IVERIC bio Inc (ISEE) 2018 Q1 法說會逐字稿

Good day, and welcome to the Ophthotech Corporation First Quarter 2018 Results Conference Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Kathy Galante, please go ahead.

Good morning, and welcome to our First Quarter 2018 Earnings Call. Representing Ophthotech today is: Mr. Glenn Sblendorio, Chief Executive Officer and President; Dr. David Guyer, Executive Chairman; Dr. Kourous Rezaei, Chief Medical Officer; David Carroll, Chief Financial Officer; Keith Westby, Chief Operating Officer; and Vishal Kapoor, Vice President of Business Development.

I would like to remind you that today, we will be making statements relating to Ophthotech's future expectations regarding operational, financial and research and development matters, including statements regarding the implementation of our strategic plan; our projected use of cash and cash balances; the timing, progress and results of clinical trials and other research and development activities; the potential utility of our product candidates; and the potential for our business development strategy, including any potential in-license or acquisition opportunities. These statements constitute forward-looking statements for purposes of the safe harbor provision under the Private Securities Litigation Reform Act of 1995.

These statements cover many events and matters that are subject to various risks that could cause actual results to differ materially from those expressed in any forward-looking statements, including risks related to the initiation and the conduct and design of research programs and clinical trials; availability of data from these programs; expectations for regulatory matters; need for additional financing and negotiation; and consummation of in-license and/or acquisition transactions.

I refer you to our SEC filings, and in particular to the Risk Factors section in our annual report on Form 10-K filed on March 5, 2018, for a detailed description of the risk factors affecting our business. In addition, any forward-looking statements represent our views only as of today, and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements at some point in the future, we disclaim any obligations to do so even if our views do change.

I would now like to turn the call over to Glenn.

Thanks, Kathy, and good morning, everybody. We really appreciate you joining our call this morning.

Beginning of 2018 has been productive, as we announced our first gene therapy collaboration with the University of Massachusetts Medical School in its Horae Gene Therapy Center and continue to build on our Zimura complement factor C5 inhibitor program, with ongoing clinical trials in multiple ophthalmic diseases: first, our Phase IIa trial in wet age-related macular degeneration, or AMD, which has just finished recruitment; second, our IIb geographic atrophy trial secondary to dry AMD; third, our Phase IIb trial in autosomal receptive Stargardt disease; and our Phase IIa trial in idiopathic polypoidal choroidal vasculopathy. We're also excited to have initiated an innovative gene therapy research program for treating retinal diseases in the back of the eye. Among the novel technologies, we have evaluated to date, we believe that gene therapy solutions may be well suited to execute on our strategy to identify potential treatments for both orphan and large-market back of the eye diseases.

As we continue to move forward, our business development outreach will continue to be aggressive, but selective as we seek new opportunities that are in-sync with our science-driven ophthalmic focused strategy. We will build on this strategy to uncover novel and differentiating technologies and product candidates through collaborations with leading academic institutions and companies in the U.S. and internationally. We believe our clinical expertise and retinal expertise are key to delivering on this strategy to creating tangible opportunities for the company and value for our shareholders. Both wet and dry AMD are considered large-market retinal indications, with approximately 10 million people in United States and 30 million people worldwide suffering from some form of AMD. Dry AMD accounts for 85% to 90% of all AMD cases. And as many of you are aware, there are no FDA or EMEA (sic) [EMA] approved treatment options for dry AMD, including geographic atrophy secondary to dry AMD, which is the end stage of this disease.

Last week, we completed patient enrollment in our dose-ranging open-label multicenter Phase IIa clinical trial of Zimura in combination with the anti-VEGF agent LUCENTIS in treatment-naïve patients with wet AMD, who have not been previously treated with any anti-VEGF agents. A total of 64 patients have been enrolled in this clinical trial. This uncontrolled trial is designed to assess safety at different dosages and to detect potential efficacy -- potential efficacy signal. The company will evaluate data at month 6. We are extremely pleased with the enthusiasm shown by principal investigators in the recruitment for this clinical trial leading to an on-target enrollment of patients. With the recruitment completed on schedule, we are on track to report initial top line data from this clinical trial by the end of 2018. Following the completion of this trial, clinical data will be analyzed to assess whether to proceed to a randomized sham-controlled clinical trial of Zimura in combination with anti-VEGF therapy.

We continue to recruit patients for ongoing randomized, double-masked, sham-controlled Zimura Phase IIb trial in geographic atrophy, or GA. This trial is designed to assess the safety and efficacy of Zimura monotherapy in patients with GA. Recruitment is going well, and we are on track to report top line data from this trial in the second half of 2019.

At the end of last year, we initiated an open-label Phase IIa trial evaluating Zimura in combination with anti-VEGF therapy for idiopathic polypoidal choroidal vasculopathy. Initial top line data is expected in the second half of 2019.

In connection with the initiation of our first orphan disease clinical development program, earlier this year, we announced the first patient enrolled in our Phase IIb randomized double-masked, sham-controlled clinical trial assisting the efficacy and safety of Zimura in patients with autosomal recessive Stargardt disease, or STGD1. We expect initial top line data to be available from this trial in 2020. We expect to enroll approximately 120 patients globally in this Phase IIb trial, making this one of the largest interventional clinical trials in Stargardt disease to date. We believe that there are advantages to pursuing drug development for orphan indications, including the potential for regulatory exclusivity and accelerated development time lines.

Our collaboration with UMass Medical School is the initial step in executing our strategy to build a portfolio of next-generation gene therapy options in retinal diseases. In February, we entered into a series of gene therapy-sponsored research agreements with UMass Medical School to utilize novel gene delivery methods and its minigene therapy approach to target retinal diseases. As a condition of each reach agreement, UMass Medical School has granted us an option to obtain an exclusive license to any patent or patent applications that result from this sponsored research.

Before I turn the call over to Kourous, who will go into more detail on our gene therapy program and our collaboration with UMass Medical School, during the first quarter, we welcomed Jane Pritchett Henderson, Chief Financial Officer and Senior Vice President of Corporate Development at Voyager Therapeutics, to our Board of Directors. Jane's extensive background in biotechnology and specifically in Corporate Development has already proven to be a valuable addition to our board. Jane is also Chair of the Audit Committee.

I'd now like to turn the call over to Kourous.

Thank you, Glenn. Good morning, everyone. Before we discuss our gene therapy initiative, I want to highlight that scientific details to our Zimura ongoing clinical trials were recently presented at multiple medical conferences. Dr. Karl Csaky, the T. Boone Pickens Senior Scientist in Molecular Ophthalmology Laboratory and Clinical Center of Innovation for AMD at the Retina Foundation of the Southwest and pioneer at Texas Retina Associates presented the details of our Stargardt trial during a paper presentation titled "Complement C5 Inhibition as a Potential Treatment for Autosomal Recessive Stargardt Disease, Design of a Clinical Trial Assessing the Novel Treatment and Primary Outcome Measure." This presentation took place last week during the 2018 annual meeting of the Association for Research in Vision and Ophthalmology annual meeting in Honolulu, Hawaii. In addition, scientific details of this trial were also presented at the International Symposium on Ocular Pharmacology and Therapeutics, ISOPT, in Tel-Aviv, Israel, in March 2018.

For our Zimura trial in dry AMD, Dr. Baruch Kuppermann, Professor and Chair of the Department of Ophthalmology, Gavin Herbert Eye Institute, University of California, Irvine, presented scientific details of our Zimura trial in geographic atrophy secondary to dry AMD at the 41st Annual Macula Society Meeting in February of 2018, in California.

Moving on to gene therapy. Orphan indications in the eye present a significant unmet medical need since most patients do not have any approved treatment option available to them. Since the majority of the orphan indications in the eye are caused by genetic mutations, strategically, it was natural for us to enter the gene therapy arena. Gene therapy's key strength, it is potential to provide durable, prolonged therapeutic effect and possibly cure with a single administration. This approach is particularly appealing for patients, caregivers and physicians. Further, gene therapy may also be attractive for large market ocular indications that currently require chronic treatment over years or even decades.

Eye presents itself as a compelling organ for gene therapy since it allows local delivery and is immune privileged. As you know, the first gene therapy in the United States was recently approved for an ocular orphan indication. We are particularly interested in adeno-associated virus or AAV gene therapy delivery, as AAV vectors can be designed to be cell-specific for the retinal tissue and the safety profile in humans is relatively well documented.

As Glenn referenced earlier, our first step into gene therapy is our exciting future collaboration with the Horae Gene Therapy Center at UMass Medical School that allows us to collaborate with high-caliber scientists, such as Dr. Guangping Gao, Professor of Molecular Genetics and Microbiology and Director of the Horae Gene Therapy Center; and Dr. Hemant Khanna, Associate Professor of Ophthalmology and Visual Sciences. As you know, Dr. Gao is a pioneer in the development of novel adeno-associated virus family for gene therapy, and Dr. Khanna's research focuses on using minigene technology to develop treatments for orphan retinal indications.

We would evaluate the minigene therapy approach that is being developed at UMass to target orphan ophthalmic indications. AAV vectors are generally limited as a delivery vehicle by the size of their genetic cargo. The use of minigenes as a therapeutic strategy seeks to deliver a smaller, but still functional form of the larger gene package into an AAV delivery vector. The minigene strategy may offer a novel approach for diseases that would otherwise be difficult or impossible to address through conventional AAV gene replacement therapy, where the size of the gene of interest exceeds the transgene packaging capacity of AAV vectors. The scope of our agreement with UMass includes: Leber Congenital Amaurosis type 10, or LCA10, which is the most common type of LCA and is caused by mutations in the CEP290 gene; and autosomal recessive Stargardt disease, which is caused by mutations in the ABCA4 gene. LCA10 and Stargardt disease are both orphan inherited degenerative retinal diseases that lead to vision loss without any currently available FDA or EMA approved treatments. The minigene therapy for Stargardt disease is a potentially strategic life cycle improvement for our Zimura program in this disease.

Further our collaboration with UMass Medical School, while world expert researchers in AAV vectors, will focus on developing AAV vectors for delivering gene therapy for the back of the eye. The field of gene therapy is advancing at a rapid pace, and we believe it is crucial for us to be at its cutting edge. We believe that our collaboration with UMass Medical School will pave the way for our strategy to develop innovative, gene therapy solutions and novel therapeutic options for patients with, degenerative retinal diseases and which creates value for our shareholders.

I will now turn the call over to Dave Carroll. Dave?

Thank you, Kourous, and good morning, everyone. I'd like to highlight a few items from our press release this morning and also reaffirm our year-end cash guidance.

For the quarter, our net loss totaled $13.1 million and $0.36 per share compared to a net loss of $43.1 million or $1.20 per share for Q1, 2017, assuming 2017 reflected the impacts of the discontinuation of the Fovista Phase III clinical program and our organizational restructuring.

Turning to our expected year-end cash balance. Our cash balance at March 31 was approximately $155 million, a $12 million decrease from year-end 2017. We reaffirm our cash guidance and expect our year-end cash balance to range between $112 million and $117 million based on our current 2018 business plan, which includes continuation of our Zimura development programs and the initiation of our collaborative gene therapy research programs. Of course, these estimates do not reflect any additional expenditures resulting from potential in-licensing or acquisition of additional product candidates or technologies or associated developments that company may pursue.

I'll now turn the call back over to Glenn.

Well, I would like to thank everybody for joining the call this morning. And, operator, I'd ask that you open up the phone for questions.

(Operator Instructions) We will take our first question from Yigal Nochomovitz with Citigroup.

This is (inaudible) on for Yigal. So for your gene therapy program, can you discuss which stage is this program on? And do you have any potential time line regarding to this program? And I have a follow-up.

Thank you, Yigal, for the question. I'll answer your second question first. At this one we have not publicly provided any time lines regarding our gene therapy collaboration with UMass. And the strategies as indicated, the size of the gene is too large to be delivered on its own by AAV. AAV has a good track record in the eye, so the research involves looking at portions of the gene that still produces functional protein that can still be incorporated into the AAV vector and be delivered. The paper was recently published that showed that it can rescue photoreceptors in mice and, currently, it's in the process of being optimized. And the similar concept will be also used to Stargardt. Again, the gene is too large to be delivered with AAV.

Okay, great. And so my follow-up is, as you know, some other companies are taking a gene-editing strategy for diseases like LCA10. So can you discuss the treatment strategy kind of pros and cons between gene editing and the gene therapy?

Yes, I think that's a great question. I think one of the differentiating factors for minigene therapy is that it is mutation independent. And we think that's a key advantage of this technology.

We'll now take our next question from Anupam Rama with JPMorgan.

I had a quick question on the Phase IIa in wet AMD readout in the second half of this year. I know this is an uncontrolled trial, but help us to understand kind of the scenarios and what would be a win scenario for you guys for this program relative to what we've already seen with some of the clinical data for Zimura and wet AMD?

Another great question. As you know, we have already performed a Phase IIa trial in the past. What we had around 60% 3 line gainers in our higher dose and some at around 15 letters mean change in vision, and that is quite high when you compare to the average amount of letters gained, the 3 line gainers in the large clinical trials. They usually sum it around 30%, 35%. The highest is 40%. And now here we had 60% and 15 letters gained. So -- and that was achieved at our highest dose. So what we did basically before going into another very large clinical trial looking at combination therapy versus monotherapy, we decided to replicate that trial, see whether the result validated itself in another independent trial, and also did some additional dose-ranging to see if we can further improve the outcome in comparison to what we have done before. And obviously, these are small sample sizes. These are uncontrolled. This is going to be discussed statistically what values need to be looked at based on the sample size to see after what's -- what outcome to move forward with a larger indication. But the idea is to whether one can -- obviously, if you can replicate independently twice 60%, 3 line gainers and some at around 15 letters of visual improvement, that gives you a good indication that one may want to move forward. But again, that needs to be statistically analyzed and decided at that time point.

As there are no further questions from the phone, I'll now turn the call back to your host for any additional or closing remarks.

Again, thank you, everybody for joining the call this morning. I appreciate it. And as we look forward to the balance of the 2018, we'll continue to execute on recruitment of the Zimura trials, as we talked about today. Also, moving forward, we will work on our collaboration with UMass. As Kourous just said, many exciting programs there. And importantly, we will continue our aggressive BD efforts to look for additional opportunities to add to the portfolio. Thank you, and appreciate you listening. Operator?

Thank you. That will conclude today's call. Thank you for listening. Ladies and gentlemen, you may now disconnect.