Eiger BioPharmaceuticals Inc (EIGR) 2014 Q1 法說會逐字稿

Good day ladies and gentlemen and welcome to the Celladon first quarter 2014 earnings call.

(Operator Instructions)

As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Fred Wiklund, Vice President, Investor Relations and Corporate Development. Please go ahead.

Good afternoon and welcome to Celladon's first quarter 2014 conference call. This is Fred Wiklund, Vice President of Investor Relations and Corporate Development of Celladon Corporation. You can listen to our live webcast or a replay of today's call by going to the Investor's section of our website Celladon.com.

The agenda for today's call is as follows. First, Dr. Krisztina Zsebo, our CEO, will provide a Company summary and discuss recent corporate highlights and updates. Rebecque Laba, our VP of Finance, will then review the Company's financial results. Kris will then make closing remarks and open up the call for Q&A.

However before we begin this afternoon, I'd like to remind everyone that statements made during this call regarding matters that are not historical facts are forward-looking statements within the Safe Harbor provisions of the Private Securities and Litigation Reform Act of 1995.

Forward-looking statements are not guarantees of performance. They involve known and unknown risks, uncertainties, and assumptions that may cause actual results, performance, and achievements to differ materially from those expressed or implied by the statement. Please see the forward-looking statements disclaimer on the Company's press release issued today, as well as the risk factors section in our Form 10-Q, filed with the SEC.

In addition, any forward-looking statements represent our views only as of the date such statements are made. And Celladon specifically disclaims any obligation to update such statements to reflect future information, events, or circumstances.

Now I'll turn the call over to Celladon's CEO, Dr. Krisztina Zsebo. Kris?

Thanks, Fred. Good afternoon, everyone. Thanks for joining us today.

We have achieved a number of important milestones so far this year and see encouraging momentum in our development programs and overall business. Today we'll be providing recent updates on our development programs and then conclude with a general business update, followed by our financial overview. After our prepared remarks we will be happy to answer any questions you may have in the Q&A session.

Let me first start with some recent MYDICAR achievements. Importantly, earlier in the quarter we completed enrollment of 250 subjects in the CUPID 2 study. This trial is a randomized double-blind placebo-controlled international study, comparing a single intracoronary administration of MYDICAR versus placebo, added to an optimal heart failure regimen.

The primary objective is to determine the efficacy of MYDICAR in patients with NYHA class III/IV symptoms of heart failure, by reducing the frequency and/or delaying heart failure related hospitalizations compared to placebo treated patients. I want to note that the CUPID 2 trial is an event driven trial and two events needed to occur prior to unblinding this trial.

First, we need to observe at least 186 cardiovascular events. Second, all patients need to be observed for at least 12 months. In light of these requirements we today reconfirm that we are on track for data from this trial in April 2015. Also in this quarter we had our third CUPID 2 data safety monitoring committee meeting where the committee recommended we proceed with the trial as planned.

We are also tremendously pleased that MYDICAR was recently granted Breakthrough Therapy Designation by the US Food and Drug Administration for reducing hospitalizations for heart failure in NYHA class III or IV chronic heart failure patients that are neutralizing antibody negative. I also want to remind everyone that MYDICAR has previously received fast-track status from the FDA, so this designation is now in addition to fast-track status.

The relatively new Breakthrough Therapy Designation is intended to further expedite the development and review of drugs for serious or life-threatening conditions, where preliminary clinical evidence suggests it provides a substantial improvement over existing therapies. I believe this designation validates MYDICAR's unique characteristics and is a testament to the strength of our clinical data to data, wherein the CUPID 1 trial MYDICAR high dose subjects had an 88% reduction of cardiovascular events with a p-value of 0.003. I also believe it clearly underscores the urgent need for new treatments for this serious and life-threatening condition.

This is the only third Breakthrough Therapy Designation awarded by the CBER division of the FDA and MYDICAR is the first gene therapy product candidate granted this designation. We look forward to working with the senior staff at the FDA to determine the most expeditious path to bring MYDICAR to patients with heart failure.

Although we can't predict the outcome of future discussions with the agency, under MYDICAR's new status as breakthrough therapy product candidate, we believe that depending on the strength of the CUPID 2 data there is a possibility that the FDA may not require us to complete additional efficacy trials of MYDICAR for the treatment of systolic heart failure if the results of our ongoing CUPID 2 trial satisfy FDA's requirement, under the new breakthrough therapy regime.

In a recent article, Janet Woodcock, the Director of the FDA, stated and I quote, traditionally greater toxicity and also less certainty about drug performance has been accepted in the setting of diseases that are the target of breakthrough therapy designated drugs, end quote.

So let me provide additional context with respect to the unmet need in advanced heart failure, which is clearly a highly relevant factor in receiving Breakthrough Therapy Designation. Currently the long-term prognosis associated with heart failure is unfortunately worse than that associated with the majority of cancers with a mortality rate of approximately 50% at five years following initial diagnosis.

With respect to treatment options, an enormous treatment gap exists today for heart failure patients, particularly in the advanced stages where patients suffered debilitating symptoms and have frequent re-hospitalizations. Currently the patients we are targeting with MYDICAR have two remaining treatment options. A heart transplant and implantation of a left-ventricular assist device.

These are both invasive and open chest surgery procedures associated with a host of complications. And there are fewer than 5,000 of these two procedures conducted in the United States each year combined. Contrast that with the estimated 280,000 annual deaths from heart failure in this country, illustrating the stark contrast between available therapies and patient need. We therefore believe that the culmination of these factors collectively presents a significant opportunity for new treatment modalities in advanced heart failure.

Also with this backdrop in mind, we believe this landscape presents a very attractive commercial opportunity for MYDICAR. If approved, we estimate that upon launch in the United States there would be approximately 350,000 patients eligible for MYDICAR therapy, who have a significant unmet need.

Let me now move on to some other new initiatives with MYDICAR in advanced heart failure that we're excited about. As many of you are aware we're currently at excluding from treatment all patients that have evidence of pre-existing antibodies to the AAV vector that is used to deliver the SERCA2a gene to heart muscle cells. The reason for this is that antibodies to AAV effectively block MYDICAR from entering the heart muscle cells, therefore rendering the treatment ineffective in this subgroup of patients.

We have developed a companion diagnostic which helped us identify the presence of levels and levels of neutralizing antibodies in patients. Based on our data of blood samples to date, we currently estimate that approximately 60% of all patients in the United States are excluded from receiving MYDICAR treatment and perhaps even more than that in certain European geographies.

Last week during our investor and analyst day in New York City, we introduced the concept and early data suggesting that undergoing plasmapheresis can potentially lower AAV1 neutralizing antibody titers prior to MYDICAR dosing in certain patients. If successful, this procedure would effectively remove the presence of these antibodies for a certain period of time, which in turn would allow additional patients to receive MYDICAR treatment.

Let me briefly explain the concept further. During plasmapheresis blood is removed from the body and blood cells and plasma are separated and then the blood cells are returned, essentially clean of certain antibodies. There are several precedents where plasmapheresis has been successfully implemented in the clinical setting and has become standardized practice for many patients.

For example certain organ transplant patients may have multiple plasmapheresis sessions before and after surgery to remove antibodies to prevent organ rejection. While preliminary, we are encouraged by our data to date suggesting that we can lower the titers of AAV1 antibodies. And are hopeful that plasmapheresis may present a path forward to allow effective MYDICAR therapy for a portion of additional patients.

We'll give you updates on the progress of this initiative going forward and provide more context as to how we think plasmapheresis may potentially get rolled into our development program and how it could ultimately impact the number of incremental patients available for MYDICAR therapy.

Now let me move on to our other evolving MYDICAR program, which is guided by the fundamental biological role that SERCA2a enzymes play in vascular health. SERCA2a has an important beneficial role not only in muscle but also in blood vessels.

SERCA2a enzyme levels increase in tissues with exercise training and increasing SERCA2a in blood vessels with MYDICAR has been demonstrated to improve blood flow and inhibit stenosis or vessel blockage. Therefore we believe there are scientifically substantiated opportunities to address vascular related diseases such as AV fistula maturation failure and pulmonary artery hypertension with SERCA2a therapeutics such as MYDICAR.

We have just recently initiated development program with MYDICAR targeting AV fistula maturation failure in end-stage renal disease. AV fistulas are surgically created in the blood vessels of dialysis patient's arms, to provide easy access for dialysis. And are the preferred route of vascular access for dialysis patients.

Unfortunately, approximately half of these interventions fail due to vessel blockage, which presents a major clinical problem to these patients and physicians. As many as 25% of hospital admissions in the dialysis population have been attributed to vascular access problems, including fistula malfunction and thrombosis.

We believe MYDICAR may be able to prevent these blockages and to improve success rates for these procedures. There are currently no marketed products addressing this clinically important condition. And we also believe this indication may qualify as an orphan drug disease under FDA guidelines. We will update you all on the progress of this program going forward.

Now moving to our small molecule program. Earlier in the quarter we announced a research collaboration and option agreement with Servier, for the discovery and development of our novel SERCA2b modulators for the treatment of type II diabetes and other metabolic diseases.

Under the terms of the agreement, we granted Servier an exclusive option to license the ex-US rights to the program in the field of diabetes and other metabolic diseases for a certain period of time. We would expect Servier to make their decision whether to exercise their option by early next year based on the outcome of a series of pre-specified in vitro and in vivo studies.

Separately we plan to initiate a number of other preclinical studies this year, primarily in neurodegenerative applications. And we will provide periodic updates on the progress of these programs. With that pipeline update, I'd now like to focus on some recent corporate highlights.

On the corporate, front we successfully completed our initial public offering in February raising net proceeds of $44.3 million. This level of funding puts us on a solid financial footing expected to provide funding through the end of 2015.

We also continue to strengthen our Board of Directors and we are very pleased to have elected in the first quarter Dr. Peter Honig, currently head of Global Regulatory Affairs at AstraZeneca and Dr. Patrick Yang, recently retired as global head of Pharmaceutical Technical Operations at Roche, to our Board. We expect Peter and Patrick to add tremendous technical, scientific, and strategic industry expertise to our Board.

Finally, I want to remind everyone that last week we hosted an investor and analyst breakfast meeting in New York City, where we talked in greater scientific detail on many of the subjects covered in this call. The webcast from this presentation is available on the investors section of our website Celladon.com.

To conclude, we believe Celladon today is in excellent position to execute on our vision and goals. Our financial position has never been stronger. We have an innovative and expanding pipeline of development programs, led by the broad potential of our gene therapy product candidate in several disease areas, as well as an emerging small molecule platform targeting SERCA2b enzymes.

With that overview, I'll now turn the call over to Rebecque to discuss the financials for the quarter.

Thanks, Kris. I will now discuss Celladon's financial results for the first quarter, which are also included in this afternoon's press release and are available with additional information in our form 10-Q, which was filed with the SEC today.

For the three months ended March 31, 2014, Celladon reported a consolidated net loss of $7.2 million compared with a consolidated net loss of $3.5 million for the first quarter of 2013. Research and development expenses were $5.2 million in the first quarter of 2014 compared to $2.9 million in the first quarter of 2013. This increase was primarily due to increased spending on our CUPID 2 clinical trials and manufacturing activities for clinical supply of MYDICAR.

General and administrative expenses were $1.7 million in the first quarter of 2014 compared to $0.6 million in the first quarter of 2013. The increase is largely due to an incremental expense as associated of being a public Company.

As of March 31, 2014 Celladon had cash, cash equivalents, and marketable securities of $57.6 million, which included $44.3 million in net proceeds from our IPO. With completion of the IPO, all of the Company's preferred stock and convertible promissory notes have been converted into common stock. As a result the Company has no debt outstanding at March 31, 2014.

We believe that we are well capitalized to drive our lead program through meaningful clinical milestones expected in 2015. I will now turn it back over to Kris.

Thanks, Rebecque.

In summary we are very pleased with our recent progress and intend to continue this level of execution as we progress our development programs going forward. As you have just heard we have a number of new initiatives ongoing and we look forward to sharing the progress of these programs over the course of the next month and years.

And with that, we'll now open to Q&A. Operator?

(Operator Instructions)

Brian Klein, Stifel.

Hello, thank you for taking my questions. Nice progress on the quarter.

Thank you.

My first question has to do with the CUPID 2 trial design. Just wondering if you're including a final analysis of the level of neutralizing antibodies at the 12-month time frame?

And if not, is there an opportunity to amend the protocol to include that so you can get a good sense of how many patients develop neutralizing antibodies after the year is up?

Yes, thanks, that's a great question.

First of all, we are following neutralizing antibodies. I don't have right off the top of my head the exact time points.

However, what I can tell you from our previous experience is that 100% of patients zero convert to fairly substantial titers at the doses that we're currently administering.

So if your thought was that perhaps we could use plasmapheresis and redose these patients or perhaps some patients wouldn't develop antibodies, unfortunately I do not think that's the case.

Okay. Thank you.

And then in regards to the Servier program. Could you just give us some timing on when we might get an update there and how quickly we can see that program get into the clinic? Thank you.

Thanks.

We are conducting a series of research experiments in collaboration with Servier. We expect a decision to be made about exercise of their option early next year.

We believe that there is a potential for them, if they move forward with their option, to proceed with some of the compounds that are currently being evaluated.

I certainly wouldn't want to speak for them in terms of a timetable for IND filing, given that the development program, ex US, would be largely in their hands. But we're encouraged that some of the compounds that we're currently evaluating have the potential to move into the clinical arena.

Great. Thank you for taking my questions.

Ying Huang, Barclays.

It's actually Catherine for Ying.

This is probably a little early to talk about this, but say that CUPID 2 is positive and it is accepted as pivotal. How are you guys thinking about or preparing for a commercial launch? What are the steps you're going to take or are taking for that process?

And then can you give us anything on the timing for the antibody-positive patients? Thank you.

Hi, Catherine. This is Fred Wiklund speaking.

I'll just address your question regarding moving forward after CUPID 2. So today is a bit early to give you definitive answers how we can proceed after data. Clearly, we'll connect with agencies both in Europe and the US to look for the most expeditious path towards development.

With regard to commercialization, our position today is that we believe that MYDICAR is suitable for commercialization by ourselves building out a commercial infrastructure. And with that in mind, we are also constantly evaluating potential partnerships that could aid that effort in certain geographies.

Yes, and we're obviously preparing now for some of the long-lead items relating to manufacturing and so on that would be important to move forward with.

The other question you had about the neutralizing antibody trial. We are constantly evaluating priorities in our development program.

And with the recent initiative on the AV fistula program, we've pushed back somewhat the neutralizing antibody trial start. So that will either start in late 2014 or 2015. And the viral shedding study is going to be 2015.

Neither of these changes impact commercialization time lines because the commercialization time lines are really driven by commercial manufacturing facility readiness. And that's where we've focused our attention right now to make sure that we're addressing those long-lead items.

Okay. Great. Thank you very much.

I'm not showing any further questions at this time. I'd like to turn the call back over to management for closing remarks.

Thanks.

I just want to thank everybody who joined the call today for the first time and also for your attention. We appreciate your interest and continued support and belief in the bold innovation that Celladon seeks to deliver to patients in need.

So hope you all have a good day and thanks again for joining.

Operator?

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may all disconnect. Everyone have a good day.