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spk00: Greetings and welcome to the PolyPEAT first quarter 2022 conference call. At this time, participants are in listen-only mode. As a reminder, this call is recorded, and I would now like to introduce your host for today's conference, Bob Jedid from LifeSci Advisors. Mr. Jedid, you may begin.
spk03: Thank you all for participating in PolyPEAT's first quarter 2022 conference call. Joining me on the call today will be Amir Weisberg, Chief Executive Officer, Tikla Chachkas-Oxobrod, Executive Vice President and Chief Financial Officer of PolyPede, and Ford Wachowski, the Chief Operating Officer for PolyPede's U.S. operation. Earlier today, the company released financial results for the three months ended March 31, 2022. A copy of the press release is available in the Investors section of the company's website, www.polypede.com. I'd like to remind you that on this call, management will make forward-looking statements within the meeting of the federal securities laws. For example, management is making forward-looking statements when it discusses the conditions for the drawdown of the second and third tranches of the Creo's capital loan, how the loan agreement broadens the company's financing options and provides it with access on a non-dilutive basis to significant additional capital, the company's pipeline, the expected benefits from recent executive appointments, the expected timing and recruitment for trials, the interim data analysis, the expected timing, the release of its results, and the potential implications. In addition, forward-looking statements include future commercialization of the company's products, potential use and benefits of DPLEX-100 and OncoPlex, market opportunity for Dplex 100, the U.S. addressable market for Dplex 100, its ongoing pre-commercialization preparations and pre-launch activities, the company's potential partners, additional publications and presentations at important scientific conferences, and sufficiency of the company's cash to fund future operations into the second quarter of 2023. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks described from time to time in our SEC filings. Our results may differ materially from those projections. These statements involve material risks and uncertainties that could cause actual results or events to materially differ. Accordingly, you should not place undue reliance on these statements. I encourage you to review the company's filings with the SEC including without limitation the company's form 20F, which identifies specific factors which may cause actual results or events to differ materially from those described in the forward-looking statements. PolyP describes, disclaims any intention or obligation that is required by law to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information. It speaks only as of the live broadcast today, May 11th, 2022. A copy of the slides the management team will review on this call can be found on the investor section of the company's website at investors.pallyp.com. With completion of those prepared remarks, it's my pleasure to turn the call over to Amir Weisberg, CEO. Amir.
spk04: Thank you, Bob. On behalf of our team at PolyPID, I would like to welcome everyone to our first quarter 2022 earnings call. As this will be my final earnings conference call as a CEO, I would like to take this opportunity to thank the board and our shareholder for their support and confidence in allowing me to serve as a CEO of PolyPID for over 11 years. I am also grateful to all of my colleagues at PolyPID for their hard work and commitment during this development stage, which allow us to accomplish much over the years. PolyPID is now a position of strength clinically, operationally, and financially. As we advance with our phase three trial, and there are Near potential commercialization, it is current time for Dikla to lead the company into its next phase of growth. Therefore, once again, I would like to congratulate Dikla on her well-deserved appointment as a CEO, which will become effective July 1st. Since joining Polypid seven years ago, Dikla has been key guiding the company towards our objectives. As a shareholder, along with our other shareholders on this call, I look forward to the DMC recommendation on our SHIELD-1 trial once the interim data on 750 patients is fully analyzed and to the continued development of our promising pipeline product candidate OncoPlex for the treatment of solid tumors. With that, I will now turn the call over to Dikla to provide a detailed update, including a discussion of upcoming key milestones and review of our financial results. Following this, she will open the call for your question. Dikla?
spk02: Thank you, Amir, and thank you all for joining us on the call. On behalf of the entire PolyPEAT team, thank you, Amir, for your steadfast leadership over the past 11 years. Your guidance has been invaluable to me as we have prepared for the upcoming CEO transition together over the last several months. Next slide, please. With that, I will begin by providing a brief update on the status of our pipeline. First, we remain extremely pleased with the rate of enrollment in Shield 1. our Phase III study evaluating DIPLEX-100 for the prevention of abdominal soft tissue surgical site infection, or SSI. We now have approximately 900 patients enrolled into the study across about 60 centers in the United States, Europe, and Israel. Importantly, you will recall from our first quarter announcement that the FDA agreed to Polyfit's request for the addition of an unblinded interim analysis in SHIELD1. Our request was based on the FDA's recently published guidance for pharmaceutical companies to address the impact of COVID-19 on meeting enrollment and study objectives for clinical trials conducted during the ongoing pandemic. The interim analysis is expected to occur very shortly once 750 patients complete their 30 days follow-up and the statistical analysis is concluded, which will allow for early trial stopping due to efficacy, fertility, or for sample size reassessment. An early stop to the trial can occur if the efficacy results on the SSI rate exceed expectations. As we said on our last call, this interim analysis is an exceptional opportunity for PolyPID to more precisely define the targeted patient enrollment range for the SHIELD-1 study and the timeline for our NDA submission. As a reminder, the 750th patient was enrolled into SHIELD-1 in early March 2022. Next slide, please. Before I move on from the development program for DPLEX-100, I would like to remind you that one of the key priorities for 2022 that we discussed on our last call was a focus on building the significant value of evidence in support of the safety and efficacy of this promising product candidate throughout peer-reviewed publication and data presentation at important medical meetings. To this end, we recently presented positive clinical data on DPLEX-100 from our Phase II clinical trial at both SAGE's 2022 conference and the Surgical Infection Society 2022 Annual Meeting. Before we continue to discuss polypids financial and our activities to strengthen our commercial readiness and enhance our clinical development function, Ori will give some color on market opportunities for DPLEX-100, our ongoing pre-commercialization preparation, and potential partnership in the U.S.
spk01: Ori? Thank you, Dikla. Next slide, please. In the U.S., we believe the total addressable market for DPLEX-100 is just over 12 million surgeries per year based on IQVIA data, the leading industry source on procedure and prescription data. There are approximately 4.4 million abdominal soft tissue surgeries annually, both open and minimally invasive procedures, principally comprised of hernia repair, appendectomy, and colorectal surgeries. We also believe that there is an opportunity for the use of DPLEX-100 in an additional 2.1 million abdominal procedures, principally in gynecology and urology, including hysterectomies and other related procedures. Other DPLEX-100 relevant surgeries, which either have high SSI rate or our high-risk surgeries include strenotomies, joint replacements, and vascular surgeries. As part of our pre-launch activities, we examined pricing, and the range of $200 to $600 per vial was tested in market research in line with other local therapies used in the surgery suite, such as Exparel and Zinrolef. Moreover, we are doing additional diligence to analyze pricing requirements for DPLEX-100 to qualify for additional reimbursement when used in inpatient and outpatient settings, which would facilitate more rapid uptake of our drug by healthcare facilities. From an execution standpoint, we are advancing our go-to market plan, which includes the patient and surgeon journey, defining our differentiation levers value drivers, and a tactical plan for launch. We are also making significant efforts in the medical affairs area, including onboarding a number of key opinion leaders, as well as planning for additional publications and presentations at important scientific conferences. Finally, on the business development front, we continue our discussions with potential partners for the U.S. as well as ex-US with companies with established presence in the hospitals, a number of them with established surgeon and surgery-focused sales team. And with that, I will hand the call over back to Dikla. Dikla?
spk02: Thank you, Ori. Next slide, please. We continue to strengthen our management team with the recent appointment of Yevgeny Valdman as the company's new EVP of operations. and the promotion of Dalit Hazan to EVP research and development in clinical and regulatory affairs. We believe Evgeny will meaningfully enhance our technical operations, and Dalit will have an expanded positive impact on our clinical development initiatives. Evgeny will lead technical operations for PolyPID, including manufacturing, engineering, supply chain, logistics, and quality affairs. Her expertise spans FDA approval, prerequisite operational optimization, supply chain management, and sterile pharmaceutical manufacturing. Dalit has served as PolyPID Senior Vice President, Research and Development, and Regulatory Affair since June 2021, and has been with the company since 2016 in roles of increasing responsibility. Her new role as Executive Vice President heading R&D and Clinical and Regulatory Affairs is a recognition of her important contribution to policy. Next slide, please. From the perspective of our balance sheet, we have made excellent progress over the last quarter. We were pleased to recently obtain an up to 15 million non-dilutive secure term loans this year. This agreement broadens our financing options and provide us with access on a non-dilutive basis to significant additional capital, which strengthens our ability to invest in our commercial capabilities for DPLEX 100, as well as fund future advancement of our unique Plex technology platform. The loan facility is comprised of three trenches in the amount of $10 million, $2.5 million, and $2.5 million respectively. The first tranche of $10 million was drawn in April 2022. The second tranche of $2.5 million will be available subject to obtaining positive results from the planned unblinded interim analysis of Shield 1. Drawdown of the third and final tranche of $2.5 million will be available subject to obtaining positive top line results from the SHIELD-1 trial or if other conditions are met. Drawdowns of the second and third tranches can potentially be made by the end of this year. Also, as it relates to our balance sheets, during the first quarter of 2022, we sold approximately $4 million worth of ordinary shares from our existing at-the-market facility, or ATMs. This action, combined with the loan agreement with Creos Capital, extended our cash runway into the second quarter of 2023. As of March 31st, 2022, the company had cash, cash equivalents, and short-term deposits of $23.6 million, excluding the first tranche of $10 million of Creos loan, which was drawn in April 2022. Next slide, please. Now let's turn to our income statement. Research and development expenses for the three months ended March 31, 2022, were $8.7 million, compared to $6 million in the same three-month period of 2021. The increase in R&D expenses resulted primarily from the increased cost and activities related to the expedited recruitment in the ongoing SHIELD I Phase III clinical trial in soft tissue abdominal surgery. Marketing and business development expenses for the first quarter of 2022 were approximately... Just one moment, please.
spk01: Thank you. Everyone, it looks like we have a technical problem, so give us just one or two more minutes to fix it.
spk02: slightly higher than the
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