Earnings Call Transcript - ABOS Q1 2024

Operator, Operator

Good day and thank you for being here. Welcome to Acumen Pharmaceuticals First Quarter 2024 Conference Call and Webcast. Please note that today's call is being recorded. I will now turn the conference over to Alex Braun, Vice President and Head of Investor Relations. Please proceed.

Alex Braun, Vice President and Head of Investor Relations

Thanks, Norma. Good morning and welcome to the Acumen conference call to discuss our business update and financial results for the quarter ended March 31, 2024. With me today are Dan O'Connell, our CEO; and Matt Zuga, our CFO and Chief Business Officer. Dan and Matt have some prepared remarks and then we'll open the call for questions. Joining for the Q&A session, we also have Dr. Jim Doherty, our President and Chief Development Officer; and Dr. Eric Siemers, our Chief Medical Officer. Before we begin, we encourage listeners to go to the Investors section of the Acumen website to find our press release issued this morning that we'll discuss today. Please note that during today's conference call, we may make forward-looking statements within the meaning of the federal securities laws, including statements concerning our financial outlook and expected business plans. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Please see Slide 2 of our corporate presentation, our press release issued this morning, and our most recent annual and quarterly reports filed with the SEC for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements. We undertake no obligation to update or revise the information provided on this call or in the accompanying presentation as a result of new information or future results or developments. And with that, I'll turn the call over to Dan.

Daniel O'Connell, CEO

Thanks, Alex. Good morning, everyone, and thanks for joining us today. As we noted on our year-end call in March, 2024 is a year of execution for Acumen as we work to establish the therapeutic potential of sabirnetug as a best-in-class treatment option for the substantial early Alzheimer's patient population. I'm pleased to say that we are off to a great start with the first patient dosed in our ALTITUDE-AD Phase II study announced just last week. ALTITUDE is a randomized placebo-controlled double-blind study with 3 arms designed to evaluate the clinical efficacy and safety of sabirnetug with approximately 180 participants per arm for a total of 540 participants with MCI or mild dementia due to Alzheimer's disease. We are highly encouraged by the start of the ALTITUDE study, which we attribute to a couple of key factors. First, we received positive feedback from site investigators on our Phase I INTERCEPT results. The thoroughness of the INTERCEPT data package appears to be resonating, particularly the confluence of biomarker improvements we saw in patients after only 3 doses. Second, the design of the ALTITUDE study has been viewed favorably by many investigators and patients. Because our Phase I oligomer target engagement data was so informative, we are proceeding in Phase II with 2 dose arms that may prove efficacious. So patients have a greater chance of receiving a therapeutically relevant dose level of sabirnetug. Additionally, the open-label extension is proving to be important to patients in the screening process as it provides for 12 months of sabirnetug active treatment following the 18-month placebo-controlled portion of the study. Overall, I'm extremely pleased with the strong foundation that our team and CRO partner have built with key trial sites, highlighting the benefits of preparation, communication for screening, and enrollment efficiency. In addition, we also recently announced a collaboration agreement with Lonza for manufacturing of sabirnetug for clinical development and commercialization should it be approved. This is important because it allows us to leverage Lonza's regulatory expertise, extensive experience in antibody manufacturing, and global manufacturing network. We are also on track to initiate a Phase I study in healthy subjects for a subcutaneous formulation of sabirnetug in mid-2024. We believe a competitive product profile for sabirnetug includes a subcutaneous option to offer additional flexibility and convenience for patients and caregivers. We'll provide more information on the plan for that work stream once we have the PK results in hand. We remain committed to delivering on our strategic priority to efficiently and thoughtfully advance the clinical development of sabirnetug for the benefit of patients, caregivers, and shareholders. I look forward to updating you as we work to achieve ALTITUDE-AD Phase II data that we believe will provide the true value inflection for the sabirnetug program. And with that, I'll turn the call over to Matt for the financials.

Matt Zuga, CFO and Chief Business Officer

Thanks, Dan. As a reminder, our first quarter 2024 financial results are available in the press release we issued this morning and in our 10-Q, we will file later today. As of March 31st, we had approximately $297 million in cash and marketable securities on our balance sheet and continue to expect that cash runway to last into the first half of 2027. R&D expenses were $12.4 million in the first quarter. The increase over the prior year was primarily due to the increased spending to support the ALTITUDE-AD trial. G&A expenses were $5.3 million in the quarter, with the increase over the prior year primarily the result of increased headcount. This led to a loss from operations of $17.8 million in the quarter. We are off to a strong start with ALTITUDE-AD. We are well capitalized to execute on the study and to develop a subcutaneous formulation of sabirnetug. We are committed to delivering on the opportunity ahead of us and look forward to providing additional updates this year as we advance sabirnetug for the benefit of patients, caregivers, and shareholders. And with that, we can open the call for Q&A.

Operator, Operator

And our first question will come from Tom Shrader with BTIG.

Tom Shrader, Analyst

I have a couple of quick ones. First for Matt, is R&D about stable now, or are we expecting it to go up significantly? I know you're probably early in enrollment, but you probably had some upfront costs. So where is R&D now compared to what you expect over maybe the next 2 years?

Matt Zuga, CFO and Chief Business Officer

It's going to trend up for the next couple of quarters and then flatten out and then go down. But if you notice, R&D this quarter was more than any quarter that we ever had, and it's going to go up and sort of plateau for a couple of quarters and then come down.

Tom Shrader, Analyst

Okay. Perfect. And then on the subcutaneous formulation, do you have a sense of what you're looking for? Is the general idea here to do a quick study to show you can match AUC and then maybe wait for the field to figure out if AUC is really the deliverable for a subcutaneous antibody? Is that kind of the plan?

Daniel O'Connell, CEO

Thanks, Tom. This is Dan. I'll just quickly comment on that. For us right now, I think the important thing is to get the healthy volunteer study up and evaluate the PK. And I think there is considerable optionality to observe sort of where the field heads, both from a clinical and regulatory perspective. So I think we're still sort of in the TBD as to the next step for subcutaneous, but certainly want to get these Phase I results in hand as quickly as possible.

Eric Siemers, Chief Medical Officer

Yes. And maybe just quickly, for the first study in healthy volunteers, I think the goal was really just to match AUC. The next study, which would occur in patients, we haven't developed that, planned that, or designed that completely by any means. But since it will be in patients, then we have a lot of other options in terms of biomarkers and target engagement and other things that we did in our INTERCEPT study. But this first study is just based on AUC.

Operator, Operator

Our next question will come from the line of Paul Matteis with Stifel.

Unidentified Analyst, Analyst

This is James on for Paul. And maybe just a follow-up on the subcutaneous, and I'm just curious how your kind of thinking has evolved. Do you think you can ultimately get to a plaque-busting dose with the subcutaneous, or is the subcutaneous more focused on oligomers? Just kind of curious what your thoughts are there. And then also maybe just quickly, just curious what you're most interested in, in the upcoming donanemab AdComm and what you think some of the implications may be for the broader Abeta space?

Eric Siemers, Chief Medical Officer

Yes. Well, maybe I'll answer the first one and then pass it over to Dan for the second one. For the subcutaneous, I don't think we look at that as being different than we saw in our INTERCEPT study in terms of plaque reduction versus oligomer target engagement. I mean, oligomer target engagement is something that's important for this antibody, but having some plaque reduction as long as you can do it without a lot of ARIA isn't a bad thing either. So the goal from that standpoint is really no different with the subcutaneous effort versus the IV effort that we had in our Phase I study.

Daniel O'Connell, CEO

Thanks, Eric. And James, in terms of the AdComm for donanemab, I think that session will principally focus on 2 main concerns that the FDA has raised regarding treatment duration and stratification. So those will be important discussions to have in a public forum. And I think they will likely have implications for label and market development. But ultimately, we do think that donanemab likely will be approved and really will become a commercial player in the Alzheimer's space, which we take as a positive as this is still sort of the early days of commercial infrastructure build and providing greater access to patients. So certainly, it was a bit of a curveball for Lilly, presumably, but I think the AdComm should go reasonably well and continue to underpin the growth of this treatment modality.

Operator, Operator

Our next question comes from the line of Pete Stavropoulos with Cantor Fitzgerald.

Samantha Schaeffer, Analyst

This is Samantha Schaeffer on the line for Pete. Now that you have presented the P1B data at multiple conferences and have extensively socialized the data, we're curious to hear if you have any updated thoughts on the potential mechanisms behind the lack of ARIA-E and APOE homozygous and observed only in females. Is this pattern just by chance, or is there a plausible mechanistic reasoning?

Eric Siemers, Chief Medical Officer

Yes, those are really good questions, and we've thought about them a lot. I'm not sure we have a definite answer. The absence of ARIA in APOE4 homozygous is quite encouraging for this antibody. Mechanistically, we can speculate that not all plaques are identical. Our antibody primarily targets oligomers with some plaque reduction. As we gain more insights into the biochemistry of plaques, we will likely discover more differences among them and how antibodies interact with various plaque forms. However, at this stage, it's all speculation. In our Phase II study, we will closely monitor for ARIA in APOE4 homozygous. The observation that ARIA cases were found only in women is a valid point, and interestingly, it hasn't been raised before. We've considered it as well. It parallels the lack of ARIA in E4 homozygous and could be coincidental, similar to the absence in E4 homozygous. Nonetheless, it is puzzling. As we begin to understand more about sex differences in the effectiveness of antibodies and ARIA rates, there’s still much to learn. This is another area we’ll keep a careful watch on in our Phase II study.

Operator, Operator

Our next question comes from Jason Zemansky with Bank of America.

Jason Zemansky, Analyst

Congratulations on the progress. Curious as far as your enrollment expectations for ALTITUDE, especially given the availability of lecanemab and potentially donanemab in the future. Can you talk a little bit about what you think the implications are and whether or not the availability of either both of those antibodies will impact what you see? And then a follow-up, if I may.

Daniel O'Connell, CEO

Yes, Jason. So thanks for the question. Based on the scripted word portion of the call, we were highly encouraged with the early phase of the ALTITUDE study and encouraged by the level of interest and engagement from sites and how we're doing in the study generally. So I think for the moment, we feel really good about the rate of enrollment in ALTITUDE.

Jason Zemansky, Analyst

Got it. And then as far as the subcutaneous formulation goes, is there a possibility or at least a protocol where you can use it, if the healthy volunteer study goes well, within ALTITUDE potentially? Is there some mechanism that would permit bringing that in, or would you have to wait for a separate study?

Eric Siemers, Chief Medical Officer

So I guess I'd take that one. Yes, in our case, theoretically, of course, it would be possible to try to put it into ALTITUDE. But ALTITUDE is a Phase II study, it's completely designed, so I think that would be a challenge logistically to actually do. Again, what we will do after our healthy volunteer study for the subcutaneous formulation is move to patients. And again, we can do a lot of the same things that we're doing in the ALTITUDE study. In fact, we probably will. But I don't think you would try to insert that into the actual Phase II ALTITUDE study.

Operator, Operator

And this concludes our Q&A portion. I'd like to hand the conference back over to Alex Braun for closing remarks.

Alex Braun, Vice President and Head of Investor Relations

Thanks, Norma, and thanks for everyone for listening today. If you have any further questions, we're always available at the company; please reach out. All right. Have a great day.

Operator, Operator

This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.