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spk01: Good day and welcome to GalMed conference call to discuss financial results for the second quarter 2021. Today's conference is being recorded. Before we begin, please note that we will be making certain forward-looking statements on today's call, including those regarding financial results, statements and forecasts regarding anticipated timelines and expectations with respect to our regulatory and clinical development programs, as well as other statements that relate to future events. These statements are based on the beliefs and the expectations of the management of today and actual results, trends, timelines and projections relating to our financial position and projected development programme and pipeline could differ materially. We urge all investors to read carefully the risks and uncertainties disclosed in our filings with the SCEC, including without limitations the risks under the heading risk factors described in our annual report on form 20F filed with the SEC and the risks and uncertainties included in the form 6K filed with the SEC earlier today. GALMED assumes no obligation to update any forward-looking statements or information which speak as of the respective dates only. I would now like to turn the conference over to Alan Beharif, President and Chief Executive Officer. Alan, please go ahead.
spk07: Thank you, Emma. Good morning, and thank you for joining us on today's conference call. I'm pleased to be here today with our Chief Scientific Officer, Dr. Liat Hayardeni, and our Chief Financial Officer, Bokhai Stensler, to provide you with an update on our clinical development programs, as well to report to you on our financial results for the second quarter of 2021. As always, we'll be happy to take any questions you may have at the conclusion of our prepared remarks. Let me start with the news we reported earlier this week announcing FDA agreement with our plan to use aramcol megalomines in the randomized double-blind placebo-controlled part of the Phase III R-MO study. In essence, the FDA agreed that we can proceed with our proposed clinical studies with aramcol megalomines in use of aramcol-free acid without the need to repeat any non-clinical or clinical studies. As you may recall, Administration of Aramcol megalomine doubled the systemic exposure of Aramcol compared with that after dosing Aramcol-free acid. Thus, once daily QB 383 mg Aramcol megalomine oral dosage correspond to that obtained with existing twice daily BID 300 mg Aramcol-free acid form, which is currently being evaluated in the Phase III RMO study. As a reminder, in addition to its longer IP protection until December 2034, the transition to Aramcol Megalomine will benefit our patients in two meaningful ways. First, achieving the required exposure with 50% less API means that we can move back to one's daily regimen with a potential improvement in convenience and adherence in our Phase III registration report. The second benefit is that we can potentially significantly reduce our target marketing price once Aramco is approved via potential saving of approximately 50% of cost of goods. We consider the FDA agreement a significant validation of our consistent efforts to maximize the potential of Aramco in developing enough treatment. The transition to Aramco Megamind is the final step in our drug product optimization which included dose optimization, higher exposure, treatment duration optimization, 24, 48, and 72 weeks, and compound optimization, i.e., salt form, which can be given QB and allows longer patent protection. Now, let me update you on the open-label part of our HOMO Phase III study. As you may recall, the open label part will provide us highly valuable data on the optimization of treatment duration and potential non-invasive test needs associated with NASH and fibrosis. This is aimed at de-risking our clinical development plan while increasing the probability of success of Aramco's ARMO registration report of the ARMO study. Results from approximately one-third of the study population, about 50 subjects, The open-label part of our RMO phase 3 study that has completed the post-baseline liver biopsy are expected to be available in Q4 2021 as planned. Now, shifting here to our pipeline compound, amyloprimer. As a brief reminder, amyloprimer is a highly potent inhibitor of chronic inflammation currently under development for IVD with targeted and specific mechanism of action. Amil-O5MER done regulates multiple pro-inflammatory cytokine secretion. In preclinical studies, Amil-O5MER demonstrated interference with serum amyloid A polymerization and aggregation, which is essential for the activity of serum amyloid A. Aggregated serum amyloid A is the main cause and a biomarker of chronic inflammation. Amil-O5MER has a unique mode of action upstream to all pro-inflammatory cytokine production, which are currently being used in clinical trials and in clinical use. Earlier in Q2, we announced the first dosing of the first in-human Phase I clinical trial of amyloprimer for single and multiple dosing. I'm happy to report to you today that we completed Phase I dosing, and top-line data is expected later this quarter. We are currently developing Amido 5 Mer as an oral treatment for mild to moderate ulcerative colitis. Since this mechanism of action is relevant to other chronic inflammatory diseases, we are also looking at additional indications and are currently developing formulations accordingly. Before I conclude, I would like to note that we are planning to virtually attend three investors' conferences in the coming quarter. The first is Canicode Annual Growth Conference, to be held next week on August 10th to 12th, 2021. The second is the H.C. Wenright Annual Global Investment Conference to be held on September 13th to 15th, 2021. And lastly, the Kantor Global Healthcare Conference to be held on September 27th to 30th, 2021. We will be happy to schedule one-on-one meetings during these events. Now let me transfer the call to our CFO, Lohar Stensler.
spk06: Thank you, Alan. Good morning, and thanks for joining our call today. This morning, I will be providing you with our financial results for the second quarter and in June 30th, 2021. For more information, please refer to our report on Form 6-K, signed earlier today with the SEC, which, among other things, provides a summary of such financial results. For the second quarter of 2021, our net loss totaled 8.4 million, or 33 cents per share, compared with a net loss of $5.8 million, or $0.26 per share, for the first money quarter in 2020. Research and development expenses totaled $7 million for the second quarter of 2021. This compares with $5 million for the second quarter in 2020. Increase resulted primarily from an increase in clinical trial expenses in connection with the R-MODE trial. Turning now to GNA, our general and administrative expenses for the quarter totaled $1.4 million, compared with 0.8 million for the corresponding period in 2020. Increased results primarily from an increase in the cost of our DNO insurance policy premium, as well from an increase in salaries and benefits. Our cash balance as of June 30th, 2021, which includes cash, cash equivalents, restricted cash, short-term deposits, and marketable securities, was at 51.2 million, compared with 51 million on December 31st, 2020. With that said, operator, please provide instructions for the Q&A portion of our call.
spk01: Ladies and gentlemen, if you would like to ask a question, you may do so now by pressing star 1 on your telephones. That's star 1 if you'd like to ask a question. We will now take our first question from Edward Nash from Conaccord Genouli. Please go ahead. Your line is open.
spk00: Great. Thank you very much, and congratulations, guys, on getting the go-ahead with Ramcall Metamind. That's a huge plus for you guys, I know. So, I just wanted to understand and I think thank you for that review on the phase phase 3 design. But just wanted to understand again, we're going to be getting those 1st 50 patients in the 4th quarter of this year. Those patients will be the 24 week. Is that correct? And then the next 50 will be the 48 and the next 50 72 weeks. Is that correct?
spk07: No. Hi, good morning. No, this is not correct. I mean, most patients, the patients are blinded randomized into the three groups. So in the first 50 patients, we will have about half of them are going to be of 24 weeks, and the rest are 48 and 72 weeks biopsied. These are patients that had transitioned from the double-blind part.
spk04: Got it. Okay.
spk07: So each group, each 50 group is blinded and a mix of the populations of 24, 48, and 72.
spk00: Perfect got it. Okay, great. And then the for the, for the analysis, you should go forward in front of the FDA. Obviously, this will give you additional strong that safety data, but obviously, for powering and accelerated approval submission that will all be from the clearly the blinded part where you'll only be using the around call Megalobon correct?
spk04: Yes, indeed.
spk07: So, as you know, the study is about efficacy kinetics. We are using this study for really three main reasons. One, for safety, which will support the safety data of our NDA. Second is to learn what is the optimal treatment duration. When there is 24, 48, or 72, there is a difference, and there is an association between the two. is the powering of the study. Since the dose is much higher, you know, if you compare the initially almost study was powered based on the phase 2B study. Now we are giving twice daily, which is 50% higher exposure. We are expecting that the effect size will change accordingly, and hence the powering of the study and the number of patients will change accordingly.
spk05: Perfect. Thank you guys so much. Thank you.
spk01: Thank you. We will now take our next question from Kirsten Kluska from Contour Fitzgerald. Please go ahead. Your line is open.
spk08: Hi. Good morning, Alan and team. Thanks for taking my questions. And let me also add my congratulations to you on the outcome of this recent meeting with the FDA. First, I wanted to ask if you could provide us with more details around the planned limited pharmacology studies and associated timing here, and whether you still think the end of the first quarter of 2022 is a good time point to start the next trial.
spk07: So, I will let Leigh up take that. Hello, Christine. Good morning. Thank you.
spk02: Hi, Christine. How are you doing? So, we offer the FDA three very reasonable as clinical pharmacology studies. The first one is going to do with the dose range finding. You know, our relevant dose is twice daily 300 mg aramcolysis, and we will do dose range finding to match exactly the exposure of the 300 mg twice daily that we have, which is, as Alan alluded, higher exposure by 53 percent than they are raised. The second study that we offered is food effect, which is quite clear. And the final one is bioavailability. It's not a bioequivalent. It's not like a – so it's just when you transfer from one entity to another, when you expect the exposure, you just have to match the exposure to the food effect and do one dose and match it with the twice daily, which is currently new. So it's quite regular clinical pharmacology, and it has all the other package, which we did thus far, is fully acknowledged by the regulators for other developments.
spk07: Now, as to your question about the timelines, it is very much dependent on the formulation. We are ready, all is set and ready, and the data, the very relevant data that we get, at the end of the year should allow us to better design the protocol amendment and decide on the, as I said before, duration and powering the statistical analysis plan of the study. So this is why, and everything is done with the CMO in order to produce the formulation on time to initiate the double-blind part of the study which are called megalomines. So at the moment, we are still getting clear guidance about, you know, once we received the guidance from the FDA, we immediately had discussions with our drug product manufacturer to initiate the process and complete the formulation. We will keep you updated if there will be any delays Whether it would slip into Q2 from Q1, we would only know once we have more visibility as to the formulation development.
spk08: Thanks. I appreciate that. And now that you have the official green light here from the agency, just as it relates to some of your ongoing collaborations, particularly the combination study with ASC41, will you also look in the future to use Meglumine forward here? And then as it relates, you know, you've made multiple comments in the past about, you know, using your therapy potentially as a backbone, but how might this data that we're getting in the fourth quarter here help you determine future plans as it relates to evaluating different types of combinations as well?
spk07: Absolutely. I mean, from now onward, we are using iron-cold megalomines. So, the first would be to incorporate iron-cold megalomines in the open-label study, and I hope that this will be done already by the end of the first quarter of 2022. And then all other combination studies, whether it's the HCC41 or the Macrobiome or others that we haven't planned and we've communicated, are going to be done together with Aramco-Medlimine. This is the product that we are taking forward. It's an improved product, and we would like all our patients to benefit from this improved product.
spk08: Okay, thanks. Appreciate that. And then my last question for you. Now that this, again, that this agreement is in place and you have an extended IP portfolio, has this changed how you might think about the opportunities to commercialize, specifically whether you would look to pursue partners in certain geographies, again, now that because the IP portfolio is strengthened? Thanks again.
spk07: Yes, so, yes, we've always openly said, I mean, we are working under the assumption that we are developing Aramco, Megalomon, and taking it into phase three. Our door is open, and we are definitely looking for global, geographical, joint venture, any form of collaboration. I think that we have built a very nice package for any pharmaceutical company that would look at the data. Because on the one hand, we've optimized the API and the drug product. We did all the heavy lifting in terms of getting the regulation from all the way from Australia to Brazil to China, US, of course, Middle East, Korea, whatever. I mean, we're talking 18 countries, agreements with more than 250 sites. around the globe, around five continents. So all this heavy lifting together with the optimization of the drug product is on the one hand, and on the other hand, giving the partner an opportunity to influence the protocol, because I'm sure that everyone wants to make and to review before you initiate the double-blind part, they want to make their own adjustments and fine-tuning, and we are very open to that. So between today and until we start the double-blind part of the study, we are open for discussion for any commercial discussion.
spk01: Thank you. We will now take our next question from Steve Seedhouse from Raymond James. Please go ahead, your line is open.
spk03: Hi, this is Timur Vanikov on for Steve Seedhouse. I also would like to congratulate you on the agreement for Armchol Megalamine. Just to make sure I understood correctly, the main gatekeeper that's holding you back before you can start a randomized Phase III study So you were talking about material needing to be manufactured, but you also obviously need to see some label called data. So could you just talk about what kind of data you would need to see before you can proceed with a randomized study? Sort of what is the benchmark for that data? Thank you.
spk07: So thank you for the question, because I think this is a very important issue. I'm, you know, here at GALMED, we are looking at the data very carefully, not only in our data, on the competitive landscape data as well. And we have to ensure that our data is in line and our, what is the target product profile of article megamines is in line of the development in this space. We are very much aware of the recent NASH studies, NASH resolution studies in natas, whether it's the semaglutide or other compounds that have a very significant effect on NASH resolution. On the other hand, the very mild effect that we observed on fibrosis, from Obitucolic Acid. So all together, we are trying to build the best package, the best package that benefits risk ratio to our patients that will give both NUS resolution, fibrosis improvement, and safety. And this is the kind of the data that we anticipate to see from the open-label study. Maybe the first 50 patients will not be enough. Maybe we need to wait for the 100 or 160. We are hoping that there will be a strong enough signal with the first 50 patients, but if we look at the data and we say we want to wait another quarter or another two quarters until we see 100 patients, and then decide to embark on this large, expensive phase three study, double-blind part of the study, we'll definitely do that. This is because I think we have this responsibility to our patients and to our investors. And we want to make sure that once we go into that route of initiating this double-blind part of the study, we significantly de-risk the program and increase the probability of success.
spk02: We, I think that we can, we planned the two programs to cross. So we developed rancor megalomines. We gave it to formulation. We are doing the best formulation for rancor megalomines. And at the same time, data will arrive from the kinetics of the efficacy. And they, you know, the dates will somehow approximately will cross. So, when we will have, finally, kind of formulation, stability, and everything that we have with Rampel's necromycin, at that time, approximately, we will probably have the data on the kinetics so that we will have a very good design of the A3 clinical trials, the regulatory clinical trials.
spk04: Okay. Thank you for that.
spk03: Can you also talk about the cadence of additional cohorts from the open-label study? I think if I remember, you were saying every six months. I'm not sure if, you know, your next cohort data will still be around mid-2022, or is that, you know, is that timing different? Thank you.
spk07: No, this is correct. The next cohort is anticipated by the second quarter of 2022. So this is the 100 patients. So, the first 60 and then another 50 by mid-2022.
spk03: Okay. Okay. Great. And then, for one question for Amila Fivemer. So, I think you talked about going after oral and sub-Q for phase 1B for different indications. Can you just talk about, in terms of your oral formulation, still systemically distributed, you know, versus minimally absorbed. And just to clarify, phase 1A, that's oral only, right?
spk07: So the phase 1A was done subcutaneously and with healthy volunteers. And now we are working on two types of formulations. We are working on oral local formulation which is for ulcerative colitis for the GI tract. So we're working with a specific formulation that will open in the right place where we want it to open and create the local effect in the GI tract. This formulation is designed for a Phase IIa study for ulcerative colitis patients. At the same time, we're also working on neocolized formulation. This would be injectable, again, for a different indication, probably RA, which would be injectable to the joints. This formulation, we may also look at other indications, but it's too early to talk about.
spk05: Okay. Thank you very much. Thank you.
spk01: Thank you. Thank you. That will conclude our Q&A section for today's call. I will now turn the call back to Alan Bahar for any closing remarks.
spk07: So thank you all for joining our call today. I hope that we'll be able to come with some more good news in this coming quarter and eventually, of course, to communicate the this open-level part of the study. We are, again, I would like to reiterate our participation in the three conferences, in the CannaCode Annual Growth Conference, the HC Wenright Conference, and the Canto Conference, which we welcome any questions and would like very much to meet as many of you. And, of course, hope to see you This comes probably virtually also at AASLD, where we've submitted a number of abstracts, which I hope will be accepted, and that will be an additional catalyst for our activity. Thank you.
spk01: Ladies and gentlemen, that will conclude today's conference. You may now all disconnect.
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