Altimmune Q1 2023 Earnings Call Transcript

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May 11, 2023

There are 6 speakers on the call.

Operator

Good day, ladies and gentlemen. Welcome to the Altimmune Inc. First Quarter 2023 Financial Results Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time.

Operator

As a reminder, this call is being recorded. I would now like to introduce your host for today's conference call, Rich Eisenstadt, Chief Financial Officer of Altimmune. Rich, you may begin.

Speaker 1

Thank you, Gigi, and good morning, everyone. Thank you for participating in Altimmune's Q1 2023 financial results and Business Update Conference Call. Members of the AltaMed team joining me on the call today are Vipin Garg, our Chief Executive Officer Scott Roberts, our Chief Scientific Officer and Scott Harris, our Chief Medical Officer. Following the prepared remarks, we will hold a question and answer session. A press release with our Q1 2023 financial results was issued this morning and can be found on the Investor Relations section of the company's website.

Speaker 1

Before we begin, I would like to remind everyone that remarks about future expectations, plans and prospects constitute forward looking statements for purpose Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Altimmune cautions that these Forward looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated. Factors and other cautionary statements contained in the company's filings with the SEC. I would also direct you to read the forward looking statement disclaimer in our press release issued This morning and now available on our website. Any statements made on this conference call speak only as of today's date, Thursday, May 11, 2023 and the company does not undertake any obligation to update any of these forward looking statements to reflect events or circumstances that occur on or after today's date.

Speaker 1

As a reminder, this conference call is being recorded and will be available for audio replay on Altimmune's website. With that, I will now turn the call over to Doctor. Griffin Garrett, Chief Executive Officer of Optimmune.

Speaker 2

Thank you, Rich, and good morning, everyone. We appreciate you joining us today for a discussion of our Q1 2023 financial results We continue to advance our lead product candidate, pemidutide, a GLP-one glucagon dual receptor agonist in development for both obesity and NASH. Late last year, we announced compelling 24 week data from our trial in subject with NAFLD and we plan to initiate the IMPACT Phase 2b NASH trial mid year 2023. We believe that the effects of pambigutide on liver fat are class leading. We also believe that pamidutide is the only NASH candidate in development that combines robust reductions in both liver fat and body weight.

Speaker 2

This is extremely important because NASH patients suffer not only from the complications of liver disease, but also from the underlying problem of obesity, a principal driver of NASH. Scott Harris will provide more details on the impact of trials shortly. With regards to obesity, we look forward to reporting top line 48 week Weight loss data from our Phase 2 MOMENTUM obesity trial in the Q4 of this year. The momentum interim results of 160 subjects reported earlier this year showed weight loss of 10.7% At the 2.4 milligram dose and 9.4 percent at the 1.8 milligram dose compared to 1% weight loss in subjects receiving placebo after only 24 weeks. These robust reductions in body weight Together with the effects of pemidutide on serum lipids and blood pressure suggest that pemidutide has the potential to be an important treatment options for patients with obesity, especially individuals with NAFLD and dyslipidemia.

Speaker 2

Finally, enrollment in the Phase 2 clinical trial of HepTcell in chronic hepatitis B is now complete, and we expect to have a data readout in the Q1 of 2024. Recall that this trial is designed to show evidence of Antiviral effects of ANGHACE HBV and establish its role in combination therapy for the treatment of this important disease. We're excited about the progress of Remedytiv and T Cell and the upcoming results of these ongoing trials. With that, I'll now turn the call over to our Chief Medical Officer, Doctor. Scott Harris, to discuss our clinical plans.

Speaker 2

Scott?

Speaker 3

Thank you, Vipin, and good morning, everyone. First, let me start by reviewing the clinical plans for our IMPACT Phase 2b NASH trial. This biopsy driven NASH trial will be conducted at approximately 60 sites in the U. S. With Doctor.

Speaker 3

Stephen Harrison, Medical Director of Pinnacle Research An Adjunct Professor of Medicine, Oxford University, serving as Principal Investigator. To be eligible for study participation, subjects will be required to have a BMI of at least 27 kilograms per meter squared, A liver fat content of at least 8% is measured by MRI PDFF and NAFLD activity score of at least 4 on a pretreatment biopsy and either F2 or F3 fibrosis. At least 50% of the subjects will be required to have F3 3 fibrosis. Subjects both with and without diabetes will be enrolled. In our 2 earlier NAFLD trials, the 2.4 milligram dose did not materially improve liver fat reduction or CT1 response over the 1.8 milligram dose and the 2.4 milligram dose will not be evaluated in this trial.

Speaker 3

Subjects will consequently be treated with pemfadutide 1.2 milligrams, pemfadutide 1.8 milligrams or placebo. We are planning for approximately 190 subjects to be enrolled in the IMPACT trial in a 1 to 2 2 randomization scheme with subjects stratified for fibrosis stage in the presence or absence of diabetes. Therefore, approximately 36 subjects are expected to receive pemfadutide 1.2 milligrams, 76 subjects pemfadutide 1.8 milligrams and 76 subjects placebo. The primary endpoints of the NAKT IMPAQT trial will be dual endpoints of achieving either NASH resolution with no worsening of fibrosis or fibrosis improvement with no worsening of NASH, With the primary treatment comparison being the 1.8 milligram dose versus placebo. Secondary endpoints will include weight loss, liver fat reduction by MRI PDFF, CT1 response rate, Serum lipids and non invasive biomarkers of disease.

Speaker 3

All endpoints will be assessed at week 24 of treatment and subjects will continue to be dosed and followed for an additional 24 weeks to a total of 48 weeks for safety and additional biomarker responses. Our algorithm for biopsy reading and adjudication leverages the experience of other recently completed NASH trials, which we anticipate may optimize the likelihood of pemvadutide achieving robust endpoint responses. A plan has been developed to correlate non invasive tests With NASH resolution and fibrosis improvement biopsy endpoints and the commenced discussions with FDA about the use of these biomarkers is primary endpoints in Phase 3. We remain on target for the trial to commence mid year and to report top line results in the Q1 of 2025. Dose reduction will be made available to subjects who experience Now let me talk about the Phase 2 MOMENTUM trial of pemfidutide in obesity.

Speaker 3

The trial was designed to enroll approximately 320 subjects Without diabetes, but with obesity or overweight with at least one comorbidity. Doctor. Louerone, From Weill Cornell Medical School, a leading authority in obesity and obesity clinical trials is serving as the principal investigator. Subjects were randomized 1:one:one:one to 1.2 milligrams, 1.8 milligrams, 2.4 milligrams pempedutide or placebo administered weekly for 48 weeks in conjunction with diet and exercise. A pre specified interim analysis was performed when 160 subjects completed 24 weeks of treatment.

Speaker 3

Weight loss of 10.7% at the 2.4 milligram dose and 9.4% at the 1.8 milligram dose was compared to 1% weight loss in subjects receiving placebo. Approximately 50% of subjects Achieved at least 10% weight loss and approximately 20% of subjects achieved at least 15% weight loss by week 24 at the 2.4 and 1.8 milligram doses. The adverse event discontinuation rate That the 2.4 milligram dose was higher than observed in our 4 prior trials with pempedagutide, but similar to the adverse event discontinue rates in similar Phase 2 trials of other incretin based agents. We believe that the GI adverse Discontinuation rate can be mitigated to low levels in future trials of panfidutide through the use of dose reduction. We look forward to our top line results from our MOMENTUM trial in the Q4 of this year.

Speaker 2

We expect

Speaker 3

to see continued weight loss beyond the double digit levels noted at our 24 week interim analysis. Other top line readout parameters will include adverse events, vital signs, serum lipids, glucose control and study discontinuations. Also, as we previously announced, we have completed the enrollment in our Phase 2 multicenter clinical trial of HepTcell in patients with chronic hepatitis B. Chronic hepatitis B continues to represent a serious unmet need in the U. S.

Speaker 3

And worldwide and represents a significant commercial opportunity. The hep T cell trial was designed to enroll approximately subjects with an active chronic hepatitis B and low hepatitis B surface antigen or HBsAg and to evaluate the efficacy of hep T cell monotherapy as measured by a reduction in HBSAG and other virological markers of infection. We expect to announce the results of this trial in the Q1 of 2024 once all subjects complete the 6 month treatment period. It is generally believed that an effective therapy for chronic hepatitis B We require both direct acting antivirals and immunotherapy and we believe that HepTcell could be combined with novel direct acting antivirals in this treatment strategy. I'll now hand the call over to Rich Eisenstadt

Speaker 1

Thank you, Scott, and good morning again. For today's call, I'll be providing Brief update on Altimmune's Q1 2023 financial and operating results. More comprehensive information will be available in our

Speaker 2

$165,800,000

Speaker 1

of cash, cash equivalents and short term investments compared to $184,900,000 Research and development expenses were $17,200,000 in the Q1 of 2023 compared to $15,100,000 in the same period in 2022. Approximately $10,800,000 of this Total for the Q1 of 2023 were direct expenses for the conduct of our clinical programs, including $8,700,000 direct costs related to development activities for pembodiedai and $2,100,000 in direct costs related to development activities for HepTcell. General and administrative expenses were consistent period over period at $4,500,000 $4,400,000 for the 3 months ended March 31, 2023 and March 31, 2022 respectively. Interest income was $1,700,000 for the 3 months ended March 31, 2023 and was negligible in the 3 months ended March 30 1, 2022. Net loss for the 3 months ended March 31, 2023 was $20,100,000 or $0.40 net loss per share compared to net loss of $19,400,000 or $0.44 net loss per share for the Q1 of 2022.

Speaker 1

We estimate that our existing cash funds us through the 24 week biopsy results from our IMPACT Phase 2b NASH trial expected in the Q1 of 2025. Our financing also funds completion of 48 week MOMENTUM trial and the HEFT T cell trial. Our current cash projection includes no funding for the initiation of A3 obesity campaign, which would only commence with a partner. I will now turn it back over to Vipin for his closing remarks. Vipin?

Speaker 2

Operator, that concludes our formal remarks, and we would like to open the lines to take questions.

Operator

Our first question comes from the line of Seamus Fernandez from Guggenheim Securities.

Speaker 4

Great. Thanks for the question. So, Rich, in your remarks, you commented that forward advancement into Phase 3 obesity would require a partner. Can you just help us understand how Vipin and Rich, if you can both help us understand how you're thinking about a potential partner here given sort of the overlapping dynamics of NASH and Obesity. And then separately, just maybe remind us what you're hoping to see in In the broader clinical data set from the MOMENTUM study when we received that at 48 weeks And the importance of those data to a potential partner, what you believe partners are looking for in that data set or potential partners might be looking for in that data Seth, to move forward.

Speaker 4

Thanks.

Speaker 2

Yes. Good morning, Seamus. Thank you for the question. So as you know, both NASH and obesity, they're both large markets and we believe we'll benefit from having a partner for both of these indications. So our goal is to have a partner for the Phase 3 initiation by the time we are ready to start Phase 3 for obesity.

Speaker 2

And in parallel, we'll also discuss with partners joining forces with regards to NASH as well. Ultimately, our goal is to have a partner that has the resources and can bring value to both of these indications because Ultimately, in order to market a drug for both of these indications, we'll need a partner. So we will Explore a partnership across both of these assets. If it turns out that initially the partnership is only centered around obesity with a downstream prospect Including the NASH as well, we will explore all of those options and multiple ways of doing these partnerships. Obviously, we have embarked on our Phase 2b plan for NASH and that data will become available in due course.

Speaker 2

So all of those items will sort of play a role in terms of ultimately designing the optimum structure for a partnership around both of these indications. With regards to the data, as You know, we've announced the 24 week data. And again, our goal has been to engage in partnership discussions on the back of that data. Clearly, partners will also be looking for the 48 week data as we are at least some partners would want to see the 48 week data. We expect to continue to show additional weight loss, and I think that would be very important as we go into Partnership discussions later this

Speaker 4

year. Great. And then, just wanted to Reconfirm the timing of the NASH 24 week results. I think previously you'd stated that you anticipate having those Results sometime in the first half of twenty twenty five. Just wanted to see as you're Getting closer to the initiation of the Phase 2, how those timelines are continuing to shake out?

Speaker 4

And then I'll jump back in the queue. Thanks.

Speaker 2

Yes. No, the timeline is looking good. We think we can get those results in the Q1 of 25, and that's what we are guiding to at this point. So we feel very comfortable saying that the trial should start here in the next Few weeks or a few couple of months and basically based on our analysis of the time it will take to enroll these subjects And keep them Q1 of 2025 would be in a reasonable timeline.

Speaker 4

Great. Thank you.

Operator

Thank you. One moment for our next question. Our next question comes from the line of Yasmeen Rahimi from Piper Sandler.

Speaker 5

Good morning, team, and thank you so much for all the details and also the really outstanding NASH trial design. Few questions for you. I think the first one is along with, what Seamus was asking, Mike, in regards to discussions with Partners in regards to the profile of fazemetide, do you have a feeling for what type of weight loss Do they want to or see it competitive at week 48? That's question 1. And then question 2 is, Could you maybe speak a little bit about the nature of the biopsy handling in the study?

Speaker 5

Will you have Two readers, will they be read in pairs. So any sort of logistical details around the reading? And then the third question is, if you could just comment on what NITs are being utilized at baseline for Screening the patients and creating a homogeneous population. And I'll jump back right into the queue. And thank you again for taking my questions.

Speaker 2

Yes. Good morning, Gus. Yes, and thank you for the question. I'll take the first Part of your question and then I'll turn it over to Scott Harris to talk about the NASH patient population. So in terms of weight loss, we've always maintained that a weight loss in mid teens would be competitive.

Speaker 2

And in our discussions, We're finding that's basically where the universe is in terms of at 48 weeks, if we are in that mid teen range, That would be a competitive weight loss. But once again, I would like to emphasize that it's not just about weight loss. There are multiple parameters here that are going to play a role. I mean, we believe that having this combination of GLP-one and glucagon brings a unique unique attribute to the product, where the product will be much well suited for obese patients With high liver fat content and dyslipidemia. And that's a distinct patient population from people having diabetes and obesity.

Speaker 2

I think as this field develops, there would be multiple segments. In fact, the number of patients with dyslipidemia and obesity is higher than patients with diabetes So we think there's significant opportunity there with mid teen weight loss, but having the benefit of Direct Impact on Liver and Liver Fat Reduction. Scott Harris, do you want to address the second part of the question?

Speaker 3

Sure. Good morning, Yasmin. So regarding the biopsy readout procedure, we've benefited greatly from the experience of other companies and Really comparing across the readout methodologies. So we think we have a really robust plan in place based on that experience. We've not made those

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