Inhibikase Therapeutics, Inc. (NASDAQ:IKT) Q2 2023 Earnings Call Transcript

Inhibikase Therapeutics, Inc. (NASDAQ:IKT) Q2 2023 Earnings Call Transcript August 15, 2023

Operator: Good morning. Welcome to the Inhibikase Therapeutics Second Quarter 2023 Financial Results Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Alex Lobo, Stern Investor Relations. Please go ahead.

Alex Lobo: Good morning and welcome to the Inhibikase Therapeutics second quarter 2023 financial results conference call and audio webcast. With me today is Dr. Milton Werner, Chief Executive Officer and Joe Frattaroli, Chief Financial Officer. On Monday, August 14, 2023, Inhibikase issued a press release announcing financial results for the second quarter ended June 30, 2023. We encourage everyone to read yesterday’s press release as well as Inhibikase’s quarterly report on Form 10-Q, which is being filed with the SEC. The company’s press release and quarterly report are also available on Inhibikase’s website at inhibikase.com. In addition, this conference call is being webcast through the Investor Relations section of the company’s website and will be archived there for future reference.

Please note that certain information discussed on today’s call is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Participants are cautioned that this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, August 15, 2023. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company’s business. Information on potential risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. The company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this webcast, except as maybe required by applicable securities law.

With that said, I would now like to turn the call over to Dr. Milton Werner. Milton, you may begin.

Milton Werner: Thank you, Alex and thank you everyone for joining us today for Inhibikase Therapeutics second quarter 2023 earnings call. We are pleased with the progress we have made across our clinical programs in the first half of this year. Our Phase 2 201 trial using IkT-148009 to treat Parkinson’s disease is screening and enrolling patients across 22 of up to 35 planned sites, with the first patient 12-week dosing regimen. Additionally, this quarter, we launched a public awareness campaign through of the 201trial.com that we believe will enable us to continue to drive enrollment in the trial. The trial website is being augmented with outreach to patient advocacy groups, caregiver networks, foundations and social media advertising throughout the United States.

In June, we completed the pivotal phase of the 501 trial evaluating bioequivalence between IkT-001Pro commercial 400-milligram imatinib mesylate. Following agreements with the FDA, we are contemplating to evaluate the bioequivalent dose between IkT-001Pro and high-dose 600-milligram imatinib mesylate to further explore the potential safety benefit of IkT-001Pro delivery of imatinib. High-dose of imatinib mesylate is in common use for the treatment of CML, but poorly tolerated by most patients, a shortcoming that IkT-001Pro may overcome. We plan to release a full data description for the pivotal phase of our 501 trial in the near term. Upon completion of the study, we plan on engaging the FDA to discuss the parameters of drug approval under the 505(b)(2) regulatory pathway.

In addition to these clinical accomplishments, we continue to expand our expertise in drug delivery, not only with IkT-001Pro, but also now with IkT-148009. The development of a commercial tablet formulation of IkT-009 – 148009 has nearly doubled the efficiency of drug delivery for IkT-148009, providing the opportunity to lower the therapeutic dose and improve safety as well as consistently deliver the dose each and every day to ensure a continuous therapeutic benefit from once daily dosing. Before I turn the call over to Joe to review our financial results, I would like to touch on our preclinical efforts in other neurodegenerative diseases. Multiple system atrophy or MSA is a rare Parkinson’s-related disease that is rapidly progressive – that is a rapidly progressive neurodegenerative movement disorder of the central and autonomic nervous systems.

Currently, we are evaluating MSA in two models, one that measures the ability of IkT-148009 to block progression early in the course of MSA and a second model that evaluates the therapeutic potential to correct functional loss and neurodegeneration late in the course of the disease. The first MSA model study is nearing completion and has demonstrated that treatment with IkT-148009 for 20 weeks, prevented functional loss and preserved neural anatomy in mice when IkT-148009 is given orally once daily. Functional benefit in this model was accomplished by substantial reduction in the underlying alpha-synuclein pathology. Evaluation of the effect of IkT-148009 when treatment begins late in the course of the disease remains ongoing, and we expect to complete that study by the end of 2023.

These studies will form the basis of our planned Phase 2 clinical study of IkT-148009 in MSA. We look forward to providing further updates on these studies and potential timing of the planned Phase 2 trial in the coming quarters. I will now turn it over to our Chief Financial Officer, Joe Frattaroli to review our financial results for the quarter. Joe?

Joe Frattaroli: Thank you, Milton. Before I review our financial results, I’d like to highlight that we recently received notice from the Listing Qualifications Staff of The Nasdaq Stock Market, indicating that we had regained full compliance with the minimum bid price requirement of $1 per share under Nasdaq Listing Rule 5550(a)(2). Regaining compliance allows us to move forward and work to generate meaningful clinical data that will ultimately drive value for our shareholders. Now let me review our financial results for the 3 months ended June 30, 2023. For the second quarter 2023, we reported a net loss of $5.8 million or $1.11 per share compared to a net loss of $4.6 million or $1.10 per share in the quarter ended June 30, 2022.

Research and development expenses were $4.5 million for the quarter ended June 30, 2023, compared to $3 million for the quarter ended June 30, 2022. The increase was primarily due to the company’s ongoing Phase 2 201 PD clinical trial costs and IkT-001Pro for CML program. Selling, general and administrative expenses were $1.8 million for the quarter ended June 30, 2023, compared to $1.7 million for the quarter ended June 30, 2022. The increase was driven by a net increase in normal selling, general and administrative expenses. As of June 30, 2023, we had approximately $20.9 million in cash and cash equivalents. We expect that existing cash and cash equivalents will be sufficient to fund operations into the fourth quarter of 2024. That concludes our review of our financial statements.

I’d like to hand the call back over to Milton for closing remarks.

Milton Werner: Thank you, Joe. We continue to demonstrate the value of c-Abl ambition of therapeutic paradigm for treatment of neurodegenerative disease and the safety profile of our lead c-Abl inhibitor IkT-148009 remains promising. We look forward to reporting the outcomes of the 201 trial and to share our plans for future trials in Parkinson’s disease and multiple system atrophy. We’d like to thank our site investigators, our partners and our shareholders for their continued support as we seek to transform the treatment paradigm for neurodegenerative diseases. I’d now like to open the call to questions. Operator?

Q&A Session

Operator: [Operator Instructions] The first question comes from Ed White with H.C. Wainwright. Please go ahead.

Ed White: Good morning. Thank you for taking my questions. So on the Phase 2 201 trial, you said screening is ongoing at 22 sites. How many sites have enrolled patients so far? And can you just tell us about the screening process, is the number of patients coming in meeting your expectations?

Milton Werner: Well, so first of all, this is a challenging patient population, the untreated Parkinson patients since the advent of COVID in the United States has driven many patients who are diagnosed with Parkinson’s disease into telehealth appointments and that has led physicians to start treatment much earlier than they had previously done. Often much sooner than patients actually require when other medical interventions such as exercise and physical therapy would better benefit patients during the course of the disease. So, we have not yet provided guidance on the enrollment rate for the number of sites that are enrolling patients because we want to see how that – the implementation of all of our patient outreach activities over the last six weeks and into the fall, really bears fruit. I think we have guided that we will be providing that guidance closer to the next quarterly report.

Ed White: Okay. Thanks Milton. And on the 501 trial for IkT-001Pro, you had stated that following discussions with the FDA, you are considering a high-dose bioequivalence cohort. Maybe you could just review some of the pros and cons that you are considering when thinking about running that cohort?

Milton Werner: Well, so we had to have a discussion with the FDA related to safety. So, the norm in the oncology division of the FDA these days is often to do Phase 1 studies in the target population because many agents to treat cancer are quite toxic unlike IkT-001Pro. And so it takes some work with the FDA to have them agree to do these studies in healthy subjects. We have agreement with the agency to do things at single doses. We did that in both dose escalation and pivotal trials in the 501 study so far, and the FDA has agreed to allow us to do the same in the next cohort for a limited number of patients. The 600 milligram dose is generally in wide use by many clinicians who are treating patients for CML, but it’s also very poorly tolerated.

And so the agency has agreed to a design that’s similar to what we did in the dose escalation phase, eight subjects, a single dose with a full PK description and a full safety description. And so that’s what we are contemplating the addition of. We are just going through all of the nuances and details of the safety profile from the 31 subject pivotal trial that has been completed that has the pharmacokinetic analysis. We should be releasing those results very shortly in detail.

Ed White: Okay. Thanks. And my last question is just on expenses. How should we be thinking of R&D expenses into the second half of the year where you have patients enrolling in the 201 trial and then the potential for this IkT-001Pro high-dose cohort?

Milton Werner: Well, all of our current activities are part of our existing budget. So, we don’t have a concern that the burn rate will increase and exceed our current resources. So, if that’s the question you are asking, I don’t know, Joe, if you have additional color you want to add?

Joe Frattaroli: Yes. I mean that’s exactly it. All of the budgeted items are contemplated in our present cash forecast. When it will flow out will be dependent in part on the rate of enrollment, right, which we are still assessing.

Ed White: Okay. Great. Thanks for taking my question.

Milton Werner: Sure. Thanks Ed.

Joe Frattaroli: Thanks Ed.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Dr. Milton Werner for any closing remarks.

Milton Werner: Well, thank you everyone for participating in our earnings call for the second quarter. This is obviously a challenging time in the public markets. Our financial picture remains strong and consistent, and we remain on track with our overall goals of reading up the current trial work in 501 shortly and in the 201 trial in the coming year. And look forward to how those outcomes will further inform our ability to control neurodegenerative diseases and other diseases that can be treated by Abl kinase inhibitors. Thank you for your attention.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.