Inhibikase Therapeutics, Inc. Q4 FY2023 Earnings Call

Ladies and gentlemen, thank you for standing by. Greetings, and welcome to Inhibikase Therapeutics Fourth Quarter and Full Year 2023 Financial Results. At this time, all participants will be in listen-only mode. A question-and-answer session will follow the formal presentation. Please note that today's conference is being recorded. I will now turn the call over to Alex Lobo, Stern Investor Relations. Alex, you may now begin.

Thank you, operator. Good morning, and welcome to Inhibikase Therapeutics fourth quarter and full year 2023 financial results conference call and audio webcast. With me today is Dr. Milton Werner, Chief Executive Officer; and Garth Lees-Rolfe, Chief Financial Officer. On March 27, Inhibikase issued a press release announcing financial results for the fourth quarter and full year ended December 31, 2023. We encourage everybody to read yesterday's press release as well as Inhibikase's annual report on Form 10-K, which is being filed with the SEC. The company's press release and annual report are also available on Inhibikase's website at inhibikase.com. In addition, this conference call is being webcast through the Investor Relations section of the company's website and will be archived there for future reference. Please note that certain information discussed on today's call is covered under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Participants are cautioned that this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, March 28, 2024. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. Information on potential risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. The company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this webcast, except as may be required by applicable securities laws. With that said, I would now like to turn the call over to Dr. Milton Werner. Milton, you may begin.

Thank you, Alex, and thank you, everybody, for joining the call today. Before I begin, I want to give a round of applause to our outgoing Chief Financial Officer, Joe Frattaroli, who is on the call. Tomorrow will be his last day with the company, and we are very grateful for the six years of work that he and I have done together to bring Inhibikase to where we are. I also want to introduce you to our new Chief Financial Officer, who will formally begin on Monday, Garth Lees-Rolfe, who will be discussing our financial results. I appreciate everyone joining the call for our discussion of our fourth quarter and full year 2023 financial results and recent clinical and business updates. 2023 was really a year of execution as we made significant advancements across our clinical pipeline, culminating in our recent pre-NDA meeting with the FDA for IkT-001Pro and the rapid enrollment of Parkinson's patients in our 201 Trial for Risvodetinib, or Risvo as we will refer to it throughout this presentation. We are also evaluating new second-generation molecules arising from our internal medicinal chemistry and external collaborations that could further expand our pipeline and enhance suppression of neurodegeneration or address other diseases that could benefit from Abel-kinase inhibition. While we have much work to do in 2024, we believe that we are well positioned for success and continue to build value for our shareholders. Let's now take a deeper dive into each of our programs, starting with Risvodetinib or Risvo. As you may remember, Risvo is a potent selective inhibitor of c-Abl that is administered once daily and that we believe may slow or halt progression of Parkinson's disease. Our 201 Trial is a two-phase trial with an ongoing 12-week double-blinded study across three doses that we believe should be therapeutic, plus a fourth group that is taking a placebo. The trial is approximately 61% enrolled as of March 22, with 73 participants, 20 prospective participants in medical screening, and an additional 48 potential participants being evaluated for suitability to initiate medical screening. Additionally, 34 participants have completed the full 12-week dosing period. To date, 15 mild and two moderate adverse events have been observed that may be related to Risvo treatment. Two people elected to withdraw from the trial despite having only one or two moderate adverse events. We believe the last patient will be enrolled during the summer of 2024. To date, trial recruitment has been successful in our review, generating broad interest within the Parkinson patient community nationwide, allowing for hundreds of unique individuals to be screened by an outside medical staff and referred into our clinical sites prior to entering a medical record review process in advance of initiation of formal medical screening. We plan to report top-line results from this study in the second half of this year. The 201 Trial plans to enroll everyone who continues to meet the eligibility criteria into a 12-month extension study. Although we have completed several of the infrastructure builds to execute this trial, we still need additional financing to begin enrolling participants into the extension study at our clinical sites. As we have previously disclosed, the extension study will transition participants from the blinded phase who will still meet the enrollment criteria to an additional 12 months of treatment, which will also serve the purpose of evaluating our novel commercial tablet formulation for Risvo that we announced last year. As we continue to establish the potential of Risvo in Parkinson's disease, we believe it is important to communicate the progress to key stakeholders in the medical and scientific community. In January, we published the Phase I/Ib data evaluating Risvo in healthy volunteers and the patients treated with anti-Parkinson's medications. That report appeared in the peer-reviewed Journal of Parkinson Disease. The publication highlighted the safety, tolerability, and pharmacokinetics of Risvo across 94 healthy volunteers and 14 participants with Parkinson's disease in both single ascending dose and multiple setting dose studies. We found that Risvo demonstrated a favorable safety and tolerability profile for all trial participants with 12 potentially treatment-related adverse events observed, none of clinical significance. Single-dose pharmacokinetics were approximately between 12.5 and 200 milligrams for both Cmax and the area under the curve or AUC measurement with no pharmacokinetic difference between healthy volunteers and participants with Parkinson's disease. Exposures of these doses were high, relative to other drugs in the same class, specifically the same kinase inhibitor class. Of note, we used voluntary lumbar puncture to measure the concentration of Risvo in cerebrospinal fluid in six participants with or without PD, which indicated that Risvo crossed the blood-brain barrier and was persistently present in the central nervous system. While this is a limited data set, we find these results encouraging. We believe that the totality of the data we've generated to date continues to support the development of Risvo and we look forward to providing updates on the progress of the 201 Trial throughout the year. Moving now to IkT-001Pro, which is a prodrug formulation of imatinib mesylate designed to improve on the safety profile of imatinib, we had a pre-NDA meeting on January 19 of this year with the FDA to discuss the requirements for potential approval of IkT-001Pro under the 505(b)(2) statute. We're pleased with the discussion we had with the agency as we begin the process of building our first NDA package, and we plan to seek all 11 blood and stomach cancer indications for which imatinib mesylate has been approved. The FDA review team from the Division of Hematologic Malignancies determined that, through a review of our clinical data, 600 milligrams and 800 milligrams of IkT-001Pro provided similar exposures to 400 milligrams and 600 milligrams of imatinib mesylate, respectively. The review team advised that if we want to seek all the indications for which imatinib has previously been approved, we should measure the safety, tolerability, and pharmacokinetics of IkT-001Pro at doses up to 800 milligrams, the highest approved dose of imatinib mesylate. We plan to evaluate IkT-001Pro at a 1200-milligram dose, which we believe will lead to exposures of imatinib similar to 800 milligrams of imatinib mesylate. The review team asked that we evaluate whether IkT-001Pro and imatinib are absorbed differently from the gut, so we are initiating a standard preclinical test to further evaluate IkT-001Pro and imatinib gut absorption, which is a test performed in cell culture. As we continue to advance the elements of the NDA package, we will seek milestone meetings with the FDA to ensure we are meeting manufacturing, scientific, and quality control requirements for approval. Now before I turn the call over to our incoming Chief Financial Officer, Garth Lees-Rolfe, to review our financial results for the quarter, I'd like to again extend our deepest gratitude from both the Board of Directors and our entire team to Joe Frattaroli for his years of service as Chief Financial Officer, and we all wish him the best in his retirement. With that said, I'll turn the call over to Garth to review our financial results.

Thank you, Milton. Now let me review our financial results for the year and quarter ended December 31, 2023. The net loss for the year ended December 31, 2023, was $19.0 million or $3.57 per share, compared to a net loss of $18.1 million, or $4.28 per share for the year ended December 31, 2022. Research and development expenses for the full year ended December 31, 2023, were $13.6 million compared to $12.0 million for the full year 2022. The increase was primarily due to a $1.5 million increase for IkT-001Pro and a decrease of $0.6 million in expenses for Risvo, along with a net increase of $0.7 million for all other R&D activities. Selling, general and administrative expenses for the full year 2023 were $6.7 million compared to $6.2 million for the same period in 2022. The $0.5 million increase was primarily the result of an increase in investor relation costs of $1.0 million, an increase in employee costs of $0.3 million that were partly offset by a decrease in D&O insurance of $0.6 million, a decrease in legal and consulting fees of $0.4 million and a net increase of $0.2 million in all other selling, general and administrative expenses. As of December 31, 2023, we had $13.3 million in cash, cash equivalents and marketable securities. We expect that existing cash and cash equivalents will be sufficient to fund operations into the first quarter of 2025. That concludes the review of our financial statements. I'd like to hand the call back over to Milton for closing remarks.

Thank you, Garth. As we look ahead to 2024, we will continue to take advantage of the recent momentum we have experienced to continue to create value for our shareholders. We believe that the recent feedback from our pre-NDA meeting was constructive as we plan to conduct additional tests and studies to begin to build our first NDA submission package. In addition, we will continue to enroll patients into our 201 Trial and expect to provide top-line data from this study in the second half of the year. Our recent publication of early clinical data for Risvo in the Journal of Parkinson Disease reinforces our belief that Risvo could be a transformative treatment for patients with Parkinson's disease and related disorders. We look forward to continuing to establish ourselves as a leader in the development of treatments for neurodegenerative diseases. We want to thank all our shareholders and trial participants for their continued support as we advance the medicines for patients with high unmet medical needs. I would now like to open the call for questions. Operator?

Thank you. We will now be conducting a question-and-answer session. Our first question is from Ed White with H.C. Wainwright. Please proceed with your questions.

Good morning. This is Steve on for Ed White. So assuming positive data in Parkinson's in the second half, what are the next steps towards approval and timing?

Well, approval is a little bit hard to gauge. We've been fortunate to enroll the 201 Trial for this patient population at a faster rate than other studies of its kind in the last three years since COVID emerged. The Phase III trial or trials would need to be run again in untreated Parkinson patients on a larger scale. We'll need to assess the degree of benefit, if observed, at all three doses of Risvodetinib and decide whether we're going to have a one or two trial - one or two dose trial before registration. We also think that based on the outcomes of biomarker analysis, and we don't know if that will come to date, but if biomarkers support what we've seen in the preclinical animal models, there are opportunities to seek accelerated approval designations that could assist in speeding up those Phase III one or two trials that will be necessary for administration. I would guess it's probably a two to three-year process overall. We would plan, depending on the outcome of the trial that we see this year, to schedule a meeting with the FDA to discuss the parameters of the Phase III program. On the manufacturing side, we're well ahead of the game. We are already producing Risvodetinib on the order of commercial scale. We have a commercial tablet formulation. We'll be testing in the extension trial, and assuming that there are no issues that arise from that tablet formulation, we'll be in a very strong position to complete the other requirements of clinical development and enter into an NDA process.

All right. Thank you. And for IkT-001Pro, can you just comment on the big-picture strategy? And then any comments on potential partnering?

IkT-001Pro is an unusual molecule for us, being a novel chemical entity with composition of matter protection. We initially evaluated it to see if the technical ideas we incorporated could enhance a well-established and well-tolerated drug. Preliminary results from our clinical work show some promise. Additionally, we have reasonable support from the FDA that could facilitate approval via the 505(b)(2) statute. One important note is that 001Pro would be considered both a brand and generic product. Its earning potential is currently uncertain and appears modest, especially since the frontline drug imatinib mesylate has become generic, with 15 generic suppliers in the U.S. Its future depends on further developments. We plan to seek a partner to help with the costs of a non-inferiority or superiority trial aimed at enhancing safety knowledge. This trial is not required for the approval process, but we want to start it soon, focusing on patients with blood or stomach cancers. Moreover, we are interested in exploring 001Pro as a potential branded product in non-oncology areas, and we will provide an update on this strategy soon, as we have a meeting with the FDA on this topic at the end of next week. I don't want to preempt that announcement, but we will share more details shortly.

All right. Thank you. I was going to ask about that meeting. That’s all our questions. Thanks.

Thank you. I see no additional questions at this time. And this will also conclude today's teleconference. You may now disconnect your lines at this time. We thank you for your participation, and have a wonderful day.