inhibitor-free with a short eight-week treatment duration. It also has a low risk of drug-drug interactions, and there is no food effect. The proprietary market research we have conducted and KOL feedback to date supports our high confidence in this combination therapy. which has the potential to address these remaining unmet needs. Turning to slide seven, the U.S. HCV market demand grew roughly 5% in 2023, based on the number of patients treated, with the market share of the two key HCV treatment options, Eclusa and Maviret, remaining stable. With an estimated 2 million plus people in the U.S. living with chronic HCV, there is a large number of patients to be treated. The patient pool continues to be replenished with approximately 100,000 new chronic cases each year. We believe that the best-in-class profile of benifosfavir and rusavir, together with the anticipated future government initiatives and removal of access barriers, including certain constraints by payers, will increase the number of patients cured for this severe viral disease. Slide 8 outlines our Phase II single-arm open-label study of 550 milligrams of benifosforbidine in combination with 180 milligrams of rusavir once daily for eight weeks. We plan to enroll up to 280 treatment-naive patients across all genotypes, including the leading cohort of 60 patients. From the initial 60-patient cohort, sustained biological response or SBR at week four post-treatment was used as the decision criterion to continue enrollment to complete the phase two study. As a reminder, the primary endpoint of the study is SBR at week 12 post-treatment and safety. Slide nine. Before we review this slide, I want to provide a brief background on the patient demographics and baseline characteristics in the leading cohort of 60 patients. It was comprised of non-serotic patients only. However, 10 patients had an advanced stage of fibrosis, F3, which is borderline with cirrhosis. These final results from the leading cohort were 98% SBR4 cross-treatment across all genotypes involved. Slide 10 shows the on-treatment viral kinetics of individual patient data from the leading cohort. By week four on treatment, all 60 patients in the leading cohort had viral load near or below the lower limit of quantification. Therefore, these very rapid kinetics across all genotypes support an eight-week regimen and compare favorably to Maviret, which is the only approved eight-week treatment for HCD. As turning to slide 11, the combination of benifosfavir and rusavir was generally safe and well-tolerated in the leading cohort. There were no drug-related serious adverse events, no discontinuations, and adverse events were mostly mild. Moving to slide 12, to summarize our HCV efforts supported by positive leading cohort data, we reinitiated patient enrollment in January. for the remainder of the Phase II trial. We expect to enroll up to a total of 280 patients at 50 clinical sites across 15 countries, including the U.S. Looking ahead, we are very excited about upcoming data presentations at ESO, including the new Phase II efficacy data from the leading cohort. We expect to report complete Phase II SDR12 results in the second half of this year. Additionally, over the first half of 2024, we're conducting phase one studies in the US for the selection of the best six-dose combination tablets, which will be evaluated in the phase three program and used for subsequent commercialization. We anticipate that the phase three program will be initiated around the end of this year. Slide 13. Next, I'll turn the call over to Janet to provide an update on our COVID program.
spk03: Good afternoon, everyone. Slide 14. To reiterate Jean-Pierre's earlier remarks, COVID-19 continues to be an established pathogen of concern with significant unmet need despite the availability of approved vaccines and antiviral treatment options. New variants continue to quickly evolve. And the most recent family of variants, nicknamed FLIRT, after their mutations include KP2, which is now the dominant variant overtaking JM1 in the United States. Our goal for COVID is to deliver a safe and effective treatment for the millions of patients for whom the current standard of care is not an optimal option. Benifosavir has a robust target profile with a low risk for drug-drug interactions, favorable safety and tolerability, and a distinct mechanism of action with a high barrier to resistance. In a therapeutic area with a $4 billion plus market opportunity and only two antiviral products approved, we believe Bonifosavir's compelling clinical profile and overall value proposition present a strong opportunity for potential market expansion and uptake. Moving to slide 15. In the first quarter, we completed enrollment in Sunrise 3, our global phase 3 trial, evaluating Benefoster there for COVID-19 in high risk patients. Sunrise 3 is currently the only phase 3 program exclusively in high risk patients with hospitalization rather than symptom alleviation as the primary endpoint through day 29. The secondary endpoints measure patient outcomes through day 60 post-treatment. I'm pleased to report the patient enrollment finished ahead of our guidance. This is a significant achievement and demonstrates our strong operational execution in preparation to be ready to capitalize on the JN1 variant surge. We enrolled 2,221 patients in the monotherapy cohort and only 74 patients in the combination cohort. We were surprised to see such a high rate of enrollment in the monotherapy cohort. The care preference by investigators to enroll patients in the monotherapy cohort highlights the major unmet medical need for new oral COVID-19 treatment options for these high-risk patients. In particular, we experienced strong enrollment in the U.S., where sites were responsible for 77% of all the patients enrolled. Turning to slide 16, I'll now review our Sunrise 3 Global Phase 3 trial. This trial enrolled high-risk outpatients with mild or moderate COVID-19 regardless of vaccination status. Symptom onset was five or less days before randomization. As a reminder, this Phase 3 trial was randomized, double-blind, and placebo-controlled. The study drug either Benifostavir 550 milligrams BID or placebo, was administered concurrently with the locally available standard of care, including other compatible COVID-19 drugs at the discretion of the investigator. The primary endpoint for the study is all-cause hospitalization or death through day 29 in the supportive care monotherapy population. The secondary endpoints are COVID-19 related hospitalizations and deaths, medically attended visits, and symptom relapse through day 60 post-treatment. With a fast track designation, recent supportive data presented at ESCMID and stronger than expected enrollment trends specifically seen in the monotherapy cohort, we're pleased with the execution and look forward to providing the results from our phase three trial during the second half of 2024. Slide 17, I'll now hand the call to John to discuss the market opportunity for COVID-19.
spk01: Thanks, Janet. Turning to slide 18, the U.S. prescription demand for oral antivirals to treat COVID highly correlates with infection rates. We believe the market opportunity for oral antiviral therapeutics for COVID-19 will continue to remain a multibillion-dollar opportunity for the long run. This is supported by Acuvia's retail prescription data indicating between $4 and $5 billion of annual revenues between the only two approved oral antiviral products. A significant unmet need still exists with limitations due to drug-drug interactions and tolerability with Paxlovid and safety concerns with Ligavrio. We believe in Benefosavir and its potential to greatly improve the treatment landscape and bring meaningful value to patients and physicians. I will now turn the call over to Andrea to discuss ATEA's financials.
spk05: Thank you, John. As Joneigh mentioned in her introductory remarks, earlier today we issued a press release containing our financial results for the first quarter of 2024. The statement of operations and balance sheet are found on slides 20 and 21. There was a market increase in research and development expenses for the first quarter of 2024 compared to the corresponding period in 2023. This increase was primarily driven by higher external spend related to the completion of enrollment of our Sunrise III clinical trial and advancement of our HCV Phase II clinical trial. G&A expenses remain relatively consistent for the first quarter of 2024, compared to the first quarter 2023. Interest income also remained relatively consistent for the first quarter 2024 compared to the corresponding in 2023 due to investing in higher yield marketable securities and higher interest rates. During 2024, we anticipate our quarter-over-quarter R&D spend to vary as we complete Sunrise 3 and our HCC Phase 2 study, and then engage in activities to initiate the HCB Phase III program in the fourth quarter of this year. At the end of the first quarter of 2024, our cash, cash equivalent, and marketable securities balance was $541.5 million. With patient enrollment completed as had scheduled for Sunrise III and our ongoing financial discipline, we now project our cash guidance runway into 2027. I'll now hand the call back to Jean-Pierre for closing remarks.
spk00: Thank you, Andrea. In closing, we have made meaningful progress in the first quarter as a result of strong execution across both programs for COVID-19 and HCV. Our current momentum positions are there for an exciting year ahead. Indeed, we have multiple key milestones for both programs expected this year, which have the potential to drive significant shareholder value. For COVID-19, they include the top-line results from Sunrise 3 in the second half of 2024 and an NDA target submission expected around year-end. These milestones follow recent fast and unexpected enrollment of almost 2,300 patients in our global Phase 3 study exclusively in high-risk patients, as Janet reminded us. As part of a multi-pronged approach against COVID-19, we continue to also make progress with our discovery program focused on the highly differentiated second-generation protease inhibitor, and we expect to provide an update for this program later this year. For HCV, in the first quarter, based on the positive 98% SVR4 results in the leading cohort of 60 patients, We are now completing enrollment for up to 220 additional patients in the ongoing Phase II study. As Arantza mentioned, we are extremely excited to showcase preclinical and new Phase II efficacy results in support of our HCV program at EASL next month. Looking ahead, Complete SVR12 results for all patients enrolled in the Phase II study are anticipated in the second half of 2024, and we are optimistic that these results will reflect the strong SVR4 efficacy data that we have reported. We are targeting Phase III program initiation around the end of this year. I'm always impressed with the ATEA team effort, considering that we are a company with less than 80 employees, successfully carrying out two global studies in diseases with multi-billion dollar market opportunity with great efficiency and financial discipline, as Andreas has shared with us. We believe that our product candidates are highly differentiated and have the opportunity, if approved, to fill significant unmet medical needs in the current treatment landscape with strong blockbuster potential. With that, I will turn the call back over to the operator.
spk08: Thank you. To ask your question, you'll need to press star 11 on your telephone. To withdraw your question, please press star 11 again. Please wait for your name to be announced. Please stand by while we compile the Q&A roster. One moment for our first question, please. Our first question comes from the line of Eric Joseph with JP Morgan. Your line is now open.
spk10: Hi there, it's Billy on for Eric. Thanks for taking our question. I know before you've mentioned about how in the HCV trial you'll be enrolling serotic patients. I'm just wondering kind of on a percentage basis how sizable this would be of the 220 patients?
spk00: Can you answer the question, please?
spk02: Yes. Well, you know, it depends on how many we enroll. We have targets in the protocol and our target will be to enroll at least 10%, between 10 and 20%. And it's a target, you know, we will see.
spk10: Okay, thank you. And then kind of looking a bit further ahead with the HCV trial, what exactly, how would you describe the pathway for registration for this? And Is this something you'd look potentially to do yourselves or look for a partner to progress?
spk00: Okay. First, as you anticipate, we will have to have an end of phase two meeting with the regulators. We anticipate that we will need two trial, two phase three trials. We anticipate that one of the two very likely will be against a comparator since the We anticipate that the trial will be including HCV, HIV co-infected patients very likely because of the drug-drug interaction with Marivet. We anticipate that the regulators will agree with us that it will be a head-to-head against Abclusa, but obviously I cannot speak for the regulators. And we anticipate, as you have heard from Andrea, we have a very strong balance sheet. And for the Phase III clinical program, we will be in a strong position to execute, ourselves, the Phase III program. And we have already operations in many countries in terms of regulatory approval for the Phase II, which is a good step to move into the Phase III program, including the United States. So, we anticipate that we will do ourselves the Phase III program. Thanks for taking our questions.
spk08: Thank you. One moment for our next question, please. Our next question comes from the line of Maxwell Score with Morgan Stanley. Your line is now open.
spk11: Morgan Stanley Great. Thank you. I was wondering if you would provide any thoughts on Shinogi's recent Phase 3 update, which they missed on the primary, and their intention to meet with the FDA. Also, which secondary endpoints in the Sunrise 3 trial would you call out as particularly important given the competitive landscape? Thank you very much.
spk00: Thank you, Max. Janet?
spk03: Thank you, yes. So with regard to the SheaNOD phase three trial, I think our information is much the same as yours. I think to some extent, symptom endpoint has been a case which has not been successful for companies developing antiviral drugs in this space. And so I think some of the things which are different from their trial than ours were really, I think, first and foremost, that they selected to go after this as the primary endpoint. I think they were explained to point out that they did succeed on a subset of those symptoms. However, it's obviously disappointing to see them failing on that key primary endpoint. We, as I mentioned, are focusing on hospitalization because we have strong proof of principle on that from our morning sky study. And our population is different from that in that we enrolled exclusively high risk patients where hospitalization continues to be a problem. However, I think that obviously hospitalization hasn't been as common as it was previously, which is also good. So I think in regard to secondary endpoints, we have endpoints which are comparable to what others have in terms of looking. for reductions in viral load in patients, looking also for potential evidence of viral rebound. This is something which has been described, I think, both in placebo and in treated patients, and we have a commitment to look at that. Also looking for evidence of emergence of resistance and also looking for hospitalizations and medically attended visits all the way through day 60. So I think those are the key endpoints that we're interested in.
spk11: Thank you.
spk08: Thank you. One moment for our next question, please. Our next question comes from the line of Umar Rafat with Evercore ISI. Your line is now open.
spk12: Hi, guys. It's John for Umar. I would like to start with the expectation that you do phase 3s internally. So does your current runway guidance to 27 include two phase 3s for HCV? And then secondly, obviously you need to have that meeting with the FDA, but do you have a sense of what the timeline for the registrational program could be if your assumptions of a trial design are all true? How long do you think those trials would take to run? And then just lastly on the easel data that will be coming up later this month, we are going to include new data on the lead-in cohort. Is that going to include long-term SVR, like SVR12 for that lead-in cohort, or just fuller details of SVR4? Thanks.
spk00: Thank you, John. Just to address your second part of the question, we were presenting new Phase 2 efficacy data. As you know, the embargo for abstract lived on May 22nd, and we would be excited to present the data on June 5th. We cannot say more than that, not to break the the embargo on the easel. Andrea, can you go over in terms of the finance for the budget in terms of what we include to go all the way to 2027? Sure. And then I will take over the regulatory part. Go ahead, Andrea.
spk05: Yes, John. So in answer to your question, Our guidance does anticipate that we will have two phase three trials, and they will be completed during that window of time with our existing resources.
spk00: And regarding timelines, let us complete the end of the phase two and the agreement with the regulators, obviously first in the U.S. and then Europe, but this will be Global trials are going to have to deal with several regulators. So I think we will have a better view in 2025 and share what we see as timelines, John.
spk12: Makes sense. Just one final one, I guess, on Sunrise. You're guiding to date in the second half, but fair to assume that since you've got full enrollment and it's a one-month primary endpoint, that's going to be on the early side in the second half? Other than the waiter side? Janet?
spk03: I think as we mentioned, we've enrolled approximately 2,300 patients in the trial. So there's a considerable amount of data that needs to be cleaned. And we said the second half of the year, when we're nearer to knowing exactly when that is, we'll provide, I think, more specific guidance. So I think that's the best I can do for now.
spk00: And don't forget, John, we need to go to 60 days also, not just 30 days. And obviously, there is a significant cleanup. I saw some numbers today. We are talking about, just for symptoms, I think 700,000 reports. So, just to put an example. It's pretty major.
spk12: Understood.
spk00: Thanks.
spk08: Thank you. One moment for our next question, please. Our next question will come from the line of Tim Lugo with William Blair. Your line is now open.
spk04: Thanks for taking the question. And I know you mentioned you didn't want to break the easel embargo. Can you discuss, though, kind of what broadly the fixed-dose combo in HDD looks like? I know Benofosadir is being dosed at 550 megs once a day, and Ruza is 180 once a day. Is the fixed-dose combo Roughly a combination of those, what the pill burden look like, and also, yeah, and let's just start there.
spk00: Sure. Look, we, it would be a tablet. And we don't want to have a, you know, a huge tablet, the 1.2, 1.3 gram. So we believe that two tablets will be the ideal. formulation once a day, obviously. And again, we have several formulations. We have excellent data in DOG under several conditions. We have completed already one Fixed dose combination, we anticipate to have one or two more. Actually, the next one will start in the next couple weeks. So, as you can see, we want to maximize. Our goal is to get very close to 100% drug exposure for both BAM and resusvia without any food effect. Basically, that's our goal, Tim.
spk04: Okay, that makes a lot of sense. And can we expect some data, you know, maybe not as easily, but in the decompensated serotics, I know that that seems to be a real unmet need.
spk00: Well, you know, you're right, you know, for decompensated serotic, our answer, you want to address that question?
spk02: So we are now enrolling compensated cirrhotics in phase two, but the plan for decompensated cirrhotics will be something that we'll do later. I understand.
spk00: Yeah, look, Tim, as you can appreciate, okay, and I think that right now MAMIVET is not indicated in decomp because of the presence of the PI, as you know, uh we we will have and you anticipate that you know that that uh unfortunately there will be some dust uh in uh in the phase three with decompensated patients so it's clear that we want to complete the phase three trial uh and then very likely uh very shortly after it will be a head-to-head against a clue so that patient population cannot ethically have a placebo control study. So definitely something that we look forward to move rapidly because of the need of those patients.
spk04: Fantastic. Thank you.
spk08: Thank you. As a reminder, to ask a question, you'll need to press star 1-1. One moment for our next question. Our next question comes from Ruiz with Learing Partners. Your line is now open.
spk06: Hi, everyone. This is Rosa on for . A couple of questions on HCV. Do you have a sense for how large of a safety database you'll need for registration? And thinking about the decompensated cirrhosis patient that was mentioned, can you give us a sense of the percentage of these patients as they make up like the total HCV population?
spk00: All right, so you want to address the question, please?
spk02: Yeah, so regarding the safety database for a combination antiviral like this, usually it's around 1,000 patients at the recommended dose and length of treatment. So that's roughly what the Phase III program will have to have, plus what we already enrolled in in Phase II. And the second question was the percentage of decompensated patients. I cannot give you the exact percentage in the United States, but it's really less and less, and it's really quite few. There is some still in usually some Asian countries, but in the United States it represents a really small amount of patients with HCV right now.
spk06: Got it. Thanks. And then thinking about current rates of hospitalization for COVID-19, are you guys still using the assumption of like maybe 2% to 3% currently?
spk00: Janet?
spk03: So we're thinking about it really in terms of achieving a statistically significant difference in hospitalizations and deaths. And we are powered for something around a 50% difference, which is comparable to what others have seen. I think our assumptions on hospitalization are possibly a little lower than that, but I think hospitalization has decreased. And you'll recall we did actually expand our sample size about a year ago, I suppose, to accommodate some of that.
spk06: Got it. Thanks. And then the last one on your cash runway. Does your current assumption include... partnering out your COVID program as the only option, or would you consider, or does that build in launching yourself potentially for COVID?
spk00: Andrea?
spk05: So it does anticipate that we will have a partner for COVID-19, but nonetheless, we do anticipate that there will be some initial commercialization activities in which we individually will engage.
spk00: Including large-scale manufacturing, if I may add.
spk06: Okay, got it. Thanks so much. That's it for us.
spk00: Thank you.
spk08: Thank you. I'm currently showing no further questions at this time. I'd like to hand the conference back to Mr. Jean-Pierre Samadasi for closing remarks.
spk00: Again, thank you all for joining our first Quadro 2024 earning conference call, and thank you for your continued support. Thank you.
spk08: This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone have a wonderful day.

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