TFF Pharmaceuticals, Inc.

Good afternoon, ladies and gentlemen, and welcome to the TFF Pharmaceuticals fourth quarter and year-end 2021 financial results conference call. As a reminder, this conference is being recorded. I would now like to turn the call over to your host, Corey Davis of LifeSci Advisors. You may begin your conference at this time.

Thank you, operator. Hello, everyone, and welcome to the TFF Pharmaceuticals fourth quarter and year-end 21 financial and business results conference call. With me on the line today is Glenn Mattis, President and CEO of TFF, Kirk Coleman, Chief Financial Officer, Dr. Dale Christensen, TFF's Director of Clinical Development, Dr. Bill Williams of the University of Texas at Austin, and Chris Cano, TFF's Chief Operating Officer. The press release announcing our fourth quarter results is available on the TFF Pharmaceuticals website. Please take a moment to read the disclaimer about forward-looking statements in the press release. The earnings released in this teleconference both include forward-looking statements, and these forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from the statements made. Factors that could cause actual results to differ are described in the disclaimer and in our filings with the U.S. Securities and Exchange Commission, including the risk factors section of our 2021 annual report on Form 10-K filed with the SEC. And now it's my pleasure to turn the call over to Mr. Glenn Mattis.

Good afternoon and thank you for joining us today to review the company's fourth quarter operations and recent highlights. During this call, I will provide an update on our overall progress. There is a lot to share. After my discussion, I will ask our leader of clinical development, Dr. Dale Christensen, to update us on the progress we are making on our internal clinical programs. Following Dale's remarks, Kirk Coleman, our chief financial officer, will then review the company's financials for the quarter Following Kurt's comments, Dr. Bill Williams of the University of Texas at Austin will provide an update on the latest R&D applications using our thin-film freezing platform technology, which continue to expand as well as opportunities to continue to expand our intellectual property estate. Finally, Chris Cano, our Chief Operating Officer and Head of Business Development, will update our progress in that arena as our thin-film freezing technology continues to generate expanding interest on the part of industry pharma and biotech partners, some of the world's leading academic research institutions, and the government. Without question, 2021 can be best described as a year of significant corporate achievements. Our robust activity on the partnering front, coupled with the advancement of our internal clinical stage pipeline candidates, should provide our shareholders with confidence that we are building significant sustainable growth and value while fully executing our corporate strategy. Obviously, the recent weakness in the capital markets have created conditions that, in our view, do not accurately reflect the progress we have made. Over time, however, we know that building partnerships and generating positive clinical data are important achievements that create value for our shareholders. So despite the current environment, we are more optimistic than ever that our progress on all fronts will be recognized and rewarded. Let me start by briefly describing the progress we've made in our clinical stage pipeline. I'm happy to report that the investments we made in developing our internal pipeline assets have enabled us to advance both of our inhaled boriconazole and inhaled tacrolimus into larger, potentially pivotal Phase II trials that began at the start of the year. In a few minutes, Dale Christensen will describe in more detail these innovative clinical programs, but for now, I'll provide just a brief overview and explain the significant potential of each program. We're applying our thin-film freezing technology to develop an improved formulation of the antifungal voriconazole. Our inhaled voriconazole powder has a target product profile that will improve upon orally administered voriconazole by delivering the drug directly to the infected lung tissue in patients with invasive pulmonary aspergillosis. Our clinical trial is designed to demonstrate efficacy while improving the safety profile of the existing drug, specifically in patients who require more chronic use of Oraconazole, and patients with prophylaxis of infections is advised. In fact, we recently hosted a TFF Science Day last December, featuring a presentation by Dr. Carsten Schwarz, Director of the Cystic Fibrosis Center in Potsdam, Germany. The presentation, which is available on the TFF website under the Events and Presentations section, provides an important KOL-based perspective on the broad potential of TFF borate to support the current use of the oral formulation. As we think about developing internal pipeline candidates, Our main focus is not to just reformulate an existing or novel drug per se, but to rather develop a new formulation that has strong clinical potential to advance the current standard of care. Based upon the clinical data generated to date, the emerging profile of inhaled boriconazole powder has the opportunity to do just that, and we look forward to providing updates on the Phase II program as we move forward. We're equally excited about the potential to improve the current standard of care with our inhaled formulation of tacrolimus. DFS inhaled tacrolimus powder target product profile includes delivering immunosuppressive levels of tacrolimus directly into the lungs following transplantation while reducing the patient's overall systemic exposure. Presently, tacrolimus is administered intravenously to lung transplant patients immediately following surgery to prevent acute rejection of the transplanted lung. Unfortunately, higher doses of tacrolimus are often required to prevent acute rejection, and this can lead to considerable systemic toxicities. By delivering tacrolimus directly to the lung by using our thin-film freezing technology, we hope to achieve sufficient immunosuppression while avoiding these systemic toxicities associated with both the IV and oral delivery currently available. These toxicities are quite limiting and have an extreme negative effect on renal function. In our view, the successful development of inhaled tacrolimus powder offers the potential to significantly improve upon the current standard of care of patients receiving immunosuppression therapy following lung transplant. We are also confident that TFF's inhaled tacrolimus powder will demonstrate similar advantage in patients who have received heart, liver, and kidney transplants as well. The potential of the product can have a profound effect on a significant number of patients. Our internal commercial market forecasts conservatively project sales potential in excess of $1 billion, making TFS inhaled tacrolimus pluriter a blockbuster drug. Now that we are in phase two development for both TFF inhaled tacrolimus and voriconazole, it is important to note that the trials are designed with an interim data analysis. These interim data will be available in the latter part of the third quarter and will serve as a major inflection point for our company. As noted in our corporate presentations, it is our goal to partner these assets with a pharmaceutical company who has the ability to optimize these products in the commercial setting. That process has already begun, and Chris Cano will discuss the approach later on this call. Upon the successful closing of those transactions, we look forward to a meaningful monetization and creation of value for our shareholders. We also made considerable progress with our inhaled niclosamide program. Back in October, we announced Canadian approval for testing niclosamide in humans. And just last month, we announced highly positive data showing the ability of our inhaled niclosamide powder to significantly inhibit viral replications of the Omicron variant of the SARS-CoV-2 virus. These data showed the remarkable potency of this antiviral drug. When delivered directly to the lung at a low concentration, inhaled niclosamide powder produced very strong antiviral activity. Given this level of potency, we believe inhaled niclosamide powder could offer a potential with respect to safety and tolerability over oral delivery. The full Phase I study data set will be available next month. Those data will be shared with our partner, Union Therapeutics. Union Therapeutics will then have some time to exercise their option to further develop inhaled niclosamide powder. EFF believes strongly in the antiviral potential of niclosamide in COVID-19 and beyond. We're evaluating additional indications and potential for necrosomies that involve receiving non-dilutive funding to move forward where there is an opportunity. In addition, we are working with our partner, Augmenta Bioworks, on Augmenta 3387. Augmenta 3387 is a potent monoclonal antibody that we're developing to treat SARS-CoV-2. Thus far, in animal testing, we have demonstrated positive data On all the COVID variants, including the Delta variant, we have shown binding to Omicron, and we are assessing the neutralization profile of augmented 3387 on that variant as well. Dale will discuss further in his section. And finally, we continue to work with PLUS products on refining the thin-film freezing formulations of cannabinoids. Very happy to report that we are receiving very positive feedback from PLUS on their consumer testing. Our goal is to launch TFF versions of cannabinoids as a safe substitution for vaping. It is imperative that the TFF formulations meet the preferred product profiles by the users. The target product profiles focus on an easy-to-use inhaled product that delivers a desired experience. We believe that we have now reached that threshold. Plus Products is an excellent partner and has worked closely with TFF to refine our formulations, and test the products with consumers. Plus is in the process of restructuring their company, and we've been told that they are close to announcing a successful outcome. We look forward to partnering with Plus on bringing these products to the marketplace as soon as possible. We're also discussing the TFF cannabinoid opportunities with additional partners. TFF announced our latest collaboration with the global CDMO Catalyst on March 1st. We are very excited about this agreement, as Catalan significantly expands our access to manufacturing capabilities, which has been a major question asked by our potential farmer partners about producing product. This has been especially true in the biologic space, and Catalan clearly addresses this need. Catalan will also offer a thin-film freezing technology to a targeted list of their over 1,000 clients. Catalan has a significant amount of sales resources to enable that effort, and we expect that the TFF portfolio of collaborations will greatly increase as a result of this outreach. Now, I want to address the status of our business development activities. Chris Cannell will greater detail them in a few minutes. The work with potential licensing partners is proceeding very well. Our list of partners continues to grow, as well as the number of open projects We understand that the investor community wants to see TFF sign a number of meaningful licensing transactions. The TFF team very much shares this desire. The company is very confident that this will happen and we will realize the value contribution to the company. Each partnership is different and requires a great amount of work to complete the required experiments to fully demonstrate the value of the thin film freezing technology. Again, this is especially true in the biologic space. We have not been faced with any specific scientific challenge that cannot be addressed. Our partners remain highly engaged and we're working diligently to get to the finish line. We will continue to report progress and when given the go-ahead by the partner, share their names with you. Continuing to focus on our accomplishments, I'm pleased to note that we recently entered into a second cooperative research and development agreement with the United States Army Medical Research Institute of Infectious Diseases, also known as USAMRIT, which is part of the U.S. Army Medical Research and Development Command and the U.S. Army's premier institution and facility for defensive research into countermeasures against biological warfare. And the Geneva Foundation, a nonprofit foundation that supports and advances innovative medical research within the U.S. military. Through this collaboration, TFF Pharmaceuticals and USAMRIT will evaluate the immune response of a dry powder recombinant vascular stomatitis virus severe acute respiratory syndrome coronavirus 2-glycoprotein vaccine using TFF's thin-film freezing technology. The end goal is to develop a single, easily administered and temperature-stable set of countermeasures to protect our warfighters against multiple viral pathogens such as SARS-CoV-2, Ebola, Marburg, and others. This is the second CRADA announcement we've announced over the past two years, and we're very proud to build the government partnerships that are so important in developing effective countermeasures to potential bioterrorist threats and to the future of public health in general. These craters are an addition to the contract we have with Leidos and DARPA to formulate additional countermeasures administered in unique formulations, including the nose, eye, and skin. Also in the government area, I am very happy to announce that our efforts to expand and attract opportunities within the U.S. federal government and build on our ongoing collaborations with USAMRID, DARPA, and other agencies We have been engaging broadly with congressional members to elevate awareness of dry powder approaches with thin film freezing drying that allow for vaccines to be physiochemically stable. We saw this language included in the recently passed fiscal year 2022 government funding bill that was recently signed by President Biden. The language is non-binding, but will elevate the opportunity for securing funding by providing notice to the related agencies, such as HHS, that Congress is interested in monitoring progress on this issue. You will note that in the legislation that the language is specific to thin-film freezing. Moving on in respect to recent corporate developments, I'm pleased to announce the appointment of Brandi Roberts to our Board of Directors. Brandi has over two decades of financial management expertise within the life sciences sector. As we continue to grow and develop more strategic relationships with our existing and future partners, Brandy's expertise and experience will undoubtedly help us navigate larger and potentially more complex partnerships while also bringing us to manage through periods of significant company growth. I welcome Brandy to our board and look forward to working with her for many successful years to come. Today we are also announcing that Dr. Brian Windsor will be stepping down as chief scientific officer and board member to focus exclusively on his role as CEO of Lung Therapeutics. Brian has been with us since our company's founding and has made many significant contributions, both with respect to scientific achievements and as a board member. He was especially helpful as we prepared for and executed our IPO. I'd like to thank Brian for these contributions and wish him the best in his future endeavors. TFF is also proud to announce that Dr. Anthony Hickey will assume the role as Chief Scientific Officer for TFF. Dr. Hickey is a Professor Emeritus in Pharmacoengineering and Molecular Pharmaceutics at the Eshelman School of Pharmacy at the University of North Carolina at Chapel Hill. Dr. Hickey is also an Adjunct Professor of Biochemical Engineering at the University of North Carolina School of Medicine. Tony has also been a member of the TFS Scientific Advisory Board since its inception. Please join me in welcoming and congratulating Dr. Hickey. I also would like to announce the appointments of three senior executives who will bolster our leadership across key areas of our business. Dr. John Kohling has joined as Vice President of Product Development and Manufacturing. Dr. Greg Davenport as Vice President of Government and Strategic Initiatives. and Paul Manley as head of regulatory affairs. Each of these executives has significant experience in their respective fields. And as our partnerships and programs continue to expand, the depth of their scientific knowledge, medical expertise, and relationships will be tremendous assets to help further grow our business. I realize that I just delivered a significant amount of news and likely left out other elements of our progress. Thank you for your attention and patience. Let me now turn the call over to our head of clinical development, Dr. Dale Christensen, who will discuss our clinical programs in greater detail. Dale?