Biora Therapeutics Q1 2023 Earnings Call Transcript

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May 15, 2023

Key Takeaways

  • BT600 toxicology results show no adverse events in canines, with high colon delivery and systemic exposure at ~25% of oral tofacitinib; IND filing remains on track for Q3.
  • Biojet preclinical study with semaglutide achieved over 2× target bioavailability (~37%) and was accepted as a late‐breaking abstract at the ADA Scientific Sessions.
  • Ongoing Biojet collaborations with Ionis and Biogen are advancing, with additional preclinical data expected in Q2 to enable partner molecule testing.
  • A key patent on ingestible jet delivery of GLP-1 agonists reinforces Biora’s IP position in the expanding oral GLP-1 market.
  • Ended Q1 with $30.5 M in cash, an average monthly burn of ~$4 M, and $12.9 M raised via ATM; capital structure optimization is in progress.
AI Generated. May Contain Errors.
Earnings Conference Call
Biora Therapeutics Q1 2023
00:00 / 00:00

There are 6 speakers on the call.

Operator

Welcome to the Biora Therapeutics First Quarter 2023 Financial Results Call. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. I will now turn the call over to Kristi Kubowski, Director of IR Communications with SaFire Advisors, Biora's Investor Relations firm.

Operator

Thank you. Please go ahead.

Speaker 1

Thank you, operator. Good afternoon, and welcome to the Biora Therapeutics First Quarter 2023 Corporate Update and Financial Results Conference Call. Joining me on the call are Adi Mohanty, Chief Executive Officer and Eric Despardes, Chief Financial Officer. Before I turn the call over to Mr. Mohanty, I would like to remind you that today's call will include forward looking statements within the meaning of the federal securities laws, including but not limited to the types of statements identified as call, we are forward looking in our quarterly report on Form 10 Q that we filed or will file later today and our subsequent reports filed with the SEC, which are available on our website in the Investors section.

Speaker 1

These forward looking statements represent our views only as of the date of this call and involve substantial risks and uncertainties, conference call, including many that are beyond our control. Please note that the actual results could differ materially from those projected in any forward forward looking statements. For a further description of the risks and uncertainties that could cause actual results to differ materially from those expressed in the call, as well as risks related to our business, please see the company's periodic reports filed with the SEC. With that, I will now turn the call over to Adi Mohanty, CEO of Biora Therapeutics. Adi?

Speaker 2

Thanks, Christy, and thank you, everyone, for joining us. Since our last call 6 weeks ago, time, we have continued executing on development plans for our NaviCap targeted delivery platform, completing much of the data analysis from this talk study in our BT600 program with results that are encouraging. With our Biojet systemic delivery program, time, we made excellent progress with device development and began preclinical studies using an autonomous version of our next generation Biogen device. Time, based on the top line bioavailability results we shared in March that were more than double our target levels, time, we progressed rapidly to preclinical testing with 1 of our pharma collaborators. We're also planning to present detailed bioavailability results from our Biogen platform at an upcoming medical conference.

Speaker 2

Finally, we strengthened our clinical team conference call with the addition of Doctor. Ariela Kelman as Chief Medical Officer, which is good timing as we prepare to enter the clinic this year. Moving on to the program updates. First, I'll cover our NaviCap targeted therapeutics platform with our lead program, BT600

Speaker 3

call in

Speaker 2

ulcerative colitis. Currently available therapeutics for ulcerative colitis or UC work by entering the bloodstream and being circulated on the NaviCap platform, which uses an orally ingestible device about the size of a fish oil pill that is designed to deliver drug directly to the colon call using our GI tract localization technology. Our lead program, BT600, is our proprietary liquid formulation of tufacitinib conference call delivered via the NaviCap device. A commercially available version of tofacitinib is approved for the treatment of UC. Time, we will be conducting a few questions.

Speaker 2

Today, tofacitinib is administered orally and like other orally delivered drugs, it is taken up systemically time with a limited amount reaching the area of disease in the colon. By delivering drug where it is needed at the site of disease, BT600 has the potential to deliver sufficient drug to the tissue of the targeted area to improve efficacy and also reduce systemic exposure, which may improve safety. Although global sales for UC drugs are approximately $7,000,000,000 per year and growing, We know UC patients are still suffering tremendously with a large unmet need. We believe time, we can potentially solve one of the primary treatment gaps, which is the inability to achieve high enough drug levels in the diseased tissue without systemic toxicity. That's why we're excited about the results that we're seeing from the toxicology study for BT600.

Speaker 2

At the time of our last call in March, we had recently completed execution of our toxicology study for BT600, during which we administered over 600 drug device combinations in canines. Since then, we have received a majority of the data

Speaker 3

call and the results continue to look good.

Speaker 2

All planned devices were administered and we observed no adverse events or safety signals. Of particular note, time, there were no safety findings on histopathology of the colon or on blood safety and chemistry tests, including liver function tests, even at the highest 25 milligram dose of tofacitinib. With the Navigat platform, our goal is to achieve high drug concentrations in the colon tissue and we want to see these levels going down between doses and not accumulating. Time, when we look at drug levels in the blood, we want to see some drug in the blood, but at low levels because it is believed that reducing systemic exposure can improve safety. In our previous 7 day canine study, we measured tissue drug levels at 6 12 hours after administration of the last dose and saw tissue concentrations exceeding IC90, which is what we want to see.

Speaker 2

In this talk study, we measured drug levels in tissue 24 hours after administration of the last dose and saw drug in colon tissues level with levels suggesting that the drug does not accumulate over time, which is another favorable sign of safety. Time taken in the aggregate, we believe these studies support the ability of BT600 to deliver high concentrations of drug to colon tissue to potentially drive efficacy and then dissipate in a short enough time to support safety. Time, in the recent toxicology study, we continued to see peak drug levels in blood at approximately 1 quarter of what would be expected with the equivalent dose of commercially available tofacitinib using traditional oral administration. Time, this further supports our desired approach of having lower levels of systemic exposure to potentially reduce toxicity. Final analysis is still ongoing and we anticipate receiving the audited report in the coming weeks.

Speaker 2

We're also tracking well on progress with other aspects of the program call and we currently remain on track for our planned IND filing in Q3. We also recently announced that Doctor. Time, Ariela Kellman has joined Biora as Chief Medical Officer, bringing valuable experience as an immunologist and strengthening our clinical team. Time, we will be evaluating our IND for BT600 and then progress our program into later stages of development. Moving on to our Biojet systemic therapeutics platform.

Speaker 2

Time, the Biojet platform aims to facilitate systemic oral delivery of drugs that would otherwise require injection or infusion. The Biojet platform is based on an orally ingestible device that provides liquid jet delivery to the small intestine to maximize systemic uptake. The platform has the potential to deliver a broad range of large molecules such as and associated patient outcomes and reduced intravenous infusion costs across a range of chronic use indications. Time, most of all, we believe this will improve patient convenience, which has been shown to affect patient compliance. Time, these improvements could also help injectable biotherapeutics such as monoclonals become more competitive with alternatives.

Speaker 2

During Q1, time, we announced top line results from preclinical studies with 2 drugs adalimumab, a monoclonal antibody and somaglutide, a peptide and GLP-one receptor agonist. In the preclinical study with somaglutide, time, we achieved more than double our target bioavailability using Biojet platform. I'm excited to share time, the data from this study was accepted as a late breaking abstract at the American Diabetes Association Scientific Sessions. Time, we think the acceptance of this abstract as a late breaker indicates the tremendous interest by the scientific community in oral delivery of GLP-one agonists and other large molecules. We look forward to sharing detailed results from the study at the upcoming ADA meeting in June.

Speaker 2

Time, we recently conducted a round of preclinical testing with our collaborator Ionis Pharmaceuticals using an endoscopically activated BioJET device conference call with an Ionis antisense oligonucleotide molecule. We're awaiting updates on results of that study and we'll share more as soon as we're able to. In the few short weeks since our last call, time, we've also conducted preclinical testing with an autonomously triggered Biogen device. We expect testing to continue through the coming weeks time, we remain on track to generate data during Q2 that we believe are necessary to enable our other 2 pharma collaborators to initiate testing with their own molecules. We look forward to progressing these collaborations and advancing toward our goal of achieving meaningful partnerships call for our Biojet platform later this year.

Speaker 2

We continue to see potential for multiple partnerships over time call due to the broad applicability of the Biojet platform to different molecules. As a reminder, one aspect of our comprehensive patent position for the Biojet platform is a key patent granted last year, which covers Methods for using an ingestible device to treat a condition using jet delivery of a GLP-one receptor agonist formulation to the small intestine to achieve systemic uptake. This puts Biora in a very strong competitive position call for providing oral delivery of GLP-1s. With the success of drugs like Ozempic and Monjaro, time, we're seeing analyst projections for the GLP-one market being revised upward to $100,000,000,000 annually within the next 10 years. Conference call to summarize our anticipated milestones for both platforms.

Speaker 2

For our NaviCap platform, we remain committed to filing an IND for BT600 in Q3 and we anticipate initiating our Phase 1 trial for the end of the year. For our Biojet platform, we're continuing development of our autonomous Biogen device with additional preclinical data generation expected during the Q2 of 2023. Time, we also expect to continue to test and initiate new testing of the Biojet device with the molecules of our pharma collaborators. Time, we also look forward to sharing results for our Biojet preclinical study with semaglutide at the American Diabetes Association Scientific Sessions on June 23. With that, I'll now turn the call over to Eric for a review of our financial results and capital market activities.

Speaker 4

Thanks, Heidi, and good afternoon, everyone. During the Q1, operating expenses, excluding stock based compensation expenses, time, we expect to be in stock based compensation expenses, while R and D expenses in the Q1 were $7,200,000 including $900,000 in stock based compensation expenses. While spending will continue to fluctuate from month to month time, as we progress towards the clinic, we maintain our guidance of an average monthly operating cash burn of approximately $4,000,000 time, we successfully raised $12,900,000 in gross proceeds from our ATM program during the Q1, effectively funding our Q1 operating expenses, leading to a stable cash balance of $30,500,000 as of March 31, 2023. We also continue to make progress with monetizing remaining legacy assets, which might add incremental funding in the near future. Finally, we continue to work actively on optimizing our capital structure to maintain and enhance our public company profile, and we expect to have some updates before our next call.

Speaker 4

With that, I will now turn the call back over to Adi.

Speaker 2

Thanks, Eric. Biora continues to make strides with both our NaviCap targeted oral delivery platform, time, we're focused on entering the clinic with our BT600 program and our Biojet systemic oral delivery platform, where we're focused on completing our next gen device time, we are now ready for questions. With that, operator, we're now ready for questions.

Operator

Thank you. We will now be conducting a question and answer The first question is from Mayank Montini of B. Riley Securities. Please go ahead.

Speaker 5

Hi, this is Yuan for Mayank. Congrats on the completion of the TOK study for 600 program, I'm looking forward to seeing more data updates from you guys. I have a couple of questions, if I may. On the 600 program, it's great to see the peak drug level is about 1 quarter of oral drug. Can you comment on if the half life in blood is different from the oral route as well, following on that, can you maybe share the route of clearance following this drug delivery device, where will the majority of the drug go?

Speaker 5

And then I have a follow-up.

Speaker 2

Okay. Hi, Yohann. So you asked about the half life. Interestingly, what we find is pretty consistent with what is seen in literature about tofacitinib, which is A very typical half life and clearance, what we impact more is time to reach C MAX And the AUC. So we're going to start getting really technical about these things.

Speaker 2

But the bottom line is we think we have a Better profile where we don't get to that Cmax, which is where people end up with the toxicity issues. So we're at about a quarter of what would happen with the regular tofacitinib. However, it behaves the same way as it normally does, which is time, it clears with a similar half life and clears out within the same amount of time that it would normally clear out. We don't see accumulation in the blood. We don't see accumulation in the tissue, which is all good signs that encourage us as we move forward.

Speaker 5

Got it. Thanks for the clarification. And regarding the R and D filing in 3Q, Can you clarify is the 14 day GLP talk study the only experiment you need to file that IND? And for this GLP talk study, is NHP involved? As you know, there is an industry wide shortage of NHP at the moment.

Speaker 2

Yes. Well, so we don't have a supply issue. What we need, as you know, for an IND, primarily it's a safety study that we're With this talk study we're completing, but there's several other aspects. There's stability data, there's all the CMC sections time, we've been generating stability data, which continues to look encouraging. So all of those things we are already in progress, creating all that data.

Speaker 2

Time, we'll be receiving final reports on the safety studies over the coming weeks, which is why we keep thinking, look, with what we've seen so far, It gives us confidence in being able to be in a position to file our IND in Q3.

Operator

The next question is from Joe Pantginis of H. C. Wainwright. Please go ahead.

Speaker 3

Hey, everyone. Matt on here for Joe. Two questions from us on the GLP-one Biogen program. The first one, I was wondering if you can preview the types of data that you might be presenting at the ADA meeting? And then second, given the popularity of the GLP-one agonist, do you have any other additional updates around the potential partners or partner conversations you're having for the program and is there any potential to keep it in house?

Speaker 3

Thank you very much.

Speaker 2

Okay, Matt. So in next month, as we said, We're going to be presenting data. That data is all the data that we generated with our next generation device, which is the device that we are currently continuing to test. We're really excited about it. As we mentioned, we got greater than twice our target.

Speaker 2

And just as a reminder, our target is around 15% bioavailability and time, we were able to get more than double of that. The numbers were I think we announced were somewhere in the 37% range. But what we couldn't share was the details of the various animals and all the tightness of the CV. And So we'll be sharing how consistent and how well it performed with multiple animals in that study. So that's pretty interesting and it's you're right.

Speaker 2

There's a lot of interest in the GLP-1s right now. There's a significant amount of news that has been created, yes, we get questions all the time. And the fact that we also have this broader GLP-one patent, which has to do with all kinds of GLP-one molecules time, we might want to be administered with a jet system internally like we do with our Biojet program. Platform, a pretty broad, pretty wide, ranging in terms of number types of molecules, disease areas. We absolutely think that as we get past having collaborations and partnerships, we can and will have in house program that we will take forward, our goal this year is to stay focused and streamlined, get time, our NaviCap program into the UC patients get a Phase 1 started, get the data generated in the Biojet program Create these opportunities for collaborations and partnerships and then we do have enough IP as well as data generated to create our own program where we could take, for example, potentially oral alternative to the injectable GLP-1s that is absolutely something we could and would look at doing.

Speaker 2

But the near term clarity in the company and our goal is stay focused over the next few months we could have some very, very interesting data generated and that's something that will help us with what we plan to do in the future.

Speaker 3

Yes, great. Totally makes sense. Thanks for the updates.

Operator

At this moment, there are no further questions. I I'd like to turn the floor back over to Adi Mohanty for closing comments.

Speaker 2

Thank you all once again for joining us call, we're really happy with the progress we're making and look forward to keeping everyone updated as things progress. Thank you.

Operator

Ladies and gentlemen, that completes this conference. Thank you for joining us. You may now disconnect your lines.

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