Acumen Pharmaceuticals, Inc. (ABOS) on Q4 2021 Results - Earnings Call Transcript
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Operator: 00:07 Thank you for standing by, and welcome to the Acumen Pharmaceuticals, Fourth Quarter and Full-Year 2021 Update Call. At this time, all participants are in a listen-only mode. There'll be a presentation followed by a question-and-answer session. Today's call is being recorded. 00:25 And I would now like to turn the call over to John Woolford from Westwicke. Please go ahead.
John Woolford: 00:38 Thank you, operator. Good afternoon. Thank you for joining us today to review Acumen’s fourth quarter and full year 2021 operational progress and financial results. Before we start, we encourage you to view the slides for this webcast, as well as the operational and financial results press release issued this afternoon, both of which are accessible on our website in the Investors section. 01:00 As shown on Slide 2, 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. All these statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. 01:20 Our actual results could differ materially due to a number of factors, including the extent and duration of the effects of the COVID-19 pandemic and the timing and extent of recovery from it. Please refer to our recent filings with the SEC for a full review of the risks and uncertainties associated with our business. Forward-looking statements speak only as of the date on which they are made and Acumen undertakes no obligation to update or revise any forward-looking statements. 01:45 Daniel O'Connell, President and Chief Executive Officer will begin today's call with a high level overview of Acumen and review select 2021 business highlights. Dr. Eric Siemers, Chief Medical Officer will then provide a quick primer on amyloid beta oligomers and discuss the ongoing INTERCEPT-AD trial. Next Matt Zuga, Chief Financial Officer, who will provide a brief financial update. We will then open the call for Q&A. 02:09 I'll now hand the call over to Dan O'Connell, President and Chief Executive Officer.
Daniel O'Connell: 02:13 Thank you, John. Good afternoon, and thank you to everyone joining the call today. I'm delighted to be here on our first conference call as a public company. 02:21 Moving to Slide 3, 2021 was a transformational year for Acumen, highlighted by the achievement of several major accomplishments, including our successful IPO. As this is our first public call, I want to take a moment to provide a brief introduction to Acumen for those that may be new to the company. Acumen is focused on the development of novel targeted therapeutics for Alzheimer's disease, which has received significant attention over the last year given the approval and launch of Biogen's Aduhelm. While controversial to Aduhelm approval has brought substantial needed attention to the enormous need to help people living with Alzheimer's disease. 02:59 While many companies have pursued treatments targeted to amyloid plaques, fibrils for monomers, Acumen is focused on targeting amyloid beta oligomers. We believe there is an emerging scientific consensus that oligomers are the most toxic form of amyloid beta and the development of a product that reduces toxicity of oligomers is one of the most promising approaches for the potential treatment and prevention of the progression of Alzheimer's. 03:27 Our lead product is ACU193, the first monoclonal antibody developed to selectively target amyloid-beta oligomers to enter clinical testing. ACU193's potential is supported by extensive preclinical data supporting its differentiation from other anti-amyloid programs. To guide ACU193’s development, we have assembled an experienced leadership team with significant industry expertise in Alzheimer's drug discovery and development. Many of our employees were formerly part of Eli Lilly's Alzheimer's team. 04:01 As I mentioned earlier, we successfully completed an IPO in 2021. We raised approximately $184 million in gross proceeds in the offering that included multiple well respected biotech investors and provides us the financial resources to advance ACU193 through multiple clinical milestones and extending our cash runway through 2025. The next key milestone for ACU193 is proof of mechanism data from our ongoing Phase 1 trial in early Alzheimer's disease, which is now expected in the first half of 2023. Eric will discuss the trial shortly. 04:41 I'll now move to some key business highlights in 2021 as shown on Slide 4. Following the funding of a $30 million tranche from a Series B financing in June, we rapidly strengthened our balance sheet further with the completion of our IPO raising gross proceeds of $184 million as I mentioned. We then initiated the INTERCEPT-AD trial, dosing the first patient in October. We were then pleased to be accepted to present at the 2021 clinical trials on Alzheimer's disease or CTAD conference in November in Boston. 05:16 At the conference, we discussed the scientific rationale for targeting amyloid-beta oligomers, the clinical trial design of INTERCEPT-AD and how the study is designed to establish safety and proof of mechanism and assess any potential improvements in cognition and blood flow in the brain. To support our expected growth over the coming years, we recently made several senior level appointments to the company's leadership team. The new leaders include Julie Bockenstette, Head of Human Relations; Siew Tin Gan, Head of Clinical Operations; and Stephen Reynolds, Corporate Controller and Treasurer. All three bring deep experience and collective passion for improving the lives of patients with Alzheimer's disease. 06:00 I'd also like to use this opportunity to welcome Kim Drapkin to our Board of Directors effective April 1. Ms. Drapkin brings to more than 20 years of experience working the private and publicly traded biotechnology and pharmaceutical companies, including building and leading finance functions raising capital and leading strategic financial planning. 06:21 Turning to Slide 5. We continue to make significant progress in advancing the INTERCEPT-AD trial. As I mentioned previously, we now expect to report top line results in the first half of 2023, a slight revision from our previous timing of year-end ‘22. We believe the COVID-19 pandemic impacted our site activation timeline and enrollment somewhat. However, given our strong financial position, we also now plan to incorporate a larger dataset expanded to the end of study and database lock. 06:54 Regarding enrollment, we have experienced continued success in activating clinical trial sites and enrollment is now ongoing at eight active sites with six additional sites selected for potential activation. Time to activation of these sites has accelerated dramatically starting in 2022. In parallel to conducting the INTERCEPT-AD trial, we have also made significant progress in preparing for a future Phase 2/3 trial of AUC193. 07:19 Chronic GLP toxicity testing has been initiated in our new drug substance production process and drug product formulation are being finalized. We have begun designing the Phase 2/3 study and planning for an end of Phase 2 meeting with the FDA. Given this headway, we anticipate being able to initiate the next trial rapidly after demonstrating proof of mechanism in the INTERCEPT-AD trial. 07:48 I'll now turn the call over to Dr. Eric Siemers, our Chief Medical Officer.
Eric Siemers: 07:52 Thanks, Dan. Good afternoon, everyone. I'll start today with a quick primer on ACU193 and amyloid-beta oligomers. 08:00 Turning to Slide 6. As Dan mentioned, our monoclonal antibody ACU193 is designed to address a major component of Alzheimer's disease pathology by binding to amyloid-beta oligomers, also known as Aβ oligomers, (ph) which are a toxic form of the Aβ proteins. A growing body of evidence indicates that these oligomers are a primary trigger and persistent driver of Alzheimer's pathology and neurodegeneration. The accumulation of Aβ beta oligomers is associated with loss of the connections between nerves, as well as inflammation. If there is substantial evidence that Aβ oligomers lead to the memory impairment, cognitive decline and progressive neurodegeneration that are seen in Alzheimer's disease. 8:54 By binding to Aβ oligomers, ACI 93 prevents them for binding to specialized parts of nerves called , which we believe may help to preserve nerve function and protect cells from neurodegeneration. What makes ACU193 so unique and differentiated from other monoclonal antibody studied in Alzheimer's disease, is AUC193's high selectivity for Aβ oligomers relative to other anti-amyloid monoclonal antibodies that are less selective or target different amyloid species such as Aβ monomers or deposited Aβ amyloid plaques. We believe this can lead to improved clinical efficacy compared to other monoclonal antibodies studied in Alzheimer's disease and importantly, with an expected lack of ARIA-related safety concerns, which are seen with other monoclonal antibodies. We also believe there is some potential for possible cognitive improvement in addition to disease forward. 10:02 With that introduction, I'll now provide a brief overview of the ongoing INTERCEPT-AD Phase 1 trial. As shown on Slide 7, the studies are randomized, placebo-controlled Phase 1a/B trial. As a standard, there are two portions, including a single ascending dose portion Part A and a multiple ascending dose portion Part B. The trial is being conducted in patients with early Alzheimer's disease those with mild cognitive impairment and mild dementia. To participate in the trial, patients must be amyloid positive as determined by PET scans. 10:43 As Dan mentioned, a key objective of the trial is to demonstrate targeting great engagement and proof of mechanism, as determined by demonstrating that ACU193 is down to oligomers in cerebral spinal fluid. Other important outcomes include the evaluation of safety and tolerability, pharmacokinetics and measures of cognition. 11:10 Slide 8 illustrates the trial design of INTERCEPT-AD. Part A, the single-ascending dose portion includes four cohorts with eight patients per cohort at doses of 2, 10, 25 and 60 milligrams per kilogram or placebo. Part B, the multiple-ascending dose portion includes three cohorts with 10 patients per cohort at doses of 10 and 60 milligrams per kilogram dosed every four weeks and 60 milligrams per kilogram dosed every two weeks or placebo. I want to highlight that included in the trial design is the ability to initiate the first cohort of the multiple-ascending dose portions after safety and tolerability as demonstrated in the second cohort of the single-ascending dose portion. 12:06 Slide 9 shows the objectives of the trial in detail. In the interest of time, I'm not going to read them all out, but we wanted to give everyone an indication of the data that we plan to ultimately report from the study. As you can see, we expect the trial to provide a significant amount of data that will be crucial in the design of the planned Phase 2/3 trials, as well as our regulatory strategy. 12:33 Ultimately, what's most important is that we expect that the data will justify advancement into a Phase 2/3 trials. Assuming INTERCEPT-AD demonstrates acceptable safety and tolerability shows ACU193 gets into the central compartment and confirms target engagement. We plan to advance the program to the Phase 2/3 study. 13:00 With that, I will turn the call over to Matt Zuga, our Chief Financial Officer and Chief Business Officer.
Matt Zuga: 13:08 Thank you, Eric and thanks to everyone for joining. To start, I want to reiterate what Dan said earlier. As a result of planning and executing on our private and public financing strategy in 2020 and 2021, we are well capitalized and have the resources to achieve multiple clinical development milestones. As of December 31, 2021, we had approximately $225 million in cash and marketable securities. 13:36 Looking ahead, based on our current operating plan, we expect our cash runway to last through 2025. Our strong balance sheet is the result of the proceeds from Series B and IPO financing completed in 2020 and 2021. Our complete financial results for 2021 are available in the press release we issued this afternoon and in our 10-K, which will be filed shortly. I'm not going to review our results in detail, but I do want to highlight a few items. 14:07 R&D expenses were $12.3 million in 2021. The increase over 2020 was primarily the result of the initiation of the INTERCEPT-AD trial during the year. G&A expenses were $7.3 million in 2021 with the increase primarily the result of increased headcount and the cost of going public and being a public company following our IPO. This led to a loss from operations of $19.6 million for the full year. Note that our net loss for the full year was $100.6 million. This was primarily driven by a non-cash expense of $81.2 million that represents the changes in fair value of our Series B tranche liability and our Series A warrant liability. The tranche liability and the warrant liability were initially recorded at fair value as a liability on Acumen’s balance sheet and are subsequently remeasured at fair value at the end of each reporting period, both liabilities were extinguished by the conversion of our preferred shares and warrants to common shares at the IPO. 15:13 We will continue to work hard over the coming quarters to enroll INTERCEPT-AD and look forward to reporting topline data in the first half of 2023. Importantly, we will continue to operate Acumen efficiently and cost effectively to ensure our cash runway is maintained through 2025. We thank our shareholders and partners for their ongoing trust and support and we'll now open up the floor for questions.
Operator: 15:41 Our first question comes from Paul Matteis with Stifel.
Alex Park: 15:56 Hi, there. Thanks for taking our questions. This is Alex on for Paul. I was wondering, I think in the prepared remarks, Dan, you mentioned that the slight delay for intercepts would allow you to have an expanded data set for the topline. I wonder if you could elaborate a little bit more on kind of what that looks like, and how that would impact the top line data? Then I have a couple of other follow ups. Thanks.
Daniel O'Connell: 16:14 Hey, Alex. Thanks for your question. Yeah. Just real quickly, I think in terms of the follow-up period, what we've looked at is, COVID has definitely impacted the front end of the study. I think we're really encouraged by the rate of progression, both at the site level and with enrollment, right now, we've got more work to do, but certainly the momentum is building. In terms of the follow-up period, we are looking at following patients out there day one, 68 follow-up. There had been some discussion around putting out preliminary top line results a little bit earlier, but I think the prudence would be to carry out the study to that day one, 68 follow-up and allow us to basically have the dataset that would be the basis for the end of Phase 2 meeting and a subsequent presentation at a major meeting as the dataset that's reported on. So that's really our goal with the call today was to set expectations both on the timeframe and clarity on what topline results might be and when they would be announced.
Alex Park: 17:17 Yeah. That makes sense. And I guess, I don't know if you've commented on how far you are in terms of dosing. But I wonder, if you could confirm that you started dosing patients and whether or not you've had a chance to look at blinded safety data and can confirm any instances of ARIA? And if you can’t answer that, that's fine. And then my final question on runway, I wonder if you could talk a little bit, what's embedded in your expectations for our 2025 runway and how that or if that includes expectations for Phase 2/3 study and how you're thinking about that? Thanks.
Daniel O'Connell: 17:49 Yeah. Thanks, Alex. So in terms of where we are in the study, I think what we announced at the end of the third quarter that we dosed the first patient. We continue to dose patients at multiple sites. We're not providing patient level or cohort level information at this point I can't -- I can't say that there is nothing that we have seen and we have looked at blinded safety data that has suggested best modifier or shift our expectations, both in terms of the study design and duration. So we're -- it’s really just more of an operational element. 18:22 I think from the runway -- the cash runway perspective, we've always envisioned, part of the capital strategy from the B and as well as the IPO was to ensure that we have the resources on hand to hit multiple clinical milestones. So we do think the INTERCEPT-AD dataset essentially that safety target engagement in general observations to support moving forward into a Phase 2/3 study. It is intact, and in fact that the resources on hand would allow us to fund a Phase 2 study to its completion into demonstration of proof of concept. 18:59 So I think the markets have been a bit volatile in this recent period, but we're feeling at a minimum that we have the runway provided the product performs as we will hope in the INTERCEPT-AD study to lease carried into through a Phase 2 study.
Alex Park: 19:15 Great. That's helpful. Thank you.
Operator: 19:19 Our next question comes from Geoff Meacham with Bank of America.
Jason Zemansky: 19:22 Good afternoon. This is Jason on for Jeff. Thanks so much for taking our questions. Wanted to get your broader level comments on, obviously, the regulatory environment. Certainly, there is one hand FDA's signaled more permissive attitude potentially towards the approval of Alzheimer's treatments, while at the same time CMS is kind of done the opposite and suggested a much more strict environment in terms of reimbursement, but has this dynamic influenced your thinking at all as far as moving forward with the results of the Phase 2 and a willingness to move forward with a Phase 2/3, and then what dynamics are you specifically looking for as you think about putting these trials together. Obviously, it's a little early, but would love to get your thinking on this?
Daniel O'Connell: 20:15 Hey, Jason. Thanks for the question and it's good one and I will say, we will all learn a little bit more on the basis of the CMS determination on the April 11. So that is I think an important development for the Alzheimer's drug development field. We're tuned into that. I think we will also be observant of other study readouts and regulatory actions over the course of the next 12 months. To be clear, our plan is to take the INTERCEPT-AD dataset into an end of Phase 2 type of interaction with the FDA with those results and really establish the basis for the next study to be either a Phase 2 or if certain criteria are met on an interim basis move to a Phase 3 study. The possibility of submitting on the Phase 2 data exists, but I think we'll have -- it's probably too early for me to speculate as to how and when that would come about and again, we're going to learn much from the additional regulatory interactions that some of our peers will undertake in in the next 12, 18 months.
Jason Zemansky: 21:17 Perfect. Really thank you for the color.
Operator: 21:23 Our next question comes from Judah Frommer with Credit Suisse.
Judah Frommer: 21:28 Yeah. Hi, guys. Thanks for taking the questions. Maybe just a quick follow-up on that one. Maybe just your thoughts on pricing for Aβ antibodies right obviously, Aduhelm started at a higher price than where it is now and kind of how that might affect or maybe not affect your internal pricing assumptions? And then beyond that, is it right to think about now potentially having longer follow-up for those earlier cohorts, when we do get the Phase 1 data and if so, how might that affect the COGS state battery -- would that be given I guess beyond those 168 days for the earlier cohorts?
Daniel O'Connell: 22:07 Yeah. Hey. Thanks, Judah. In terms of pricing and like, I think we have=-- we really haven't adopted or changed any of our particular models. I mean I think the Biogen history suggested they came out -- high relative to maybe expectations they made a modification. We'll see where CMS (ph) goes, I think that we have, we're cognizant of looking at cost of materials and dosing and ensuring that we have Pharmaceutical margins at a particular price point that may be in a marketplace that has several other products approved. So I guess the simple answer is it's probably a little bit too early for us to go into a pricing discussion. But again, we're in a position to look at what -- how the market develops what reimbursement rates are available, and ultimately our goal is to generate differentiated data both in terms of ARIA safety and ultimately with clinical efficacy. And I think those are factors that certainly would affect would contribute to a pricing strategy that we would pursue in the future. 23:17 I think on the second question in terms of the follow-up duration, essentially this gives us additional imaging and other clinical assessments primarily for safety. You referenced the COGS state battery and yes, we are employing a compute battery really in interest that if there is an acute pharmacodynamic effect based on neutralizing the toxicity of Aß oligomers that that highly repeated in highly sensitive measure administered on a computer would be able to detect those types of signals. We really again just a word of caution, we're not powered or we're calling that out as a criteria for this Phase 1 study. And I think it's unlikely that those measurements would impact the day 168 follow-up, which is really just a full determination of the safety profile.
Judah Frommer: 24:13 Got it. Thank you.
Operator: 24:14 And I'm not showing any further questions at this time. I'd like to turn the call back over to Dan for any closing remarks.
Daniel O'Connell: 24:20 Well, thank you, Kevin and thank you everybody for joining our first public company earnings and business highlights call. We look forward to be engaging with you in the near future and updating you on our progress, both in the clinic and with the company. So thank you everyone.
Operator: 24:38 Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.
