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spk01: Greetings and welcome to X4 Pharmaceuticals' third quarter financial and operating results conference call. At this time, all participants are in a listen-only mode. The question and answer session will follow the formal presentation. As a reminder, this conference call is being recorded. It is now my pleasure to introduce your host, Candice Ellis, Director of Corporate Communications and Investor Relations at X4. You may begin.
spk07: Thank you, Operator, and good morning, everyone. Thanks so much for joining us today. Presenting on today's call will be our Chief Executive Officer, Dr. Paula Reagan, and our Chief Financial Officer, Adam Mostafa. Following prepared remarks by each, we will open the call to your questions, and they will be joined by our Senior Vice President of Technical Operations and Quality, Dr. Mary DiBiase. As a reminder, on today's call, we'll be making forward-looking statements regarding our regulatory and product development plans, as well as our research activities. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. Descriptions of these risks can be found in our most recent Form 10-K, on file with the SEC, and our forthcoming Form 10-Q. I'd now like to turn the call over to our CEO, Paula Reagan.
spk09: Thanks, Candice, and thank you, everyone, for joining us on the call this morning. We hope you are all continuing to stay safe and healthy. We are pleased to report today that while the operating environment remains challenging due to the ongoing COVID-19 pandemic, we continue to advance our Mavericks IV clinical development programs. Let me begin with a review of our most recent accomplishments. We are pleased to announce the publication of our positive Phase II safety and efficacy data for Mavericks IV and WIM syndrome in the prestigious journal Blood, which we believe further recognizes the significant potential of our lead candidate in this patient population. As a reminder, WIMP syndrome is a rare inherited primary immunodeficiency disease caused by mutations in the chemokine receptor CXCR4, a receptor that plays a key role in enabling the healthy trafficking of immune cells and effective immunosurveillance. MAVIRISTA4 is our first-in-class small molecule antagonist of the chemokine receptor CXCR4, and it's being developed as a once-daily oral therapy. While the comprehensive data published in blood expands on previously presented data, there were new results presented, including patient-level data regarding the specific effects on neutrophils, lymphocytes, and monocytes, as well as the effect of increasing doses of maverixifor on total white blood cell counts. In addition, the manuscript provided the most up-to-date long-term safety and pharmacokinetic data and presented a detailed analysis of the clinical benefit of the extended Maverick Sephora therapy on infection rates and warp burden. This important publication in the official journal of the American Society of Kematology provides key third-party validation of the data supporting our clinical strategy, including the selection of the dose, primary biomarker endpoints, and secondary clinical endpoints for our ongoing pivotal Phase III clinical trial. The published results continue to reinforce our belief that by down-regulating the CXCR4-CXCL12 signaling pathway, Mavrixivor has the potential to be the first disease-modifying therapy for the more than 3,500 estimated diagnosed and undiagnosed WIM patients in the U.S. We are also thrilled to be granted FAST-TRACK designation by the FDA for Maverick Spore and WHIM syndrome. Through the FAST-TRACK program, X4 is eligible for more frequent meetings with the FDA to discuss the drug development plan, protocols, and clinical data that would support Maverick Spore's potential approval for WHIM. This key regulatory achievement further recognizes the significant unmet need of WHIM syndrome and Maverick Spore's potential to treat this challenging disease. As a reminder, Maverick Sephora was previously granted breakthrough therapy designation by the FDA, as well as orphan drug status by the FDA and the European Commission for the Treatment of Wim Syndrome. Let me now provide an update on our ongoing clinical development programs for Maverick Sephora. Importantly, despite continued uncertainties surrounding COVID-19, we remain focused on advancing our clinical development programs. We continue to enroll patients in our Phase III WHIM syndrome trial and make good progress across the various regulatory and clinical aspects of the trial. We are diversified across numerous sites and countries around the world, each of which has its own regional and site-level COVID-19 considerations. We are working with the sites to maintain enrollment momentum in the trial and including additional services, such as in-home patient visits, to mitigate the impact of COVID-19. We continue to anticipate top-line Phase III data in WHIM syndrome in 2022 and intend to provide further clarity on the timeline as soon as we are able to do so. Our Phase I D-trial in severe congenital neutropenia also continues to make progress, and we anticipate initial data from this 14-day proof-of-concept study in 2021. Similar to the Phase III WIM syndrome trial, we intend to provide further clarity around our SBN trial timeline as soon as we are able to do so. In Waldenstrom's macroglobulinemia, or WM, a rare form of lymphoma, we are continuing to enroll patients, although COVID-19-related delays have had some impact, as we recently disclosed. We expect the availability of the initial Phase Ib clinical results in the first half of next year, a slight delay from our previous guidance of the second half of this year. In order to mitigate COVID-19-related patient travel concerns in the study, we are focused on implementing home health visits. We are in regular dialogue with our investigators and through our patient advocacy team with patients to understand their needs given the extended challenges of the COVID pandemic. We are confident that we have an effective plan in place to appropriately address the impact of COVID-19 on our WM study. As a reminder, this Phase Ib clinical trial is expected to enroll between 12 and 18 patients with WM and is a multicenter, open-label, dose-escalation clinical trial assessing the safety and tolerability of Maverick's spore in combination with ibrutinib. The trial is being conducted as part of a collaboration with the Leukemia and Lymphoma Society to accelerate the development of Maverick's spore for the treatment of Waldenstrom's. The results of this study will share safety and dose escalation data and important efficacy signals, and we expect that these data will inform future FDA discussions regarding the potential registration trial in WM. Lastly, I would like to welcome two new additions to the X4 leadership team. Dr. Art Tavares started earlier this week as our new chief scientific officer. Art is an experienced CSO who is joining us from Co-Met Therapeutics, a privately held company focused on coenzyme A science and intermediate metabolism, where he also served as CSO. Prior to his role at Co-Met, he founded and was chief scientific officer of Transform Therapeutics, where he led the discovery of a novel next generation CXCR2 antagonist for the treatment of cancer. In addition, Art held key leadership roles in drug discovery at Biogen and at Shearing Plow earlier in his career. With his significant expertise in chemokine-related chemistries, decades of drug discovery experience, and inspiring leadership, Art is an ideal fit to lead our R&D initiatives and further foster our evolution towards becoming a global rare disease company. In addition, we recently expanded our board of directors with the appointment of Allison Lawton, an industry veteran who strengthens our board's expertise across many strategic fronts. Ms. Lawton most recently served as CEO of Kaleido Biosciences and having previously served as a consulting chief operating officer to the company and as a member of X4's corporate advisory board. Allison brings a unique understanding of X4's core scientific and corporate goals. I look forward to working closely with her again. With that, I'll now turn the call over to Adam to discuss our financial results for the quarter. Adam?
spk10: Thank you, Paula, and thanks to all of you on the call today. As presented in our press release this morning, I will summarize our financial activities and results for the third quarter of 2020. As of September 30, 2020, X4 had $90.7 million in cash, cash equivalents, and restricted cash. We continue to expect that our cash and cash equivalents will fund our operations into early 2022. Note this guidance does not include the $25 million in potential and contingent proceeds from our Hercules debt facility or any cash exercise proceeds from investors holding our outstanding warrants. Research and development expenses were $11.4 million for the third quarter of 2020, as compared to $8.6 million for the comparable period in 2019. R&D expenses included $1 million of certain non-cash expenses for the quarter ended September 30, 2020. General and administrative expenses were $5.6 million for the third quarter of 2020, as compared to $4.4 million for the comparable period in 2019. G&A expenses included $1.4 million of certain non-cash expenses for the quarter ended September 30, 2020. Finally, our net loss was $17.4 million for the third quarter of 2020, as compared to a net loss of $17.7 million for the comparable period in 2019. Net loss included $2.5 million of certain non-cash expenses for the quarter ended September 30, 2020. With that, let's open up the call for questions. Operator?
spk01: Thank you. As a reminder, to ask a question, you will need to press star 1 on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Our first question comes from Stephen Lilly with Stiefel. Your line is now open.
spk06: Hi, all. This is Ellen. I'm for Steve. Just two quick questions for me. So first you mentioned that you're focused on implementing home health visits for patients enrolled in the Wallenstrom's trial in order to mitigate some of those effects from COVID-19. Is that same strategy being applied to the WIM and SCN trials as well? And if so, how is that going? Thanks.
spk09: Sure. Thanks, Ellen, for the question. So, yes, the home health is being implemented for our studies where it makes sense for the chronic dosing, which is both WIM and Waldstrom. Obviously, these patients are coming in over many months. For SCN, it makes less sense given the actual period of the study is only two weeks of treatment. So the home health is focused solely on WIM and Waldenstroms.
spk06: Okay. That makes sense. And then can you provide any updates regarding X4P003 or X4P002? Are either of these assets in IND enabling studies at this point? And then also, can you just remind us how those two assets are differentiated from each other? I know 002 is engineered to cross the blood-brain barrier. But I was just wondering if you could give a little more color on 003.
spk09: Thank you. Great. No, thank you. We're happy to talk about our peak clinical programs that are going really well. So 003 is the most advanced of the two. It is approaching IND-enabling studies, and then typically after that it's about a year to get into the clinics. So we're extremely excited with the profile that we've been seeing come together with this particular molecule. The differentiation between OO3 and Mavericks IV is that it does engineer out some of the minor but meaningful profiles of Mavericks IV. So, for example, OO3 does not have a food effect likely. Of course, we have to kind of prove that out, but so far everything's looking very good. And we've also engineered out some of the drug-drug interaction profiles, again, although minor profiles. it certainly makes an important step forward for patients and clinicians to not have to worry about that. So that's moving forward very nicely. 002 is behind 003 in late lead optimization. And, again, it's making good progress in terms of finding that right profile between brain exposure and plasma exposure, and we're really excited to continue to advance that to support further development for some of those serious brain cancers that we hope to address.
spk01: Okay, great. Thank you. Thank you. Thank you. Our next question comes from Arlinda Lee with Canaccord. Your line is now open.
spk04: Hi, guys. I was hoping that you could provide an update on the enrollment for the WIMS syndrome. And then I also was curious on the preclinical programs. Might we be expecting any data presentations on those anytime in the near future? Thank you.
spk09: Great. So, just with respect to enrollment on WHIM, as consistent with the past, we're not providing any specifics other than to say that we're on track with our top line data in 2022. And we are seeing patients to continue to enroll in the trial, even despite the global pandemic. So, we're really happy to see the patient's commitment and the site's commitment to continue to advance the trial. With respect to the preclinical program data, that's a great question, and it kind of segues very nicely to X4's recent announcement this week of hiring our chief scientific officer, Art Tavares. We're very pleased to have someone with his tremendous experience in drug development and drug discovery. So I think, you know, while we don't have any specifics on rolling data out around our preclinical program, stay tuned because I think we'll have some updates coming into next year.
spk04: Great. Thank you.
spk01: Thank you. Our next question comes from Joel Beattie with Citi. Your line is now open.
spk02: Hi, guys. This is Sean on for Joel. Thank you for taking my questions. Two for me today. First on Waldenstroms and for your data in first half next year, maybe just talk about how you plan to roll out that data and then kind of getting into the weeds on maybe what the results could be. Aside from seeing any complete responses, are there any biomarkers that would give you confidence that any efficacy signals we see are due to your drug and not the combo. And then a follow-up on WIMS. And maybe could you talk about patient identification, where you're kind of at right there, and how many patients are on your EAP program right now? Sure.
spk09: So thanks, Sean. Nice to hear from you. So I'll try to kind of walk through your questions. So in terms of the Waldenstrom data, the format of EAP, Presenting the data, it's an open-label trial. We're making nice advances, and our goal is to present a robust data set that people can interpret and certainly want to do that in conjunction with our support of the key opinion leaders that are working with on our trial. So we're not yet sure of the format, but at the end of the day, all of us will be aligned to make sure we can communicate and put the data in context of the overall treatment landscape. So stay tuned for more specifics as they unfold. With respect to the results, though, it is important to help the world appreciate. So with ibrutinib alone, there's actually a very well-defined profile of responses in the first three to six months on single-agent treatment in these patients with the CXCR4 mutation. In fact, only about a third of them get something called a major response, which means IGN drop greater than 50% of their baseline. So it's a pretty – Unfortunately, sad bar for these patients. Not many of them are getting those profound and deep IgM responses. So we'll be showing data from patients on the first three to six months of dosing and certainly hope to beat that number of 30% with the data that we present the first half of next year. But stay tuned on the results as they unfold. And then finally, I think you mentioned WIM patient ID. So we are continuing to So with respect to the trial, again, I think we feel very confident that patients are there and waiting. There's obviously been some issues with having sites being open and able to enroll due to COVID, but with respect to the trial, we're incredibly confident. With respect to just the overall market, obviously this is a long-term commitment for the company. Between our education and awareness through our medical science liaison teams, both in the U.S. and starting in Europe, Actually, I feel like we've been making great progress in getting the broader community to engage. We've had some virtual booths at various conferences where patients have come to visit us. So we feel like the word is getting out, and we're beginning to, you know, get a nice groundswell of people thinking more broadly about women and their own patient populations in their clinics and also reaching the patient community directly. And we continue to make progress. We're excited about the long-term trajectory of the company in support of the, you know, hopeful commercial approval of Maverick's for these patients.
spk02: Great. Thank you so much, Paul.
spk01: Thank you. Our next question comes from my mom telling me with the Uribe Securities. Your line is now open.
spk11: Hi. Good morning, team. This is Saul Hillon from IONCA. Congrats on all the progress. Just a few questions from us this morning. First off, as it relates to the Waldenstrom's program and now expecting the data first half of next year, is this more sort of enrollment related more than anything else in terms of, you know, monitoring responses? And should we still expect data on that, you know, 12 to 18 patient range?
spk09: Yeah. So if I understood your question in the beginning as a little bit of what's the shift, or did I get that right?
spk11: No, that's exactly right. Mm-hmm.
spk09: Yeah, so there's definitely just enrollment issues due to, again, the site is primarily U.S., the two ex-U.S. sites. As you can appreciate with COVID, there are ebbing and flowing travel restrictions for patients, depending on where they're located, and also on their own comfort level, which is why the in-home health has been, you know, a good direction to alleviate that and why we feel confident about that and now enabling enrolling to be a little bit more consistent. In terms of the data, again, we just have to wait and see. It's an open-label trial. It's 12 to 18 patients. Partly it will be dependent upon dose and safety. And then as we see efficacy signals around the IgM level drops, we'll look forward to sharing that in the first half of next year.
spk11: Great. That's helpful. And maybe just a brief follow-up as it relates to the SDN program. Can you just remind us, is this still a single site in Washington, I believe, on clinicaltrials.gov, and then, you know, given the immunocompromised nature of the patients, how do you plan to sort of manage enrollment concerns, you know, acknowledging that 14 days is that short treatment window and maybe at-home visits don't make as much sense here?
spk09: Yeah, no, so I think I've been pretty consistent since the start of COVID. The SBN trial has always been our trickiest because it is a translational research study, so From the patient lens perspective, it's something that they need to weigh risk benefits along with their clinicians on whether or not enrollment makes sense. The University of Washington is a site that's open. We do have other sites that are open as well. I think there's always a delay on clintiles.gov in terms of that update. But at the end of the day, this is probably our trickiest study to try to balance respect and appreciation for the potential risk for these patients due to or added risk due to COVID and along with the investigators' enthusiasm for exploring this mechanism in these patients with this type of need. So, again, stay tuned. It's a 2021 story, and we'll look forward to sort of sharpening that as we learn more.
spk11: Great. That's really helpful. Thanks for taking our questions, and congrats on the progress.
spk01: Thank you. Thank you. Our next question comes from Arthur He with HC Wainwright. Your line is now open.
spk03: Hey, good morning, everyone. This is Arthur for RK. So I just have a quick question or a follow-up on the WM study. So could you guys remind us the dose level across the patient, and what can we read through from the Wayne Syndrome study in terms of the optimal dose level?
spk09: Sure. Great question. So let's just start with the current day three dose in WIM, which is 400 milligrams once per day. And that drug is obviously treated as a single agent therapy for WIM. How we've crossed back into Waldenstrom's is we're starting at 200 milligrams per day. The rationale behind that is that we do need to consider the potential, even though it's low, drug-drug interactions between mavericks before and abrutinib to make sure that the exposure of those two drugs are not impacted in any direction by co-administering them. So, hence, we started at a 200 milligram once-per-day dose level. And We're confident that that's already a highly active level based even on what we saw in WIM at 200 milligrams per day in healthy volunteers. You see a very nice, robust bump in white blood cell mobilization, and also the trough levels from known TK are certainly in the highly active range. So we feel good about where we're starting at in terms of being able to see clinical activity. After that starting dose, you just want to keep pushing the dose until you get across that kind of maximum dose per patient. So the dose escalation levels are then 400 and 600 after each patient clears the 200 milligram dose. Does that answer your question?
spk03: Yes. Thank you very much for that.
spk01: Thanks, Arthur. Thank you. Our next question comes from Laura Christensen with Cowan. Your line is now open.
spk05: Hi. Good morning, guys. Thanks for taking my question. I'm Waldenstrom. I was wondering if you could just talk a little bit more about how you expect Mavarixifor might fit into the treatment paradigm if it's approved. Just what's the potential for Mavarixifor to be used for spine in combination with Ibrutinib and CXCR4-positive MyDVD8 patients? Sure.
spk09: So our current study is exploring patients that are either treatment-naive and up to three prior lines of treatments. So we will start to, at least in a small handful of patients, see what this drug potentially could do as a combination, I should say, as a frontline approach. So based on that data, I do think that we'll begin to kind of gather the evidence of where this drug makes the most sense in terms of line of treatment. Currently in the U.S. and primarily in Europe, ibrutinib is more typically used in the second line, although it is approved for other lines of treatment. So there's a little bit of what is the current market and clinicians, how are they utilizing rutinib versus what will our data deliver? Certainly the more robust data sets that's achieved with the combination will open clinicians' minds about how to use that combination. So I think there's opportunity, and then obviously the data will then drive how clinicians will consider using the treatment for their patients.
spk05: Perfect. And then just a quick one for Adam. I'm wondering how the – stock purchase agreement that you recently put in place, how that might impact your expected cash runway?
spk10: Yeah. Thanks, Laura. So right now, I think our primary objective is to continue to track towards key milestones like Wall and Strong's in the first half and think about opportunistic ways to extend the runway based on that progress. The stock purchase agreement I think is a helpful tool in our financial tool belt to potentially utilize as we progress the business, but I think represents a little bit more in the way of downside protection or insurance policy, if you will, given the external environment. So that's how I sort of stack it up in terms of our financial strategy.
spk05: Perfect.
spk01: That's helpful.
spk05: Thanks.
spk01: Thank you. As a reminder, to ask a question, you will need to press star 1 on your telephone. Our next question comes from Zegbe Javella with Roth Capital. Your line is now open.
spk08: Good morning, guys. Thanks for the update. I think I was just going to ask one again about the preclinical pipeline with Art on board, as you mentioned. I just kind of want to know, you know, how you expect to kind of leverage his broad expertise. Do you plan to broaden out the pipeline or pursue more? additional indications for some of your early-line preclinical programs.
spk09: Sure. Thanks so much. And, yes, you know, we feel incredibly fortunate to have Art join, given his strong drug discovery experience and biology overlap in the chemokine world. So I think when we think about not only Maverick before, but also our two preclinical programs, you know, first we really need to, you know, intend to operate and hit our near-term milestones. For example, I do think as the drug Mavericks 4 shows activity in Wallenstrom, there's a tremendous amount of support for CXCR4 more broadly in certain leukemias and lymphomas. I think between Art's experience in the biology and then complementing what we're learning in the clinic, that will really help us enable to prioritize how we can either develop Mavericks 4 and or possibly 003 to expand the total market that we could potentially develop you know, explore and hopefully benefit patients with our drug.
spk08: Thanks, Paula. And then just to follow up here, I'm not even sure you can answer this one, but I think on the last call we had, you noted that you were in capping, you know, patients that were pre-treated or non-pre-treated for the Waldron study, which is going to try to enroll and see what you get. But can you provide any comments on if you're enrolling more pre-treated patients or are you enrolling more naive patients?
spk09: I know we, you know, there's no profile yet that we're really able to disclose. We'll certainly do that when we share the data. I do like to point back to the literature with respect to the double mutant patients, regardless of what line of therapy they're sort of addressed with, they have this remaining unmet need. So I do think the consistency for the impact of having a CXCR4 mutation is important. I think that kind of creates a nice homogeneous patient population for us to study, and we'll look forward to sharing that data in the first half of next year.
spk08: Thank you.
spk01: Thank you. I am not showing any further questions at this time. I would now like to turn the call back over to Paula Reagan for closing remarks. Thank you so much.
spk09: Well, thank you again today for joining us. We sincerely appreciate your interest in X4. and look forward to continuing to provide updates on our progress as we approach multiple key catalysts in our business. If you have any further questions, please don't hesitate to reach out. Thank you again, and enjoy the rest of your day.
spk01: Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.
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