Immunic Inc (IMUX) 2023 Q1 法說會逐字稿

Good morning, and welcome to Immunic's First Quarter 2023 Earnings Call. My name is Jessica Breu, Head of Investor Relations and Communications at Immunic. I will also be the moderator on today's call.

Speaking on the call are Dr. Daniel Vitt, our Chief Executive Officer and President; as well as Glenn Whaley, our Chief Financial Officer. (Operator Instructions) And this event is being recorded. (Operator Instructions)

Before we begin, I would like to remind you that this presentation may contain forward-looking statements. Such statements can be identified by words such as may, will, expect, anticipate, estimate or words with similar meaning, and such statements involve a number of risks and uncertainties that could cause Immunic's actual results to differ materially from those discussed here.

Please note that these forward-looking statements reflect Immunic's opinions only as of the date of this presentation, and it undertakes no obligation to revise or publicly release the result of any revision to these forward-looking statements in light of new information or future events.

Please refer to Immunic's SEC filings for a more detailed description of the risk factors that may affect Immunic's results and these forward-looking statements.

I would now like to turn the webcast over to our CEO and President, Dr. Daniel Vitt, to begin the presentation. Daniel?

Yes. Thank you, Jessica. I would like to welcome everybody to Immunic's First Quarter 2023 Earnings Call. This morning, we announced our financial results for the first quarter ended March 31, 2023, and provided an update on our clinical development progress and upcoming clinical milestones.

During the webcast today, we will walk through our first quarter 2023 and subsequent highlights, financial and operating results as well as anticipated clinical milestones. As Jessica noted, after the presentation, you will have the opportunity to ask questions.

Let's start with the review of our first quarter 2023 and subsequent highlights. As a reminder, in February, we hosted a Celiac Disease R&D Webcast, which included 2 renowned experts, namely Dr. Joseph Murray from Mayo Clinic in Rochester and Dr. Michael Schumann from the Charité, Berlin.

Topics discussed included the dynamics of this multifactorial, complex autoimmune disease, including the characteristics of celiac disease, immune stimulation and its connection to clinical symptoms, the role of the epithelial barrier in the pathogenesis of the disease, as well as current and potential treatment options.

The R&D Webcast was intended to lay the groundwork of our clinical Phase Ib result of IMU-856 in celiac disease patients. As most of you know, the data set published later on in May provide an excellent clinical proof-of-concept data for IMU-856, which I will get to in a few moments.

Also to note, in February, Dr. Bob Fox from Cleveland Clinic, who is also the co-ordinating investigator of our insured and clinical programs in Multiple Sclerosis presented data from the blinded and open-label extension parts of our Phase II EMPhASIS trial of vidofludimus calcium in relapsing-remitting MS.

At the prestigious ACTRIMS Forum 2023, I would like to point out again that the data was favorable compared to historical data for current MS' treatments and showed that long-term treatment of vidofludimus calcium was associated with a low rate of confirmed disability worsening over time.

This data nicely underlined with vidofludimus calcium's neuroprotective potential in addition to its already established anti-inflammatory and antiviral effects.

Last month, we reported positive data from the maintenance phase of our Phase IIb CALDOSE-1 Trial of Vidofludimus Calcium in patients with Moderate-to-Severe Ulcerative Colitis or UC. These results were extremely encouraging as they demonstrated statistically significant activity of vidofludimus calcium as compared to placebo, while confirming the very favorable safety and tolerability profile of observed in other trials.

It is important to note that we believe the maintenance phase data confirms vidofludimus calcium activity in absence of chronic corticosteroid co-administration. As previously announced, based on this encouraging outcome, we are exploring a variety of value creating point -- options for the UC program and other inflammatory bowel disease indications.

I also, once again, would like to welcome Dr. Richard Rudick, to our Board of Directors. Rick has a stellar background, including decades spend as a clinical expert in multiple sclerosis and as a clinical trialist, who has overseen multiple successful pivotal studies. We are delighted to have Rick on our board and look forward to working with him as we continue to progress with the development of vidofludimus calcium in multiple sclerosis as well as our other pipeline programs.

I also want to thank Dr. Vincent Ossipow, who is stepping down from our Board at the end of June for his dedication to Immunic and his valuable guidance over the past 7 years. I speak for our entire team, when I say wish him well in his future endeavors.

As many of you are aware, on May 4, we announced highly positive results from the Part C portion of our Phase I clinical trial of IMU-856 in patients with celiac disease. This data significantly exceeded our expectations. IMU-856 demonstrated consistent and meaningful clinical improvements or placebo in 4 key dimensions of celiac disease pathophysiology, specifically protection of gut architecture, improvement of patient symptoms, biomarker response and enhancement of nutrient absorption.

IMU-856 was also observed to be safe and well tolerated in this trial. Most importantly, the observed protection of the lining of the gut and intestinal villi from gluten-induced destruction independent of targeting immune mechanism involved specifically in celiac disease, appears to be unique among proposed therapeutic approaches, which for the first part, target either the immune response or antigen processing.

We believe this impressive data set provides first diligent proof-of-concept that this oral first-in-class molecule IMU-856 represents an entirely new therapeutic approach, which could be a game changer in the way we treat gastrointestinal disorders, such as celiac disease, but also ulcerative colitis, Crohn's disease or irritable bowel syndrome with diarrhea. We are extremely enthusiastic about the potential for this program.

Just last Saturday, we published additional news on our IMU-856 program. In e-poster presentation at Digestive Disease Week in Chicago, we were pleased to have unveiled for the first time, IMU-856 mode of action as a potent modulator of SIRT6, a protein, which serves as a transcriptional regulator of intestinal barrier function and regeneration of bowel epithelium.

Through its effect on SIRT6, IMU-856 has shown the ability in animal and clinical studies to restore intestinal barrier function and bowel wall architecture.

That concludes our summary of the first quarter 2023 and recent subsequent highlights. I would now like to hand over to Glenn to provide a financial overview. Glenn?

Thank you, Daniel. I will now review the financial and operating results for the first quarter ended March 31, 2023. Let me start with the cash overview.

We ended the first quarter with $97.1 million in cash and investments, which we expect will be sufficient to fund operations into the fourth quarter of 2024.

Regarding the operating results. Research and development expenses were $23 million for the 3 months ended March 31, 2023, as compared to $17.4 million for the 3 months ended March 31, 2022. The increase was mainly driven by external development costs related to the ongoing clinical trials of vidofludimus calcium and IMU-856 and was partially offset by a decrease in external development costs related to Phase II clinical trials of vidofludimus calcium and ulcerative colitis and the IMU-935 program. General and administrative expenses were $4.3 million for the 3 months ended March 31, 2023, as compared to $4 million for the same period ended March 31, 2022. The slight increase was chiefly driven by travel expenses was partially offset by a decrease in non-cash-based stock compensation.

Other income was $2 million for the 3 months ended March 31, 2023, as compared to $0.6 million for the same period ended March 31, 2022. The increase was principally attributable to an increase in German tax incentives and the interest income and was partially offset by reductions in foreign exchange gains and R&D tax incentives for clinical trials in Australia.

The net loss for the 3 months ended March 31, 2023, was approximately $25.3 million or $0.58 per basic and diluted share. Based on 43.7 million weighted average common shares outstanding compared to a net loss of approximately $20.8 million or $0.74 per basic and diluted share based on approximately 28.1 million weighted average common shares outstanding for the same period ended March 31, 2022.

With that, I'll turn the call back over to Daniel for an outlook on upcoming clinical milestones. Daniel?

Yes. Thank you, Glenn. Let me provide an update on our anticipated upcoming clinical milestones. During the first quarter, we continued to progress vidofludimus calcium for the treatment of multiple sclerosis. Our ongoing studies include the identical twin Phase III ENSURE trials in relapsing MS and the Phase II CALLIPER trial in progressive MS.

Our current expectation is to report data from the interim biomarker analysis of the CALLIPER trial in progressive MS in the second half of 2023 and to read our top line data at the end of 2024.

The CALLIPER trial is designed to corroborate the neuroprotective potential of vidofludimus calcium in a progressive patient population and, if successful, it could be an important additional differentiator for the vidofludimus calcium in this market. Additionally, we look forward to reporting data from the interim analysis of our Phase III ENSURE program late next year and to read out the first of our Phase III ENSURE trials in relapsing MS at the end of 2025.

As we have stated before, based on the strong clinical activity observed thus far, the solidly established safety and tolerability profile to date and vidofludimus calcium combined anti-inflammatory, antiviral, and neuroprotective effects, we continue to believe that it has the potential to be a unique treatment option targeted the complex pathophysiology of multiple sclerosis.

With regards to our IMU-856 program as a result of the overwhelmingly positive data generated from our Phase Ib clinical trial in patients with celiac disease, we have begun preparing for Phase IIb clinical trial of IMU-856 in ongoing active celiac disease patients.

We are, at the same time, considering additional potential clinical applications for this oral first-in-class molecule in other gastrointestinal disorders. As stated earlier, we are very excited about this program and believe that IMU-856 could present an entirely new and innovative oral treatment approach for a number of gastrointestinal diseases, without the serious consequences associated with immunosuppressive therapies.

This brings us to the end of our first quarter 2023 overview. Jessica, please open the webcast for the Q&A session.

Yes. Thank you, Daniel and Glenn for walking us through the first quarter 2023 and the subsequent highlights and also our upcoming clinical milestones. (Operator Instructions) Our first question today comes from Andreas Argyrides at Wedbush. Andreas, hello, and please unmute yourself.

I'll just ask 2 here. So to our knowledge, this is the first drug targeting SIRT6. Can you just provide additional insight into what gives you confidence IMU-856 could work in this indication? And along the same lines, do you see IMU-856 being beneficial in other indications, if so, which ones?

Yes, sure. Thank you, Andreas, for that question. I'm not unexpected. Yes, this is, if you are a first mover in an interesting area, of course, the challenges doesn't work or not. And I'm very glad that the clinical trial really more or less exactly showed what we have seen in pre-clinical works before or so. And looking on the Phase Ib data we have recently shown is exactly what we have seen. So we have seen, for example, protection of villi we have even seen increasing villi size in some of the patients despite the gluten challenge design of that study. So pretty impressive data on the histology and the functions as well.

So just to remind you that we have seen an increase in vitamin B12 for example, already despite being a short trial. So that is a wonderful confirmation of what we have seen preclinically. And on top of that as I said, we have done a lot of preclinical work, including DSS model and so forth, where we have exactly seen those findings.

And this is, I think, the nice thing on this mode of action, is very different from what else is there, and it's not including any kind of immunosuppression. So we think, this really could start -- could be the start of a very broad activity.

So the second question for other indications, we have done most of the preclinical work in colitis models. So we believe that the holistic view of the data we have really makes us believe that Crohn's disease and an ulcerative colitis are indications where clearly patients should benefit as well from such a treatment. And given that it's a completely different approach from everything out there, it could really be a very nice synergistical effect for patients to achieve higher rates of remission and protecting patients from relapses down the road.

So our next guest today is Yasmeen Rahimi from Piper Sandler.

This is Lauren on for Yaz. A few questions from us. First, when are you planning or if you are planning to tighten the guidance to the interim CALLIPER in 2H '23? And can you remind us of the utility of this key data. And then our second question, when do you expect to have the meeting with the FDA for the Phase IIb design details? And do you think that 2024 will be an opportunity to share data from the study? And then what work is being done in regards to evaluating IMU-856 and other GI diseases?

I need to remember the first question.

The first one was the interim CALLIPER.

All right. So, we gave the guidance for a second half of this year. We keep it as it is right now. If we have more knowledge about precise timing, we will come out with that.

And what is included?

And what is included, okay, yeah. So clearly the focus of this interim is on biomarkers and I think we stated that in some of the calls earlier, that I think the key readouts which we have planned in the -- for the interim, we're looking on NFL and gfab levels for the patients, just to have the state-of-the-art pair of biomarkers, which should give us a little bit of an insight to what extent patients on the treatment groups benefit more than patients on placebo. And also looking on potential differences in the subset of patients with primary and secondary progressive MS.

So that's what we so far have mentioned in the public. Then on the FDA, of course, that's an important point. I think the team is currently working on. And so, we just recently got the data. So we try to be very quick, in including the findings in the Phase II protocol and design. And then as quickly as possible, submit our IND filing in the U.S. and use that as the starting point for the discussion with the regulators.

And because we think we really want to make sure we have some proper feedback on design of the trial. You may be familiar that the FDA released the draft guideline for celiac disease Phase III studies last year. And I think that that's a good starting point for any discussions within the company and the regulators.

And the third question was...

Was other GI diseases, 856.

Yes. I think that's more in the making. I think we definitely for time and resource reasons, we'll definitely focus first on the celiac, given the, I think, outstanding data we got from the very small Part C on the Phase I study, encouraging us real to fill that space. And also, I think the medical need is very high in celiac. There is no treatment approved. So these are all forces driving excitement here towards celiac as a first indication. But of course, the value gets much bigger if you consider Crohn's and colitis, for example, as indication. But more, I think -- I don't want to make a pre-decision on what we will do as a next indication. But from the biology point of view, for example, Crohn's should be one of those prioritized indications in the future.

(Operator Instructions) Our next guest is Matt Kaplan from Ladenburg.

Just continuing on 856 a little bit. I guess based on the recently announced mode of action, mechanism of action for 856 and combined with the positive data that you had in celiac, what-- and what are your thoughts, I guess, given the results for 838 in ulcerative colitis? And how you're thinking about moving these 2 programs forward in the clinic, given kind of their overlap and potential indications, also colitis, Crohn's disease, et cetera?

Well, I think there is a synergy between the concepts. As I said, 856 is not just another shot on the same goal. It's really an article in all mode of action. And if you look on what the current treatment landscapes delivered and how patients are treated, for example, if you look on and you see how often patients switch therapies, they -- what they run through, how still allow the clinical remission rates for induction trials are despite all success that it looks like a little bit of a ceiling of effects.

There is a demand for new mode of actions on the inflammation side, but 856 really comes from a very different place. So we -- I think we can add more than just another approach. It's something which can fundamentally my thought is, it can be combined with all of the current treatments. Of course, it makes more sense to combine something like 856 and you see in Crohn's with maybe the safest treatments which are currently available. So there's a lot of potential.

And I think in the perfect world, I would just combine it both. That's more a funding and resource question, you can't do every trial. So maybe first, delivering single-agent activity and then you're looking beyond makes a lot of sense. But I look at being, just as I said, coming just from Chicago from maybe Garden View, I see that we have something really important here and which goes beyond the normal piece of innovation and step-wise approach. 856 can really be a game changer. And this is not just overoptimistic CEO statement here. It's something where I feel really excitement among the experts we talk to, for example.

Okay. That's helpful. And then -- you spoke about the interim look on the CALLIPER study. How could the interim results impact the conduct of the CALLIPER study going forward?

Yes. I think, as I said, we have 2 different kind of populations in it. So secondary progressive and they are active and nonactive -- the majority is non-active, secondary progressive and primary progressive patients. And we don't know what we see there, what we will see there, because they all -- all these diseases are a little bit different and the history of patients is different so. We will -- as I said, we will compare placebo with the active ones, but also between the different active ones. Do we see more effects on the one or the other subpopulation. And therefore, we, for example, need to prioritize specific set of sub indications during completion of the trial to increase the information content of the study for the full readout.

We have 2 more which came in from an anonymous attendee in writing. The first one for 856, will you continued to follow the Phase Ib patients and provide a subsequent update?

Actually, this is not planned, a good point. I would love to have that. But when we planned this trial was just intended to demonstrate proof-of-concept. So as you know, we -- all of the Phase II studies we're running, we have these follow-ups here in this Phase I, we don't have that.

Okay. Thank you. And the second one also, I think the target disclosure was a nice surprise to a lot of folks. It does seem quite novel. So can you talk a bit more about the target and are there other companies working on this target?

Yeah. There are. This is really a new target. Therefore, there's a lot and lot ongoing there. Yes, to my knowledge, one other company, in Israel, working on the target, but in a different context. Here this, our work we originated from scientific observations or phenotypes. And it's an epigenic regulator. And it looks like that the molecule 856 binds in a way to SIRT6, as a protein, which is causing a couple of different things, which then lead to a specific phenotype.

And the specific phenotype is really a renewal of intestinal lining. You may know that the renewal is a normal physiological process. So in a healthy human intestine stem cells are replicating once a day on average. And this is a normal process. But in patients with these GI disorders, they really -- this process is not sufficient enough to heal the gut and to renew it and therefore damage goes on. So it's not a structural effect, which we achieved by repairing that mode of action. Yes. And it's -- I think the key is here really that intestinal renewal leads down to restore barrier function. And therefore, as a consequence, also should lead to less symptoms and ongoing disease. And this was nicely shown in this Phase I study.

Thank you. We have one more in the queue here. Tom Smith from SVB Securities.

Just a couple on our end. Yes. First on business development. Can you comment on whether there's been any uptick in inbound interest on the celiac disease data? And can you just remind us how you're thinking about partnership opportunities broadly across 838 and 856? And then secondly, we noticed on the pipeline side that you've added a new program, this IMU-381 for GI diseases. What can you tell us about this program? How are you thinking about development time lines? And when can we expect to hear more on this?

Yes. I think -- thank you, John, for the question. And as I said, I had the pleasure that close to the data readout and release of the mode of action that we have attended, DDW. And also took the opportunity to speak to players in industry and Academia care hospitals but also companies. I think with the concept of 856, we somehow -- my feeling is we hit the sweet spot of what is missing there. It's something which is not another simple solution for the same problem, but a different way to approach it. And my feeling is this is appreciated among industry and the players we talk to.

Of course, we can't tell you more details here publicly about discussions with the many pharma companies. But my feeling is that, that is really resonating well. Maybe you get the same feedback if you have the time, get the opportunity to speak to some of those. And from the general BD perspective, I think, as I always said, we are on that and we are open-minded people. We are executing trials because at the end BD is driven by data and the potential of molecules and how they fit into the company's strategy and maybe also needs on commercial side. And therefore, we are open on both ends.

And decisions here will be based on what is available, what's on the table and what is attractive on the value perspective for the company. And maybe too early to give more details on that. But I think this is something where I feel personally very excited about.

Then on the 351, you mentioned this is the newest addition to the pipeline. And as you know, we are working broadly in GI, and we have also achieved quite positive data here in the maintenance study from -- for 838. And we think it is of more resources and focus for preclinical work to come up with something where we have -- maybe make benefit of all the learnings. And our technical capacity is here to optimize molecules. And we have developed a series of very potent molecules and just decided that one of those should now be brought into a preclinical development process. No guidance on that, how quickly that goes. This is preclinical work, and we need some time to complete the package. But it's something which nicely will complement the portfolio in the GI space.

Yeah. Thank you to all the questions. This concludes our question-and-answer session. I would like to turn the webcast back over to Daniel for any closing remarks.

Yes. Thanks, Jessica. Thank you to today's participants for your great questions and good discussion. In summary, we look forward to reporting data in the second half of this year from the internal analysis of our Phase II CALLIPER trial of vidofludimus calcium in progressive MS. We also look forward to providing an update on our IMU-856 program hopefully here soon. We remain well funded with $97.1 million on our balance sheet, providing us runway into the fourth quarter of 2024.

With that, I would like to close today's call. Again, thank you very much for joining. And as always, we are more than happy to answer any additional questions one-on-one.

Thank you for joining Immunic's first quarter 2023 earnings call. The webcast has now concluded. You may now disconnect.