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Operator
Thank you. Thank you. Good afternoon, ladies and gentlemen, and welcome to the SELQET second quarter 2024 financial results conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded today, August 14th, 2024. I would now like to turn the conference over to Maria Jankowski with ICR Westwick. Please go ahead.
Maria Jankowski
Thank you, Operator, and good afternoon to everyone on the call. Thank you for joining us to review Salcuity's second quarter 2024 financial results and business update. Earlier today, Salcuity released financial results for the second quarter ending June 30, 2024. The press release can be found on the Investors section of the website. Joining me on the call today are Brian Sullivan, Felcuity's Chief Executive Officer and Co-Founder, Vicki Hahn, Chief Financial Officer, as well as Igor Gorbachevsky, Chief Medical Officer, who will be available during Q&A. Before we begin, I would like to remind listeners that our comments today will include some forward-looking statements. These statements involve a number of risks and uncertainties, which are outlined in today's press release and in our reports and filings with the SEC. Actual events or results may differ materially from those projected in the forward-looking statements. Such forward-looking statements and their implications involve known and unknown risks, uncertainties, and other factors that may cause actual results or performance to differ materially from those projected. On this call, we will also refer to non-GAAP financial measures. These non-GAAP measures are used by management to make strategic decisions, forecast future results, and evaluate the company's current performance. Management believes the presentation of these non-GAAP financial measures is useful for investors' understanding and assessment of the company's ongoing core operations and prospects for the future. you can find the table reconciling the non-GAAP financial measures to GAAP measures in today's press release. And with that, I would now like to turn the call over to Brian Sullivan, CEO of Selcuity. Please go ahead.
Brian Sullivan
Thank you, Maria, and good afternoon, everyone. We appreciate your interest in Selcuity. We made significant strides advancing the clinical development of Get It to Listed this quarter. Overall enrollment in Victoria 1 Our Phase 3 study evaluating geta-telicib plus fulvestrin with and without palbociclib as second-line treatment for patients with HR-positive HER2-negative advanced breast cancer remains robust and on track. Our Phase 1b2 trial evaluating patients with metastatic castration-resistant prostate cancer is also enrolling on schedule. And we further expanded the patient population eligible for geta-telicib when we initiated efforts to launch Victoria 2, a Phase 3 study designed to evaluate geta-telicib as a first-line treatment option for patients with HR-positive, HER2-negative, advanced breast cancer. In our view, each of these three programs has the potential to generate blockbuster levels of revenue. If these three programs ultimately result in regulatory approvals, we estimate that nearly 200,000 late-stage cancer patients globally would be eligible to be treated with gadotelicib. We first announced our plans to conduct the FICTORIA-1 study over two years ago, in May 2022. At that time, we estimated that 65% of the patients enrolled would lack detectable PIK3CA mutations and would thus be assigned to the study's PIK3CA wild type cohort. And this assumption was used to estimate enrollment by cohort and, in turn, the timing of events for primary analysis. We estimated that the threshold number of events required to trigger the primary analysis for this PIK3CA wild type cohort of patients would be reached in the second half of 2024. And while the study's overall enrollment remains on track and robust relative to the estimate we made over two years ago, the total proportion of patients enrolled who have PIK3CA wild-type tumors has recently shifted lower. We now project that 60% of the patients enrolled in the study will be enrolled in the PIK3CA wild-type cohort rather than the 65% originally estimated. And this proportion, while lower than our original estimate, is within the range reported in other studies. and thus we don't believe this shift is study-related, but simply a result of normal sample variation within a population. Despite the lower proportion of PIK3CA wild-type patients completed, enrollment for the PIK3CA wild-type cohort is over 80% complete. We expect to reach the enrollment target for the PIK3CA wild-type cohort during the fourth quarter rather than the end of the third quarter, as we originally forecast. We now expect the primary analysis event threshold trigger for the PIK3CA wild-type cohort will be reached sometime between late Q4-24 and the end of Q1-2025. Our guidance regarding the PIK3CA mutant patient subgroup remains unchanged, and we expect primary analysis for this cohort to be triggered during the first half of 2025. Turning now to our Victoria 2 study, we announced our plans to initiate this Phase 3 clinical trial this past May. The study will evaluate gadotelicib plus a CDK4-6 inhibitor and fulvestrin, as first-line treatment for patients with HR-positive, HER2-negative advanced breast cancer whose disease recurs while receiving or within 12 months of completing adjuvant endocrine therapy. Now, these patients are considered to have endocrine therapy-resistant disease. They have a significantly poorer prognosis than endocrine therapy-sensitive patients whose disease recurs more than 12 months after completing their adjuvant endocrine therapy. Current standard of care first-line treatment for endocrine therapy-resistant patients includes any of the three approved CDK4-6 inhibitors combined with fulvestrin. The limited efficacy these regimens offer endocrine therapy-resistant patients, though, was not well understood until the Innovo 120 study, Phase III clinical trial for the PI3K-alpha inhibitor in Innovolizid, reported results last December. As part of this trial, the efficacy of standard of care palvocyclib and fulvestrin was evaluated. as first-line treatment in patients who were resistant to endocrine therapy. And for these patients, median PFS was only 7.3 months. And for those patients whose disease relapsed within the first two years of their adjuvant endocrine therapy, the median PFS was only 3.7 months. And these results compare poorly to the median PFS of 27 months reported for patients who were sensitive to endocrine therapy and who received the same regimen highlighting a significant need for more effective therapies for patients with advanced breast cancer that are resistant to endocrine therapy. We reported last year the preliminary clinical data from our Phase Ib trial for getatolizumab as first-line treatment in patients with advanced breast cancer. As you may recall, the median progression for survival in endocrine-sensitive patients who were treatment-naive and were treated with getatolizumab in combination with polycyclobin letrozole was 48.6 months. And the objective response rate was 79%. And these results compare very favorably to the results reported for palvocyclib plus letrozole in this population. Additionally, the NFO-120 study that evaluated in a volicib combined with palvocyclib and filvestrin in the endocrine-resistant patients reported positive data. Now, these patients had tumors with PIK3CA mutations, and the patients were not pre-diabetic or diabetic. So this subgroup only represents about 20% of the total endocrine-resistant patient population. However, the results reported were positive relative to the control, providing further evidence of the critical role the PIK3CA pathway plays as a driver of disease in treatment-naive patients.
Victoria 2
In the VICTORIA2 study for the CDK4-6 inhibitor,
Brian Sullivan
Investigators might choose either ribociclib or palbociclib. Safety profile of getatilisib combined with fulvestrin and palbociclib is well described, but the investigational combination of getatilisib with ribociclib has not yet been clinically tested. And therefore, a safety run-in of approximately 12 to 36 patients will evaluate the safety profile of getatilisib combined with ribociclib and fulvestrin. Safety run-in will be completed and getatilisib's phase 3 dose with ribociclib confirmed before enrolling patients in the phase 3 portion of the study. For this study, approximately 638 subjects will be assigned to a cohort based on their PIK3CA mutation status. After the investigator selects the CDK4-6 inhibitor for a subject, the subject will then be randomly assigned on a one-to-one basis to either be treated with getotelicib, fulvestrin, and either ribociclib and palbociclib, or be assigned to an arm that treats patients with fulvestrin and either ribo or palbo. The clinical trial primary endpoints are progression-free survival per Rhesus 1.1 criteria as assessed by blinded independent central review. And the primary PFS endpoint for each of the two cohorts will be evaluated independently. Study design was reviewed and discussed with the US FDA during a Type C meeting in the first quarter. And then we've also just recently received feedback from the FDA on the study protocol as part of a Type D meeting. So we can now focus on our feasibility and site selection activities. We expect to activate roughly 200 clinical sites across North America, Europe, Latin America, and Asia, and we expect to enroll the first patient in the second quarter of 2025. We estimate that 15,000 to 20,000 patients with endocrine therapy-resistant advanced breast cancer are diagnosed each year in the United States alone. Since this population does not overlap with the patient population we're evaluating in our Victoria 1 study, an approval to treat these patients would increase the size of the addressable U.S. market potential for getatilisib by up to $3 billion. Given the importance of developing a more efficacious therapeutic regimen for these patients and the scale of the financial opportunity, we decided it was important to proceed as quickly as possible to initiate a phase three study for this patient population. To accomplish this, we needed to strengthen our balance sheet, which we did this quarter when we raised $129 million gross proceeds from equity and debt offerings. By initiating this trial now, 12 months earlier than we would have been able to do so without this financing, we estimate we added over $1 billion to the net present value of the potential revenue stream from this indication. I'd like to turn now to our Phase 1b-2 trial that's evaluating the safety and efficacy of gadotilacib in combination with darolutamide, an androgen receptor inhibitor, in patients with metastatic castration-resistant prostate cancer. The study dosed its first patient in February of this year. and enrollments on track. We continue to expect to report preliminary data in the first half of 2025. We're also pleased that our non-clinical research describing getatelicibs activity in different tumor types was recently published in two leading journals. In June, Nature Breast Cancer published results from various in vitro and in vivo studies we conducted that compared getatelicibs activity in several approved single-node PI3K, AKT, mTOR, or PAM inhibitors in various breast cancer models. And in August, Molecular Oncology published results of similar studies in prostate cancer models. Both sets of studies demonstrated that getotelicib exhibited more potent and cytotoxic effects compared to the single-node PAM inhibitors, regardless of the PAM pathway mutational status of the cell lines. And these results indicate that inhibition of multiple PAM pathway nodes by a PAM-PI3K mTOR inhibitor like getotelicib is more effective at inducing any tumor activity and single-node PAM inhibitors in vitro and in animal models. Overall, it was a very busy and productive quarter. I'm very pleased of the progress we made. I'd like now to turn the call over to Vicki, who will review our finances.
Vicki
Thank you, Brian, and good afternoon, everyone. I'll provide a brief overview of our financial results for the second quarter, 2024. Our second quarter net loss was $23.7 million, or $0.62 per share, compared to 14.6 million net loss, or 66 cents per share, for the second quarter of 23. Because these quarterly net losses include significant non-cash items, including stock-based compensation and interest, we also included in our press release non-GAAP adjusted net loss for the quarter ending June 30, 2024. Our non-GAAP adjusted net loss was $22.2 million or $0.58 per share for the second quarter of 24 compared to non-GAAP adjusted net loss of $11.1 million or $0.51 per share for the second quarter of 23. Research and development expenses were $22.5 million for the second quarter of 24 compared to $13.8 million for the same period in 2023. Of the approximately $8.7 million increase in R&D expenses, $6.6 million primarily related to activities supporting the Victoria 1 Phase 3 trial and the initiation of the Phase 1B2 prostate trial. And $2.1 million was related to increased employee and consulting expenses. General and administrative expenses were $1.8 million for the second quarter of 24, compared to 1.3 million for the second quarter of 23. Employee and consulting related expenses accounted for 0.3 million of the increase. Professional fees and other administrative expenses accounted for the remaining increase of approximately 0.2 million. Net catch used in operating activities for the second quarter of 24 was 18.1 million compared to 9.7 million for the second quarter of 23. We ended the quarter with approximately $283.1 million in cash, cash equivalents, and short-term investments, compared to $180.6 million at December 31, 2023. The increase of approximately $102 million in cash and cash equivalents and short-term investments was the result of several financing activities that occurred in the first half of 2024. and yielded net proceeds of $137.5 million. We closed on two financing activities in May resulting in gross proceeds of $122 million and net proceeds of $115.5 million. The first activity was an equity financing resulting in $60 million of gross proceeds with net proceeds of $56.3 million. The second activity was a debt offering resulting in gross proceeds of $61.7 million with net proceeds of $59.2 million. Additional financing activities in the first half of the year resulted from warrant exercises of $14.2 million, accessing our at-the-market offering of $7.3 million, and stock option exercises and employee stock purchases of $0.5 million. The $137.5 million was offset by year-to-date operating cash used of $35.1 million. I will now hand the call back to Brian.
Brian Sullivan
Thank you, Vicky. Operator, could you please open the call for questions?
Operator
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the number one on your touchstone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the number two. If you are using a speakerphone, please make sure to lift the handset before pressing any keys. Your first question comes from the line of Maury Raycroft from Jefferies. Your line is now open.
Maury Raycroft
Hi, thanks for taking my question. Just checking on the enrollment, I appreciate that the timeline is moving a little bit. Based on the shift in proportion of wild-type and mutant populations, is it possible that the wild-type and mutant readouts could happen at the same time, or are you confident that the wild-type and mutant readouts will be staggered? And secondly, is it fair to assume you'll do another update on enrollment in fourth quarter and provide more specifics on the plan for the readout at that point?
Brian Sullivan
Thanks, Maury, and thanks for your question. As far as the timing of announcement of results for mutated, we're maintaining our guidance that we would expect to have those results available sometime in the first half. We're enrolling the same number of patients in each cohort of the studies, wild type versus mutant, and 40% of the patients are mutated, so that enrollment period will take longer to complete, albeit a little bit sooner. And we originally planned because of the higher proportion of mutated patients. But we're not changing our guidance at this time. And as far as updating enrollment, we'll continue to update guidance as we have every quarter on when we expect to report top-line results.
Maury Raycroft
Okay. Makes sense. And then for Victoria 2 in the frontline setting, can you talk more about the safety run-in with the 12 to 36 patients? Why is there a range of patients that you could enroll? And are you assessing any variations with dosing strategy? And how long will you have to treat these patients?
Brian Sullivan
I'll give you an initial high-level summary, and then Igor could maybe fill in the blanks. Essentially, the study is designed to evaluate, if needed, various dose levels of gettalizib to find the phase three dose. If we don't need to reduce the dose of gettalizib in the first cohort of patients that we're evaluating, then we'll be able to proceed with the data from that group of 12 patients. And then subsequently, if we find that we need to dose reduce getta, we would enroll another 12 patients and you know, do the same thing again if we had to and enroll another 12 patients. So essentially, you know, depending on what the results and the outcome of that, of each cohort or one cohort will or may or may not lead you to enroll additional patients. As far as the thresholds, I mean, it's a standard safety run and design. Igor, maybe you could provide a little bit more color on that question.
spk09
Thank you, Brian. As Brian pointed, it's very straightforward safety running. Three dose level will be tested, 12 subjects per each dose level. And DLT will be assessed after one cycle of treatment is completed. It's a very safe and straightforward design that has been discussed with the regulators and agreed upon. And to Brian's point, decision about initiation of randomized CA3 study could be done as early as completion of initial cohort 12 subjects.
Maury Raycroft
Got it. Okay, thanks for taking my questions. You're welcome.
Victoria 2
Thank you.
Operator
Your next question comes from the line of Tara Bancroft from TD Cohen. Your line is now open.
Tara Bancroft
Hi, good afternoon. I was hoping you could tell us Exactly what you're seeing now for the percentage of the split of wild type versus mutant that you think you're observing now versus what your previous expectations were, and also just a point of clarification. By target enrollment, you mean completion, right?
Brian Sullivan
Right, right. There's always variation. You may have patients in screening at the end of a period and enroll additional patients just because you can't not enroll patients that you've potentially already approved to screen once you hit that target. But completed enrollment is correct. So we were at 65% at the end of 23. And so over the course of 23, you'd see fluctuations month to month, which is kind of expected. Fluctuations are normal. So again, we were cautious in interpreting variation, but because we ended the year at the target number we had set in May 22, you know, nearly 18 months prior, you know, we thought that that estimate was solid and what we would continue. Once we hit 80% enrollment, which we did recently, the wild type cohort, and we were at 60%, we just decided that we should update our forecast to the current ratio, cumulative ratio, which is 60%.
Tara Bancroft
Okay, great. And then, so I guess, late Q4 for potentially meeting the event timeline. That would potentially fit into the San Antonio conference timeline. Is this still maybe what you're primarily hoping for? Because I know that the abstract deadline passed early to mid-July. So did you submit an abstract or plan on presenting there?
Brian Sullivan
So we haven't. Yeah, we aren't going to until we have an announcement to make about the data, we aren't really going to go into details about what venue will be reporting that data. And it's going to be very situational, depending on the timing and relative to the next most relevant meeting. And so once the data is available, we'll report the top line as soon as we have it. And then we'll provide guidance on when we would go into more detail at a meeting or go into some detail in the announcement press release.
Tara Bancroft
Okay, great. Thanks so much for taking the questions.
Brian Sullivan
You're welcome.
Operator
Ladies and gentlemen, just a reminder, if you would like to ask a question, please press star followed by the number one on your touchtone phone. And if you're using a speakerphone, please make sure to lift the handset before pressing any keys. Your next question comes from the line of Brad Canino from Stifel. Your line is now open. Hi, thanks for taking the question.
Brad Canino
Brian, I just wondered, can you talk about how the potential forthcoming approval of Roche's interval factors into your clinical and regulatory strategy for frontline, at least for the proportion who will have the mutation? And also, how important is the ultimate label outcome around the metabolic parameter eligibility as you think about this? Thank you.
Brian Sullivan
I'm not sure I understand your question regarding inovilisib as it relates to us. Are you asking that question about how that might affect our first-line study? Yes. Brad? We don't think it will because, you know, they're only evaluated, you know, patients who, A, had the PIK3CA mutation, but, B, didn't have, you know, were not pre-diabetic or diabetic, which, again, depending on the estimates, can narrow that indication down to 50% of the mutated population. So it really is not a drug that could fully treat the indicated population, which is women who have endocrine-resistant disease. And as a result, we've reviewed this information with the FDA in several settings, so we're confident in our design and that that's what we'll be evaluating. So we don't think that data will affect us. It provides, we think, validation of what we're doing. They showed in that population that the pathways involved and inhibition of that pathway can induce a meaningful treatment benefit. As far as what's on the label, you know, The drug had been tested in patients without the strict limitations used in this most recent study, the INIVO-120. I think the eligibility criteria were informed by the results in that study. And if I recall correctly, from data they reported, I think in 2021, where patients may have had a cutoff of A1C similar to alpalypsib, I think in one of the cohorts, they treated roughly 40% grade 3 hyperglycemia. So I think it would be unlikely that the label wouldn't address the hyperglycemia risk and the fact that the drug has not been evaluated in patients who are pre-diabetic or diabetic. And to the extent doctors decide they want to ignore that, based on the results that at least were reported on a preliminary basis in these other studies, it would seem that the likelihood of inducing grade 3 hyperglycemia would be pretty significant. So I think that drug has a similar profile in some ways as opalipsib. They just narrow their patient population as a way to avoid inducing high levels of grade 3 hyperglycemia.
Victoria 2
Appreciate it. Thank you. You're welcome.
Operator
There are no further questions at this time. I would now like to turn the call over to Brian Sullivan, CEO of CellQAT, for closing remarks.
Brian Sullivan
Thank you very much for attending our call. We appreciate your interest in our company, and I look forward to reporting to you next quarter. Good evening.
Operator
Ladies and gentlemen, this concludes today's conference. Thank you very much for your participation. You may now disconnect.
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