Good morning, ladies and gentlemen, and welcome to Vero Inc. Investor Relations Conference Call. All participants will be in listen only After this morning's discussion, there will be an opportunity to ask questions. Please note that this event is being recorded. I would now like to turn the conference over to Mr.
Sam Fish, Vero Inc. Director of Investor Relations. Please go ahead.
Good morning. The statements made on this conference call may be forward looking statements. Forward looking statements may include, but are not necessarily limited to statements of the company's plans, objectives, expectations or intentions regarding its business, Operations, Finances and Development and Product Portfolio. Such forward looking statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected, suggested or included in any forward looking statements. Risks that may cause actual results or developments to differ materially are contained in our 10 Q and 10 ks SEC filings.
I would now like to turn the conference call over to Doctor. Mitchell Steiner, Veru Inc. Chairman, CEO and President. Thank you, Sam, and good morning. With me on this morning's call are Michelle Greco, CFO and CAO Michael Purvis, EVP, General Counsel and Corporate Strategy and Sam Fish, Director of Investor Relations.
Thank you for joining our call. Veru is a late Clinical stage oncology biopharmaceutical company focused on developing novel medicines for the management of 2 of the most prevalent cancers, Prostate cancer and breast cancer. We continue to invest cash generated from our sexual health commercial business Into the clinical development of our potentially high value oncology drug candidates, so that our shareholders might realize the maximum value of our oncology biopharmaceutical company. This morning, we will discuss the progress of our late clinical stage prostate cancer and breast cancer drug pipelines, As well as the sebizobulin, the new name for VERU-one hundred and eleven Phase 3 study for the treatment of COVID-nineteen. We'll then provide financial highlights for our Q2 fiscal year 2021.
In oncology, We're focused on providing new and novel oral therapies with unique mechanisms of action and favorable safety profiles for both advanced prostate and breast cancers. Bureau anticipates registration clinical trials for up to 4 oncology indications And the additional registration Phase 3 clinical trial for cebesabulin for COVID-nineteen makes a total of 5 potentially The company continues to make strong clinical progress advancing cebisabulin as a treatment for metastatic castration and androgen receptor targeting agent with resistant prostate cancer and VERU-one hundred for androgen deprivation therapy for metastatic prostate cancer. Zebizobulin, which as I mentioned is the new name for VERU-one hundred and eleven is an oral first in class new chemical entity that targets, Cross links and disrupts alpha and beta tubulin subunits of microtubules to disrupt the cytoskeleton. And in prostate cancer, this also results in the disruption of the androgen receptor transport from the cytoplasm into the nucleus. Tavizobulin is being evaluated in an open label Phase 1b study in men with metastatic castration and androgen receptor targeting agent resistant prostate cancer.
The Phase 1btwo clinical study enrolled 39 men in the Phase 1 portion and 41 men in the Phase 2 portion. The Phase 2 portion is completely enrolled and still ongoing. The safety of tepizobulin appears to be similar to an AR targeting agent like apirato and enzalutamide based on what has been reported in literature. Long term daily chronic administration for the drug appears to be feasible and safe. We have patients in the Phase Ib portion that have reached 2 years of treatment without evidence of prostate cancer tumor progression.
At the recommended Phase 2 63 milligram oral daily dose, the most common adverse events were mostly Grade 1 and 2 diarrhea, fatigue and nausea. There have been no reports of neutropenia, significant neurotoxicity or hair loss. The Phase 1btwo study also has yielded promising And significant efficacy outcomes. The efficacy results show PSA declines and responses as well as objective and durable tumor responses, including partial and complete responses. Furthermore, the median radiographic progression free survival in men who had at least 163 milligram dose of sebizobulin was 12 months.
As there are approximately 10 men still on study, the median progression free survival in the Phase 2 portion has not been reached. We also conducted a PK study to compare the Phase 1b2 dosage formulation with a Phase 3 dosage formulation. Measured blood concentrations of sebizobulin at the 63 milligram Phase 1btwo dose were similar to the 30 2 milligram Phase 3 dose, which means the Phase 3 dosage formulation has better oral bioavailability. The scientific abstract reporting the Phase IbII safety and efficacy results has been accepted for presentation The upcoming ASCO Scientific Meeting, which will be held June 4 through 8, 2021, And it's entitled, zebizobulin VER-one hundred and eleven, an oral cytoskeleton disruptor to treat men with metastatic castration resistant prostate cancer who have failed an angion receptor targeted agent to be presented by Mark Doctor. Mark Markowski, Assistant Professor of Oncology at the Sidney Kimmel Comprehensive Cancer Center, Johns Hopkins University School of Medicine and a principal investigator on the study.
The company has also reached agreement with the FDA on the Phase 3 clinical trial design for cibizobulin, And we plan to enroll the 1st patient in the Phase 3 registration study by the end of this month. The Phase 3 VERASITY study It's an open label, randomized study evaluating the efficacy and safety of cibizobulin 32 milligrams oral daily dosing versus an alternative androgen receptor targeted agent in men with metastatic castration resistant prostate cancer who have failed at least one androgen targeting agent prior to IV chemotherapy. The primary endpoint is median radiographic free survival. This study will be a 2:one randomization. The trial assumptions expect a median radiographic progression free survival of 7.4 months for sebazobulin versus 3.7 months for the alternative antigen receptor targeted agent, which if achieved, We represent a doubling in improvement in median radiographic progression free survival with sebizobulin compared to the active control.
Statistically, using an alpha of 0.05, a power of 98% and a dropout rate of 30%, The study size will be approximately 245 subjects. We expect enrollment to take 10 months recruitment time and 12 months follow-up after the last patient is first dosed. The study will be conducted in 45 clinical sites across the United States And the lead principal investigator will be Doctor. Robert Dreiser, Deputy Director, University of Virginia Cancer Center, Director of Solid Tumor Oncology and Professor of Hematology and Oncology. Tibizobulin, if approved, will address a large part Treatment sequence of advanced prostate cancer.
The 2 currently approved indications for androgen receptor targeting agents For hormone sensitive metastatic prostate cancer and for non metastatic castration resistant prostate cancer. When patients progress or fail an androgen receptor targeted agent in both of these settings, they now have Metastatic castrate resistant and androgen receptor targeted agent resistant prostate cancer, the very indication we're pursuing in the Phase 3 clinical This means that as many as 90% of all advanced prostate cancer patients whose only other option would be to proceed to IV chemotherapy could potentially benefit from sebesibulin By being an orally administered drug with a side effect profile that appears to be similar to an alternative AR targeting agent, Enroll in the management of advanced prostate cancer patients. Typically, the urologist involves the medical oncologist when the patients require IV chemotherapy. Next, I will update you on VERU-one hundred, an androgen deprivation therapy for the treatment of hormone sensitive metastatic prostate cancer. Androgen deprivation therapy, also known as ADT, is currently the mainstay of advanced prostate cancer treatment and is used as a foundation of treatment throughout the course of the disease.
Furthermore, ADT has continued even as other endocrine Chemotherapy radiation treatments are added or stopped. Standard medical practice for urologists and medical oncologists is to administer androgen Pervasive therapy every 3 to 4 months in their office. These injections coincide with the follow-up office visits to metastatic or advanced Prostate cancer. Furthermore, these injections are administered as a buy and bill product And are reimbursed under Medicare Part B, not Part D as in dog. So the urologist is compensated both for the drug and administering the drug.
Therefore, urologists prefer injections over oral agents. Gonadotropin releasing hormone, GnRH antagonist treatment or preferred because castration occurs rapidly within a week with no surges or flares in testosterone. Testosterone levels also tend to be lower, which is better for tumor control. GnRH antagonist also lower FSH levels, which is thought to be the reason why there are fewer cardiovascular side effects with GnRH antagonist versus GnRH agonist. There are no GnRH antagonist depot injection formulations commercially approved for treatment beyond 1 month duration.
VERU-one hundred Happy to report that the GMP manufacturing scale up is complete and we plan to start the open label Phase 2 study in approximately 35 men to evaluate VERU-one hundred dosing by the end of this month. The open label Phase 3 registration study, whose design has already been agreed upon with FDA, will evaluate the efficacy and safety of VERU-one hundred in approximately 100 men With hormone sensitive metastatic prostate cancer and is anticipated to start towards the end of the calendar year of 2021. Next, I will discuss the progress of our breast cancer drug pipeline, which includes Inovusarm and cebizobulin. The most common type of breast cancer, which occurs in about 85% of women is ER positive breast cancer, where estrogen is one of the main drivers of proliferation, tumor progression and metastasis. Consequently, treatments that Target and block the estrogen receptors or ER are the mainstay of breast cancer therapy.
According to the 2020 National Comprehensive Cancer Network Guidelines, also known as the NCCN guidelines, the recommended first line treatment in a metastatic setting It's either a non steroidalimatase inhibitor in combination with CDK4six inhibitor or fulvestrant in combination with the CDK4six inhibitor. The recommended second line treatment in the metastatic setting is fulvestrant in Combination of the CDK4six inhibitor if a CDK4six inhibitor was not used in first line metastatic setting. Fortunately, almost all of the women being treated with these regimens will eventually develop resistance to the Receptor blocking agent and the CDK4six inhibitor therapies and there are limited clinical data that allow recommendation will be required as there are limited treatment options following the CDK4six inhibitor and an estrogen receptor blocking agent resistance in the management of ER positive HER2 negative metastatic breast cancer. Interestingly, like the estrogen receptor, The androgen receptor is found in over 85% of breast cancer. What is the androgen receptor's function in breast cancer and breast Does it stimulate or inhibit breast cancer growth?
A recent publication in Nature Medicine Of an international study headed by Doctor. Hickey and her team has provided scientific evidence establishing that the androgen receptor is a tumor suppressor an estrogen receptor positive breast cancer. This means when the androgen receptor is activated by androgens, It strongly suppresses estrogen receptor breast cancer growth. This explains why historically When synthetic androgens were used to treat breast cancer, they demonstrated good efficacy, but unfortunately, the masculinizing side effects, Increases in hematocrit and liver toxicity have prohibited their use as a viable treatment. In contrast, InovaSonic, an oral first in class new chemical entity is a selective androgen receptor targeted activating agent and is being developed for the treatment of AR positive, ER positive, HER2 negative metastatic breast cancer and would represent the 1st new endocrine therapy for advanced breast cancer in decades.
Novusarm has extensive non clinical and clinical experience having been evaluated in over 25 separate clinical studies involving more than 2,100 subjects, including 5 prior Phase 2 clinical studies in advanced breast cancer involving more than 2 50 patients. In addition to suppressing androgen receptor positive, ER positive breast cancer cell proliferation and tumor growth, InnovusArm has other potential beneficial clinical properties. In preclinical studies, InnovusArm has demonstrated that it builds and heals Cortical and trabecular bone and therefore has the potential to treat osteoporosis and skeletal related events. The Novosarm has also been shown To build muscle and to improve physical function in clinical studies involving elderly subjects and patients with cancer cachexia, including breast cancer patients. Furthermore, because of its tissue selectivity, Inovus Arm has a favorable side effect profile with no masculinization to facial hair or acne, No increase in nematocrit and no liver toxicity.
The science supporting the efficacy of Innovosome by targeting the androgen receptor in If you are positive, advanced breast cancer was also the subject of the Nature Medicine studies published in February 2021 by an independent group of breast cancer It's led by Doctor. Hickey. In their study, they show that by using breast cancer tissue from patients who had resistance To estrogen receptor blocking agents in CDK4six inhibitor therapies, Inovusarm monotherapy exhibited significant antitumor activity, While the combination of Innovusarm plus a CDK4six inhibitor demonstrated even greater anti tumor activity. They concluded that these data suggest The Novosarm restores the sensitivity of a CDK4six inhibitor resistant breast cancer tissue to suppression by the CDK4six inhibitor. 2 positive Phase 2 studies involving 150 women with AR positive ER positive metastatic breast cancer We will focus on the second of these two studies, the G200-802 Phase 2 study, which is a 2 arm study evaluating 9 milligram and 18 milligram of Innovus Arm daily dosing in 136 women with AR Positive ER positive HER2 negative advanced breast cancer.
The patients in this study were heavily pretreated, having failed an average of 3 estrogen Receptor blocking agents and 88% have received prior chemotherapy. Clinically meaningful tumor responses observed With Innovus Arm monotherapy strongly established the relevance of targeting the androgen receptor with the selective androgen receptor activating agent in women with heavily pretreated estheramuchepta blocking agent resistant AR positive, ER positive metastatic breast cancer. The 9 milligram dose was selected for our Phase 3 study as the 9 milligram cohort had similar tumor responses with a slightly better toxicity profile than the 18 milligram dose cohort. Focusing on the 9 milligram cohort, Innovus on monotherapy in the 802 Phase 2 study had a favorable clinical benefit rate of 32% and objective tumor response rate of 29.4%. Inovisar appeared safe and well tolerated without virilizing effects, Increase in inadequate liver toxicity.
Quality of life measurements demonstrated overall improvement, including mobility, anxiety, depression We also performed a post hoc subset analysis of the Phase 2 clinical data to understand whether Inovus arm had any antitumor of blocking agents and CDK4six inhibitor. These data were presented at the European Society For Medical Oncology, ESMO, Breast Cancer Virtual Congress in 2021 that was held this past May and actually earlier this month. In this subset analysis, Inovusarm treatment in patients with measurable metastatic AR positive, ER positive breast cancer, who have progressed Following treatment with an estrogen receptor blocking agent and a CDK4six inhibitor, in this case, palbociclib, Resulted in a clinical benefit rate of 24 weeks of 50% and the best objective tumor response of 30%, Including 2 complete responses and 1 partial response. The overall mean radiographic aggression free survival for the 9 milligram group was 10 months. With those small subset, one conclude that Novusarm has antitumor activity in women With AR positive, ER positive metastatic breast cancer that is resistant to estrogen receptor blocking agents and CDK4six Furthermore, the presence and the degree of answering receptor expression in the breast cancer tissue It was also important for the Innovus Arm's antitumor activity, which is consistent with Innovus Arm being a targeted agent or biomarker that could in the Phase 3 clinical trial design.
The subset analyses of AR staining and the Novusarm anti tumor activity From the Phase 2 clinical study will be presented at the upcoming ASCO 2021 meeting on June 4 through 8, And the presentation is entitled efficacy for Novusarm, a selective antirecepta targeted agent, correlates with the degree of AR positivity In advance AR positive, ER positive breast cancer in an international Phase 2 study. It will be presented by Professor Carlo Palmeri, Professor of translational oncology and medical oncologists at the University of Liverpool has posted a discussion session and the abstract number is 10/20. By targeting the androgen receptor and ER positive metastatic breast cancer, InovaSarm introduces a novel endocrine therapy to patients with breast cancer That have exhausted ER blocking agents and CDK4six inhibitors, but prior to IV chemotherapy. In October of 2020, the company met with FDA to discuss the Innovus Arm clinical breast cancer program. The FDA agreed to the Phase 3 Registration clinical trial study design to evaluate the efficacy and safety of Novosarm 9 milligrams versus an active control either exemestane The 3rd line treatment of androgen receptor ER positive HER2 negative metastatic breast cancer patients failed a non steroidal aromatase inhibitor, fulvestrant and the CDK4six inhibitor.
Phase 3 study will be called the test study and the primary endpoint will be median radiographic progression free survival. We were intrigued by the preclinical study results reported in the recent Publication I mentioned and in that, it showed that Novusarm in combination with the CDK4six inhibitor restored The CDK4six inhibitor's ability to suppress the androgen receptor positive ER positive metastatic breast cancer There was previously resistant to both the estrogen receptor blocking agents and CDK4six inhibitors, which as you know is the target population in We met with the FDA again in April of 2021 to discuss the Phase 3 RTEST clinical study And the best regulatory strategy to address the combination treatment of InnovusRMB CDK4six inhibitor in an AR positive, ER positive HER2 negative metastatic breast cancer patient who has progressed following treatment with the CDK4six inhibitor and ER blocking agent. And requested, we also have a companion diagnostic test for this important biomarker to identify the target population. 2nd, based on the FDA's regulatory guidance, Veru plans to conduct 2 separate InnovusRm selective AR targeted programs. Program 1 is to evaluate InnovusR monotherapy in a third line metastatic setting.
We will conduct a Phase 3 registration clinical study to evaluate the efficacy of enobasarm monotherapy versus the active control, in this case exemestane in subjects with AR positive, ER positive, HER2 negative metastatic breast cancer who have failed in onsor LAI, fulvestrant And the CDK4six inhibitors. So this is the RTEST clinical study and it's approximately 210 subjects anticipated to commence in June of 2021. Program 2, this is new, is to evaluate Innovusarm plus a CDK4six inhibitor combination therapy, Moving it earlier in a second line metastatic setting. We will conduct a Phase 2 clinical trial To evaluate the efficacy and safety for Novosarm plus CDK4six inhibitor, abemaciclib combination versus an alternative Estrogen receptor blocking agent, whether it's fulvestrant or AI, they'll be active control in subjects with AR positive, ER positive, HER2 Negative breast cancer have failed the first line. And first line in this case is Palvo, the CDK4six inhibitor plus an estrogen receptor blocking agent.
The clinical study in approximately 106 subjects is expected to commence in calendar Q3 2021. Now let's focus on the Phase 3, our test trial, which is expected to start next month. The design is more specifically as follows. An open label, multicenter, multinational, randomized 1:one, active control pivotal study Evaluating the efficacy and safety of InnovusR9 milligrams daily oral versus an active control, which is going to be either exemestane or serum. This It will be the physician's choice in centrally confirmed AR positive, ER positive, HER2 negative metastatic breast cancer subjects We have failed a non steroidal AI fulvestrant and a CDK4six inhibitor.
The primary endpoint is median radiographic progression free survival. The statistical assumptions are estimated median radiographic free survival of 6 months for the Innovosarm monotherapy versus 3 months with the active control, Exemestane or serum. With an alpha of 0.05, 99 percent power and a 20% dropout rate, The sample size will be approximately 210 subjects. We expect enrollment to take 10 months recruitment time and 12 months follow-up after the last patient is dosed. We expect that the antireceptor companion diagnostic test will be developed in parallel to the Phase 3 ARTEST study With a large diagnostic company partner, the Phase 3 ARTEST study will be conducted in 49 clinical sites across the United States.
So excited to get going on this. Next, I will update you on the Phase 2b clinical study evaluating sebizobulin for the treatment of taxane chemotherapy resistant metastatic triple negative breast cancer. So metastatic triple negative breast cancer is an aggressive form of breast cancer. It represents approximately 15% of all breast cancers. This form of breast cancer does not express the estrogen receptor, the progesterone receptor or HER2 and is resistant to endocrine therapies.
The first line of treatment usually consists of multiple systemic chemotherapies, including IV taxane chemotherapy. Unfortunately, almost all of these women will eventually develop resistance and exhibit tumor progression. In preclinical studies of human triple negative breast cancer that has become resistant to paclitaxel, which is a taxane. Subesabulin significantly inhibits cancer proliferation, Migration, metastasis and invasion. We plan to submit an IND using the safety information from the Phase 1b2 Sibizobulin prostate cancer clinical studies plan to initiate an open label 3 arm Phase 2b clinical study To evaluate the efficacy and safety of sebizobulin, sebizobulin plus trodelbi combination versus trodelbi alone in In the treatment of approximately 150 metastatic triple negative breast cancer patients that have failed at least 2 systemic chemotherapies, including IV And if sebizobulin was well tolerated with no reports of neutropenia.
It will be interesting to see whether sebizobulin In combination with TRUDELEVI results in less neutropenia with a better efficacy similar to what has been observed in a metastatic non small cell lung cancer trial with plenabulin and IV colchicine site targeted antitubulin with a similar mechanism In combination with docetaxel, which is ataxine, prevented docetaxel induced neutropenia. The Phase 2b study is planned to commence in the calendar Q3 2021. And as I mentioned, if successful, This would represent a second major clinical oncology indication for sebizobulin. This week, Now moving to the COVID-nineteen study. This week, we expect to enroll our 1st patient in the Phase 3 COVID-nineteen study Evaluating sebizobulin for the treatment of hospitalized patients with COVID-nineteen who are at high risk for acute respiratory distress syndrome.
Sebesipullin in this setting is a novel once daily oral dosed small molecule with both Broad antiviral and anti inflammatory activities, which may serve as a 2 pronged approach to the treatment of COVID-nineteen virus infection and the subsequent debilitating inflammatory effects that lead to ARDS and death. We conducted a double blind, randomized, placebo controlled Phase trial evaluating once daily oral dosing of cebizobulin 18 milligrams versus placebo in 39 hospitalized COVID-nineteen patients With high
risk for
acute respiratory distress syndrome, the primary efficacy endpoint was proportion of patients alive without respiratory failure at day 29. For the primary endpoint in hospitalized patients and modified intent to treat population, sebizobulin treatment compared to placebo Had a clinically meaningful reduction in proportion of patients who are treatment failures deadened or alive with respiratory failure With a 30% treatment failure rate in the placebo group N equals 20 compared to 5.6% in the cebisiabulin treated group N equals 18 at day 29. This represents an 81% relative reduction in the sebizobulin treated failures. Secondary endpoints in the intent to treat population, sebizobulin reduced the proportion of patients who died on study From 30% in the placebo group to 5.3% in the sebizobulin treated group with a P value of 0.044. This is an 82% relative reduction in mortality in the And so, Busibulin showed a statistically significant and clinically meaningful reduction in days in the ICU with Subisibulin patients at 3 days versus Placebo at 9.55 days, p value 0.04.
The zebizobulin reduced the days of mechanical ventilation for 5.4 days in the at the end of Phase 2 meeting with FDA to discuss the next steps, including the Phase 3 clinical registration trial designed for cebizobulin COVID-nineteen program. The FDA agreed upon sebizobulin for the COVID-nineteen Phase 3 trial as a double blind, Multi center, multinational, randomized 2:one placebo controlled trial evaluating daily oral doses of 9 milligrams of subizobulin for up 21 days versus placebo in 300 hospitalized COVID-nineteen patients who had high risk of ARDS There'll be 200 subjects who will be treated with cebisobulin and 100 subjects will receive placebo. Because of better oral bioavailability, The systemic blood levels from the 9 milligrams of bisabulin dosage is similar to the 18 milligrams of bisabulin formulation used in the Phase 2 study. The subjects in both the sebizobull and placebo arms will also be allowed to receive standard of care. The primary efficacy endpoint will be Proportion of patients that die on study up to day 80, so it's mortality.
Secondary endpoints will include the proportion of patients Without respiratory failure, days in the ICU, WHO Ordinal Scale for clinical improvement change from baseline, days on mechanical ventilation, days in The study will be conducted in the United States, Brazil, Argentina, Mexico and Colombia, And enrollment is targeted to be completed by year end. The company has sufficient clinical drug supply on hand to complete the Phase 3 clinical study. We'll seek funding from the Biomedical Advanced Research and Development Authority of the U. S. Department of Health and Human Resources, BARDA, and other agencies to try to fund the The estimated amount of the commercial drug to supply the needs of the U.
S. Population, assuming confirmatory positive clinical results And FDA approval. COVID-nineteen infection rates and hospitalizations are still at a serious level. There are mutating and double mutating virus strains and large parts of the population either unwilling or unable to get access to effective vaccines. In fact, global cases of COVID-nineteen are at the highest level since the start of the pandemic.
It is clear that effective and safe oral therapeutic that can prevent deaths of hospitalized patients with moderate to severe COVID-nineteen disease with risk for acute respiratory distress syndrome is desperately needed. We strongly believe That zebizobulin with its anti inflammatory and antiviral properties and its favorable safety profile Can be that greatly needed oral therapy. Based on the strength of these Phase 2 clinical study promising clinical results, The company continues to be duty bound during this persistent global pandemic to pursue the COVID-nineteen indication, even though it's not our primary focus of the company. We believe we have the resources to conduct our planned sebizobulin for COVID-nineteen Phase 3 trial without impacting the other cancer drugs in clinical development. Finally, I'll comment on Tantfin.
Tantfin is our combination of down flow 5 milligram finasteride 5 milligram urology product Developed to treat low urinary tract symptoms caused by benign prostatic hyperplasia, also known as BPH. The combination product contains tadalafil, which is approved for the treatment of BPH and erectile dysfunction and finasteride for BPH. We submitted the NDA for TADFIN to FDA In February, FDA accepted the NDA in April. Our PDUFA date decision The decision date for TADFIN will be December of 2021. We plan to launch TADFIN if approved We have 3rd party telemedicine channels and when launched, we should provide near term source of additional revenues for We're not going to have a marketing and selling group.
It will be done through telemedicine. I will now turn the call over to Michelle Greco, CFO and COO, to discuss for financial highlights. Michelle?
Thank you, Doctor. Steiner. As Doctor. Steiner indicated, we're having a great year. In December, the company sold PREBOOST For $20,000,000 and in February, the company completed an equity raise, which resulted in 107,900,000 dollars and net proceeds after deducting underwriting commissions and costs.
And to give you a sense of the continuation of our revenue growth trajectory, In the U. S. Prescription channel, we sold 171,900 units year to date in fiscal 2020 compared to 2 247,200 units year to date in fiscal 2021, an increase of 44%. Let's start our highlights with the Q2 results for the 3 months ended March 31, 2021. Overall, net revenues were up 34% to $13,300,000 from $9,900,000 in the prior year Q2.
The company reported record quarterly Sales for its U. S. Prescription business of $10,300,000 an increase of 48% from $7,000,000 in the prior year's Q2. Overall, gross profit was $10,900,000 or 82 percent of net revenues compared to $7,400,000 or 75 percent of Net revenues in the prior year quarter. The increase in gross profit and gross margin is driven primarily by increased sales in the US FC2 prescription business.
Operating expenses for the quarter increased to $12,400,000 compared to the prior year quarter of $7,700,000 Research and development costs were $7,600,000 compared to $3,900,000 in the prior year quarter. The operating loss for the quarter was $1,500,000 compared to $300,000 in the prior year quarter. Non operating expenses were $1,400,000 compared to $644,000 in the prior year's Q2 and primarily consisted of interest And the change in the fair value of the derivative liabilities related to the synthetic royalty financing. We entered the synthetic royalty financing during March 2018. For the quarter, we recorded a tax expense of $22,000 compared to a tax benefit of $133,000 in the prior year The bottom line results for the Q2 of fiscal 2021 was a net loss of $2,800,000 or $0.04 per diluted common share compared to a net loss of $811,000 or $0.01 per diluted common share in the prior year's 2nd quarter.
Now turning to highlights for the results for the 6 months ended March 31, 2021. For the 1st 6 months of fiscal 2021, Total net revenues were up 36 percent to $28,000,000 from $20,500,000 in the prior year period, A record high for the 6 month period ended March 31. Company reported growth in the sales in the U. S. Prescription business and in the Global Public Sector Business.
Net revenue from the U. S. Prescription business was up 49% to $19,400,000 From $13,000,000 in the prior year period, the global public sector business was up 11% to $7,700,000 Overall, gross profit was $21,700,000 or 78 percent of net revenues compared to $14,700,000 or 72% of net revenues in the prior year period. The increase in profit and gross margin is due primarily to the increase in the U. S.
Prescription business. Operating expenses increased by $5,600,000 to $22,400,000 compared to the prior year period of $16,800,000 The increase is primarily driven by research and development costs, which increased by $4,000,000 to $13,300,000 from $9,200,000 in the prior year period. Operating income for the period was $17,700,000 compared to an operating loss of $2,100,000 in the prior year period, an increase of $19,800,000 The increase is primarily due to the gain on the sale Preboost of $18,400,000 Excluding this gain, we had operating loss of $694,000 for the period. Non operating expenses were $3,200,000 compared to $2,200,000 in the prior year period and primarily consisted of interest expense And the change in the fair value of the derivative liabilities related to the synthetic royalty financing. For the 6 month period, we recorded a tax expense of $100,000 compared to a tax benefit of $210,000 in the prior year period.
The company has net operating loss carry forwards for U. S. Federal tax purposes of $41,700,000 with $13,500,000 expiring in the years through 2,030 8 And $28,200,000 which will carry forward indefinitely. Our U. K.
Subsidiary has net operating loss carry forwards of $61,300,000 which do not expire. The bottom line results for the 1st 6 months of fiscal 2021 With net income of $14,400,000 or $0.18 per diluted common share compared to a net loss of $4,100,000 or $0.06 per diluted common share in the prior period. Excluding the gain on sale of PREBOOST, the adjusted net loss was $4,000,000 or $0.06 per diluted common share in the current period. Turning to our balance sheet. As of March 31, 2021, Our cash balance was $136,700,000 Our accounts receivable were $5,100,000 Due to our sales pre boost, we added $15,000,000 in cash during December $5,000,000 in notes receivable, which will be collected over the next 15 months.
In February, we completed an underwritten public offering of 7,419,000 354 shares of our common stock at a public offering price of $15.50 per share. Net proceeds were 100 $7,900,000 Our net working capital was $137,200,000 at March 31, 2021, compared to $12,300,000 at September 30, 2020. During the 6 months ended March 31, 2021, we used cash of $1,900,000 for operating activities compared with $4,900,000 used for operating activities in the prior period. Overall, we're delighted to see the continued increases in sales in the U. S.
Prescription business and look forward to increasing sales in the global public sector business in the 3rd quarter. These revenue sources together with our strong balance sheet continue to be a source of funds we use to invest in our promising pharmaceutical Clinical development programs as we continue to transform our company into an oncology biopharmaceutical company with a focus on developing novel medicines for the management of prostate and breast cancers. Now, I'd like to turn the call back to Doctor. Steiner.
Thank you, Michelle. Our company's fundamentals are strong. We've enjoyed another strong financial quarter with record U. S. FC2 prescription net revenues, which has allowed us to significantly advance our clinical programs.
Based on year to date performance, We expect to have a record year in revenue. With the robust performance of the sexual health business, plus the prospects for additional future revenue from TADFIN, Coupled with our strong cash position, we believe that we'll be able to substantially invest in the continued clinical development of our prostate and breast cancer drug Continue to generate robust growing revenues for the sexual health business. As previously announced, the company also continues to explore strategic alternatives Regarding its legacy Female Health Company business, which markets the FC2 female condom internal condom, including continuing to operate It's been a very, very busy quarter as we have successfully transplant continued to transform our company into a late Clinical stage oncology biopharmaceutical company supported by growing revenue from our cash generating sexual health business. We plan to enroll potentially up to 5 registration studies and 2 Phase 2 studies this calendar year. More Specifically, prostate cancer, cebizobulin in an open label Phase 3 veracity study in men with metastatic and androgen receptor targeted agent resistant prostate cancer VERU-one hundred in an open label Phase 2 And later in the year, an open label Phase 3 for hormone sensitive metastatic prostate cancer.
For breast cancer, Inobusarm in an open label Phase 3, our test study in AR positive ER positive HER2 metastatic breast cancer in a third line metastatic setting after failing a non store lay eye fulvestrant and a CDK4six inhibitor. Inovisirn plus abemaciclib Combination in an open label Phase 2 study in AR positive, ER positive, HER2 negative metastatic breast cancer in a second line metastatic setting after failing palbociclib plus an ER blocking agent. With Rydelvie alone in an open label Phase 2b study in metastatic triple negative breast cancer patients that failed at least 2 systemic chemotherapies, including an IV taxi. And for COVID-nineteen, tibisobulin 9 milligrams in a Phase 3 Trial, double blind, multicenter, multinational, randomized, placebo controlled trial in hospitalized COVID-nineteen patients who are at high risk for And if we do confirm the promising results that we observed in the completed Phase 2 clinical study, we expect to seek And emergency use authorization for this indication. With that, I will now open the call to questions.
Operator?
We will pause momentarily to assemble the roster. And the first question comes from Chris Howerton with Jefferies.
Congratulations on the very broad progress here to you, Mitch and the team. So thanks for taking the questions as well. I guess for the two questions from me. First up, with respect to sebizobulin, I guess, could you give us just a little more color in terms of what the impetus was to reformulate the drug and it Sounds like a more bioavailability dosage form. And then what additional kind of operational work may be required to Have that formulation fully ready to go for the upcoming clinical trials and of course commercialization.
The second question that I have is related to AR expression levels and the potential for a companion diagnostic. So I guess For that feature of the Innovus Arm development program, is the expectation that there will be some cutoff of AR And if so or if not, I guess, what will we learn at the ASCO presentation with respect to that? Thanks.
Great. So the first question is on the reformulation. As you know and in drug development, you typically start with the cheapest way To do this study and that is you take the drug and you put it you pack it into a capsule and that's what you give patients in their Phase 1b2. And so what we've done is we the to be marketed forum, so I've got to be careful because the lawyers get mad when I say that, but the to be marketed forum It doesn't mean that we got approved. It means that it's the forum that we would use if approved.
And typically in your Phase 3, you have to use the form that is to be marketed so that you have your commercial form. So to answer your question, there's no further work. Serendipitously, when they put in the excipients and created the formulation for the Phase 3 and we did the PK study in The Phase 1b2, it turns out that the excipients allowed for better oral bioavailability. And so that means that the 32 milligram dose is equivalent to the 63 milligram dose. And it raised the question that in the Phase 1b2, Where did the other 31 milligrams go?
The answer is the other 31 milligrams didn't disappear. It stays in the gut. And it may be responsible maybe for some of the diarrhea that we're seeing, for example, even though it's grade 1, grade 2. So one potential benefit The reformulation is that we may in the Phase 3 setting see some fewer side effects that may be Related to residual drug that was not absorbed. So we don't have to do any additional work.
We have the to be marketed form And that form is the one that we're going to be using not only in the Phase 3 for prostate, we're using it in It's the 9 milligram version in the Phase 3 for COVID-nineteen, which will start this week, and we're using it also in the triple negative breast cancer To study that has sebizobulin going against TRUDElvi and in combination with TRUDElvi. 2nd question has to do with AR Expression, this is exciting because every so often you'll find somebody says they have a biomarker or a A targeted marker, this is truly a targeted marker. And what we're going to be presenting in the June ASCO meeting Are the data that support that? And as you would imagine, there is some expression level where you get better activity Because for something to be considered a targeted marker, it has to be for activity to happen, it has to happen through that marker. So in this case, You wouldn't expect activity with a Novus arm if the antigen receptor is not present.
And the second thing is, the more of that marker The way that's being expressed, the better the result should be at least from an antitumor activity, and we see all that. And So we're going to be presenting in the ASCO paper and ASCO presentation is the data to support that And particularly as it relates to objective tumor responses, target tumor responses, clinical benefit rates, Radiographic progression free survival, it all goes as you would expect if AR is truly the reason why Novusarm is working. And so because of that, it becomes critical that you have a companion diagnostic that can be done And it's immunohistochemistry, so it's not complicated, which is a good thing for us because we don't want a complicated companion diagnostic. One that can be easily done, can be done across the world, because we don't want that to be the bottleneck, but to be able to identify Women that are most likely to respond and means that we can actually stack the deck in our favor in the sense that we're We're going to be putting in women that will have a hopefully robust response to an OPUS arm, so that we can blow away the active control.
And so that's the intent. And so, we're not a companion diagnostic company. And so for us to do Do something that's not in a wheelhouse doesn't make sense. And so we are in discussions with companies that once we announce those companies, you're going to say these guys know the hell they're And they will be able to work with us in parallel, so that the companion diagnostic and the drugs are both available at the same time. And they've done this over and over because this is we can do therapeutics, let them do the diagnostic.
But having a companion diagnostic, it also is an opportunity for laboratories to when they breast cancer is one of those cancers That when a woman is diagnosed, she is automatically molecularly characterized, meaning that they look for the estrogen receptor, the progesterone after HER2 expression, in some cases BRCA1 and BRCA2. So the antigen receptor It can be added in that very select group of initial molecular characterizations of the breast cancer. And the report says, oh, by the way, Novosarm is available, then you can ask for better marketing than that, because in that, We'll be the only one available for it. So yes, you'll be learning at the ASCO meeting. You'll be seeing the cutoff, the correlations and all that stuff.
So again, we're excited because this just helps us Enrich our patient population for those patients. Now, the last question somebody may ask is, well, if you do that, are you reducing the number of patients so much that You've really reduced the number of patients in your market. Refresh your memory, 85% The women are going to be AR positive and of those women, Even if we had half those, that's a huge population of women that will still be eligible for our AR target Population compared to BRCA 1, BRCA 2, you're at 5% to 10%. So we're going to it's better I think from the standpoint of Having a drug that works in majority of the time in a good number of patients would be would make sense.
Okay. Well, that's great. I look forward to that presentation at ASCO, and thanks for taking the questions.
Thank you, Chris. Thank you.
And the next question comes from Brandon Folkes with Cantor Fitzgerald.
Hi. Thanks for taking my questions and congratulations
on all the progress. Maybe firstly, just What is your degree of urgency to sell the female condom business? Obviously, it continues to do well and well capitalized now. So just any color there. And then secondly, sorry if I missed this, but on the enobasome Phase 2 combination study that starts next quarter, will this be a registration study?
Okay. So your first question, it's kind of where we are with the Female Health The business, so as we announced, we are in again another record year. We had a record year last year. This year, it looks like it's heading that way again. And you can see from the numbers, It looks like any math you do, we're on a growth trajectory that is high growth.
And the other thing that's important to realize is that the margins that we're receiving because we've changed the business from a public sector business to a U. S. Prescription business is as you would imagine is more like a prescription product. And as a result, It allows us to have and let me make one more comment. And because we're not selling the prescription product Using a marketing and selling sales force of 70 people or 100 people, which is eating up at your eating your profits, We spend almost no money on marketing and selling.
So essentially all of that money can be reinvested into our projects. And so that's why we're able to run all of these projects that our cash is strong. And so I think the shareholders want us To be able to invest with multiple shots on goal in these multibillion dollar opportunities and to be able to have this The foundation, this platform to do that is wonderful. And so we're very blessed and we're very excited that the team has been able to do this. With that said, the best time to look for a possible alternative strategy to monetize the business is when it's doing well And it's growing.
The flip side of it is, when it's doing well and it's growing, it takes a lot of pressure off the company Because you're not trying to do a fire sale, you want to get the best deal that you can get. Interestingly, by doing a Successful fundraiser that we did back in February, it put enough resources in the bank that we're also in a that we don't have to take any deal that comes in for the Female Health Company because we have the resources to keep going. So I think we've put ourselves in the best, best position to monetize this at the best, best price for shareholders And not put ourselves in any time strain or any, I mean, we're in the driver's seat. So from that standpoint, what I can tell you is there's a lot of activity and we continue to explore all kinds of options And because we're not stressed for time, because we have the money and we're moving forward, we're going to do this In a way that's best for the shareholders. As it relates to your second question, which is Innovus Arm's 2nd indication, the second it actually is a second indication.
So the FDA said you can do Combination therapy, there's a lot of things you have to do with combination therapies and that's at first is to make sure that there's safety in the combination therapies. And so that's really a separate program. And so we decided that based on the FDA's response that the easiest thing to do is Inovusim monotherapy in the 3rd line setting, we have the data. We treated heavily pretreated women that have failed estrogen receptor engaged in 12% failed CDK4six inhibitors, you see good activity, preclinical data. So we're good to go with our test Phase 3.
But boy, wouldn't it be nice to move in earlier in a second line setting. So that means if 83% of patients are coming in with ER positive breast And they're getting treated with a CDK4six inhibitor, which almost predominantly is palvo, palbociclib, And in estrogen, we set the targeted agent, whether it's a non store AI or fulvestrant, what do you do after they fail? So that Initially, we were told this is a crowded space. There's a lot of drugs trying to get into the space. But literally overnight, Because of CDK4six inhibitors, that crowded space has become less crowded because of the fact that after first line therapy, Majority of women are looking for something that has not been proven.
So the Phase 2 that we're doing We're not thinking of it as a registration trial. We're thinking the Phase 2 in a second line setting is to provide us the information we need to confirm it in the Phase 3 study.
Thanks. That's very helpful and congrats again on the progress.
Thank you.
Thank you. And And the next question comes from Leland Gershell with Oppenheimer. Mr. Grisha, your line is live.
Sorry, I'm unmuted now. Good morning, Mitch. Thank you. And thanks for the comprehensive update on all your plans. Just a quick question, just really a clarification.
So the exploratory arm with CDK4six inhibitor that you had contemplated for that test study is no longer going to be included in our test, Correct. Your CD4 ks combination will be restricted only to the Phase 2 or will you be keeping that exploratory in the Phase 3 as well? Thanks.
No, no. So we moved the exploratory arm out of the Phase 3, so that the Phase 3 then becomes simpler, easier. And as you know, every time you add an additional arm, it's another statistical hurdle. So the idea was just make it clean to InnovusONE monotherapy Versus another blocking agent, which these women have failed several. And so it's a good control for us to go up against.
And for us to go up against. And 3rd line setting, these women would have exhausted all these things. And so it's a good it's pre chemo and Our side effect profile looks pretty good. It looks like an endocrine therapy. It's not a chemotherapy.
There's no diarrhea, vomiting and hair loss and all that stuff. And so We feel that that's a great spot for us to be. But to move in earlier, that was our thinking if we're going to do combination therapy. Because one of the things the agency asked for is that if you pick if you can do combination therapy, you just can't say I'm going to do CDK4six inhibitor And an estrogen receptor blocking agent, they want you to specifically name CDK4six inhibitor. That kind of makes sense, right?
Because if you look at PDK4six inhibitors, palbociclib has a different safety profile than for example ribociclib. And so, one of the reasons why Palbo is used so much and is the leader is because of its safety profile and because it was first to market. So that's why in the Phase 2, in the combination program, which in the Phase 2, we're very specific since Palafo is being used 80% of the time in first line, then we're going to come in with a bimexiclib Plus in OBOSARM and go up against what's standard right now, which is another estrogen receptor blocking agent. And that, my gosh, can you imagine if we're in the 2nd line setting and move in Opusarm earlier. So they're very separate programs, The Phase 3 program for 3rd line setting, Phase 2 program to go in earlier.
And I think we'll get a lot of credit for good Phase 2 data, Because then at that point, it's just going to confirm in your Phase 3. So essentially what we've done is we just increased the depth and breadth of the Innovosarm program And there will be other indications that we'll be able to go into that we'll announce later. But when you're The only game going after the antigen receptor, which is there, in some cases more prevalent than the estrogen receptor in breast cancer, Then we have to continue to explore how we're going to build the indications for the drug.
And then just a follow-up, with the tolerability of the Novozarm, any thoughts kind of on a maintenance type Use pattern down the line, patients who may get through sort of an initial treatment period and then they Stay on it. And if there's a maintenance, any thoughts there? Thanks.
So you're talking about in the trial or you're talking about real
No, in real world. Yes. So in the real
world, since we're using radiographic progression free survival as the endpoint, Then the patient gets to stay on until they progress. So it won't be like induction chemotherapy followed By maintenance chemotherapy, because it's an endocrine therapy, how is it any different than tamoxifen being used for 5 years or Or an aromatase inhibitor being used for 3 to 5 years. So if we're fortunate, the treatment would be alongside The patient for as long as the patient is stable or benefiting from it. And so we don't have to do any maintenance studies. It will be they'll continue to take it until it's almost similar to some of the cytostatic drugs like the Tyrosine Kinase inhibitors where We're patients on it for a while, even in lung cancer.
Thank you, Lewin. I appreciate it.
Thank you. And the next question comes from Kumar Raja with Brookline Capital Markets.
Congratulations and thanks for taking my questions. With regard to COVID-nineteen trial and given the variability in Standard of care with regard to different regions, how do you think that is going to impact the results? And also looks like you are going with a 60 day endpoint in the Phase 3 compared to the 29 day. What are the factors driving this?
Yes. So the first question has to do with recruitment And potential effect recruitment, I guess geography and potential effect on results. It's a very good question. And so from that standpoint, in the United States, we still have several sites in U. We're opening up and United States is weird.
It's become almost like a checkerboard where some areas look fine and some areas are not fine. And so even though we are thinking we are getting out of it in the U. S, if you look at it, it was still between 3,905 1,000 cases a day and you still have a death rate that is significant. And, so I don't know how long that's going to go, but we're in Position given the Phase 2 to take advantage of that, so in the U. S.
Now, one of the reasons why we picked Instead of ICU days and all that stuff, which we're going to measure, we pick mortality. Why did you pick mortality? We pick mortality because you can't fake a death. So if a patient dies, you can count that pretty easily. If a patient has respiratory failure, is it respiratory failure because of standard of care, is it best placed there failure because they couldn't get oxygen?
Is it days in the hospital because they needed that bed because I mean there's too many other variables that go into some of these other endpoints that people use in the COVID-nineteen studies. Since we're going after hospitalized patients with a WHO score of 5 or greater, By definition, these are the sickest patients and depth is a pretty good endpoint to determine whether your medicines are working is working or not. So even if we go into other geographic locations like Brazil, Mexico, Argentina and Colombia as I mentioned, And hospitals by the way in those countries are good enough. And we think that and again of The FDA will always make you look at each region and how it contributes, but we think we'll be okay. We have some backup in Europe.
As you know, Europe is about to go through another surge. And so we do have backup if we need to. We're going to be incredibly aggressive in making sure we fill this trial by year end. And so I think we're going to be fine because of the endpoint in terms of different geographies, but we will look at Each geography and their contribution to the final answer at the end of the study. As it relates to 60 days versus the 29 days, Looking at a mortality endpoint, we picked 29 days because the FDA picked 29 days and if you look at almost every study was done contemporarily, It was 29 days.
It turns out that we want to capture as much good information as we can And what we've learned in our study is if patients were not doing well, you're going to capture most of them by day 29. But boy oh boy, it would be nice to see whether or not we have a benefit beyond that. And so day 60 is really what was in our previous study, our safety window. So the idea is if you capture it for 60 days and death is an endpoint and the patient He's in respiratory failure and they're able to keep him alive a little bit longer past day 29, but then he dies at day 35 or day 40 And he is in the placebo group, you want to capture that. And so I think what it will do is we'll make the mortality data more robust.
Okay, great. Thank you.
Thank you.
Thank you. And the next question comes from Yi Chen with H. C. Wainwright.
Thank you for taking my questions. Just to clarify, is this the first time for the 9 milligram and 32 milligram Those formulation of sebiseptalain to be used in their respective patient groups?
Yes. So it will be the first time for those formulations, but those formulations were bridged With a PK study that we did in the Phase 2 study in prostate, where we looked at the 63 milligram dose Blood levels compared to the to be marketed Phase 3 dose forms. And based on those data, which Joe, bioavailability was 100% better than what it was before. Then we went to the agency and the agency reviewed the Formulations and agreed that the doses that we picked for the Phase 3s were acceptable given what we've learned in the PK study in the Phase 2. So the answer is yes, it's the first time we're using those formulations, But we also know we know what the drug levels are going to be and the drug level is going to be consistent with what we did in the Phase 2s.
So the 9 milligram will be similar to the 18 milligram for COVID-nineteen and the 32 milligram is similar The 63 milligram dose that we used in the Phase 1b2 prostate.
Got it. Thanks. My second question is, how are the operating expenses going to trend with multiple trial initiations throughout the year?
I lost your first part of your question. Say it again please.
How are the operating expenses Going to trial with multiple trial initiations?
All right. Good question. So, Michelle, do you want to answer that question?
Sure. We've indicated that our drug expense has increased for this Period. Let me just pull those numbers back. Our R and D expense went Quarter from 3.9 last year to 7.5 and for the 6 months from 9.2 to 13.5. They're going to continue to increase.
Again, this quarter, we were at 7.5. We're going to continue to increase those as we continue to add all these trials that Doctor. Steiner just went over on the call That will be going on and being added over this calendar year. So they're going to continue And to
slowly increase. Okay.
Thank you. Ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference back over to Doctor. Mitchell Steiner for any closing remarks.
Thank you. I appreciate you joining us on today's call. I look forward to updating you Thank you.
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