Inhibikase Therapeutics, Inc.

and welcome to InhibitK's therapeutic second quarter 2022 financial results conference call. All participants will be in a listen-only mode. Should you need assistance, please sign our conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press the star then one on your touchtone phone. To withdraw your question, please press the star then two. Please note, this event is being recorded. I would now like to turn the conference over to Alex Lobo, CERN Investor Relations.

Please go ahead.

Thank you, and good morning, and welcome to Inhibit Case Therapeutics' second quarter of 2022 financial results conference call and audio webcast. With me today is Dr. Milton Werner, Chief Executive Officer, and Joseph Fratelloli, Chief Financial Officer. On Friday, Inhibicase issued a press release announcing financial results for the second quarter ended June 30th, 2022. We encourage everyone to read Friday's press release as well as the Inhibicase quarterly report on Form 10-Q for the second quarter of 2022, which has been filed with the SEC. The company's press release and quarterly report are also available on Inhibicase's website at inhibicase.com. In addition, this conference call is being webcast through the investor relations section of the company's website and will be archived there for future reference. Please note that certain information discussed on today's call is covered under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Participants are cautioned that this conference call contains time sensitive information that is accurate only as of the date of this live broadcast, August 15, 2022. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. Information on potential risks and uncertainties are set forth in our most recent public filings with the FCC at FCC.gov. The company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this webcast, except as may be required by applicable securities law. With that said, I would like to turn the call over to Dr. Milton Warner. Milton, you may begin.

Thank you, Alex, and thank you, everyone, for joining the call this morning. I want to thank you for joining us today to review InhibitCase's second quarter financial results and recent business updates. At InhibitCase, we are focused on reversing the effects of neurodegenerative diseases inside and outside of the brain with the goal to deliver disease-modifying treatments to patients suffering from these devastating neurodegenerative diseases. Throughout the second quarter and in recent months, we have continued to make significant progress toward achieving that goal. Most notably, we initiated our 201 trial, the phase 2A clinical trial using IKT148009 for Parkinson's disease, with the opening of the first clinical site on May 23rd of this year. As of August 12th, we have opened 11 of up to 40 sites that are planned and began screening patients. This represents a major milestone for us, as well as for patients and families living with Parkinson's disease. This clinical study will allow us to begin to evaluate the safety and tolerability of IKT148009 in a three-month dosing regimen. The choice of the dosing duration was made to balance the unknown safety of long-term dosing of IKT148009 against the outcomes of animal model studies, where in animals, the therapeutic dosing resulted in substantive recovery from the effects of Parkinson's disease in just eight weeks in both the brain and gastrointestinal tract. Also in real recent weeks, we have filed our investigational new drug or IND application for IKT001 Pro, our pro drug formulation of imatinib mesylate, which we will apply to stable phase chronic myelogenous leukemia. Although an administrative delay had occurred, we expect to hear from the FDA by August 26, 2022 on the status of the IND and we are now working hard to initiate the bioequivalent study to identify the dose of O1-pro equivalent to 400 mg of methamethylate, the standard of care for stable phase CML. Finally, we have continued to progress our early stage pipeline for other Parkinson's-related indications like multiple system atrophy, commonly referred to as MSA. As we look ahead to the remainder of 2022, we anticipate achieving a number of key milestones. As I just mentioned, we expect to begin dosing healthy volunteers in our bioequivalent study of IKT-001-PRO following effort day review of the IND. In addition, we will present additional data from the 101 study, our Phase I-1B study, a clinical trial study of IKT-14809 at the Movement Disorder Society Congress in Madrid, Spain in September of this year. Now let me turn to an in-depth review of our clinical and preclinical portfolio, beginning with our lead program, IKT-14809, a highly selective non-receptor Abelson tyrosine kinase or C-ABL inhibitor for the treatment of Parkinson's disease and related disorders. As you know, Parkinson's disease remains one of the most prevalent neurodegenerative disorders and affects nearly one million people in the U.S. annually. Currently, all marketed therapeutic approaches for Parkinson's only help manage the symptoms of the disease and there are no available options that slow or halt disease progression. We designed 1489 with the hope to address the substantial unmet need. IKT-14809 is a brain penetrant compound which works by blocking the activation of the able kinase, which may in turn halt and reverse the loss of dopamine-secreting neurons in the brain and GI tract. IKT-14809 has so far demonstrated a low toxicity profile in healthy subjects and in Parkinson patients, at least up to seven days of daily dosing. However, this does not mean that long-term safety of the drug is known. All of these features of IKT-14809, including the ability to of able-kindness inhibition to protect against the development and progression of Parkinson's-like disease in the brain have been confirmed in validated animal models, giving us a basis for pursuing able-kindness inhibition as potential disease-modifying therapy in patients. We made substantial progress with IKT 14809 in recent months. In June, we were pleased to announce that we advanced into a Phase IIa study dubbed the 201 trial. following a review of the study protocol and the phase one WNB data or 101 trial data by the US Food and Drug Administration. As you know, the 101 trial was a single and multiple ascending dose safety, tolerability, and pharmacokinetics trial designed to evaluate once daily administration of IKT14809. The study evaluated single doses up to 325 milligrams per day and multiple doses up to 100 milligrams, first in 88 older and elderly healthy adults, and subsequently in 13 patients with mild to moderately advanced Parkinson's disease. As we announced in June of this year, and as we will share in greater detail at the Movement Disorders Society Congress in September, we were pleased to observe that clinical pharmacology of 1409 in patients closely paralleled the clinical pharmacology of 1409 in older healthy volunteers. And also that 1409 demonstrated a favorable safety and tolerability profile up to a dose of 325 milligrams with no clinically significant adverse events observed. We share these results with the FDA who reviewed safety, tolerability, and PK data from the first two cohorts of the 101 trial, as well as the proposed trial protocol for 201, and the FDA agreed that we can proceed with the 201 trial. The 201 trial was initiated at the end of May 2022, just 16 months after IKT14809 entered the clinic. This study will allow us to further evaluate the long-term safety and potential benefit of IKT14809 in patients with Parkinson's disease. The 201 trial is a three-to-one randomized, double-blind, 12-week dosing trial That will evaluate the safety, tolerability, and steady-state PK of IKT1409 as primary endpoints. The trial will enroll approximately 120 patients with untreated Parkinson's disease who have not yet progressed to the need for symptomatic treatment. Patients will be treated at one of three randomized doses at 50, 100, or 200 milligrams, given once daily. The trial will also evaluate a hierarchy of Parkinson's-related disease assessments in the brain and gut as secondary or exploratory endpoints. Turning now to our preclinical efforts, let me begin with IKT-001-PRO, our prodrug formulation of imatinib mesylate, which we have designed as a potentially safer alternative to the first FDA-approved Abelson kinase inhibitor known as imatinib. IKT-001-PRO is the first program to emerge from our novel project platform, which aims to improve the safety and tolerability of approved and novel therapeutics. As you know, imatinib is commonly taken for hematological and gastrointestinal cancers, that arise from able kinase mutations found in the bone marrow, or for gastrointestinal cancers that occur from CKIT mutations in the stomach. IKT-001 Pro has the potential to be a safer alternative for patients and may improve the number of patients that reach and sustain complete cytogenic responses in stable-phase chronic myelogenous leukemia, or CML. In preclinical studies, IKT-001 Pro has shown to be as much as three times safer than imatinib in non-human primates, reducing burdensome gastrointestinal side effects that occur following oral administration. Imatinib delivered as IKT-01 Pro was granted an orphan drug designation for stable-faced female in September of 2018. Our bioequivalence clinical trial is designed to evaluate the safety profile of IKT-01 Pro as well as identify a dose with similar systemic exposure and PK, which is 400 milligrams of imatinib, at 96 hours post-dose administration. Once the equivalent dose is determined, we plan to initiate a superiority study comparing the selected dose of IKT-01 Pro to generic Levec in existing stable-phase female patients. Finally, we are continuing to advance IKT-1409 as a potential treatment of multiple system atrophy. MSA is a rare, rapidly progressive, neurodegenerative movement disorder that affects both the central and autonomic nervous systems. Similar to Parkinson's disease, MSA is characterized by pathological alpha-synuclein aggregation, which may lead to cell dysfunction and degeneration of neurons. MSA affects approximately 20,000 people in the U.S., and there are currently no approved treatments to slow or halt progression of this disease. We have taken a multi-pronged approach to determining whether IKT1409 could be a beneficial treatment for MSA. Like our work in Parkinson's, we have gated our clinical efforts with having a successful outcome in animal model studies of human MSA that are ongoing. Simultaneously, we continue to prepare and file regulatory documents with the U.S. FDA and equivalent authorities in the EU 27 countries. However, current economic times necessitate that we preserve capital, and therefore initiation of the MSA trial itself will also require us to raise additional working capital to execute the Plan Phase 2 trial in MSA.

Now let me turn the call over to Joe Fraterola to review our financials. Joe?

Thank you, Milton. Let me review our financials for the three and six months ended June 30, 2022. For the second quarter of 2022, we reported a net loss of approximately $4.6 million or 18 cents per share compared to a net loss of approximately $2.6 million or 22 cents per share for the second quarter of 2021. Net loss for the six months ended June 30, 2022 was $9.3 million or 37 cents per share compared to a net loss of $5.3 million or 47 cents a share and the six months ended June 30, 2021. Research and development expenses were approximately $3 million for the second quarter of 2022 compared to approximately $2.4 million for the second quarter of 2021. Research and development expenses were $6 million for the six months ended June 30, 2022 compared to $4.8 million and the six months ended June 30, 2021. Selling general administrative expenses for approximately $1.7 million for the second quarter of 2022. Bids for approximately $1.6 million for the same period in 2021. Selling general and administrative expenses for the six months ended June 30, 2022 were $3.3 million compared to $3.2 million for the six-month period June 30, 2021. As of June 30, 2022, Inhibicase had approximately $32.2 million in cash and cash equivalents. then we expect that our existing cash and cash equivalents will be sufficient to fund our normal operations and capital expenditure requirements through December 31st, 2023. That concludes our financial statements, and I'd like to hand the call back over to Milton for closing remarks.

Thank you, Joe. As I mentioned earlier, we are very encouraged by our progress year-to-date and look forward to continued momentum across our clinical and preclinical programs in 2022 as we work to improve the lives of patients suffering from neurodegenerative diseases. We are laser-focused on clinical execution as we begin to screen patients for our 201 study and prepare to initiate our bioequivalent study of the IKT-01 Pro and Healthy Volunteers. We also look forward to updating you again soon, beginning with the presentation of results of our Phase I-1B trial of IKT-1409 at the Movement Disorders Society Congress in Madrid, Spain, in mid-September. Thank you all for your continued support as we seek to provide value and improve patient outcomes.

I would now like to open the call to questions.

Thank you. We will now begin the question and answer session.

To ask a question, you may press the start and 1 on your touchtone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press the start and 2. At this time, we will pause momentarily to assemble our rocker.

The first question comes from Sunit Roy with Jones Research. Please go ahead.

Hi, this is Dania for Sunit Roy. Congrats on the progress. I have a few questions. To start with, is there any color that you can add in the September data for the phase one study? Remind us on the dose levels and how many patients were treated? Okay.

As we previously indicated, we had planned to do three cohorts of eight patients each at three doses, 50, 100, and 200 milligrams. When we reached six of eight patients in the 100 milligram dose, we had heard back from the U.S. FDA agreeing with our plan to proceed with the Phase II dosing period. So we elected to terminate the trial early and advance into the phase two because the 200 milligram dose that was to be explored in the phase 1B is also being explored in the phase two trial, and we saved approximately $600,000 in doing so. We previously stated that our observations on the Parkinson-related parameters were not expected to teach us anything about the disease or anything about the potential clinical effectiveness of 14809. The only thing we wanted to know was whether the pharmacokinetics of the drug in Parkinson patients was the same as or similar to what it was in healthy volunteers, and that we have repeatedly made public. We will review at the MDS Congress in mid-September the measurement of Parkinson-related parameters, where we'll demonstrate that there's no worsening of the disease in the presence of drugs administered once daily for just seven days. Beyond that, there was nothing more to be learned or expected to be learned in that trial because of the short dosing duration and small subject size.

So we don't draw any conclusions, and there aren't any to be drawn.

Great. Thank you. And as for the phase two that you just initiated, can you guide us into about when you will expect patients to... but getting the different doses?

Well, these are patients that are not currently on medication, so they have a little bit less urgency in their involvement in clinical trial work compared to patients that are already on levodopa therapy. And so what we found is that as we're bringing up sites, and we have 11 sites open now, patients are scheduling their screening visits for August and September. And so while we were disappointed that that's what they're doing, we also don't have any control over it, sadly. We were, you know, that's just sort of how it is. Patients who are, you know, this summer has been an unusually heavy travel season for everyone. People have taken long vacations and have traveled to Europe and beyond, and that appears to have affected sort of the rapid roll-up. We anticipate having an upcoming press release more about that study in the near future, but I can't say more about it than that.

Got it. So you don't have any guidance with that or I guess when we should expect any next data update?

Well, the trial is fully blinded across three dosing cohort and placebo. So there will not be interim readouts along the path unless some miracle happens. And the data review committee says it becomes unethical not to proceed into a properly powered study. We don't, we, Our view is that three-month dosing may begin to show clinical benefits based on the animal model studies we've previously reported about repeatedly, but we don't know that. It may not be quite a long enough dosing duration, and that we don't consider to be a negative. But at our current state of knowledge, it won't surprise us if we begin to see clinical benefit at three months. The most important thing, of course, is that we have to demonstrate long-term safety of an oral kinase inhibitor in around 100 patients because that's the metric the FDA uses to allow you to go into chronic dosing. We'll be also sharing our chronic dosing toxicology data with the FDA in the near future. That's part of our 10-Q filing. And so that combination, as we can begin to see what the patient experience is on multi-month dosing, will allow us to then proceed.

We don't expect to report results out until the later part of 2023, as we previously said.

Okay. Thank you very much. Congrats again. This concludes our question and answer session.

I would like to turn the conference back over to Dr. Milton Werner, CEO, for any closing remarks.

I just want to thank everyone for sticking with the company through these very difficult times. Obviously, the entire market has been severely suppressed, our stock included, and it has been a painful period for everyone. The positive thing about inhibit case in our view is that we have had very few negative or missing milestone events. We have not seen any reason not to discourage either of our primary assets to proceed in the clinic. We've made very rapid progress on understanding the pharmacology of these drugs in human beings, and we are encouraged by upcoming events that we anticipate in the near future that could further illuminate the potential clinical benefits of both IKT-1409 in multiple areas and O1-PRO in stable-face CML. And we thank all of our shareholders and the public for their continued support.

This conference has now concluded. Thank you for attending today's presentation. You may now disconnect.