Earnings Call: H1 2021

Aug 31, 2021

Quarterly report

Afternoon, everyone, and thank you for joining us today. On the call with me from Orpazyme are Christoph Gordon, Chief Executive Officer Anders Bodschult, Chief Financial Officer and Thomas Laitler, Chief Medical Officer. The slides for this call will be available for download on the Investor Relations section of our website. Please note that the Q and A will take place at the end of the presentation via conference call. Before we begin, I would like to remind you that this call will contain forward looking statements concerning Orpizyme's future expectations, plans, prospects, corporate strategy and performance, which constitute forward looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed in our filings with the SEC. In addition, any forward looking statements represent our views only as of the date of this webcast and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update such statements. Now I'll turn the call over to Christophe. Christophe? Thank you. Thank you, Amy. Welcome everyone and thank you for joining us. The last few months have been a profound and intensive period for Orthozyme. As you know, on June 18, We reported receipt of a complete response letter or CRL for our hemoclonal for Niemann Pig disease Type C from the U. S. FDA. This very disappointing news forced us to make a series of difficult decisions regarding our business and our people. And I would like to take this opportunity to thank everyone, in particular, the departing and remaining employees at Orthozyme and the NPC patient community for their continued support. We made those hard decisions based on one fact and one conviction. Fact is, as we sit here today, the unmet need for patients with NPC remains very high. Fact is there is still no approved therapy in the U. S. For this rare genetic progressively debilitating and often fatal neurodegenerative disease. And our conviction is and remains that arimoclonal could provide significant therapeutic benefits for NDC patient alone or in combination with miglustat in Europe and in the U. S. This conviction is supported by the strength of the areimoclonal data. Indeed, areimoclonal has demonstrated statistically significant and clinically meaningful effects on the disease progression in NPC. It has shown durable response and has demonstrated a good safety profile up to 36 months in the open label extension study. On August 21st this year, the results of our pivotal O2 study were published in the Journal of inherited metabolic disease. We are very pleased with this publication and it provides validation of our program through a robust peer reviewed scientific process. Our early access program in the U. S, Germany and France is still underway and we will continue to recruit new patients. We now have more than 100 patients in our early access program evenly split between Europe and the U. S. And we expect to prolong the early access program until aramoclonal becomes commercially available in this market, which is very important to the patient community. Over the last few months, We've been working diligently to ensure a successful path forward to approval. We are focused only on NPC and have discontinued development of our hemoclonal for ALS and IBM and are in the process of discontinuing our trial in Gaucher. EMA's review of rheumoclonal in NPC is still underway in Europe and we expect a CHMP opinion by the end of this year with potential marketing authorization in the beginning of next year. And in the U. S, we plan to request a Type A meeting with the FDA in the coming weeks. In summary, we've gone through a lot of changes in the first half of this year. We acted swiftly and decisively. We restructured our business to conserve capital, maintaining our guidance announced on June 18 in order to focus on the 2 registration priorities and our focus on leveraging our existing position to secure registration for AMOCLOMO. With that, I'll turn the call over to Anders to review the numbers in more detail, and then I'll wrap up the call. Anders? Thank you, Christophe. For the first half of the year, our strategy was to pair for potential launch In June, we began working on our corporate restructuring. We anticipate an approximate 60% cost reduction in total operating expenses for the restructuring, while being able to retain our core capabilities to support our medical, regulatory and pre commercial activities. We'll continue to incur some expenses relating to our restructuring program in the second half, but we anticipate a significant reduction in our operating expenses by the end of 2021. Here's the financial figures for the first half. Orbusan recorded net revenues of DKK 13,200,000 in the first half of twenty twenty one. The revenue relates to the sales of IMOCMO in France as part of the ongoing remunerated early access program. Who continue to record revenues in this region on an ongoing basis. Our operating expenses increased to DKK479,000,000 in the first half of twenty twenty one compared to the prior year due to commercialization planning for IMOCCMOV. R and D expenses were DKK 265 1,000,000 in the 1st 6 months of this year, an increase of DKK98 1,000,000 compared to the same period of the prior year. This increase was largely due to the expenses relating to the ALS and IBM ahead of the trial readouts as well as cost for the production of inventory. General and administrative expenses were DKK240 1,000,000 in the 1st 6 months of 2021, an increase of DKK136,000,000 compared to the same period in 2020. The increase was primarily due to the build up of our commercial organization, including launch preparations Head of the potential approval for our marketing MPC and personnel and support functions to enable our business growth. Overall, our net loss was DKK 251 in the first half of twenty twenty compared to a loss of DKK 464,000,000 in the first half of twenty twenty one. We ended the first half of twenty twenty one with DKK 334,000,000 in cash compared to DKK727,000,000 at the end of December 2020. As you see here on Slide 9, the operating loss, operating expense and cash flow guidance we provided on June 18 remains the same. For 2021, we anticipate net revenues of between DKK30 1,000,000 and DKK40 1,000,000 relating to our mock mill sales from the ongoing EAP in France. And while the net revenues are positive to our balance sheet, we'll need additional capital to advance our AMOGMO towards patients. So we're exploring options to secure funds the second half of this year. With that, I will hand over the call to Christophe. Thanks, Anders. So as we look ahead into the second half of the year, we are focused on executing on our 2 major priorities: EMA approval and a pass forward in the U. S. For IMO Clomont. Our strategy is clear and focused. We've taken hard decisions. We've completed the restructuring and we are assessing financing options to secure additional capital for commercialization. In the next 6 months and in 2022, we have several pivotal milestones that could create significant value for Orthozyme. 1st in Europe. The review of RMO Clomole is ongoing and we do continue to anticipate an opinion from the CHMP in Q4 of 2021. And we will continue to record revenues and book sales. Our pre commercial activities to gain reimbursement in priority EU markets ahead of potential approval are ongoing. We also expect EMA and UK MHRA approval decisions in the first half of twenty twenty two. In the U. S, we will request a Type A meeting in the next few weeks to align our regulatory path forward with the FDA. And despite the headwinds over the last few months, we do remain committed to our mission to improve the life of NPC patients by delivering our novel therapy, Harry Moklomo as quickly as we can. We look forward to keeping you updated on our progress in the months ahead. Now we'd like to hand the call back to the moderator for the Q and A session. L'Oreal, back at you. Thank you, sir. And sir, your first question comes from the line of Sainsanadra from Guggenheim. Please go ahead. Your line is open. Hi, good morning guys. This is Eddie on for Yatin. Thanks for taking my questions. So focus has been Arimathlamal. Can you talk about any of the work you're doing on the BD front to sort of partner with other programs or sort of bring in other assets how you're thinking about BD over the next 6 to 12 months? Thank you. Thanks, Christophe. Yes. So As I said, at the moment, we are solely focused on delivering on our 2 registration milestones, 1 in Europe and 1 in the U. S. And once we have more clarity on this, we're going to assess what options we have, but that's really the focus of our first at the moment. Thank No more questions at this time. Back to you, Christophe. Perfect. And then with that, we close the call. Thank you very much. Have a good day, everyone. Bye bye.