This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk_0: good afternoon my name is john and i'll be your conference operator to that at this time i would like to welcome everyone to coburn first quarter twenty twenty two financial results conference call all lines have been placed on you to eliminate background noise if anyone should require operator systems during the conference please press start zero on your telephone keypad and now i will turn the call over to just be you know chief financial officer echo by thank you sir
spk_1: thank you john and thank you everyone for joining us coal bars first quarter two thousand twenty two financial results conference call you're an email to the call is doctor joseph to covers chief executive officer doctor nicholas hockey's cool bars acting chief medical officer and doctor kent grinds their senior vice president research following our collective remarks we will conclude with qnx the worst financial results press release was issued earlier today and maybe downloaded from our website at www dot com or dot com before we begin or like to take a moment to remind listeners that except for statements of historical fact remarks on the conference call may include forward looking statements within the meeting of the securities laws for looking statements are based on current expectations projections and interpretations that involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by colbert these risks and uncertainties are described in a registration statements reports another filings with the securities and exchange commission inapplicable canadian securities regulators which are available on our website a dot com se si dot gov and si dot com as well as in the safe harbor state really cool with today's press release your cautioned that such statements are not guarantee the future performance and then are actual results may differ materially from those set forth in the forward looking statements covert does not undertake any obligation of they publicly or revise and forward looking statements or information where there's a result of new information future events or otherwise now i'd like to turn to call the jokes red co bars chief executive officer job
spk_2: thank you just and thank everyone for joining us this afternoon in the first quarter of twenty twenty two we made steady progress that we believe that listens to bar for an exciting several years ahead on our last call we communicated several important updates about the direction and falcons for the company and during the past quarter we focus our efforts on execution in those areas we aligned are pipeline strategy to prioritize the advancement of cb fifty one thirty eight as three or i have program towards the clinic notably are id enabling said it's for this program remain on track and are a formulation efforts are well underway we invested further in our novel my plus platform to identify new product candidates we can tutor for potential partnership for cb forty two eleven program and we hired significant talent to our team which we believe one have our ability to achieve long term success on today's call after my introductory remarks mules or commentary from canton neck the most recent additions to our leadership team who bring unique perspective and extensive expertise in their functional areas can't will provide an overview of our science and armada plus platform and it will provide a recap of variety of program several then review our cue on twenty twenty two financials and summarize our upcoming proxy vote and nasdaq listing requirements i'm very excited about where we send a car park and we remain on track to hit are important upcoming milestones as we think about where we're headed i would like to put the intriguing opportunity we have to mind the mitochondrial genome into perspective oh researchers have been looking at the nuclear genome as a source of novel therapeutic for quite some time the mitochondria has been largely overlooked we think this is due to a couple of factors first utility of like mitochondria has historically been viewed solely through the lens of the atp and energy production but it turns out the function of mitochondria is much broader than that and they play important roles in regulating a variety of different biological pathways as well as impacting a wide range of diseases second i think there's an inherent assumption that the peptides encoded in the mitochondrial genome would be acting locally within the mitochondria and some of them certainly do that but it turns out that many of these peptides or secreted and circulate systemically mediating important effects on organs and tissues quite distant from where they are
spk_3: produce
spk_2: and so as these two insights about the breath of the impacts of mitochondria on the body and the fact that peptides encoded in the mitochondrial genome are acting systemically that really lead to the formation of are and that's the rationale underpinning our approach to drug discovery using armada plus platform the cat will talk about in a few minutes additionally by targeting analogue or modifications of natural peptides we expect to have are off target sachs which may translate into better safety and tolerability profile for our product candidates and this is a true platform in a sense of the commonality here is the mitochondrial origin of these peptides as you may recall we have identified over one hundred peptides and when you look at the individual compounds in our library they are structurally quite distinct and operating through a variety of different mechanisms which we believed the risks are overall approach importantly last year we demonstrate a clinical proof of principle for this mitochondrial biology from the first human study of a peptide derived from the mitochondrial genome the positive topline data from rcb forty two eleven program was an important validation not just of that program but of our overall platform and approach
spk_4: as you can imagine we spent a lot of effort identifying and sequencing these peptide families to carve out a broad patent portfolio which we firmly believe is the leading portfolio in the space
spk_2: we recently received notification regarding issuance of two additional patents that further expand our ip position on cd forty two eleven the us patent and trademark office has informed us that morrow it plants issue the second us patent for this program this most recent patent is expected to be eligible for listing in the of the orange put upon approval of cb forty two eleven as therapeutic for obesity in the united states at the same time we've also progress or international patton prosecution strategy with the issuance of a japanese that and covering cb forty six eleven and related compositions as well as medicines comprise a cb forty two eleven and related peptides for treating nes we believe this ip expansion will strengthen the overall cb forty two eleven package as easy to advance development with a partner with that it is my pleasure to outrun the ball over to can't grind staff or senior vice president of research tool review our platform approach and progress can't
spk_1: thanks joe and good afternoon everyone is don't mention are uniquely positioned nicobar to capitalize on a largely untapped area scientific research and the bread but we expect the other cheek to the power of the mitochondrial genome is tremendous
spk_5: we first tell the story of our science there's sometimes a perception that we're targeting relatively rare by congrats dysfunction
spk_1: which is not our area focus
spk_0: rather we are pursuing broad systemic conditions typically chronic diseases that have a march inflammatory five broader and or metabolic component so native mitochondrial peptides play critical role in the maintenance of normal homeostasis in many chronic disease states is normal homeostasis is disrupted which we believe can be restored bar novel peptides i'd like to point out that this field has been steadily growing to date or over forty thousand and publications on the role of mitochondrial disease of which nearly four hundred cover mitochondrial to like to write peptides or md keys with known systemic or sex demonstrating the level of interest in the space and the potential for further discovery one recent paper of no to the review that addresses a broad range of properties are some of the most widely studied mtp human and much see and slaps
spk_1: this peer reviewed paper was published as last year and emphasizes the well established side of protective anti inflammatory and metabolic properties of these mvp
spk_0: as those the strong correlation between ndp isn't a wide range of important biological processes such as atherosclerosis hype them up a denier insulin resistance and aging
spk_1: does highlighting the potential value of them dps is both novel biomarkers and therapeutic targets and disease development and progression the paper provides a good example of how the evidence for the role of mitochondria complex multi factor diseases continues to build
spk_0: while simultaneously demonstrating that the area of mitochondrial drive peptides and their systemic rules is still relatively untapped emphasizing both the opportunity and the need for further investigation
spk_1: i cope are we to talk to a bus proprietary development engine called might plus that aligns with our strategy to pursue broad systemic conditions
spk_0: our platform enables us to leverage the power of the mitochondria and the longstanding evolutionary pressures on peptides encoded in the mitochondrial genome our approach begins with a focus on understanding inherent property of mitochondrial peptides and been developed through evolutionary processes and our clinical candidates are improved versions of these natural sequences they've been optimized to enhance both biological activity and drug like properties
spk_1: well beyond ikea inside process we're continuing to interrogate the mitochondrial genome and our library of peptides to identify high value expansion opportunities to the platform in therapeutic indications when mitochondria play significant roles in disease processes such as information our screening processes are designed to detect peptides that interact with cell surface receptors and have a kid mean and portland systemic biological pathways resulting in product candidates with the potential to impact multiple biological pathways that are driving complex multi factual diseases our goal is to create first in class drugs that are truly disease modifying which is really exciting and why we look forward to working a lap each day so to summarize i'm really pleased with butter discovery team is doing and we've only become the scratched the surface of the potential of our peptide library
spk_0: will look forward to providing additional information make progress with our discovery actors
spk_1: now turn to call over to neck to provide a brief overview on cd fifty one thirty eight dash three
spk_6: nick thanks can't end good afternoon everyone as we've discussed previously we believe that preclinical data demonstrating be anti side roddick effects of cbp thirty one thirty eight dash three in models of i pft compelling and we are optimistic that this program could provide important clinical advances for patients and commercial advantages over current standard of care as a pulmonologist side taken care of many people with lung fibrosis both in the clinic and intensive care unit and have witnessed up close the devastating reality of ip at and the burden of didn't have disease that it's carried by these patients and their families as a result i'm particularly excited about the potential about cbp the one thirty eight dash three program to address that significant unmet need in this area we continue to make progress with our i in the enabling studies in our ongoing toxicology work as systemic safety profile of cb fifty one thirty eight dash three continues to look quite clean this is particularly encouraging as we prepare for clinical studies to accept site to as said safety and tolerability and human subjects as additional preclinical data becomes available for this program it increases our understanding of the molecule and how we expected to behave in humans enabling us to make further refinements to our clinical development program as i mentioned in our last call we expect that our initial clinical study will be a phase one single is sending those and multiple of sending those study in healthy volunteers performed at a phase one clinical research unit we plan to quickly followed this study with a multicenter face to study and idea patients the clinical team continues to plan ahead to be well prepared for initiating the clinical programs when the idea the is cleared the clinical development path for development in i p s has been laid out and refinements that face to study design around going cancer and i are collaborating closely and along with the rest of the code bad team are working hard to further clarify the most relevant mechanism and i ip f specific biomarkers for you use as exploratory and points in our initial ip have study alt timelines for the program remain on track and we continue to expect to file our i in the in the second half of next year
spk_1: now i'll turn the colo but subject to review our q one twenty twenty two numbers jeff can if we continue to be in a solid financial position at the end of que one two thousand twenty two twenty three point five billion dollars in cash is investments in addition are clearly burn rate was approached me three point one million dollars and have the repaying or last promissory note during the quarter we have no deaths research and development expenses were one point five million dollars into one two thousand twenty to thirty two point seven million dollars in the prior year period a decrease of approximately one point two million dollars decrease in research and development expenses was primarily due to lower clinical trial in preclinical costs to to the timing of those expenses in terms of dna or general news for expenses were one point seven million dollars into one two thousand twenty two compared to one point four million dollars in the prior year period and increase that was primarily due to higher stock based compensation costs and legal fees associated with our ip portfolio for the corner in march thirty first two thousand twenty two couple record a net loss a three point three million dollars for four cents for basic into to share to pursue a net loss for the quarter ended march thirty one two thousand and twenty one of four million dollars for seven cents for basic and diluted share net loss included noncash expenses of approximately five hundred thousand dollars for the quarter ended march thirty one two thousand and twenty two to three hundred and seventy thousand dollars to the corner and march thirty one two thousand twenty one overall we are pleased with our financial performance and we continue to estimate the we have sufficient capital the finance or operations into the second half two thousand and twenty three as you may have seen we issued a press release last week announced in the nasdaq is granted us an extension until november seventh of this year to regain compliance with nasdaq's one dollar minimum required and like to take a moment to highlight the fact that our board has included a proposal authorize a reverse stock split in this year's proxy statement which is specifically designed to enable us to regain nasdaq compliance by continuing as the nasdaq listed company respect you have greater access to capital the further fund pipeline improve the quality for our stockholders and a higher likelihood of attracting high quality institutional investors and commercial partners on behalf of the border yes vote in favor of this proposal to help build long term value
spk_2: and now through things back over to joe joe thanks just before we take your questions i'd like to provide a summary of our recent progress and review your upcoming timelines during the first quarter of the year we made steady progress across the key areas of our business and the year ahead will be focused on execution first and foremost we continue to advance even fifty one thirty eight as three through i and enabling studies we think i have a significant opportunity for cd fifty one thirty eight as three could make a real difference for patients we have successfully scale the manufacturing necessary to support the initial clinical study and as you progress arranging enabling studies we continue to demonstrate systemic tolerability of cb fifty one thirty it as three in animal models in parallel we look forward to finalizing are formulation work as you move closer to clinical development in the second half of twenty twenty three and as your heard from can't today we continue to mine are extensive library peptides derive from the mitochondrial genome to identify those peptide families that so the most promise for further development we're also evaluating commercial in competitive landscape to preserve to pursue disease areas where we think we have a clinical advantage we are not focus on me to opportunities and drug development as we aim to create disease modifying therapies they'll make a real difference in people's lives we believe city forty two eleven has that potential and we are working to scare partner to enable further clinical development of that program we look forward to providing updates throughout the year as we continue to make progress on these initiatives in summary twenty twenty two is off to a good start we have an exciting scientific platform based on the mitochondrial genome that we believe offers a breath of untapped therapeutic opportunities we have a clear and focused strategy to vote therapies for difficult to treat multi factorial diseases like ideas and we have the right team in place to advance or science and pipeline
spk_0: john can you please open the line for questions yes thank you at this time will be conducting a question and answer session if he would like to ask a question please press star one on your telephone keypad a confirmation tumble indicate a your line is in the queue you may press start to if you would like to remove your question from the queue and for participants using speaker equipment and may be necessary to pick up your handset before pressing any starkey is one moment please when we pull for any questions
spk_7: our first question comes on the line of kristin chluski with cantor fitzgerald please proceed with your question good afternoon this is read on for christian thank you for taking our questions out got to for you here when you think about potentially optimizing cbs fifty one thirty eight dash three for delivery and i p s could you give us an idea of the delivery no doubt least you're potentially exploring and think make the most and for the indication given previous experience and i p s is there anything special about this particular molecules chemical or drunk properties that makes it either good or bad
spk_2: as a candidate for any of these delivery method hi rick thanks thanks for the question so you are are
spk_8: pros generally oh involves delivery of peptides and so peptides for the most part of require delivery either subcutaneous lee or intravenously and so our general approach here is to deliver this
spk_2: such detainees flying
spk_6: but nick i think you're you probably have the most familiarity with a patient populations maybe you can talk a little bit about delivery methodology on their acceptance by this group of patients yeah great thanks joe was and thanks for the question yards at yeah it's a good question i think as you stated job for us and peptides that we have the plan is certainly for non or not or therapy so subject subcutaneous we'd certainly it's is the main goal is always a question of inhaled delivery for a lot of pulmonary disease as i think i pf is a complicated disease and
spk_0: certainly ah from where we stand at this point in early development sort of taking that approach i is is commonly not something that we're we're looking at but
spk_7: given the disease population subcutaneous delivery is that certainly something that would be acceptable to the to the patient population and we think is actually very effective way to deliver mitochondrial web peptides
spk_2: great okay now to ask one more here are you talked about the expanded patton coverage for cb forty two eleven could you give us a sense for how we should be thinking about potential pan might stand now for this for this candidate thanks
spk_4: sir
spk_2: so as i mentioned in the remarks at this is the second us patent that we had issued on this program for the just to remind everyone the first patton's was issued last fall that patton covered ah composition of matter of city forty two eleven an related peptides as well as the method of use for the treatment of mass and for the new patent the new us patents expands that now also include methods of use to treat obesity are both patents have expected terms that it would expire in twenty thirty seven and in the japanese patton that we talked about earlier is essentially the foreign counterparts that initial and that issued last fall
spk_9: and so if we've got existing patton's insert a pending from that family in multiple other jurisdictions outside the u s but for most of those patterns
spk_0: whoa are also expected to have a twenty thirty seven expiration date
spk_10: okay thank you thank you are next question comes from kumar russia with for coin capital markets please proceed with your question
spk_2: thanks for taking my questions mind one more on the formulation
spk_11: how is the work in that area progressing pam and also how are you thinking in terms of fall for being some frequency as the list of potential to be combined with the law that approved drugs
spk_2: thanks to more answers as we mentioned in remarks of the formulation work is progressing well everything is on track i think we we spoke about this a little bit on the last call but the process here in terms of the formulation work is an iterative one meaning we do certain work in the lab
spk_4: looking at different types of formulations we do some
spk_12: in vitro has to sort of see how well those new formulations look and then we we testimony in vivo setting and depending on what the results that are that inform sort of the next cycle of work so again again it's an iterative process but but so far are things are progressing quite well
spk_2: come on and on the development art are expected dosing frequency
spk_12: it is likely to be a daily subcutaneous injection or with his with this program
spk_2: which we think again a given as patient population is is likely to be quite acceptable given how symptomatic
spk_6: these patients are
spk_13: so i think that answers your questions they and upsets more you want to say in terms of the the you know how that works with the existing a standard of care and and frequency there
spk_14: yeah the i just because the one thing i would add to that job
spk_13: that being so really only formulation
spk_6: part of the development
spk_15: for to to the project dash three
spk_6: i dig the frequency of delivery obviously and become much more to us as as we move forward as we begin to understand that pharmacokinetics of the emulated drug product and
spk_13: up to be
spk_6: begin our initial human studies so i i think
spk_10: really that's a bit of an open question and as we gather more preclinical when in clinical data will get a much better understanding of that okay thanks and in some felt the resources being spent on might have plus are you were thinking about it given data market conditions
spk_2: maybe you can just highlight like you know how how that is being utilised than what i do have expectations same thumbs up you know identifying him molecules or the platform search more thanks yeah it's a good point and so obviously we are very much focused on on resources and spends a pretty lame occurrence sort of market environment and so the majority overwhelming majority of our spend is really focus on the stuff to i'm thirty three the idea of program and we're having said that we are you putting some additional effort particular we compared to what we've been doing in the more recent past ah on some of the
spk_16: discovery works at that can't was discussing our early on but certainly our our focus for those efforts has really on identifying of have ties with interesting activity and doing some additional characterization and an early work and knows
spk_2: in those efforts ah but you know we would be a we're not expecting in the near term to be bringing another yeah
spk_10: program forward into clinical development until we have our for the visibility on on cheese or something
spk_2: okay i'm paying terms of the are in be expensive you talked a little bit about the timing
spk_1: so why the less of say it out of the think about our in the compared to how we can said to one and stuff you want to talk for the there's more thanks for that you know it's a very fluid then cycle where is will tend to hockey stick towards the end of the years the circuit and deeper deeper into the programs and to spend cause you to do not think job to would represent what may happen down the road in two three four and two a twenty twenty three so we will hockey stick a bit are providing guidance is specifically to percentages bull in in a historical it has fluctuated between in aren't days depending on the timing
spk_10: between a forty five forty seven percent allocation of aspects of we have to sixty percent in the past two that's the range and in know will hockey stick as a lot of it's largely dependent on again timing
spk_1: and what we decide in the very fluid nature that we operate the business would allocate more phones or less phones
spk_10: okay and and probably would see a lot more early next year as you get closer to the in defiling
spk_1: yes
spk_0: yes some of those and because i was the have been picked up since we're the middle of and but there still isn't struggling course that associated with was just as corrupt
spk_2: talib they'd thanks so much before think it's more
spk_0: thank you at this time we have reached the end of the question and answer session and i went out and the call back over to jail for any closing remarks
Disclaimer