Celcuity Inc. (NASDAQ:CELC) Q2 2024 Earnings Convention Name August 14, 2024 4:30 AM ET
Firm Individuals
Maria Yonkoski – ICR Westwicke, IR
Brian Sullivan – Co-Founder and CFO
Vicky Hahne – Chief Monetary Officer
Igor Gorbatchevsky – Chief Medical Officer
Convention Name Individuals
Maury Raycroft – Jefferies
Tara Bancroft – TD Cowen
Brad Canino – Stifel
Operator
Good afternoon, girls and gents, and welcome to the Celcuity Second Quarter 2024 Monetary Outcomes Convention Name. Presently all strains are in listen-only mode. Following the presentation we’ll conduct a question-and-answer session. [Operator Instructions] This name is being recorded right this moment, August 14, 2024. I might now like to show the convention over to Maria Yonkoski with ICR Westwick. Please go forward.
Maria Yonkoski
Thanks and good afternoon to everybody on the decision. Thanks for becoming a member of us to evaluate Celcuity’s Second Quarter 2024 Monetary Outcomes and Enterprise replace. Earlier right this moment, Celcuity launched monetary outcomes for the second quarter ending June 30, 2024. The press launch might be discovered on the Traders part of the web site. Becoming a member of me on the decision right this moment are Brian Sullivan, Celcuity’s Chief Government Officer and Co-Founder; Vicky Hahne, Chief Monetary Officer; in addition to Igor Gorbatchevsky, Chief Medical Officer, who might be accessible throughout Q&A.
Earlier than we start, I’d prefer to remind listeners that our feedback right this moment will embrace some forward-looking statements. These statements contain a variety of dangers and uncertainties, that are outlined in right this moment’s press launch and in our reviews and filings with the SEC. Precise occasions or outcomes might differ materially from these projected within the forward-looking statements. Such forward-looking statements and their implications contain recognized and unknown dangers, uncertainties and different components that will trigger precise outcomes or efficiency to vary materially from these projected.
On this name, we may even refer to non-GAAP monetary measures. These non-GAAP measures are utilized by administration to make strategic choices, forecast future outcomes and consider the corporate’s present efficiency. Administration believes the presentation of those non-GAAP monetary measures is helpful for traders’ understanding and evaluation of the corporate’s ongoing core operations and prospects for the longer term. You’ll find the desk reconciling the non-GAAP monetary measures to GAAP measures in right this moment’s press launch. And with that, I might now like to show the decision over to Brian Sullivan, CEO of Celcuity. Please go forward.
Brian Sullivan
Thanks, Maria, and good afternoon everybody. We recognize your curiosity in Celcuity. We made important strides advancing the medical improvement of gedatolisib this quarter. Total enrollment in VIKTORIA-1, our Section III examine evaluating gedatolisib plus fulvestrant with and with out palbociclib as second-line remedy for sufferers with HR+/HER2- superior breast most cancers stays sturdy and on observe.
Our Section Ib/II trial evaluating sufferers with metastatic castration resistant prostate most cancers can be enrolling on schedule. And we additional expanded the affected person inhabitants eligible for gedatolisib, once we initiated efforts to launch VIKTORIA-2, a part III examine designed to judge gedatolisib, as a first-line remedy possibility for sufferers with HR+/HER2- superior breast most cancers.
In our view, every of those three applications has the potential to generate blockbuster ranges of income. If these three applications finally end in regulatory approvals, we estimate that almost 200,000 late-stage most cancers sufferers globally can be eligible to be handled with gedatolisib.
We first introduced our plans to conduct the VIKTORIA-1 examine over two years in the past in Could 2022. At the moment, we estimated that 65% of the sufferers enrolled would lack detectable PIK3CA mutations and had been being signed to the examine’s PIK3CA wild-type cohort. And this assumption was used to estimate enrollment by cohort and in flip, the timing of occasions for main evaluation. We estimated that the edge variety of occasions required to set off the first evaluation for this PIK3CA wild-type cohort of sufferers can be reached within the second half of 2024.
And whereas the examine’s total enrollment stays on observe and sturdy relative to the estimate we remodeled two years in the past, the overall proportion of sufferers enrolled who’ve PIK3CA wild-type tumors has just lately shifted decrease. We now venture that 60% of the sufferers enrolled within the examine might be enrolled within the PIK3CA wild-type cohort somewhat than the 65% initially estimated. And this proportion whereas decrease than our unique estimate is inside the reins reported in different research. And thus we do not imagine this shift is examine associated however merely a results of regular pattern variation inside a inhabitants.
Regardless of decrease proportion of PIK3CA wild-type sufferers accomplished, enrollment for the PIK3CA wild-type cohort is over 80% full. We anticipate to succeed in the enrollment goal for the PIK3CA wild-type cohort in the course of the fourth quarter somewhat than the top of the third quarter as we initially forecast. We now anticipate the first evaluation occasion threshold set off for the PIK3CA wild-type cohort, might be reached someday between late This autumn ’24 and the top of Q1 2025.
Our steerage concerning the PIK3CA mutant affected person subgroup stays unchanged, and we anticipate main evaluation for this cohort to be triggered in the course of the first half of 2025. Turning now to our VIKTORIA-2 examine. We introduced our plans to provoke this Section III medical trial this previous Could. Research will consider gedatolisib plus a CDK4/6 inhibitor in fulvestrant as first-line remedy for sufferers with HR+/HER2- superior breast most cancers, whose illness recurs whereas receiving or inside 12 months of finishing adjuvant endocrine remedy.
Now these sufferers are thought-about to have endocrine remedy resistant illness. They’ve a considerably poor prognosis than endocrine remedy delicate sufferers whose illness recurs greater than 12 months after finishing their adjuvant endocrine remedy. Present normal of care first-line remedy for endocrine remedy resistant sufferers consists of any of the three permitted CDK4/6 inhibitors mixed with fulvestrant. The restricted efficacy of those regimens provide endocrine therapy-resistant sufferers, although, was not effectively understood till the INAVO-120 examine, Section III medical trial for the PIK3CA — PI3K alpha inhibitor, inavolisib, reported outcomes final December.
As a part of this trial, the efficacy of normal of care palbociclib and fulvestrant was evaluated as first-line remedy, in sufferers who had been proof against endocrine remedy. And for these sufferers, median PFS was solely 7.3 months. And for these sufferers whose illness relapse inside the first 2 years of their adjuvant endocrine remedy, the median PFS was solely 3.7 months. And these outcomes evaluate poorly to the median PFS of 27 months reported for sufferers who’re delicate to endocrine remedy and obtain the identical routine, highlighting a big want for simpler therapies for sufferers with superior breast most cancers which might be proof against endocrine remedy.
We reported final yr the preliminary medical knowledge from our Section Ib trial for gedatolisib as first-line remedy in sufferers with superior breast most cancers. As chances are you’ll recall, the median progressing free survival in endocrine-sensitive sufferers who’re remedy naive and had been handled with gedatolisib together with palbociclib and letrozole was 48.6 months and the target response price to 79%. And these outcomes evaluate very favorably to the outcomes reported for palbociclib plus letrozole on this inhabitants.
Moreover, the INAVO-120 examine that evaluated inavolisib mixed with palbociclib and fulvestrant within the endocrine-resistant sufferers reported optimistic knowledge. Now these sufferers had tumors with PIK3CA mutations and the sufferers weren’t prediabetic or diabetic. So the subgroup solely represents about 20% of the overall endocrine-resistant affected person inhabitants. Nonetheless, the outcomes reported had been optimistic relative to the management, offering additional proof of the important position the PIK3CA pathway, performs as a driver of illness in treatment-naive sufferers.
Within the VIKTORIA-2 examine, for the CDK4/6 inhibitor, investigators might select both ribociclib or palbociclib. Secure profile of gedatolisib mixed with fulvestrant and palbociclib is effectively described, however the investigational mixture of gedatolisib with ribociclib has not but been clinically examined. And subsequently, a security run-in of roughly 12 to 36 sufferers will consider the protection profile of gedatolisib mixed with ribociclib and fulvestrant. Security run-in might be accomplished and gedatolisib Section III dose with ribociclib confirmed earlier than enrolling sufferers within the Section III portion of the examine. For this examine, roughly 638 topics might be assigned to a cohort primarily based on the PIK3CA mutation standing.
After the investigator selects the CDK4/6 inhibitor for a topic, topic will then be randomly assigned on a one-to-one foundation to both be handled with gedatolisib, fulvestrant and both ribociclib and palbociclib or be assigned to an arm that treats sufferers with fulvestrant and both ribo or palbo. The medical trial main endpoints are progression-free survival, per RECIST 1.1 standards as assessed by Blinded Impartial Central Overview. And the first PFS endpoint for every of the 2 cohorts might be evaluated independently.
Research designed was reviewed and mentioned with the US FDA throughout a sort assembly within the first quarter, after which now we have additionally only in the near past obtained suggestions from the FDA on the examine protocol. As a part of a Kind D assembly, so we are able to now give attention to our feasibility and website choice actions. We anticipate to activate roughly 200 medical websites throughout North America, Europe, Latin America and Asia, and we anticipate to enroll the primary affected person within the second quarter of 2025.
We estimate that 15,000 to twenty,000 sufferers with endocrine remedy resistant superior breast most cancers are recognized annually in america alone. Since this inhabitants doesn’t overlap with the affected person inhabitants we’re evaluating in our VIKTORIA-1 examine, an approval to deal with these sufferers would enhance the scale of the addressable US market potential for gedatolisib by as much as $3 billion.
Given the significance of creating a extra efficacious therapeutic routine for these sufferers and the dimensions of the monetary alternative, we determined that it was essential to proceed as rapidly as potential to provoke a Section III examine for this affected person inhabitants. To perform this, we would have liked to strengthen our steadiness sheet which we did this quarter once we raised $129 million gross proceeds from fairness and debt choices.
By initiating this trial now, 12 months sooner than we might have been in a position to take action with out this financing, we estimate we added over $1 billion to the online current worth of the potential income stream from this indication. I wish to flip now to our Section Ib/II trial that is evaluating the protection and efficacy of gedatolisib together with darolutamide, an androgen receptor inhibitor in sufferers with metastatic castration-resistant prostate most cancers.
Research dosed its first affected person in February of this yr and enrollment is on observe. We proceed to anticipate to report preliminary knowledge within the first half of 2025. We’re additionally happy that our non-clinical analysis describing gedatolisib’s exercise in numerous tumor sorts was just lately printed in two main journals. In June, Nature Breast Most cancers printed outcomes from varied in vitro and in vivo research we carried out that in contrast gedatolisib’s exercise in a number of permitted single-node PI3K, AKT, mTOR or PAM inhibitors in varied breast most cancers fashions.
And in August, Molecular Oncology printed outcomes of comparable research in prostate most cancers fashions. Each units of research demonstrated the gedatolisib exhibited stronger and cytotoxic results in comparison with the only node PAM inhibitors whatever the PAM pathway mutational standing of the cell strains. And these outcomes point out that inhibition of a number of PAM pathway nodes by a PAM/PI3K/mTOR inhibitor like gedatolisib that is simpler at inducing antitumor exercise than single node PAM inhibitors in vitro and in animal fashions.
Total, it was a really busy and productive quarter. I am very happy of the progress we made. I would like now to show the decision over to Vicky, who will evaluate our funds.
Vicky Hahne
Thanks, Brian and good afternoon, everybody. I am going to present a short overview of our monetary outcomes for the second quarter 2024. Our second quarter internet loss was $23.7 million or $0.62 per share in comparison with $14.6 million internet loss or $0.66 per share for the second quarter of 2023. As a result of these quarterly internet losses embrace important non-cash gadgets, together with stock-based compensation and curiosity, we additionally included in our press launch non-GAAP adjusted internet loss for the quarter ending June 30, 2024.
Our non-GAAP adjusted internet loss was $22.2 million or $0.58 per share for the second quarter of 2024 in comparison with non-GAAP adjusted internet lack of $11.1 million or $0.51 per share for the second quarter of 2023. Analysis and improvement bills had been $22.5 million for the second quarter of 2024 in comparison with $13.8 million for a similar interval in 2023. Of the roughly $8.7 million enhance in R&D bills, $6.6 million primarily associated to actions supporting the VIKTORIA-1 Section III trial, and the initiation of the Section Ib/II prostate trial and $2.1 million was associated to elevated worker and consulting bills.
Basic and administrative bills had been $1.8 million for the second quarter of 2024 in comparison with $1.3 million for the second quarter of ’23. Worker and consulting-related bills accounted for $0.3 million of the rise. Skilled charges and different administrative bills accounted for the remaining enhance of roughly $0.2 million.
Web money utilized in working actions for the second quarter of ’24 was $18.1 million in comparison with $9.7 million for the second quarter of ’23. We ended the quarter with roughly $283.1 million in money, money equivalents and short-term investments in comparison with $180.6 million at December 31, 2023. The rise of roughly $102 million in money and money equivalents and short-term investments was the results of a number of financing actions that occurred within the first half of 2024 and yielded internet proceeds of $137.5 million.
We closed on two financing actions in Could, leading to gross proceeds of $122 million and internet proceeds of $115.5 million. The primary exercise was an fairness financing, leading to $60 million of gross proceeds with internet proceeds of $56.3 million. The second exercise was a debt providing, leading to gross proceeds of $61.7 million with internet proceeds of $59.2 million.
Further financing actions within the first half of the yr resulted from one workouts of $14.2 million, accessing our aftermarket providing of $7.3 million and inventory possibility workouts and worker inventory purchases of $0.5 million. The $137.5 million was offset by year-to-date working money used of $35.1 million.
I’ll now hand the decision again to Brian.
Brian Sullivan
Thanks, Vicky. Operator, might you please open the decision for questions?
Query-and-Reply Session
Operator
Women and gents, we’ll now start the question-and-answer session. [Operator Instructions] Your first query comes from the road of Maury Raycroft from Jefferies. Your line is now open.
Maury Raycroft
Hello, thanks for taking my query. Simply checking on the enrollment, I recognize that the time line is transferring a bit bit. Based mostly on the shift in proportion of wild-type and mutant populations, is it potential that the wild-type and mutant readouts might occur on the similar time? Or are you assured that the wild-type and mutant readouts might be staggered? And secondly, is it truthful to imagine you will do one other replace on enrollment in fourth quarter and supply extra specifics on the plan for the readout at that time?
Brian Sullivan
Thanks, Maury and thanks on your query. So far as the timing of announcement of outcomes for mutated, we’re sustaining our steerage that we might anticipate to have these outcomes accessible someday within the first half. We’re enrolling the identical variety of sufferers in every cohort of the research, wild-type versus mutant and 40% of the sufferers are mutated. In order that enrollment interval will take longer to finish, albeit a bit bit prior to we initially deliberate due to the upper proportion of mutated sufferers. However we’re not altering our steerage right now. And so far as updating enrollment, we’ll proceed to replace steerage as now we have each quarter on once we anticipate to report top-line outcomes.
Maury Raycroft
Okay. Is smart. After which for VIKTORIA-2 within the frontline setting, are you able to discuss extra concerning the security run-in with the 12 to 36 sufferers. Why is there a variety of sufferers that you might enroll? And are you assessing any variations with dosing technique? And the way lengthy will it’s a must to deal with these sufferers?
Brian Sullivan
I am going to provide you with an preliminary high-level abstract after which Igor might possibly fill in blanks. Basically, the examine is designed to judge, if wanted varied dose ranges of gedatolisib to search out the Section III dose. If we needn’t scale back the dose of gedatolisib within the first cohort of sufferers that we’re evaluating, then we’ll be capable to proceed with the info from that group of 12 sufferers. After which subsequently, if we discover that we have to dose scale back geda, we might enroll one other 12 sufferers and do the identical factor once more if we needed to and enroll one other 12 sufferers.
So basically relying on what outcomes and the end result of that — of every cohort or one cohort will or might or might not lead you to enroll extra sufferers. So far as the thresholds, I imply it is an ordinary security run-in design. Igor, possibly you might present a bit bit extra shade on that query.
Igor Gorbatchevsky
Thanks, Brian. As Brian pointed, it’s extremely simple, security run-in, three dose degree might be examined 12 topics per every dose degree. DLT might be assessed after 1 cycle of remedy is accomplished. It is very protected and simple occasion that has been mentioned with the regulators and agreed upon. And to Brian’s level, determination about initiation of randomized Section III examine could possibly be finished as early as completion of preliminary cohort’s 12 topics.
Maury Raycroft
Obtained it. Okay. Thanks for taking my questions.
Operator
Your subsequent query comes from the road of Tara Bancroft from TD Cowen. Your line is now open.
Tara Bancroft
Hello, good afternoon. I hoped you might inform us precisely what you might be seeing now for the share of the cut up of wild-type versus mutant that you simply assume you are observing now versus what your earlier expectations had been? And in addition only a level of clarification. By goal enrollment, you imply completion, proper?
Brian Sullivan
Proper, proper. There may be all the time variation. You might have sufferers in screening on the finish of a interval and enroll extra sufferers simply because you may’t — not enroll sufferers that you have doubtlessly already permitted to display when you hit that focus on, however accomplished enrollment is right.
So we had been at 65% on the finish of ’23. And so over the course of ’23, you’d see fluctuations month-to-month, which is sort of anticipated fluctuations are regular. So once more, we had been cautious in deciphering variation, however as a result of we ended the yr on the goal quantity we had set in Could ’22, almost 18 months prior, we thought that — that estimate was strong and what we might proceed.
As soon as we hit 80% enrollment, which we did just lately, the wild-type cohort, and we’re at 60%. We simply determined that we should always replace our forecast to the present ratio — cumulative ratio, which is 60%.
Tara Bancroft
Okay. Nice. After which — so I assume, late This autumn for doubtlessly assembly the occasion time-line. That may doubtlessly match into the San Antonio convention time line. Is that this nonetheless possibly what you might be primarily hoping for? As a result of I do know that the summary deadline it handed early to mid-July. So did you submit an summary or plan on presenting there?
Brian Sullivan
So we’ve not — sure, we’re going to — till we get — have an announcement to make concerning the knowledge. We aren’t actually going to enter particulars about what venue we’ll be reporting that knowledge. And it may be very situational, relying on the timing and relative to the following most related assembly. And so as soon as the info is on the market, we’ll report the highest line as quickly as now we have it, after which we’ll present steerage on once we would go into extra element at a gathering or go into some element within the announcement press launch.
Tara Bancroft
Okay, nice. Thanks a lot for taking the questions.
Brian Sullivan
You’re welcome.
Operator
[Operator Instructions] Your subsequent query comes from the road of Brad Canino from Stifel. Your line is now open.
Brad Canino
Thanks for taking my query. Brian, I simply puzzled, are you able to speak about how the potential forthcoming approval of Roche’s interval additionally components into your medical and regulatory technique for frontline, a minimum of for the proportion who may have the mutation? And in addition, how essential is the last word label final result across the metabolic parameter eligibility as you concentrate on this? Thanks.
Brian Sullivan
I am undecided I perceive your query concerning inavolisib because it pertains to us. Are you asking that query about how that may have an effect on our first-line examine, Brad?
Brad Canino
Sure.
Brian Sullivan
We do not assume it can as a result of they’re solely evaluated sufferers who, a, had the PIK3CA mutation; however b, had been — did not have — we’re not prediabetic or diabetic, which, relying on the estimates, you may slender that indication right down to 50% of the mutated inhabitants. So it really isn’t a drug that would absolutely deal with the indicated inhabitants, which is girls who’ve endocrine-resistant illness. And because of this, we’re — once we’ve reviewed this info with the FDA in a number of settings. So we’re assured in our design and that is what we’ll be evaluating.
So we do not assume that knowledge will have an effect on us. It offers, we expect, validation of what we’re doing. They confirmed in that inhabitants that the pathway is concerned and inhibition of that pathway can do some significant remedy profit. So far as what’s on the label, the drug had been examined in sufferers with out the strict limitations used on this most up-to-date examine, INAVO-120. I feel the eligibility standards had been knowledgeable by the leads to that examine. And if I recall accurately, from knowledge they reported, I feel in 2021, the place sufferers might have had a cutoff of A1c just like alpelisib, I feel in one of many cohorts they handled had been roughly 40% grade 3 hyperglycemia.
So I feel it will be unlikely that the label would not tackle the hyperglycemia threat and the truth that the drug has not been evaluated in sufferers who’re prediabetic or diabetic. And to the extent medical doctors determine they need to ignore that primarily based on the outcomes that a minimum of had been reported on a preliminary foundation in these different research, it will appear that the chance of inducing Grade 3 hyperglycemia can be fairly important. So I feel that drug is the same profile in some methods as alpelisib. They only narrowed their affected person inhabitants, as a option to keep away from inducing excessive ranges of Grade 3 hyperglycemia.
Brad Canino
Respect it. Thanks.
Brian Sullivan
You’re welcome.
Operator
There are not any additional questions right now. I might now like to show the decision over to Brian Sullivan, CEO of Celcuity for closing remarks.
Brian Sullivan
Thanks very a lot for attending our name. We recognize your curiosity in our firm, and I look ahead to reporting to you subsequent quarter. Good night.
Operator
Women and gents, this concludes right this moment’s convention. Thanks very a lot on your participation. Chances are you’ll now disconnect.
