IVERIC bio, Inc.
Q4 2019 Earnings Call Transcript

Published: 27 Feb 2020

[Operator:]

Good day and welcome to the IVERIC bio Fourth Quarter and Year End 2019 Results Conference Call. Today’s conference is being recorded.At this time, I would like to turn the conference over to Kathy Galante. Please go ahead.

[Kathy Galante:]

Good morning and welcome to IVERIC bio’s conference call. Representing IVERIC bio today are

[Glenn Sblendorio:]

Thanks, Kathy, again, good morning, everyone. As always, we appreciate you joining our call this morning. We made tremendous progress last year, as we continue to build the diversified portfolio in retinal diseases that includes both therapeutics and gene therapy, setting the stage for IVERIC bio to be a leader in developing transformative therapies to treat retinal diseases.At the end of October last year, we achieved a major milestone of positive Zimura clinical trial data in geographic atrophy, or GA, secondary to age-related macular degeneration, or AMD. These positive results position IVERIC bio as a late-stage clinical company with Zimura as a potential treatment option for geographic atrophy secondary to dry AMD, a potential multibillion dollar market to which there are currently no FDA or EMEA approved treatments available.I’d like to review some of the characteristics and results of this trial with you.As reported in October 2019, individual administration of both Zimura 2 milligram and 4 milligram dose, met the pre-specified primary and efficacy endpoint with statistical significance in our international multicenter, randomized, double masked, sham controlled clinical trial for GA secondary to dry, showing a 27% reduction in GA growth over a 12-month period, in both the 2 milligram and 4 milligram treatment groups.Based on a recent FDA guidance, we believe that this reduction in growth is not only statistically significant, but also clinically meaningful. Zimura was well-tolerated in this trial. And based on the potentially superior safety profile of Zimura observed today, we believe that Zimura may potentially differentiate itself in the field of complement inhibitors for the treatment of GA secondary to dry AMD in elderly patients that we are seeking to treat.Based on the pre-specified screening trial design, robust masking, detailed statistical analysis, with a pre-specified statistical analysis plan, and an independent and masked imaging analysis performed by one of the leading rating centers in the world for retinal imaging. We believe that this clinical trial will serve as one of two pivotal trials, typically required for marketing approval.We are leveraging our deep expertise and efficient execution in retinal drug development with the goal of bringing Zimura to patients with GA secondary to dry as soon as possible. We’re in the process of initiating the second Zimura pivotal trial called ISEE2008 and are planning to enroll the first patient next month.As we initiate ISEE2008, we will seek to leverage our global network or top clinical trial sites for retinal diseases to assist with our plan to enroll approximately 400 patients. Kourous will review the design of ISEE2008 in more detail in a moment. The results from OPH2003 Zimura pivotal trial have already been presented or planned to be presented at several prestigious retinal meetings around the world including The Macula Society in San Diego; the Angiogenesis, Exudation, and Degeneration meeting in Miami; the Association for Research in Vision and Ophthalmology, the ARVO meeting, in Baltimore; the American Society of Retinal Specialists, ASRS, that’s going to be held in Seattle; the International Symposium on Ocular Pharmacology and Therapeutics in Spain; the Retina 2020

[Kourous Rezaei:]

Thank you, Glenn, and good morning, everyone. Age-related macular degeneration is characteristically a disease of the elderly and is the leading cause of visual loss in individuals of 50 years of age or older in developed countries. In the United States, it is estimated that approximately 11 million individuals are affected with AMD with a reported global prevalence of approximately 170 million individuals. Because of increasing life expectancies in developed and developing countries. The elderly sector of the general population is expected to continue to increase in the coming decades. While 1 in 8 Americans was considered to be elderly in 1994, which is expected that the 1 in 5 will fall into this category by 2030.As AMD progresses with age, it generally progresses to either the [manovascular] [ph] or the atrophic dry form of AMD or the neurovascular form of the disease or wet AMD. In the dry atrophic form, the loss of photoreceptors, these are the cells that perceive light, RPE cells, these are the cells that support the photoreceptors. And associated cardio capillaries, which is the blood supply leads to the formation of the geographic atrophy.Currently, approximately 1.5 million individuals are reported to have geographic atrophy in the United States. With an incidence of approximately 159,000 patients per year which is even slightly higher than what is reported for annual incident for wet AMD.Furthermore, development of progression of geographic atrophy over time is a common cause of vision loss in patients diagnosed with wet form of AMD for generally treated with anti-VEGF therapy indicating that the many patients regardless of whether they have to dry or wet form of AMD, the final anatomic outcome leading to loss of vision is geographic atrophy.Currently, there are no FDA or EMA approved treatment for GA, which leads to bilateral irreversible loss of vision in its large group of patients. As Glenn pointed out, we are excited about the results of our first pivotal trial for Zimura in geographic atrophy, secondary to AMD indicating that Zimura was well tolerated over 12 months, and was able to slowdown the growth of GA over the 12 months period in a statistically significant degree.Following these results, we immediately started the process to initiate our second pivotal trial in GA, ISEE2008 with the goal of enrolling our first patient next month. And we believe that we are on track. ISEE2008 is an international, randomized, double masked, sham controlled, multicenter pivotal clinical trial evaluating the safety and efficacy of Zimura 2 milligram in patients with geographic atrophy secondary to dry AMD.As you may recall, in the first pivotal clinical trial, both Zimura 2 milligram and Zimura 4 milligram cohorts demonstrated a statistically significant reduction in the mean rate of GA growth over 12 months, when compared to the corresponding sham control cohorts with the similar 27% reduction. And since Zimura 2 milligram is administrated as a single intravitreal injection, whereas Zimura 4 milligram requires 2 intravitreal injections, we selected the Zimura 2 milligram dose for evaluation in the ISEE2008 clinical trial.Our understanding from the FDA is that regarding the Zimura 2 milligram dose for marketing approval purposes from a safety perspective at least 300 patients need to be treated with monthly Zimura 2 milligram or at a higher dose for the duration of at least 12 months with the portion of these patients treated for 24 months. Therefore, we are planning to enroll approximately 400 patients in the ISEE2008 trial. These patients will be randomized 1 to 1 into 2 cohorts. The first cohort receiving monthly administration of Zimura 2 milligram for 12 months and a second cohort receiving monthly administration of sham.The pre-specified primary efficacy endpoint would be the same as our first pivotal trial and is the mean rate of change in geographic atrophy growth over 12 months measured by fundus autofluorescence at 3 time points, baseline, month 6 and month 12. If we receive positive 12-month data from ISEE2008, we plan to file for marketing approval for Zimura for the treatment of GA with the FDA and EMA. At month 12, we plan to re-randomize patients in the Zimura 2 milligram arm to receive either monthly or every other month administration of Zimura 2 milligram. All patients who initially receive monthly administration of sham will continue to receive monthly administrations of sham. We intend to treat and follow our patients for 24 months.The inclusion and exception criteria for ISEE2008 are similar to our first Zimura pivotal trial. However, in the first trial when patients were reported to have developed choroidal neovascularization or CNV in the study eye during the trial, they were excluded some further participation in the study, because we were concerned fundus autofluorescence images could not be reliably evaluated in the presence of CNV in the study out.After discussions with our independent reading center, who has reviewed the images from ongoing Zimura GA trial, we believe that many of these images could potentially be reliably assessed by fundus autofluorescence. Therefore, in the upcoming ISEE2008 trial, we are planning to keep patients, who developed CNV in the study eye in the trial. And the measurement of these patients GA side will be included in the primary efficacy analysis as well as their fundus autofluorescence images can be reliably assessed by the mask reading center.As Glenn mentioned earlier, Zimura met its pre-specified primary endpoint in the first pivotal trial by reducing the rate of GA growth and patients with dry AMD in an international, multicenter, randomized, double masked, sham controlled clinical trial. The reduction in the mean rate of GA growth over 12 months was 27.38% with a P value of 0.0072 for the Zimura 2 milligram group, as compared to the corresponding sham control group, and 27.81% with a P value of 0.0051 for the Zimura 4 milligram group, as compared to the corresponding sham control group.These data for both those groups were statistically significant and based on a recent FDA guidance, we consider them to be clinically meaningful. Most importantly, based on our preliminary review of the safety data today, Zimura was generally well tolerated over 12 months of administration. Over this 12-month period, there were no investigator related – investigator reported Zimura-related adverse events, no cases of Zimura-related intraocular inflammation, no ocular serious adverse events, no cases of Zimura-related increase in intraocular pressure, no cases of endophthalmitis, and no discontinuations attributed by investigators to Zimura.Further, the investigator reported rate of choroidal neovascular membrane incident appears to be lower than what has been reported in literature for complement inhibition in GA. Based on recent literature, this may potentially be to Zimura blocking the complement cascade downstream at the level of C5 and not blocking the cleavage of C3. We believe that potentially superior safety profile of Zimura today could potentially differentiate Zimura in the field of complement inhibitors for the treatment of GA in these elderly patients.The design of our first pivotal clinical trial for Zimura in patients with GA secondary to dry AMD possess a few important characteristics that differentiated from other Phase 2b trial done in the field and we believe supported to qualify as a pivotal trial.I’d like to go over some of these important differentiating factors. This trial was designed of the Phase 2b screening trial, which means that is designed and conducted as a Phase 3 trial with all necessary Phase 3 requirement, but with a smaller number of patients. The pre-specified design of screening trial provides that if the study drug is efficacious enough to reach statistical significance with a smaller sample size, then trial could qualify as a pivotal clinical trial.As reported earlier, the reduction of GA growth reached statistical significance for both Zimura 2 milligram dose and 4 milligram dose, with compared to the corresponding sham controlled arms at month 12 fulfilling this important criteria. To minimize bias in this trial, patients evaluating physicians, Iveric bio as the sponsor and the independent reading center were all masked to the treatment of the individual patients were receiving throughout the trial.The pre-specified statistical analysis plan or SAP was used for statistical analysis, based on the pre-specified criteria in this SAP, a dose of Zimura would be statistically significantly more effective than the sham control is the strength of evidence met the standard requirement of a 0.0125 one-sided false-positive error rate, incorporating on adjustment for multiplicity arising from comparing each dose with sham control. Further, robust pre-specified sensitivity analysis was planned and performed, which indicated the analysis results were robust to missing data.For the assessment of the primary endpoint, the images were evaluated by a leading independent masked reading center. The reviewers were completely masked and its visit – and each visit was evaluated independently. As indicated earlier, our first Zimura pivotal trial is still ongoing and patients continue to be treated and followed until they reach the month 18 time point.Patients evaluating physicians, the independent reading center, and we as the sponsor continue to be masked regarding the 2 main groups, to which each individual patient was randomized and expect to remain masked until the patients reach month 18. It is important to point out that this trial was not designed to assess statistical significance between individual cohorts at month 18, and any month 18 results will be descriptive only. We expect to report month 18 data by the end of second quarter.To conclude, GA is a significant cause of bilateral irreversible and to be loss of functional vision with a major impact on the quality of life and independent of our elderly patients. Although, anti-VEGF therapy is available for treatment of wet AMD, no FDA or EMA approved treatments are currently available for geographic atrophy.Further, development of progression of geographic atrophy over time, it’s a common cause of vision loss in patient diagnosed with wet AMD were being treated with anti-VEGF therapy indicating that regardless of whether patient have the dry or the wet form of AMD, the final anatomic outcome moving to loss of vision in many patients is geographic atrophy. The absence of treatment options for geographic atrophy represents an area of urgent unmet medical need and a major public health concern for the expanding elderly population.We look forward to keeping you updated regarding the progress of our Zimura program and to potentially help these patients.I would now like to turn the call over to Dave. Dave?

[David Carroll:]

Thank you, Kourous, and good morning, everyone. I’d like to highlight a few items from our press release of this morning, and provide some guidance on our expected year-end 2020 cash balance and cash runway. For the quarter, our net loss totaled $17.5 million, or $0.39 per share, compared to a net income of $104.1 million, or $2.62 per share for Q4 2018. As Q4 2018 reflects a $125 million gain on extinguishment of a royalty purchase liability payable to Novo Holdings.Our net loss for 2019 totaled $58.9 million or $1.39 per share, compared to a net income of $63.1 million or $1.70 per share for 2018, as 2018 reflects the impact of the aforementioned gain on extinguishment of a royalty purchase liability.Turning to our expected yearend cash balance and cash runway, as we previously announced our cash balance at December 31 was approximately $126 million, we now estimate our yearend 2020 cash balance to range between $60 million and $70 million. We also estimate that our available cash will be sufficient to fund our operations and capital expenditures as currently planned into the beginning of 2022.These estimates are based on our current business plan, which includes initiation of our ISEE2008 trial and the continuation of our other R&D programs. Of course, these estimates do not reflect any additional expenditures resulting from the potential in-licensing or acquisition of additional product candidates or technologies or any associated developments the company may pursue.And I’ll turn the call back over to Glenn. Thank you for your time.

[Glenn Sblendorio:]

Well, thank you everybody for listening this morning. And we’re focused on execution over the next few months. The first, obviously, to get patients into our second pivotal trial next month, and obviously, we’re looking forward to the 18-month data that will come in the second quarter. So it’s a focus on execution, working with our collaborators to move these programs forward.So thanks again, thanks for your continued support. And, operator, will you please open the line for some questions.

[Operator:]

Thank you. [Operator Instructions] We now take our first question. It comes from Ken Cacciatore of Cowen and Company.

[Ken Cacciatore:]

Hey, good morning, team. Just congratulations on all the progress you’ve been making. Just a few questions here, first, just wondering if you’ve actually, just thinking about it, entered into any ex-U.S. partnering discussions and trying to think of non-dilutive ways you may be looking to bolster your cash position.And then, secondly, I know it’s difficult to do and you’re just going to get going here on enrollment. But can you give us some thoughts or ways of putting perspective around the timing to complete enrollment for the Phase 3 program? And then, lastly, Apellis is clearly running a program as well and we understand they’re doing 2 studies versus your 1, given you already have a pivotal completed. But can you talk about any subtleties and differences between the 2 programs that you like to share? Thank you so much.

[Glenn Sblendorio:]

Yeah. Thank you, Ken, for those 3 questions. I’ll take the first 2. On the partnering, we had a very good J.P. Morgan and we got an opportunity to talk with a number of potential partners. We’re going to continue to speak to those partners. What I was encouraged by is the strength of the data, obviously, attracts people that have interest. So as you know these are and we’ve been saying so that we’re committed to explore any partnering and we keep you updated over the coming months if those discussions progress.Obviously, I don’t want to put any timelines or commitments on that. But thought about ways to further strengthen the company, not only in terms of collaboration, but also non-dilutive financing is something we’re thinking about as well.On the timing enrollment, let us get started first. Obviously, there are always very competitive questions as to enrollment. I just focused in my summary, talked about focus on execution. I think you’ll see the same intensity once we get the trial up and going. And as we move forward, if possible, we’ll update the community. But right now, that’s something we want to hold a little close.You know that we can do this based on our past track record. So, I’ll speak to in that matter. And I’m sorry for not being more specific. Kourous, do you want to take the third question about differences in the trial design?

[Kourous Rezaei:]

Sure, I mean, I can tell you a little bit of our Phase 2b trial. I’ve pointed out in great detail during our call was a pre-specified – a screening trial, which with certain qualification that I went over with a pre-specified statistical significance that is 0.0125 one sided, and also was a double mask trial and actually it’s quadruple masked, because in patients, they are looking physician, the independent reading center, the sponsor and the patients were all masked and just pointing out they’ll continue to be masked.And I think the primary – I think the endpoint is very similar that growth of GA leaves in over 3 time points, which we believe is accepted by the regulatory agency and meant to be meaningful. And we look at, as we pointed out, we look at 2 milligram, because 4 milligram was 2 injections. We didn’t believe we want to start every other month from the get-go, because as already been shown there is a less – there is less efficacy when we do every other month. So we wanted to see after 12 months how would that look like for the long-term treatment of the patients.

[Ken Cacciatore:]

Thank you.

[Glenn Sblendorio:]

Thanks, Ken.

[Operator:]

Thank you. And we’ll now move to our next question. It comes from David Nierengarten of Wedbush Securities.

[Matthew Barcus:]

So, good morning, this is Matt on for David. As I just want to get a little bit of insight on your – after the first initial for 12 months on 2008 trial, you can have the option for and every other month dosing and I just wanted to get your thoughts on what you hope to achieve from those cohort and your insight on what you think you might see this work as in maintenance?And also, look, the 2003 trial, you mentioned that you’ll have the month-18 data by the end of the second quarter. I just wondered what other type of analysis you might be able to see from – looks like a few different scientific meetings you’ll be presenting at. Thank you.

[Glenn Sblendorio:]

Sure.

[Kourous Rezaei:]

Well, thanks, Matt. Thank you.

[Glenn Sblendorio:]

Go ahead, Kourous.

[Kourous Rezaei:]

Yeah, thank you for the question. So again, I pointed out for the – in the second after – obviously, the primary endpoint is at month 12. And after that month 12, we are looking to see whether if you treat these patients for a year on a monthly basis, whether you can quiet down the disease, but in the second year you may not need to treat them as frequently.And again, I’ll just say, we know from previously published literature that if you do every other month on the get-go, even have lower efficacy. And that’s why we didn’t do that from the get-go. But whether that would still be the case after one year that is not known and that’s what we were going to find out to whether you want to need to continue treat monthly for a longer period of time or 12 month will be sufficient enough that that you can go to every other month treatment.Would you please repeat your second question for me?

[Glenn Sblendorio:]

Yeah, Kourous, I have it and it’s about the 18 month data and I’ll take that. So, Matt, I want to really stress what was talked about in the call. So it’s important to point out that this is the first trial. This trial was not designed to assess statistical significance between individual cohorts at month 18. And, Kourous said something that’s very important; any 18-month results will be descriptive.The primary endpoint is at 12 months. And as we also said, we expect to report that data by the end of the second quarter, so completes the trial, the emphasis is on the 12 and we’ll have some descriptive analysis from the 18, which really focuses on safety only.Is there anything else? Did that answer your 2 questions?

[Matthew Barcus:]

Yes.

[Glenn Sblendorio:]

All right. Thank you. Okay. That concludes the questions for today. Operator, I just like to thank everybody for joining and look forward to speaking over the coming weeks and months. Thanks.

[Operator:]

This concludes today’s call. Thank you all for your participation. You may now disconnect.