Immunic Q2 2023 Earnings Call Transcript

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August 3, 2023

There are 6 speakers on the call.

Operator

Good morning, and welcome to Munich's Q2 2023 Earnings Call. My name is Jessica Brew, Head of Investor Relations and Communications at Munich. I will also be the moderator on today's call. Speaking on the call are Doctor. Daniel Fitt, our Chief Executive Officer and President as well as Glenn Whaley, our Chief Financial Officer.

Operator

Please note that all participants will be in listen only mode and this event is being recorded. After today's presentation, there will be an opportunity to ask questions. If you join the webcast via the Zoom platform, there are 2 ways to submit your questions. You can either submit in writing via the Q and A tool of the SUM portal. Or if you would like to speak with us directly, please use the raise hand function of the SUM portal to queue your question.

Operator

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 a similar meaning. And such statements involve a number of risks and uncertainties that could cause EM Munich's actual results to differ materially from those discussed here. Please note that these forward looking statements reflect the Munich'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 Immunics' SEC filings for a more detailed description of the risk factors that may affect Immunics' results and these forward looking statements.

Operator

I would now like to turn the call over to our CEO and President, Doctor. Daniel Fint, to begin the presentation.

Speaker 1

Yes. Thank you, Jessica. I would also like to welcome everybody to Immunic's Q2 2023 earnings call. Earlier this morning, We announced our financial results for the Q2 ended June 30, 2023, and highlighted recent activities as well as Coming milestones. During today's call, we will walk through our Q2 2023 and subsequent highlights, Financial and operating results as well as anticipated upcoming milestones.

Speaker 1

After the presentation, as Jessica noted, We will open the line to give the audience an opportunity to ask questions. Let's start with a review of our Q2 2023 and subsequent highlights. In April, we reported positive data from the maintenance phase of our Phase 2b, Caldor Os 1 trial of beta thalamus calcium in patients with moderate to severe ulcerative colitis. These results were extremely encouraging as they demonstrated statistically significant activity of edifluMist calcium As compared to placebo, while confirming the very favorable safety and tolerability profile for the drug already observed in other trials. As illustrated on the slide, data showed a dose in an increase in clinical remission as compared to placebo at week 15.

Speaker 1

An exploratory statistical analysis showed a p value of 0.0358. Confirm the 30 milligram dose of B. Diffilimous calcium to be statistically superior in achieving clinical remission and MYC-fifty With a 33.7 percent absolute improvement over placebo. Overall, we believe the maintenance phase Data confirms venofludimus calcium's activity in ulcerative colitis patients. Also in April, we welcomed Doctor.

Speaker 1

Richard Rudig to our Board of Directors. Rick has spent decades as a clinical expert in multiple sclerosis and as a clinical trialist overseeing multiple successful pivotal studies. His insights are already Proving valuable as we continue to progress the development of beta fluidumous calcium in multiple sclerosis as well as in our earlier programs. In May, we reported stronger than expected positive results from the Part C portion of our Phase 1 clinical trial of IMU-eight fifty six in patients with celiac disease during periods of gluten free diet and gluten challenge. The data set shows the first clinical evidence of his ability as observed preclinically to regenerate the gut borne.

Speaker 1

In particular, the Phase Ib data showed that IMU856 was effective compared to placebo in improving 4 crucial aspects of celiac disease pathophysiology, protection of gut architecture, improvement And reversal of patients' gluten induced symptoms, biomarker response and enhancement of nutrient absorption such as vitamin B12. IMU856 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 bleeding from gluten induced destruction Independent of targeting immune mechanisms involved specifically in celiac disease, It appears to be unique among proposed therapeutic approaches. We believe this data provides initial proof of concept That this oral, 1st in class molecule, may represent an entirely new therapeutic approach, which could be a game changer in the way we treat Gastrointestinal disorders such as celiac disease, but also, for example, ulcerative colitis, Crohn's disease or irritable bowel syndrome with diarrhea. We are extremely enthusiastic about the potential for our IMU 856 program.

Speaker 1

On the heels of these results was our announcement at the Digestive Disease Week in Chicago of clinical and preclinical data For IMU856, including its molecular mode of action, has a potent and highly selective modulator of SIRT6, a protein which serves as a transcription regulator of intestinal barrier function and regeneration of bowel epithelium. Through its effect on CERT6, IMU836 has shown the ability in preclinical models to restore intestinal barrier function And we generate the whole world architecture. Importantly, in May, we also announced publication In the Journal of Medical Chemistry of preclinical evidence showing that betaflutinous calcium acts as a potent No1 activator. In addition to its known mode of action as a DHODH inhibitor, we believe that the activation of NOVAN Could be responsible for the drug's postulated neuroprotective effects and may contribute to the reduction of confirmed disability worsening events in MS as previously reported from our Phase II EMFISIS trial in patients with relapsing remitting MS. That said, these findings could be relevant not just in multiple sclerosis but also in other neurological indications.

Speaker 1

As a reminder, the potential neuroprotective properties of edufluinous calcium were already identified in our EMFISIS trial. Where the trial is short encouraging clinical signals regarding prevention of confirmed disability worsening as well as a remarkable reduction of the biomarker neurofilament like Most recently, last month, we hosted a virtual Celiac Disease Expert Roundtable to discuss ongoing active celiac disease, OACD, a serious lifelong autoimmune disorder And the substantial unmet medical need for our therapeutic solutions. We were honored to have been joined for this event by 3 renowned Thought leaders from Harvard Medical School, Mayo Clinic and the Celiac Disease Foundation. We could not be more grateful for their participation. During the call, our Chief Medical Officer, Andreas Mueller, also provided an overview of our IMU-eight fifty six program, including That concludes our summary of the Q2 2023 and subsequent highlights.

Speaker 1

I would now like to turn the call over to Glenn to provide a financial overview. Glenn?

Speaker 2

Thank you, Daniel. I will now review the financial and operating results for the Q2 ended June 30, 2023. Let me start with the cash overview. We ended the quarter with $77,300,000 in cash, which we expect will be sufficient to fund operations into the Q4 of 2024. Regarding the operating results, R and D expenses were $21,200,000 for the 3 months ended June 30, 2023, as compared to $16,500,000 for the 3 months ended June 30, 2022.

Speaker 2

These costs were mainly driven by external development costs related to ongoing clinical trials of vitaflutimus calcium and IMU-eight fifty six And partially offset by a decrease in external development costs related to the Phase 2 clinical trial of vidoflumabiscalsamin ulcerative colitis and IMU 935 program. For the 6 months ended June 30, 2023, R and D expenses were 44,100,000 As compared to $34,000,000 for the same period ended June 30, 2022. These costs also were mainly driven by external development costs related to the ongoing clinical trials in vedofludinib as calcium and IMU-eight fifty six And we're partially offset by a decrease in external development costs related to the Phase 2 clinical trial of beta fluid in this calcium and ulcerative colitis and the IMU-nine thirty five program. General and administrative expenses were $3,800,000 for the 3 months ended June 30, 2023 as compared to $4,100,000 for the same period ended June 30, 2022. The slight decrease was chiefly driven by a decrease in non cash based stock compensation, partially offset by increased costs across a number of categories.

Speaker 2

For the 6 months ended June 30, 2023, G and A expenses were $8,100,000 as compared to 8,000,000 for the same period ended June 30, 2022. The nominal increase was related to an increase across a number of categories, Which was partially offset by a decrease in personnel expense and G and A, primarily due to non cash based stock compensation decrease. Other income was $1,000,000 for the 3 months ended June 30, 2023, as compared to negative $1,300,000 for the same period ended June 30, 20 22. The increase was primarily attributable to a decrease in foreign exchange losses and an increase in interest income as a result of higher interest rates. This was partially offset by a decrease in R and D tax incentives for clinical trials in Australia.

Speaker 2

For the 6 months ended June 30, 2023, other income was $3,000,000 as compared to negative $700,000 from the same period ended June 30, 22. The increase was primarily attributable to an increase in interest income as a result of higher interest rates, A decrease in foreign exchange losses and a research allowance attributable for the tax year 2021 from the German Federal Ministry of Finance. The increase was partially offset by a decrease in R and D tax incentives for clinical trials in Australia. The net loss for the 3 months ended June 30, 2023 was approximately $24,000,000 or $0.54 per basic and diluted share. Based on 44,400,000 weighted average common shares outstanding compared to a net loss of approximately 21,900,000 or $0.72 per basic and diluted share based on 30,200,000 weighted average common shares outstanding for the same period ended June 30, 2020 Net loss for the 6 months ended June 30, 2023 was approximately 49,300,000 or $1.12 per basic and diluted share based on 44,000,000 weighted average common shares outstanding Compared to a net loss of approximately $42,700,000 or $1.49 per basic and diluted share based on 28,700,000 weighted average common shares outstanding for the same period ended June 30, 2022.

Speaker 2

With that, I will turn the call back over to Daniel for a review of our upcoming clinical milestones. Daniel?

Speaker 1

Thank you, Glenn. I would now like to provide an update on the anticipated Upcoming milestones for our clinical development programs. Our current expectation is to report an interim biomark analysis from our Phase 2 CALIFAR trial in progressive MS, including serum neurofilament light chain, NfL, in the fall of this year. This now more precise timeline provides additional clarity compared to our previous guidance on the second half of twenty twenty three. We expect to read out this trial at the end of 2024.

Speaker 1

Additionally, we look forward to reporting data from the interim analysis Our Phase III INSUURE program late next year and to read out the first of our identical twin Phase III INSUURE trials in Olapsin AMS at the end of 2025. As we have stated before, based on the strong clinical activity observed thus far, And with the Fulinum's Karlsson's solidly established safety and tolerability profile to date, we continue to believe that the design of the Phase The Reinsure program will provide a straightforward path to potential regulatory approval in relapsing MS. As I noted earlier, the Phase 2 CALIPRE trial is designed to corroborate the neuroprotective potential of beta thalamus calcium In progressive MS and could therefore be an additional differentiator for the drug in the MS market. Midofolimuscalcim With its combined anti inflammatory, antiviral and direct neuroprotective effects, may represent an important and unique treatment option targeting The complex pathophysiology of MS. With regards to our IMU 856 program, As a result of the overwhelmingly positive data generated from the final portion of our Phase 1 clinical trial in celiac disease patients, We have begun preparing for a Phase 2 clinical trial in ongoing active celiac disease patients.

Speaker 1

Once again, We are very excited about this program and believe that IMU 856 could represent an entirely new and innovative oral treatment option Approach for a number of gastrointestinal diseases without the serious consequences associated with immunosuppressive therapies. This brings us to the end of our formal presentation. Jessica, please open the call for the Q and A session.

Operator

Yes, thank you, Daniel. And also thank you to Daniel and Glenn for walking us through the first half of twenty twenty three and subsequent highlights as well as our upcoming value inflection points. We will now begin the question and answer session. As a reminder, if you join the webcast via the Zoom platform, there are 2 ways to submit questions. You can either submit your questions in writing via the Q and A tool of the Zoom portal.

Operator

Or if you would like to speak with us directly, please use the raise hand function of the Zoom portal to queue your question. And we jump right into it with Yasmeen Rahimi from Piper Sandler. Yasmeen, please unmute yourself and go ahead.

Speaker 3

Hi, guys. This is Lauren on for Yas. Congrats for all the pipeline progress. Two questions from us. So first, I know you guys have historically said that for NFL and GFAP, you want to see separation versus placebo.

Speaker 3

Maybe could you dig in a little bit? And Is there any type of magnitude that you want to see to be considered a strong signal? And with that, what do we know about this separation In regard to how it will correlate to percent brain volume change on the primary endpoint. And then the second question, have you had your end of Phase 2 meeting with the FDA Prior to the Phase 2 in celiac and when can you come back and communicate your next steps for the Phase 2? Thanks.

Speaker 1

Yes, thank you, Lorne. Coming to NFL, I think As you are aware, NfL is maybe a more established market compared to GFAP. But we don't know a lot about other studies effects in NfL changes In progressive MS, and therefore, it's difficult to really give a guidance for what we see. I think the goal is here To look for a signal and specifically and this may be the main purpose of this trial is to look whether the sub indications, so it's not groups, Really indications we are testing here. So we have patients with primarily progressive active and non active secondary progressive to see whether there is a specific indication where patients benefit more based On the biomarker signal, everything else I think would be a little bit over interpretation risk If that is done.

Speaker 1

And for the coordination with the Brainball, I don't think that's established. I think that's something we really want to observe and need to observe. And finally, also underline then with other endpoints more from the clinical For example, the confirmed disability worsening, which I believe is a very important readout For the progressive MS study for the Canneburg study. Coming to the 8 type 6 question. Yes.

Speaker 1

So we this was a Phase Ib study, so there is no end of Phase II meeting plan. I think Our regulatory interactions are currently focusing on IND submission. And based on that, I think there is an active I looked down with the FDA, so that's ongoing there. And it's a more reliable timeline, I think. That's the main reason why we think this is the right track For the regulatory interaction right now.

Speaker 3

Perfect. Thank you, guys.

Speaker 1

Thank you so much.

Operator

Thank you, Lauren. And we have a follow-up question on the CALIBRE interim analysis that came in writing from Thomas Smith at Leerink, can you elaborate on what data you expect to report with the interim biomarker analysis from the CALIBRE trial analysis in the fall. What are your expectations for this readout?

Speaker 1

Yes, as I said maybe I need to repeat myself a little bit here. So It's really more a qualitative analysis. So to see a difference here, if we, for example, see in the treatment groups A more benign NfL change effect, so for example, a reduction there, that would be great. Well, I think the main purpose is really to identify sub indications where we believe what is the most promising path forward In the progressive MS space for the treatments here. And I really I can't quantify here or give any guidance on the amounts we This is the forefront of research, I would say.

Speaker 1

There's not come too much of historic comparison available here. So let's keep fingers crossed for good differentiation here between ACTIV and placebo in this study.

Operator

Thank you, Daniel and thank you, Tom, for the question. Next one, we have live here in the queue Andreas Arguides from Wedbush. Andreas, please unmute yourself and go ahead.

Speaker 4

Good morning and thanks for taking our question. For the sorry, you let me just time my questions. So can you quickly also provide any insight into the pace of enrollment for Ensure? Is it progressing According to your expectations. And when do you expect the trial to be fully enrolled?

Speaker 4

And then, quick one On the bit of fluid is calcium in ulcerative colitis. Can you update us on where the program stands and if you continue to look for a partner for the program? Thank you.

Speaker 1

Yes. First of all, I think the insured enrollment goes well right now. We have The two studies, ENHURE I and ENHURE II, running and they are on track compared to the planned enrollment right now. So that's I think a pretty good situation there. On the UC front, yes, that's an ongoing discussion we are having.

Speaker 1

That's also important also an important thing is here that we as you may have seen, we also have IMU-three eighty one added to the pipeline, which is a program which is dedicated to GI indications and may also benefit from the data we have obtained from the From the KALDO study from the maintenance phase to potentially also come up with another molecule, Which may be effective there and can leverage the proof of concept we have generated for video phlebotomist calcium in ulcerative colitis. So there is more potential and we will I strongly believe that the mode of action here we have And was for the first time proven and that allows, I think, a pretty interesting development going forward in that space with both.

Speaker 4

All right. And just one quick follow-up. Can you just also remind us what gives you confidence that the NEAR-one activator would work in progressive forms in multiple

Speaker 1

Yes. I think it's more the general the established biology on that Coming from literature and so far also our hints we have seen on the unconfirmed disability worsening And our conclusion that vinofludimos may have an effect on relapse independent Disability worsening and therefore it may then also work in progressive MS. But that's I think the objective of the clinical study. I think we really need to prove that in this study.

Speaker 4

Great. Thanks and congrats on all the progress.

Operator

Thank you, Andreas. Again, if you have a question, please use the raise hand function of the Zoom portal or the Q and A tool. And we also have Matt Kaplan in the line from Ladenburg. Matt, please unmute yourself and go ahead.

Speaker 5

Thanks, Jessica, and good morning. Just a follow-up on 856 and celiac. I guess you're in preparation mode for the IND. What are your current thoughts on the design of the Phase II as you move it into Phase II?

Speaker 1

Yes. Thank you, Matt. This is, of course, an important thing right now here. As you see from our presentation, our Excitement about the program and we believe it really deserves to continue as quickly as possible into celiac disease. And therefore, We aligned with a couple of global experts, had a number of good meetings, discussed What is the Redisign?

Speaker 1

Also carefully looked on the FDA draft guideline for Phase III in celiac disease, which published And based on that, we maybe some things, some thoughts. This is not set in stone. So this is an ongoing discussion. I'm happy to share some of the thoughts. So We think we should the patient population should be really be a little bit equivalent to what the So we will look specifically on ongoing active celiac disease patients here and Endpoints are things tested will be, for example, histological changes, symptomatic changes And also some biomarkers and functional changes and improvements.

Speaker 1

The I think the FDA guideline states that They want to see for Phase III studies improvement of symptomatic and histological improvement here, which also should be tested in the Phase II because we really want to define the right doses and the right design for the Phase III studies. Durationals, maybe one comment here. As I said, not finally decided, but likely the study will maybe look on a 3 months timeline for improvement on those scores. And what I can't say right now is the exact size of the trial. That's work in progress to determine the exact Size of each group of the trial.

Speaker 1

But maybe one remark on the doses, we are looking On the spread of doses, which would clearly result then in identification of this best suitable dose for a Phase III study going forward.

Speaker 5

That's very helpful. And then one follow-up on that. I guess given the potential utility of 856 Side of celiac disease and also ulcerative colitis, how are you thinking internally about the development of 856 And 838 in ulcerative colitis.

Speaker 1

Well, both are interesting Honestly, I think the challenge with 828 is that we are in a very important MS study at the same time. So therefore, I think our GI focus is Right now with the fresh results from the Phase Ib study on 856 and clearly I think 856 has something very special. It is not immunosuppressive and therefore I think the drug could really add something new to the treatment landscape in GI disorders. And if you look on the current treatments and things in development for indications like Crohn's and colitis, clearly a non immunosuppressive Glaag, which is able to restore the proper healthy epithelial layer in the gut wall, would add something substantial. And I think that's the beauty of that concept could easily combine with other treatments as well down the road.

Speaker 1

And therefore, maybe the 1st choice to overcome the so called efficacy ceiling we see with just immunosuppressive therapies. So I think I see a very bright future for H56 in the broader GI space, really beyond celiac disease as well. It's true to say what indications exactly will be in the focus there, but likely, IBD is a core that's a core theme in further development.

Speaker 5

Thanks, Daniel. That's very helpful.

Operator

Thank you, Matt, and thank you to all our guests Today, this concludes our question and answer session. I would like to turn the conference back over to Daniel for any closing remarks.

Speaker 1

Yes. Thanks, Jessica. And thank you to today's attendees for your insightful questions. In summary, we remain well funded with €77,300,000 on our balance sheet, providing expected runway through multiple value creating clinical milestones into the Q4 of 2024. Looking ahead, as noted, we expect to report data from the interim analysis of our Phase 2 CALIBRE trial of idioplumous calcium in progressive MS in the fall of this year.

Speaker 1

As progress is made, we expect to So provide an update on our preparation for the Phase II clinical trial of IMU-eight fifty six in patients with ongoing active celiac disease. With that, I would like to close today's call. Thank you very much for joining. We are very happy to answer any additional questions 1 on 1.

Operator

Thank you also from my side for joining in Munich's Q2 2023 earnings call. The webcast has now concluded. You may now disconnect.

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Key Takeaways

  • Positive data from the Phase 2b maintenance of betofluminous calcium in moderate to severe ulcerative colitis showed a statistically significant increase in clinical remission at week 15 (p=0.0358) with a 33.7% absolute improvement over placebo and a favorable safety profile.
  • The Phase 1b trial of IMU-856 in celiac disease delivered first clinical proof-of-concept for intestinal barrier regeneration, demonstrating improved histology, symptom reversal, enhanced nutrient absorption, and strong tolerability during gluten challenge and gluten-free phases.
  • Peer‐reviewed preclinical data revealed that betofluminous calcium also acts as a potent SIRT1 activator in addition to DHODH inhibition, which may underlie its neuroprotective effects and relevance in multiple sclerosis and other neurological indications.
  • As of June 30, 2023, Immunic held $77.3 million in cash, providing runway into Q4 2024.
  • Upcoming milestones include an interim biomarker (serum neurofilament light chain) analysis from the Phase 2 CALIBRE trial in progressive MS in fall 2023, late-2024 data from the Phase 3 INSURE program, and preparations for a Phase 2 IMU-856 study in active celiac disease.
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Earnings Conference Call
Immunic Q2 2023
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