Dogwood Therapeutics Q1 2024 Earnings Call Transcript

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Provided by Quartr
May 9, 2024

There are 4 speakers on the call.

Operator

Good morning, and welcome to the Verios Therapeutics Incorporated First Quarter 2024 Earnings Call. At this time, all participants have been placed on a listen only mode. Please be advised that today's call is being recorded at the company's request. At this time, I'd like to turn the call over to Angela Walsh, Senior Vice President of Finance and Treasurer for Vireos Therapeutics. Please proceed, Angela.

Speaker 1

Good morning, everyone, and thank you for joining us on today's conference call. We are pleased to be with you today to discuss Verios Therapeutics' Q1 financial results and to provide a corporate update. Please note that our financial results press release is now available on our website. Before we begin, I'd like to remind everyone that statements made during this conference call will include forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that can cause actual results to differ materially from the information expressed or implied by these forward looking statements. For more information regarding such risks and uncertainties, please see the risk factors outlined in the company's filings with the SEC.

Speaker 1

Any forward looking statements are made only as of today, and we disclaim any obligation to update these forward looking statements other than as required by law. Please see the forward looking statements section in our financial results press release issued this morning for more information. Now, it is my pleasure to turn the call over to our CEO, Greg Duncan.

Speaker 2

Thank you very much, Angela. The team and I are excited to convey a few key progress highlights from the 1st 3 months of this year as the first part of today's update. First, let's start with the ongoing investigator initiated Bateman Horne Center Long COVID Phase 2 study. Clearly, this ongoing study is important to Vireo Therapeutics shareholders. However, we can't forget it's also important to the millions of patients who are suffering from the symptoms of long COVID illness.

Speaker 2

It seems each week new research highlights the growing burden of long COVID illness. Recently published scientific literature demonstrate a growing belief that reactivation of previously dormant herpes viruses, the target of our therapies, notably in Epstein Barr virus and herpes simplex-one may be triggering long COVID illness in at least a portion of those suffering from long COVID sequelae. The Center For Disease Control or CDC as you may know it, estimates that approximately 7% of the U. S. Population representing approximately 23,000,000 U.

Speaker 2

S. Citizens have suffered from long COVID symptoms at some point since the beginning of the pandemic. The CDC further estimates that 3.4% of U. S. Adults are presently right now suffering from active long COVID sequelae, representing 11,200,000 potential patient targets.

Speaker 2

That's patient targets here just in the U. S. Unfortunately, there are no FDA approved long COVID treatments. We believe valsiclovir emselacoxib or IMC2 as we call it has the potential to be a market leading option to address this major need for millions of patients worldwide. The ongoing BHC-two zero two study is a 3 arm study comparing 2 dose levels of the valsiclovir celecoxib combination versus placebo over 12 weeks to treat their symptoms of long COVID illness.

Speaker 2

I'm pleased to report that patient enrollment is going well and has surpassed the 50% enrollment level. Encouragingly and consistent with prior research, a planned preliminary safety analysis of the BAC-two zero two study data indicates that the combination of valsiclovir and celecoxib has been very well tolerated to date with no serious adverse events reported and only a few transient or temporary treatment emergent adverse events being reported throughout the study. This Phase 2 trial follows on from the previous proof of concept study results we reported last year featuring the combination of valsiclibir and celecoxib as a potential new treatment for long COVID. In this study as you may recall, IMC2 demonstrated clinical and statistical improvement in long COVID patients' fatigue, orthostatic intolerance, anxiety and pain, as well as an improvement in overall health as compared with age, gender, duration of illness and previously vaccinated match control patients. These results are particularly important for several reasons, most notably given the current dearth of treatments available to address patients' long COVID symptoms.

Speaker 2

Furthermore, we believe these data validate our approach to addressing the reactivation of secondary herpes viruses rather than targeting the SARS CoV-two virus itself as a unique approach to treating long COVID patient symptoms. This approach and these data may explain why treatments like PAXLOVID that specifically target the SARS CoV-two virus have failed to date to exhibit benefits in treating long COVID symptoms. We also now know that the risk of developing long COVID increases with each acute infection and that COVID vaccines do not prevent patients from progressing from long COVID illness. In short, there's a major need to advance new therapies like IMC2 in the hopes of addressing this emerging health problem. Top line results from this landmark study are expected in the second half of twenty twenty four and in our view represent a significant value inflection opportunity for VIRI shareholders on the near term horizon.

Speaker 2

On a related long COVID program note, VIRIOS' global patent for IMC2 covering combination antiviral treatment of both long COVID as well as Alzheimer's disease was recently published. This enables the company to streamline the process for obtaining patent protection globally. If ultimately granted, this will provide us with intellectual property protection for use of IMC2 in both treating long COVID and Alzheimer's disease until approximately 2,044. Moving beyond the IMC2 long COVID program, I also wanted to share that discussions are ongoing as we seek a partner to advance our 2nd development candidate, IMC1, a fixed dosage combination of famciclibar and celecoxib into Phase 3 development for the treatment of fibromyalgia. In particular, we are evaluating opportunities with partners who are focused on developing and commercializing non opioid pain treatments.

Speaker 2

And finally, the company continues to actively explore complementary opportunities that can build shareholder value through strategic partnerships, collaborations or other forms of transactions. In particular, we are assessing both pain and anti infective development candidates as potential complements to our focus with IMC1 and IMC2. Now I will turn it back over to Angela to discuss our quarter 1 financial update.

Speaker 1

Thank you, Greg. With respect to our income statement, as a development stage biotechnology company, we did not generate revenue during the 3 months ended March 31, 2024, or during the year ago quarter. We reported research and development expenses of $300,000 for the Q1 of 2024 as compared to $500,000 for the Q1 of 2023. The $200,000 decrease was due to decreases in expenses for toxicology studies of $100,000 and regulatory consulting costs of $100,000 In addition, we reported general and administrative expenses of $1,000,000 for the Q1 of 2024 as compared to $1,100,000 for the Q1 of 2023. The $100,000 decrease quarter over quarter was due to a decrease in insurance expenses associated with being a public company.

Speaker 1

Finally, we reported a net loss of $1,300,000 for the Q1 of 2024 as compared to a net loss of $1,500,000 for the year ago quarter. The lower net loss was primarily due to the decreases in research and development and operating costs that I just discussed. As of March 31, 2024, we had 2 $400,000 in cash as compared to $3,300,000 as of December 31, 2023. We expect our current capital to fund operations into the Q4 of 2024. At this time, I will turn the call back over to Greg, who will moderate the Q and A session of the call.

Speaker 1

Greg?

Speaker 2

Thank you, Angela. Holly, we are now ready for questions.

Operator

Thank you. Ladies and gentlemen, the floor is now open for questions. Thank you. We have a question on the line from David Boats with Zacks Small Cap Research. Your line is live.

Speaker 3

Hey, good morning, everyone, and thanks for taking the questions this morning. Greg, I'll start with for the two zero two study, what can you remind us again what kind of data are we should we be expecting when those results are released? And do you expect them to be released basically through a press release? Or is this going to be at a scientific meeting?

Speaker 2

Hi, David. Greg here and thank you for the question. So the design of a Phase 2 study, the BHC-two zero two study is quite similar to the prior trial and that is by design and it is consistent with the discussions we've had with the FDA regarding what would be required to advance a drug, potentially the first drug to treat long COVID sequela or symptoms as we speak to them. The primary endpoint in that study is fatigue. It is to the best of our knowledge the first time FDA has agreed with using fatigue as a primary endpoint and we're excited about that for two reasons.

Speaker 2

Number 1, this combination, famciclovir and balsiclovir when used with selacoxib, either as IMC1 or IMC2 as we call it, has consistently shown in both fibro clinical research and in long COVID clinical research, significant reduction in fatigue. 3 point change is considered clinically meaningful. We've seen between a 3 and a 7 point change across all of those 3 studies. And as a consequence, we believe frankly that this may be the symptom that best responds to treatment with this particular combination. So the primary endpoint for this 12 week study is fatigue.

Speaker 2

The secondary endpoints include orthostatic intolerance. You may know this as orthostatic hypotension when people get dizzy, when they get up quickly or when they move. Unfortunately, that happens for patients. In this particular category with this illness all day long. And this is arguably as debilitating as the fatigue itself.

Speaker 2

So fatigue, orthostatic intolerance, pain will be assessed. We'll also look at pain, anxiety and overall global health. So those outcomes, as I referenced in my earlier remarks, are the ones we were so excited to see improved in the first BHC, the 201 study. And that led us to progress to this double blind placebo controlled trial. And we are very hopeful and encouraged by past performance and are looking to read out those results in the second half of this year.

Speaker 2

It is pretty material. So I think we'll probably announce those results directly, at least top line from Vireos Therapeutics. And certainly, we'll be looking and are exploring what might be the best scientific venue, Dave, to announce those results to make sure that the entire scientific community, not just the investment community, is aware of those results.

Speaker 3

Okay, great. And so assuming positive results, what do you envision as the next step for that program? Do you think you'll be doing a Phase 2b? Do you think you can go to a Phase 3? Maybe you can talk about kind of how you foresee things moving there?

Speaker 2

Yes. I think with positive results and remember the goal of this trial is to help design not necessarily the endpoints per se, those will be consistent. We've agreed that with FDA. We want to progress with the same endpoints as the destination for assessing patient care. What this trial will do is it will allow us to assess the effect size.

Speaker 2

So how many patients will we need to see a particular effect on fatigue, lipostatic intolerance, etcetera. So the inputs from this study will dictate the design for the next study, which we believe will likely be a Phase 2b study. I'm not sure we could go directly to a Phase 3, but ultimately, now that we've scoped out the parameters that are required to get a drug approved, we would certainly design the study even as a Phase 2b in a way that's consistent with Phase 3 and decide what else might be required beyond that study, which we would hope to begin executing towards the beginning of next year.

Operator

That will be the rough time.

Speaker 3

Okay. And so it sounds like you're holding off on the fibromyalgia program until you get a partner there. Do you think you could move the long COVID program on your own or would you also want to partner that program?

Speaker 2

Certainly, we will choose the path that is most value enriching for shareholders and expeditious to get to the endpoints. So we feel comfortable we can execute the IMC2 long COVID program independently. But there are companies we know that have an interest in the space. I think, David, the fatigue people had for COVID vaccines is now waning. And I think as I referenced again in my earlier remarks, the scientific community is seeing it seems to me on a weekly basis, new research highlighting the role of reactivation of secondary viruses.

Speaker 2

And so I think this disease, which is really frankly pretty well known on Main Street is now coming back into focus for the scientific community on Wall Street. And so our hope is that there's great interest in this in general and we certainly wouldn't rule out potential partnership. It's the right economics, the efficient way to deliver value for various shareholders emerge following report out of those results.

Speaker 3

Okay, great. Thanks for taking the questions this morning.

Speaker 2

Of course, of course.

Operator

Thank you. Okay. As we have no further questions at this time, I will hand it back to Mr. Duncan for any closing comments you may have.

Speaker 2

Thank you very much, Ali, and thank you for the team for participating and thank you to those of you who dialed in or clicked in on the webcast. In short, just to summarize that BHC-two zero two study, the 3 arm study is enrolling well. We've passed the 50% enrollment level, and we're very excited about top line results for the second half of this year, both for various shareholders, but also because as we articulated, there are literally millions of people who are suffering today here in the U. S. And probably tens, if not 100 of millions worldwide.

Speaker 2

If that epidemiology data in other countries the same in the U. S. Patients really need something to treat this particular disease. That preliminary safety analysis of the data indicates that the combination of valcyclibir and silicoxib has been very well tolerated and that's very with what we've observed through the clinical development of both of our assets. We published our global patent earlier this year.

Speaker 2

And I'm pleased to tell you that discussions are ongoing as we seek a partner with advanced IMC1 into Phase 3 development for the treatment of fibromyalgia. And I should mention, as I mentioned earlier, just to close out, we continue to explore other complementary opportunities to build shareholder value. In particular, we're looking at other potential pain opportunities and our anti infectives with a focus on antivirals to complement IMC1 and IMC2. We appreciate your time and attention this morning and we'll report out progress on all of those matters in a very timely manner. Thank you and have a great day.

Operator

Thank you. This concludes today's conference call. You may disconnect your lines at this time and we thank you for your participation.

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Dogwood Therapeutics Q1 2024
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