Mineralys Therapeutics Q2 2023 Earnings Call Transcript

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August 7, 2023

There are 10 speakers on the call.

Operator

Welcome to the Mineralis Second Quarter 2023 Earnings Call. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce our host, Dan Ferry of LifeSci Advisors.

Operator

Please go ahead, sir.

Speaker 1

Thank you, operator. Good afternoon, everyone, and welcome to our Q2 2023 conference call. Today, after the market closed, we issued a press release providing our Q2 2023 financial results and business updates. A replay of today's call will be available on the Investors section of our website approximately 1 hour after its completion. After our prepared remarks, we will open the call for Q and A.

Speaker 1

Before we begin, I would like to remind everyone that this conference webcast will contain forward looking statements about the company. 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. These forward looking statements are qualified by the cautionary statements contained in today's press release and our SEC filings, including our Annual Report on Form 10 ks and subsequent filings. Please note that these forward looking statements reflect our opinions only as of today, August 7. Except as required by law, We disclaim any obligation to update or revise these forward looking statements in light of new information or future events.

Speaker 1

I would now like to turn the call over to John Congleton, Chief Executive Officer of Mineralis Therapeutics. John?

Speaker 2

Thank you, Dan. Good afternoon, everyone, and welcome to our Q2 2023 financial results and corporate update conference call. I'm joined today by Adam Levy, our Chief Financial Officer and Chief Business Officer and Doctor. David Rodman, our Chief Medical Officer. I'll begin with a brief overview of the business and recent milestones, followed by David, who will discuss our clinical programs, And then Adam will review our Q2 financial results before we open up the call for your questions.

Speaker 2

Pineralis Focused on addressing aldosterone driven cardiorenal disorders that now include both hypertension and chronic kidney disease or CKD. We believe the growing prevalence of abnormal aldosterone levels is linked to the rising obesity epidemic. This shift in the underlying biology of hypertension And we believe in CKD as well requires new therapeutics that reduce circulating aldosterone. Based on our preclinical Phase 1 and Phase 2 data, we believe we have a highly selective, effective and well tolerated aldosterone synthase inhibitor and lorondrostat to address this growing need and make a meaningful difference in the lives of millions of patients. The first half of the year has been a very productive one for the Mineralis team, and we're expecting this momentum to continue through the second half of twenty twenty three and into 2024.

Speaker 2

Most significant amongst Our recent milestones is the initiation of patient dosing for the advanced HTN trial during the Q2. This is the first of 2 clinical trials under the planned pivotal program to evaluate the safety and efficacy of lorondrastat for the treatment of uncontrolled or resistant hypertension. And we expect to have top line data in the first half of twenty twenty four. The 2nd pivotal trial, LAUNCH HTN, which will enroll a larger population of uncontrolled or resistant hypertension subjects, is expected to begin in the second half of twenty twenty three. We expect data from the launch HTN trial in mid-twenty 25.

Speaker 2

In addition, after completing either of the pivotal trials, subjects will be offered the opportunity to participate in an open label extension trial, which has already begun enrollment. This trial will contribute to our long term safety data set. Last month, we announced the expansion of our clinical development of lorondestat as a potential therapy to treat patients with Stage 2 to Stage 4 chronic kidney disease. The role of aldosterone in the progression of chronic kidney disease is well established. This study is anticipated to begin enrollment before the end of this year and will have top line data readout in Q4 2024 to Q1 2025.

Speaker 2

More than 35,000,000 adults in the United States suffer from chronic kidney disease And we believe the oroderstat has the potential to provide significant clinical benefit for many of these patients given the role that abnormally elevated aldosterone plays in the progression of this disease. Let me now turn the call over to Doctor. David Rodman, Chief Medical Officer of Mineralis Therapeutics,

Speaker 3

who

Speaker 2

will provide additional details on our ongoing clinical program for lirondrastat. Dave? Thank you,

Speaker 4

John, and good afternoon, everyone. Today, I'll provide an overview of the pivotal clinical program for lorondrastat that, As John touched on earlier, has commenced enrollment. I will then provide a summary overview of the planned Phase 2 trial lirondristat for chronic kidney disease. Since the initiation of the advanced HCN trial, we remain on track. During this time, we have continued to onboard additional sites and randomized subjects into the trial.

Speaker 4

As a reminder, It is a randomized, double blind, placebo controlled pivotal trial that will enroll up to approximately 300 Adult subjects with uncontrolled or resistant hypertension. Patients failing to achieve their blood pressure goal On 2 to 5 antihypertensive medications are eligible for the trial. 1 third of subjects will be randomized to placebo, 1 third to 50 milligrams lorondrastat once daily and 1 third to 50 milligrams of lorondrastat once daily and then increase to 100 milligrams at week 4 if the blood pressure goal has not yet been achieved and if they meet certain safety criteria. The primary endpoint of the trial will be change in systolic blood pressure as measured by 24 hour ambulatory monitoring at week 12 in the 2 active arms versus placebo. We anticipate having top line data from this trial in the first half of twenty twenty four.

Speaker 4

The second part of our pivotal program for lorondristat is the larger launch HTN trial, which is expected to be initiated in the second half of twenty twenty This randomized double blind placebo controlled 3 arm trial is planned to have a similar design as the advanced HTN pivotal trial, Except subjects will remain on their previously prescribed background regimen of 2 to 5 antihypertensives, including a thiazide or thiazide like diuretic. In the LAUNCH HTN trial, randomization will be stratified by body mass index Less than 30 kilograms per meter squared versus greater or equal to 30 milligrams per meter squared. Approximately 1,000 subjects will be randomized 1 to 1 to 1 to either placebo, Once daily 50 milligrams of lorondristat or once daily 50 milligrams of lorondristat with the option to titrate In a manner similar to the ADVANCE HTN trial, the top line data from the LAUNCH HTN trial are expected in mid-twenty 25. In addition, subjects from both pivotal trials will be offered the opportunity to roll over into an ongoing open label extension trial. Now as John mentioned earlier, we recently announced plans to initiate An expanded Phase 2 trial of lorondrastat alone and in combination with an SGLT2 inhibitor As a potential therapy to treat patients with Stage II to IIIA chronic kidney disease.

Speaker 4

This trial will be conducted in 2 parts. Part A will be a proof of concept trial with the primary outcome measure being change in proteinuria at week 12 compared to placebo, A very good surrogate for the registration endpoint, which is reduction in the rate of decline in glomerular filtration rate. Part A is a randomized double blind placebo controlled trial that will consist of 2 treatment periods. We plan on enrolling up to 100 subjects with mild to moderate kidney disease and persistent proteinuria despite treatment with an ACE inhibitor or an angiotensin receptor blocker. Subjects will receive either once daily combination treatment with 50 milligrams of lirondrastat Plus 10 milligrams of Farxiga or placebo for 12 weeks.

Speaker 4

This will be followed by a second 12 week treatment period During which subjects in the active arm will receive 50 milligrams of lorondristat alone. As I mentioned, Part A of the trial will evaluate benefit of lirondrastat in combination and alone on proteinuria in this population. Part B of the trial will be for profiling subjects with lower kidney function. The second part of the trial is an open label single arm dose escalation trial that will enroll approximately 20 subjects with moderate to severe chronic kidney disease with or without hypertension despite treatment with an ACE inhibitor or an ARB. Subjects will receive 4 weeks of treatment once daily of 25 milligrams lorondristat followed by an increase in dose to 50 milligrams of lorondristat for another 4 weeks.

Speaker 4

Part B of the trial will characterize the safety profile of lirondrastat in a more renally compromised population. As this is an exploratory trial, we may conduct interim analyses of the data at 1 or more time points. We expect to have top line data from this trial between the Q4 of 2024 and the Q1 of 2025. The progress we continue to make this year speaks directly to the quality of our cross functional team members The equally important teams at our trial sites and most importantly trial subjects who anxiously wait for a new approach to treating their hypertension and associated aldosterone mediated complications like chronic kidney disease and heart failure. We look forward to keeping you appraised of the status of our pivotal program as progress on our journey to transform The antihypertension landscape unfolds.

Speaker 4

Now, I'll turn the call over to Adam, who will provide a financial review for the Q2 of 2023. Adam?

Speaker 5

Thank you, Dave, and good afternoon, everyone. Today, I will discuss select portions of our Q2 2023 financial We ended the Q2 with cash, cash equivalents and investments of $282,800,000 compared to $110,100,000 as of December 31, 2022. The company believes that its cash, Cash equivalents and investments as of June 30, 2023 will be sufficient to allow the company to fund its planned clinical trials as well as support corporate operations through mid-twenty 25. R and D expenses were $11,900,000 for the 3 months ended June 30, 2023 compared to $5,600,000 for the same period last year. The increase in R and D expenses was primarily due to increases of $4,000,000 in preclinical and clinical costs, driven by the initiation of the lorondrastat pivotal program in the Q2 of 2023, 1 point $3,000,000 in higher compensation expenses as a result of additions to headcount and expenses were $3,900,000 for the 3 months ended June 30, 2023 compared to $900,000 for the same period last year.

Speaker 5

The increase in G and A expenses was primarily due to $1,400,000 in higher compensation expenses As a result of additions to headcount, dollars 1,100,000 in higher professional fees associated with operating as a public company, $300,000 of higher insurance expense associated with new director and officer insurance policies and $200,000 in other administrative expenses. Total other income was 3 point $6,000,000 for the quarter ended June 30, 2023 compared to $0 for the same period last year, which was primarily Net loss was $12,100,000 for the quarter ended June 30, 2023, compared to 6 $5,000,000 for the same period last year. The increase was primarily attributable to the factors described earlier. With that, I'll ask the operator to open the call for questions. Operator?

Operator

Thank you. We will now be conducting a question and answer session. Our first question comes from Michael Giacobbe with Evercore. Please go ahead.

Speaker 6

Hi, guys. Thanks so much for taking my questions and congrats on all the progress. 2 for me. The first one regarding the Phase 3 LAUNCH hypertension trial, it's again the design is similar to Phase 2 except that in This Phase 3 trial, patients could be on as much as 5 background meds instead of the 3 that they are kept in in Phase 2. So could this non standardized background regimen that could include up to 5 drugs cause a greater placebo effect?

Speaker 6

And how should we think about The placebo effect here versus the much smaller, more tele controlled Phase 2 trial? And then I have a follow-up.

Speaker 2

Yes, Mike. Let me try to give you a background on that. So both Advanced HTN and Launch HTN allow patients on 2 to 5 background meds. Now we know in Advanced HTN, we're taking them off of their Prescribed treatment and putting them on a standardized treatment. As it regards, launch HTN, they could be on 2 to And we believe that 2 week placebo run-in period should largely take care of what your question points out.

Speaker 2

So whether they're on 2, 3, 4, 5 meds, we'll make sure they're compliant and we will use our AI Curesmart technology to ensure that compliance. And if at that point, compliant on whatever the regimen is from 2 to 5, They don't longer hit the criteria of being hypertensive and they would not be randomized. But we think that stabilization on their background will give us a true sense of their blood pressure If they continue to be above, I think it's 135 millimeters of mercury, then they'd be randomized. So we're not overly concerned about The number of meds causing a odd reaction within the placebo group.

Speaker 6

Got it. Very helpful.

Speaker 2

And Mike, I'd be remiss if I didn't say that's very similar to what we had with Target. Target was Greater than 2 background meds. And so we know that we had patients in target on 2, 3, 4 or even 5 background meds. So it's very similar construct. And it's at the end of the day, Mike, it's kind of the real world version or tightly curating advanced HTN Generating Class I evidence, launch H10 probably has a little bit more of a real world feel.

Speaker 6

Got it. Super helpful. Second question is more of a big picture one. With the recent update to the CKD trial, it seems as if you're No longer 100% certain that you'll be pursuing a separate dedicated CKD indication that it will be dependent on how this Phase 2 goes And that this Phase 2's primary purpose is to support the hypertension indication. Just what led to the sudden change in expansion wanting to Expand the CKD trial?

Speaker 2

Yes. Mike, I appreciate the question. I'll go back to really the genesis of the company and our Focus has been from the beginning, how do we bring a targeted solution to both hypertension and beyond? And beyond for us was broadly cardiorenal indications. In the case of CKD, that's our first step into that beyond world of cardiorenal.

Speaker 2

And the reason CKD is such a natural fit is that we know that change in proteinuria is a really good marker to predict clinical response. And for a CKD indication that clinical response, as you heard Dave say, is slowing the rate of decline of glomerular filtration rate. So it's a really good marker for us to get a keen sense for the benefit that rondersat can add. I'll also point out that the CKD proof of concept study really serves two purposes. And one is to give us a derisked view of what lorondristat can do in CKD.

Speaker 2

We know that aldosterone plays a role there based on the therapeutics, based on research and we know that lorondristat 65% to 70% reduction in circulating aldosterone. So it will give us an indication of the The potential value in chronic kidney disease, but it will also show us the value in reducing proteinuria for the hypertension population At large, because we know there's significant overlap. We've done qualitative research with physicians, from endocrinologists, nephrologists, cardiologists And really next to the reduction of blood pressure and safety, probably the 3rd rated attribute is benefit on proteinuria. And so this study basically serves 2 purposes. I think it really bolsters the attributes of lirondirstat as an antihypertensive, But it also gives us a real clear sense of what the benefit would be in the CKD population to inform future development in chronic kidney disease.

Speaker 6

Got it. Very helpful. Thank you.

Speaker 2

Yes, absolutely.

Operator

Our next question comes from Greg Harrison with Bank of America. Please go ahead.

Speaker 7

Hey, good afternoon. Thanks for taking the question. One on CKD, with that trial starting And getting some interim looks in a little over a year from now, hopefully, What are you looking for in terms of proteinuria reduction that you think would be meaningful and how that could translate into eGFR benefit? And then Kind of related to that, how would you expect the efficacy you see there in CKD to be affected by of BMI and how would that affect your later stage development?

Speaker 2

Yes. Let me Greg, I appreciate the question. Let me answer the first part and maybe I'll have Dave talk about the BMI component for it. I'm not going to guide to a range. I think there's a lot of evidence out there that it says if you can mitigate aldosterone, you see a benefit.

Speaker 2

We think reducing circulating aldosterone is more complete way to do it. What you typically see with an SGLT2 inhibitor is a 30% to 40% reduction in proteinuria over a 12 week period, which is the duration of our proof of concept study. So we're looking for a clinically meaningful reduction beyond that. Don't know that I want to guide to that just yet. As far as how that would directly translate to benefit in eGFR, I think it's premature to opine on that as well.

Speaker 2

But we're clearly looking to find a meaningful addition. We think there's significant need that remains even though the GLT-two inhibitors are quickly being adopted in the treatment of CKD. There remains a lot of unmet need even with their advances. Let me turn it over to Dave and he can address your question on BMI.

Speaker 4

Sure. So your question was, do we expect to see something similar to hypertension where Larger BMI results in more aldosterone and a better response. It's an interesting question. Now typically People who have proteinuria in this group of patients are often going to have type 2 diabetes, which is a Product of obesity. And so I think the majority of subjects are going to be obese And therefore, we probably won't have much of an opportunity to test at a statistical level whether the non obese patients have a very different response.

Speaker 4

Also the mechanisms that increase aldosterone in chronic renal disease are often related to just volume through the more classical pathways As opposed to obesity. So good question. We'll be looking for that, and we'll let you know.

Speaker 7

Great. Thanks for taking the question.

Speaker 2

You bet.

Operator

Our next question comes from Jack Pandaviano with Stifel. Please go ahead.

Speaker 3

Hi, this is Jack on for Annabel. Thanks for taking our questions. So firstly, the ADVANCE TN study doesn't necessarily enrich for BMI, but in target HTN, the lower BMI patients had less of a benefit in systolic Blood pressure reduction. Do you have any pre specified analyses to identify the better efficacy in patients with BMI over 30? And are you sufficiently powering the trial to reach STAT SIG even if the 25 to 30 BMI patients Turn out not to have that hyperaldosteronism link.

Speaker 4

Well, another great question. So your question was, since we're not Stratifying for BMI, are we going to be able to look at the BMI effect? So just for clarification, We're stratifying for 2 drugs versus 3. And the reason we chose to do that is because it's critical in understanding whether this drug As a place as the 3rd line agent for hypertension and we believe it will in people with high aldosterone, Who as you mentioned are often obese. So we do have pre planned analyses looking at BMI as a categorical again, BMI less than 30 versus greater than or equal to 30 kilogram per meter squared and we'll be looking for that.

Speaker 4

Now your last question is a great question, which So if we see a similar effect size difference to what we saw in target HTN, yes, we're powered for that. But it's not a primary, It's a secondary.

Speaker 3

Got it. And then a follow-up, if I may, on a more broad Gail, can you talk about the level of monitoring you might anticipate will be required for lirondrastat compared to MRAs regarding hyper Kalaemia, would you anticipate that to be as burdensome for physicians to monitor their patients?

Speaker 4

No, it won't be any more burdensome than the MRAs. And we'll be looking to see whether there is any evidence that our strategy, Which is to instead of blocking aldosterone production for the entire day with 50 milligrams, We do have a bit of a window so that subjects can excrete potassium later in the 24 hour period. So there's reason to be optimistic that it will be low burden. What we're thinking will happen is that patients will be put on this drug and as standard of Here, they'll come back in 2 to 4 weeks for a blood pressure and at that time they'll have another serum potassium checked. They can be titrated and the same thing will happen.

Speaker 4

And then after that, unless there is a change or unless they have a very low EGFR, I think the burden would be pretty small, certainly no worse than an MRA.

Speaker 3

Got it. Thank you.

Operator

Our next Question comes from Mohit Bansal with Wells Fargo. Please go ahead.

Speaker 8

Great. Thank you for taking my question. Congrats on all the progress. I have two questions. So first one, what is the overlap between CKD and hypertension?

Speaker 8

I'm asking this because if having some level of proteinuria data ahead of your hypertension launch Could be helpful in the marketplace?

Speaker 2

Yes, there's appreciate the question. And as you can imagine, There's a lot of different cuts of data. I think the data that we've reviewed and kind of the position we look at broadly for the market, it's probably 25 call it a quarter to a third of the hypertension population have some form of CKD. And then conversely, probably 60% to 80% of the CKD population have hypertension. So pretty significant overlap either way.

Speaker 2

And I think that's why as we did our initial target Product profile research with physicians focused on hypertension, proteinuria was an attribute that was very critical to them because of the significant overlap.

Speaker 8

Got it. This is very helpful. And then just wanted to touch base on the enrollment progress so far, especially In the ADVANCE HTN trial, could you comment something on that front? And how comfortable do you feel about First half twenty twenty four data readout at this point.

Speaker 2

Yes. We continue to feel good about first 2024 top line results from Advanced HTN, continue to feel confident about mid-twenty 25 for launch HTN, yes, things are progressing as we anticipated and that's why we're continuing to guide to data readout in the first half of twenty twenty four for advanced HTN.

Speaker 8

Awesome. Thank you very much and congrats on the progress again. Thank you, John.

Speaker 2

Yes, absolutely.

Operator

Our next question comes from Rich Lau with Credit Suisse. Please go ahead.

Speaker 9

Hey guys, good afternoon. I have a couple of questions. Based on your discussion with the FDA so far, what do you need to demonstrate in order to get approval for the higher And also what is the comparator arm for DAT based on your design? And I also have a couple of more questions.

Speaker 2

Rich, state the last part of your question. So based on the discussions, what would be required for what for the 100 milligram dose approval?

Speaker 9

Yes. So for 100 mg dose approval and also what the comparator arm for that dose?

Speaker 4

So the way we're doing it is everybody's going to get dose escalated with either placebo or Drug depending on which arm they're in. They won't know what arm they're in and if they're on placebo at 4 weeks they'll get dose escalated to 2 placebos. And the same thing for the 50 milligram group and only in the 3rd arm will they get 50 milligrams active. So that's how we blind it. Now your second part of your question was, is there a specific set of guidelines for registering that Arm as opposed to the 50 milligram arm.

Speaker 4

And there isn't and this is a very common label to do this sort of thing. And the reason is it's always benefit risk. And The benefit obviously can be greater when the exposure is greater. And Because you started 50 milligrams, anyone who develops say mild hyperkalemia Above the normal range won't be dose escalated. So the safety profile will essentially be similar, If not the same to 50 milligrams, it won't be as the same as we saw in the target Trial where we started everybody on 100 milligrams, because some of those people would have also responded to 50 milligrams.

Speaker 4

And so those people will no longer go up to 100. So it'll be same rules and I think The safety will be similar to 50 milligrams is our thought. We don't know for sure, of course.

Speaker 9

Okay, got it. So I just want to confirm, so you guys would have 2 is it 2 different placebo arms, 1 with a 50 mg and then one is the 50 mg that It's titrated to another placebo. So basically, there's 2.

Speaker 4

So let me explain it. I'm sure I didn't explain it clearly. There's only 3 arms. Everybody in this study is on one tablet that looks the same for 4 weeks. And then they all go to 2 tablets that look the same for the last 8 weeks.

Speaker 4

So the same people are on one tablet of placebo and then go to 2 tablets of placebo, but it's the same placebo group. The same thing happens in the other arms. So it's one arm All the way along, it's 1 pill in each arm for 4 weeks and then 2 pills in each arm for the last 8 weeks.

Speaker 9

Okay. Did I do any better? Yes. No, I get it. And then Couple more other questions too.

Speaker 9

How important is this second dose in the commercial strategy? How many patients or proportion of patients do you think We get this dose in commercial or clinical trial aesthetic.

Speaker 2

Yes. Rich, this is John. I think its importance lies in what we saw in target H-ten. And we know that at a subject variability level, Exposures can change from one individual to the next. We know that some patients the 50 milligrams was a great dose, gave them a great clinical response, both from an efficacy and safety standpoint.

Speaker 2

We believe that for other patients, just because of how they metabolize the drug and react to it that they're going to need a higher dose. And so it becomes important to address that patient variability. And frankly, to fit in with an existing paradigm in hypertension that is to titrate to dose. And so we think it's providing clinicians and patients that flexibility is invaluable To really acknowledge the individuality of the subject. The latter part of your question, Rich, remind me again, The proportion?

Speaker 2

Yes. Yes, it's hard to say right now, Rich. I think we'll With the size and scale of the pivotal program, we'll be able to obviously communicate that. We'll see that right to that third arm For patients that were on 50, they got to goal safely and those that required a higher dose. But right now, I wouldn't even want to hazard a guess.

Speaker 2

And I don't know that Fundamentally, it will matter. The key for us is just getting the right dose for the right patient to get the right response.

Speaker 9

Okay, got it. Thank you. And then just one last question for me. I think you guys mentioned Particula as a FGLT2 Partner or combo partner. Is there like how do you guys select this agent?

Speaker 9

And then is there any potential to do other agents?

Speaker 2

Yes, it's a good question. As we worked with our KOLs, Rich, it became Really evident to us that there's a high level of similarity, whether it's apicalethasone, dapicalethasone, canicalethasone. The responses that Have been seen in CKD have been very positive, but very consistent. And so for us, it was just a matter of let's pick the molecule that Has a good safety profile, has a good body of evidence in CKD and so the epigliphytes Zone was the one for us. And we also needed to make sure that we picked 1 to standardize the background response.

Speaker 2

Future studies that may become more open field to be on an SGLT2 inhibitor writ large. So it could be any of them. That'll be something we'll evaluate down the road. But for this proof of concept and to hold something constant like background meds, we chose dapaglif as done.

Speaker 9

Great. Thank you so much.

Speaker 3

Absolutely.

Operator

There are no further questions at this time. I would like to turn the floor back over to John Congleton for closing comments. Please go ahead, sir.

Speaker 2

Thank you, operator, and thank you to everyone for joining us today. We're very excited about the progress we've made thus far in 2023 in advance in our clinical programs and we remain enthusiastic about the upcoming milestones for the rest of the year. We look forward to updating you as our pivotal program for lirondrastat

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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