Carisma Therapeutics Inc (CARM) 2014 Q2 法說會逐字稿

Welcome to Eleven Biotherapeutics' second-quarter 2014 financial results conference call. (Operator Instructions). As a reminder, today's call is being recorded.

I would now like to introduce Leah Monteiro, Corporate Communications Manager of Eleven Biotherapeutics. You may begin.

Thank you, good morning. The press release with the Company's second-quarter 2014 financial results became available at 7:30 a.m. Eastern time today. It can be found on the investors and media section on the Committee's website at ir.elevenbio.com.

Before we begin, I will read Eleven Biotherapeutics' Safe Harbor notice regarding forward-looking statements. During today's call we may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These may include statements about our future expectations, plans and prospects, clinical development and regulatory timelines, the potential success of our product candidates, financial projections, projections for 2014, 2015, and 2016 milestones and upcoming events and presentations.

Actual results may differ materially from those indicated by these statements as a result of various important factors, including those discussed in the Risk Factor section in our quarter reports on Form 10-Q for the period ended March 31, 2014, and other reports filed with the Securities and Exchange Commission.

Any forward-looking statements represent our views as of today only and should not be relied upon as representing our views as of any subsequent date. Although we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to today.

Joining me on the call today is Abbie Celniker, PhD, President and Chief Executive Officer of Eleven Biotherapeutics who will discuss recent Company highlights and review our product pipeline development progress. Following Abbie, Gregory Perry, Eleven Biotherapeutics' Chief Business Officer and Chief Financial Officer, will review the Company's financial results for the second-quarter 2014 after which we will open the call for Q&A. For Q&A, Michael Goldstein, M.D., Eleven Biotherapeutics' VP of Clinical Research. will be joining us.

I would now like to turn the call over to Abbie Celniker.

Thank you, Leah, and good morning, everyone. We continued to make steady progress this quarter advancing our pipeline of novel protein therapeutics that are based around our expertise in cytokine biology and have come out of our proprietary AMP-Rx platform.

As a biology-driven company, we select our target, engineer our drug, and design our clinical trials based on our understanding of the biology of ophthalmic diseases. We feel that our ability to design and engineer unique proprietary drugs targeting multiple key biological pathways in ocular diseases differentiates Eleven, and provides us with the opportunity for global commercialization and expanded intellectual property rights.

We continue to execute against our stated goals as we advance our product pipeline including EBI-005, our lead molecule, which is in clinical development for dry eye disease and allergic conjunctivitis as well as EBI-029, the second program to emerge from our AMP-Rx platform, which is moving towards clinical development for back of the eye diseases such as diabetic macular edema.

Additionally, we continue to engineer novel molecules in support of our discovery collaboration with ThromboGenics, as well as our own pipeline.

I will start with EBI-005, which is our lead late-stage program. As a reminder, EBI-005 is a novel interleukin-1 or IL-1 receptor blocker that is configured as an eye drop for topical administration and is currently in Phase 3 development for the treatment of dry eye disease and in Phase 2 development for the treatment of allergic conjunctivitis.

EBI-005 was designed to be well-tolerated and have a rapid onset of action by virtue of its tight binding and blocking of the IL-1 receptor on the surface of the eye, which prevents transmission of the biological signal responsible for many of those signs and symptoms of ocular surface diseases.

IL-1 is a unique target in that it plays essential role in ocular surface inflammation and on the sensation of pain and has been illustrated to be elevated in the tears and tissue of patients with dry eye disease.

We announced last quarter that we had completed patient enrollment in the Phase 2 proof of concept allergic conjunctivitis trial. Since that time, the last patient visit has occurred and data analysis is ongoing. We are on target to report topline clinical data for the fourth -- in the fourth quarter of 2014 as planned.

The primary endpoint for the 159-patient study is a reduction in subject-reported ocular itching. Additional endpoints include reduction in ocular redness, swelling, and other signs of ocular allergy. The safety and tolerability of EBI-005 compared to the [via] control was also evaluated.

This proof of concept trial was designed to elucidate a number of factors that will be helpful in planning a Phase 3 study providing better understanding of the course of the disease, patient response, and timing of treatment. We are looking at two clinical models for allergic conjunctivitis and evaluating EBI-005's potential in both treatment and prevention setting.

Allergic conjunctivitis is an inflammatory disease of the ocular surface involving the cornea and the conjunctiva or lining of the eye lid and the front part of the eye. Allergic conjunctivitis affects 15% to 40% of the United States population and ranges in severity with the most severe chronic forms potentially resulting in impaired vision and even in some cases blindness.

We believe the prolonged moderate to severe cases of allergic conjunctivitis are characterized by an IL-1 mediated inflammatory process stimulating the maturation and recruitment of inflammatory cells that exacerbate the allergic response. These patients are often treated with corticosteroids which, while being efficacious, are associated with serious side effects requiring frequent patient monitoring to follow the risk of the development of glaucoma or cataracts or infections thereby creating an area of significant unmet need.

Our goal with EBI-005 is to create a treatment with a disease-modifying efficacy of steroids without the risk of steroid-associated side effects for the millions of patients who are suffering with the more severe form of allergic conjunctivitis. If the results of our proof of concept Phase 2 data readout are positive, the next steps with EBI-005 in allergic conjunctivitis would be to conduct a confirmatory pivotal efficacy and safety study necessary for regulatory approval.

We also remain on track with the EBI-005 dry eye disease program. We continue to enroll patients in our multi-center pivotal Phase 3 trial with over 40 sites up and running with a high level of investigator engagement. In addition, we are on track to initiate the 12-month safety study of EBI-005 later this year.

While these studies with EBI-005 are ongoing, Eleven continues to engage the broader ophthalmology community, including physicians, patients, and payers to confirm and understand their needs, the marketplace, and payer expectations with regard to EBI-005 and our earlier stage product candidates.

In parallel, the EBI-005 commercial product manufacturing and validation campaign is making good progress. We are pleased the EBI-005 development program is moving along as planned in both indications. Interestingly, dry eye disease and allergic conjunctivitis patients are most often treated by the same practitioners. This presents an intriguing synergy and commercial opportunity as we can address both markets with one specialty sales force.

Turning now to EBI-029, our novel IL-6 inhibitor. IL-6 is a cytokine that has previously been shown to be up regulated in back of the eye diseases such as diabetic macular edema and uveitis, contributing to the angiogenic and inflammatory components of these diseases.

By inhibiting IL-6, EBI-029 could offer an alternative to current standard of care.

Because the biological mechanisms that drive DME and uveitis are inflammatory, particle steroids are a part of the current standard of care in these disease settings. By leveraging our unique understanding of the biology of our interleukin-6 and the inflammatory pathway we have designed, molecule EBI-029, to modulate IL-6 thereby inhibiting the information without the steroid-associated safety issue. This common pathway enables us to apply our differentiated approach to target IL-6 and investigate both of these diseases as potential clinical indications for EBI-029.

In DME, the anti veg fs are being used more widely, but are not efficacious in all patients with DME and require more frequently, administration than when they are used for wet EMD. Interestingly, IL-6 is known to be upstream and regulates the expression of veg f and as such a more central regulator of the biology of dry -- DME and we believe that EBI-029 by blocking IL-6 could be effective in treating the patients who respond to the veg fs as well.

EBI-029 has RA demonstrated the ability to potentially -- to potently, excuse me, inhibit all forms of IL-6 signaling in vitro, opening its potential for the treatment of both diabetic macular edema and uveitis. We continue to perform the preclinical studies and market analysis work necessary to make next step development decisions with the goal of maybe this product candidate towards clinical development in 2015.

In addition to the significant progress made this quarter with our clinical pipeline, our researchers presented at several key medical and scientific meetings this quarter including the Contact Lens Association of Ophthalmologist annual meeting in Toronto at which our Medical Director Michael Goldstein gave an oral presentation on new drugs in development for dry eye and ocular surface disease and the international Society of Ophthalmologists in Iceland at which Dr. Goldstein discussed the pitfalls in the design of dry eye clinical trials and our CSO, Eric Furfine, presented on the use of targeted biologics in posterior chamber ocular disorders such as DME and uveitis.

I will now turn the call over to Greg Perry to provide a review of the financial results for the second quarter of 2014.

Thanks, Abbie. Early this morning, we issued a press release detailing our financial results for the second quarter of 2014. I will review the financial highlights and then speak to our cash position and our financial guidance.

For the second quarter of 2014, we reported a net loss of approximately $8.1 million compared to a net loss of $3.6 million for the same quarter in 2013. The year-over-year increase in net loss was due to the increase in clinical trial activity in further development of our pipeline candidates, offset by increased revenue from our collaboration with ThromboGenics.

Total revenue for the second quarter of 2014 was approximately $800,000 compared to $200,000 in the same period last year and consists of ThromboGenics collaboration revenues which began in May 2013. As you may recall, at that time, ThromboGenics licensed our proprietary AMP, our [ex protein] technology to create a novel therapeutic that will be optimized from proved pharmaceutical characteristics and therapeutic benefits.

Research and development expenses for the second quarter of 2014 were $6.8 million compared to $2.7 million for the same period in 2013, an increase primarily driven by the initiation of our pivotal Phase 3 trial of EBI-005 in dry eye disease and our Phase 2 clinical study of EBI-005 in allergic conjunctivitis.

G&A expenses for the second quarter of 2014 were $2.1 million compared to $900,000 for the same period in 2013, an increase totaling about $1.2 million. This increase was driven primarily by higher expenses related to operating as a public company and increased stock-based compensation expense. We ended the quarter with $45 million in cash and cash equivalents. Based on current operating plans the Company expects to have sufficient cash and cash equivalents to fund current operations into the first quarter of 2016.

With that, we can open up the call for questions. Operator?

(Operator Instructions). Liav Abraham, Citi.

Good morning. A couple of questions. First, Abbie, I would be interested in your thoughts on the commentary made by Shire on investor call a couple of months ago that the FDA is willing to except Shire's (inaudible) filing based on the totality of the data. What do you think the potential implications of this are for the development of novel agents for dry disease in general? And more specifically for the development of EBI-005 for dry eye?

And then my second question is on EBI-005 for allergic conjunctivitis. Can you talk a little bit about your potential timeline going forward for pivotal trials and trial design assuming that we get positive data in the current Phase 2 trial before the end of the year? Thank you.

Thanks. So first talking from addressing the question about Shire's comment. What we read into this and what I think has been communicated pretty clearly in their press release is that Shire has been working very closely with the FDA going through all of the data from all of the trials that they have conducted. So they have conducted their Opus 1 and Opus 2 efficacy studies as well as [Fenada] which was their long-term safety study that had quite a few patients enrolled.

And when they say the totality of the data, what we anticipate is that when they look at all of the data that has been generated in all of those studies, that they feel that there is an appropriate trend in achieving the spine data that they were looking for. As I think folks recognize, they hit their symptom endpoints in their first two studies. The first study, it was a secondary endpoint of the sensation of eye dryness that was moved to be a primary endpoint in their second study and they did hit it. Which is really a great thing for patients, but it really was that they had to hit their spine data and so we anticipate that the data from all of the studies together is what they have shared with the FDA and that the FDA has found acceptable.

We anticipate that if they have announced that they are going to go ahead with their filing, that they have that level of confidence from the FDA.

I think that what impact that has on dry eye development in general as well as EBI-005, I think that the FDA has been very consistent with their statements of being able to show a clinically significant separation from vehicle in assigning (inaudible) symptom in two studies. And I don't think they are changing their perspective on that.

Where I think they might be opening their mind a little bit is on how they look at the data from at -- sort of a cumulative way, understanding that there is a lot of variability in this patient population, but that when one looks at the data across studies, there is also a way to combine that data to get reasonable and meaningful information. So, I think that the FDA is just recognizing that this is a complex population of patients and that they need to be collaborative with sponsors, but I don't think they are backing up on their requirements that you show the improvement in both a sign and a symptom in two studies.

So that's the first question. Your second question about allergic conjunctivitis timelines for our pivotal development as well as what our trial design might be, I think that we are in the early stages of that right now. What we do know is that development in allergic conjunctivitis can move very rapidly, based on the use of these allergen challenge models and as we mentioned. In the call we will be looking at what is the most appropriate model to use going forward. What is the most appropriate in treatment timing and also the most appropriate endpoint.

So as we get our data from our Phase 2 trial, we will be using that data to help design our Phase 3 trial. Right now, we are moving forward with all of the development aspects of the commercial manufacturing for EBI-005 that is on time on the timeline associated with our dry eye development. This is the same activities that would be required to support allergic conjunctivitis and, therefore, we see the AC development plan being pretty much in parallel with the dry eye development plan, but possibly leading out a bit later than dry eye with a launch time that would be subsequent to the allergic conjunctivitis -- excuse me, to the dry eye launch in a [successive] area.

With regard to -- as I mentioned with regard to the design of the trial, we really will be focusing on the data that we get from this proof of concept Phase 2 trial to inform how we move forward with the actual design of the clinical trial.

Great. Thank you.

Jason Gerberry, Leerink Partners.

Good morning. Just a couple on the allergic conjunctivitis opportunity. You mentioned last patient and so just curious if we should be expecting topline data early 4Q or late 4Q and then a follow-up on the I guess if the data are positive in the Phase 2 study, as you head into the Phase 2 meeting, is that pretty straightforward? Or would you look to incorporate any novel aspects into the Phase 3 design relative to like what we have seen with a steroid like a [pad a day] or would there be any novel concepts that you look to incorporate to that study?.

So, before I go to the timing of the AC readout, I will talk to you a little bit about what our interactions with the health authorities have been and how we think about the design of the trial.

So earlier in 20 -- well, actually in both 2013 and in 2014, we have had a number of discussions with the health authorities, the FDA as well as European health authorities. And we understand that they have a very, very clear established regulatory pathway towards approval for allergic conjunctivitis. So we are certainly going to stay within the constraints of the well-understood regulatory approach for AC approvals.

But what is interesting is in our conversations with the FDA, they have made it clear that they understand that this may be a different patient population than what is traditionally used in the allergic conjunction -- or, excuse me, in the antihistamine and (inaudible) stabilizer development paradigm. That they understand that this might be a slightly different patient population and that they are sensitive to our desire to add things to our studies to help understand that more. And they have been, I think, helpful and informative in that pathway.

So we are considering by virtue of the model that we ran in our Phase 2 study, we are considering ways of doing the trial that might be different than are traditionally used for antihistamines and [mouth hold] stabilizers by virtue of using multiple allergen challenges or potentially developing in a chamber where there is environmental or aerosolized exposure versus direct conjunctival exposure, which is what is more frequently used.

So there might be some twists to how we conduct our trial. But in no cases with anything that we do be something that the agency hasn't already seen.

So while we had great interactions leading into the design of our Phase 2 trial, we anticipate that we will have a continued dialogue along those lines as we go to our end of Phase 2 meeting.

With regards to the timing for the AC readout, we are being fairly consistent with our statement of fourth quarter. As I think we described in talking about this trial in the past, we really built a lot into this trial to help us understand the design of our pivotal studies. And so we want to be careful to go through the assessment of all of those different aspects so that we have the most informed Phase 3 program possible.

I think that that is exactly what we did with our dry eye program as well, taking the time to really go through the data and understand it.

We are currently in data analysis so I think we are on track for that fourth-quarter readout. Very comfortable about that.

Okay and if I can ask one follow-up just on 029 for DME? As you think about moving that into the clinic in 2015, what are the primary barriers between now and then? Is it just accumulating more tox data or still more work to validate that efficacy in animal models? Curious what are the steps between now and your filing the IND and getting that into Phase 1 testing.

Great questions. So, what I will say, what I will start off by saying is that with regard to efficacy models, one of the things that we do understand is that it is very difficult for animal models to always translate into clinical development. So we don't really look at the efficacy models as being rate limiting to our development program, based on our understanding of the biology and the data that we have to date.

So with regard to the question about what are the barriers, when you move forward in development paradigms, obviously with a biologic, the two sort of rate limiting steps are your [KMP] and your tox. So we are moving very aggressively to produce the material such that we can initiate the tox and that tox program would likely be the rate limiting step. But we are on track to complete both our [CMC] development and our talk studies in a manner that keeps us moving into the clinic the second half of 2015.

Great. Thanks.

(Operator Instructions). Tyler Van Buren, Cowen & Company.

Good morning. I guess I will focus my two questions on the allergic conjunctivitis programs since that is reading out first. So with respect to the primary endpoint of ocular itching, could you just remind us what the current therapies show in moderate to severe patients and how that is measured so we can get an understanding of a threshold for the results and what looks good when the data it reads out? And also with respect to the two direct with the two allergen challenged clinical models, obviously there's the chamber and the direct challenge.

Is it accurate to say that once you look and analyze all the data and you decide that one model might be more appropriate that you could move forward with that model in Phase 3? Or will you still be looking at both models? I would just like to clarify that. Thank you.

Thanks very much, Tyler. For those questions, I am going to ask Michael's team to sort of chime in with regard to your last question about which model and, in fact, what you said is correct. We will be looking at the data and from the data that we have generated our Phase 2 proof of concept study picking the right model to go forward and feel comfortable that either of those models is acceptable.

But, Mike, I would ask you to address Tyler's question about the primary endpoint of ocular itching, and how patients presented, et cetera.

So, as you are aware most of the drugs have been approved in the space have been approved for the treatment of ocular itching. And they are -- most of the -- all the drugs that are out there, actually, are our really approved for this sort of milder population in general. And so there are a number of antihistamine/mast-cell stabilizers. There's even one with a steroid.

And so what we are not looking to do is to have a drug that targets, let's say, that particular population. But we are looking to do is to look for patients that aren't well treated by the topical antihistamine/mast-call stabilizers or who require steroids in order to control their symptoms. And so, that is the target population that we looked at in this study. And so again, looking then at that population and then looking at this endpoint, primary endpoint of itching is where we are focused.

The other way, the other indication that you can get in allergic conjunctivitis is you can get an indication for the treatment of ocular redness. So that is more unusual indication to get, but it is something we are also looking at in both of these models for allergic conjunctivitis.

Mike, do you want to comment on as a physician how you measure ocular itching?

So, from a clinical perspective, it's the patient's subjective response. In a trial perspective, we have a scale that has been developed and validated and measured where patients are actually given scores.

Great. Thanks.

(Operator Instructions). I am showing no further questions at this time. I would like to turn the call back over to Abbie Celniker. Please go ahead.

Thanks, very much. So, thank you, everybody. We are really happy that everyone was able to join the call and look for to our next update. Thanks again, have a great day.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program. You may disconnect. Have a great day, everyone.