Q3 2024 Chimerix Inc Earnings Call

Thomson Reuters StreetEvents

Fri, Nov 8, 2024, 12:22 AM 10 min read

Participants

Mike Andriole; President and Chief Executive Officer; Chimerix Inc

Michelle LaSpaluto; Chief Financial Officer; Chimerix Inc

Tom Riga; Chief Operating and Commercial Officer; Chimerix Inc

Maury Raycroft

Presentation

Operator

Good morning, ladies and gentlemen and welcome to the Chimerix third quarter, 2024 earnings conference call. I would now like to introduce you to your host for today's call. Will O'Connor from Stern Investor Relations. Please proceed.

Thank you, operator. Good morning, everyone. And welcome to the Chimeric third quarter, 2024 financial and operating results conference call. This morning, we issued a press release related to our third quarter operating update. You can access the press release in our investors section of the website. With me on today's call are President and Chief executive of Officer Mike Andriole, Chief Scientific Officer Josh Allen, Chief Financial Officer Michelle LaSpaluto, Chief Medical Officer Allen Melemed and Chief operating and Commercial Officer Tom Riga.
For questions before we begin. I'd like to remind you that the statements made on today's call include forward statements within the meaning of the private securities Litigation Reform Act of 1,995 and are subject to risks and uncertainties and other factors. These risks and uncertainties and other factors could cause actual results to differ materially from those referred to in the forward-looking statements. Please refer to our filings with the SEC for a more complete disclosure of these risks and uncertainties at this time, I'll now turn the call over to President and Chief Executive Officer, Mike Andriole.

Mike Andriole

Thank you will. Good morning, everyone and thanks for joining us. The third quarter was marked by continued execution across our pipeline including continued enrollment in our global phase three action study of do dordaviprone.
And we are nearing complete enrollment of our phase one dose escalation studies for our second generation dordaviprone ONC206.
The phase three action study is active in 15 countries worldwide and our first interim data readout is potentially less than a year away. During this past quarter, we received confirmation from the pre specified interim safety review undertaken by the study's independent Data Monitoring Committee which recommended the action study continue as is with no change to study conduct.
This is always welcome news but even more. So, in the case of the action study where we have two treatment arms one at the phase 2, 625mg dose administered once per week and a second treatment arm administering 625mg twice per week on consecutive days or essentially a double dose of the phase two schedule.
Passing this IDMC safety review with no change to study conduct to any arm is a meaningful milestone and underscores the well documented safety profile of dordaviprone that makes it both a promising profile as a potential monotherapy but also an ideal candidate as a potential backbone therapy.
Last month, we participated in the European Association for Neuro-Oncology annual meeting in Glasgow Scotland. It was evident that the enthusiasm across the European community for this program and the degree of support from so many investigators who recognize the very high unmet need in this patient population only continues to strengthen with time turning a little closer to home.
The annual meeting for the Society for Neuro-Oncology also known as snow will occur in Houston, Texas later this month where we're planning a large presence. We view our partnership with the snow organizers and engagement at this pivotal conference as important to the success of our programs. Not only will we have presentations for dordaviprone, but we'll also showcase ONC206 abstracts for that conference will release next week. So, please stay tuned for more details for those attending. We're looking forward to seeing many of you and our investigators in person.
We continue to make progress with the Therapeutic goods administration or TGA to file for provisional approval in Australia. Well, this was not on our radar last year. We were agile when an opportunity arose earlier this year and we're now in a position to file an NDA for provisional approval around your end. Having the NDA document ready for submission in Australia also aids our capacity and timelines. Should we have a positive interim overall survival outcome for action next year.
To that end, we are judiciously preparing the company in the market for dordaviprone potential commercialization as we may be within a year. From the first interim readout with our phase three action study and our expanded access programs in the US and Europe, we now have a well laid foundation with hospitals and physicians who have ongoing treatment experience with dordaviprone, recall there are no approved therapies specific to this patient population and we consequently expect a rapid uptake upon potential commercialization, forecasting a potential global market opportunity over $750 million.
Turning to our second generation of imipridone ONC206, our objective for the year is to gather safety and PK data in an unselected CNS patient population and to evaluate lead indications for the program. I'm happy to report the phase one dose escalation is nearing completion and the lab has been working diligently on nonclinical studies to inform the next step for the program we continue to see ONC206 is well tolerated in adult and pediatric patients. As we near completion of the dose escalation studies. As we review the incoming clinical and preclinical data, we plan to announce next steps for the program in the coming months.
Before I turn the call over to Michelle for a review of the financials. I'd like to take a brief moment to recognize the recent promotion of Josh Allen as our Chief Scientific Officer since joining Chimerix in 2021 with the acquisition of Oncoceutics. Josh has been an integral team leader and a trusted colleague to many across the company and has continually advanced the research and development of the Aipri class of compounds from academic discovery to the lead registration phase program. Please join me in congratulating Josh on this well-deserved promotion with that. I'll turn the call over to Michelle for a brief review of our financials.

Michelle LaSpaluto

Thank you, Mike. Earlier today we issued a press release containing our financial results for the third quarter of 2024 for the third quarter of 2024. We reported a net loss of $22.9 million compared to a net loss of $24 million in the third quarter of 2023. Research and development expenses increased to $19.6 million for the third quarter of 2024 compared to $17.4 million for the same period of 2023. This was primarily driven by increased spending in the action study.
General and administrative expenses decreased to $5.2 million for the third quarter of 2024 compared to $9.3 million for the same period in 2023. This decrease is due to a one-time non-cash expense related to historical grants recognized during the same period in 2023.
We ended the third quarter with just over $152 million in cash and cash equivalent as anticipated. Our cash burn rate did experience a modest increase this quarter as in preparation for the commercialization of dordaviprone we are committed to sensible cash management. Currently, we have a cash runway extending into the fourth quarter of 2026.
With that, I will turn the call back over to Mike for closing remarks.

Mike Andriole

Thanks Michelle. We've continued to execute our plan as expected in the third quarter with a focus on bringing dordaviprone to patients as soon as possible. We're beginning to prepare our organization to launch dordaviprone and are excited about the promise to further broaden our pipeline in the future by advancing ONC206 or through business development initiatives with that, Leonardo. We'll open the call to questions.

Operator

Thank you. (Operator Instructions)

Question and Answer Session

Operator

Maury Raycroft. Please go ahead.

Maury Raycroft

Can you talk about how you're preparing the submission of the NDA for Australia and a potential launch by the end of 25. Are how are you using these commercialization efforts to potentially scale the organization for a potential US launch too? Do you plan to leverage that NBA submission to dovetail into conversations with other regulatory agencies for accelerated approval path as well?

Mike Andriole

Yeah, thanks for the question. So, you know, there's probably two parts to that question, there's a regulatory component and the commercial component. So, I'll ask Tom Riga to comment on the commercial side, on the regulatory side, you know, having the backbone of the new drug application complete for Australia has great utility in other markets around the world. There's a lot of overlap between that backbone and what might be needed or expected in other markets around the world. So, we see synergy there and having this ready.
Of course, the efficacy component for this application will be predicated on the phase two response rate data that we've previously announced in terms of where we might utilize that in other markets around the world. We continue to look at the action study as the first opportunity for registration and other markets around the world. But should that change, we'll update the market accordingly, Tom, do you want to comment on our commercial? Yeah.

Tom Riga

We are enthusiastic to be inside of a year of first potential data from the action study. And I think as we approach the market. Our, me affairs team is up and running and in full force. And the early commercialization efforts are focused around payer engagement, forecast confirmation, some of the commercial build and internal infrastructure. But we're taking a very gated spend. I think you could see in our SG&A line, we are going to be conservative and gated as we get more data within the program. But we'll make sure that we're ready for the market as we're enthusiastic about the opportunity.

Maury Raycroft

Great. Thanks for the clarity. And just another quick follow up. So, EVS announced the execution of contract options for $67.4 million to acquire Tembexa for a national stop national preparedness efforts. And they also announced yesterday that they'll conduct clinical trials of Tembexa for a monkeypox in Africa. So how much of that total contract value would chimeric be eligible to receive? And what would be the timing for receiving that milestone? Do you have any insight into how the monkeypox outbreak has affected the U.S. government's initiative to stockpile Tembexa for smallpox?

Mike Andriole

Thanks for the question. Let me take the monkeypox part of that question and then, I'll ask Michelle to answer. You know, the first part on, the partial clean exercise of 67 million from a monkeypox perspective, yes, emergent did announce participation in a randomized monkeypox study at the end of business yesterday their best positioned to answer questions on that. That is an ongoing new study to explore Tembexa utility in that population. We'll see how, that unfolds in the coming years that could lead to potential royalties to Chimerix when and if there could be international sales associated with that indication. But of course, they're at the very beginning of that process. Now, Michelle comments on, the milestone.

Michelle LaSpaluto

Yes. Barta did exercise a partial exercise with emergent for Tembexa, which was just over $67 million. And with that option, we are due approximately $2.7 million related to that exercise. However, due to accounting rules, we have to wait until the cash is received for that to be recorded. So, hopefully next quarter, we'll have a little bit more information on that.

Mike Andriole

Yeah. that exercise I think goes out to 2027 Michelle. So, it's a multi year exercise of, of a plan that's about or an option. That's I think just over half of the value of, of that next option.

Michelle LaSpaluto

That is correct as that's our understanding.

Maury Raycroft

Great. Thank you so much for taking my questions.

Operator

Thank you. (Operator Instructions)

Mike Andriole

Thanks, Leonardo. Thank you everyone for your time this morning and we look forward to updating you in the coming months.

Operator

Ladies and gentlemen, that includes today's call. Thank you all for joining you. (Operator Instructions)

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