Yahoo Finance X4 Pharmaceuticals, Inc. (NASDAQ:XFOR) Q1 2024 Earnings Call Transcript
X4 Pharmaceuticals, Inc. (NASDAQ:XFOR) Q1 2024 Earnings Call Transcript May 7, 2024
X4 Pharmaceuticals, Inc. misses on earnings expectations. Reported EPS is $-0.25884 EPS, expectations were $-0.17. X4 Pharmaceuticals, Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: [Indiscernible] X4 Pharmaceuticals First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It's now my pleasure to introduce your host, Mr. Dan Ferry from LifeSci Advisors. Thank you, Mr. Ferry. You may begin.
Dan Ferry : Thank you, operator, and good morning everyone. Thank you for joining us today. Presenting on today’s call will be Dr. Paula Ragan; X4’s President and Chief Executive Officer, and company’s Chief Financial Officer, Adam Mostafa. Following prepared remarks, we will open the call to your questions and we’ll be joined by Chief Commercial Officer, Mark Baldry; Chief Medical Officer, Dr. Christophe Arbet-Engels; Chief Operating Officer, Mary DiBiase; and Chief Scientific Officer, Art Taveras; and Jose Juves. Head of Corporate & Patient Affairs As a reminder, on today’s call, the company will be making forward-looking statements regarding regulatory and product development and commercialization plans, as well as research activities.
These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. Description of these risks can be found in X4’s most recent filings with the SEC, including this year’s Form 10-K, which was filed on March 21, 2024, and in the company's Form 10-Q, which is expected to be filed later today. I'll now turn it over to Paula Ragan. Paula?
Paula Ragan : Thanks so much, Dan, and welcome everyone. Following last week's approval of XOLREMDI, it's exciting to reiterate today why this critical regulatory achievement represents a significant opportunity to improve the lives of WHIM patients and offers a strong platform for the company's growth. More specifically, I'll touch on our plans for expanding XOLREMDI's use in WHIM geographically and for quickly advancing into a potential larger indication chronic neutropenia. But let's start with last Monday's transformative announcement. As you know, XOLREMDI or Mavorixafor is now approved by the FDA for use in the US in patients 12 years of age and older with WHIM syndrome to increase the number of circulating mature neutrophils and lymphocytes.
WHIM syndrome is an ultra-rare disease caused by dysfunction of the CXCR4 receptor, which helps regulate the movement of white blood cells, including neutrophils and lymphocytes throughout the body. People with WHIM syndrome characteristically have low blood levels of neutrophils, neutropenia, and lymphocytes, lymphopenia and experienced serious and or frequent inflections that cause significant morbidities. In our Pivotal Phase 3 clinical trial that supported our approval, XOLREMDI and Oral Selective CXCR4 antagonist improved absolute neutrophil counts and lymphocyte counts ANC and ALC, and reduced the rate, duration and severity of infections in those treated versus placebo. This was the largest clinical trial to date in WHIM syndrome and enrolling 31 patients.
We'd like to note that the full manuscript of these clinical results were recently published online in blood, the Journal of the American Society of Hematology or ASH, and that results from this trial and its Open Label Extension phase or OLE were just presented last week at the annual meeting of the Clinical Immunology Society, or CIS. Notably, the CIS poster revealed that long-term treatment with XOLREMDI was associated with durable improvements in neutrophil and lymphocyte counts, as well as reductions in annualized infection rate. And that to date, no new safety signals have been observed during the OLE phase of the trial. As with most ultra-rare diseases, it can be challenging to assess the true patient prevalence as awareness is often low and patients are frequently under or misdiagnosed.
And since we didn't cover this in detail last week, we thought it might be useful to remind everyone of the market size estimates that we've shared on the US WHIM market over the past several years. Since 2019, we've completed several robust market research studies using both qualitative and quantitative analyses to not only support our prevalence estimates, but to also better understand the WHIM diagnostic journey and treatment paradigm. Across a number of methodologies, including direct market research and claims-based research, we continue to validate our current estimates, and through our growing number of conversations with physicians in the field and at medical conferences, we remain very confident in our estimate that there are at least 1000 confirmed diagnosed WHIM patients today in the US.
And now with a targeted therapy available, we expect that increased physician awareness will bring more and more focus to the WHIM community, enabling earlier recognition and diagnosis, potentially expanding the number of those diagnosed with WHIM over time. And as our Chief Commercial Officer, Mark Baldry, as we put it last week, it is well established that earlier and definitive diagnosis leads to better patient outcomes, and that is ultimately our goal for the WHIM community. We believe we are well positioned to not only deliver on the commercial opportunity in WHIM syndrome, but to also advance our global regulatory submissions, but the goal of potentially providing new options to patients across the world. Our European submission preparation in WHIM are underway and we anticipate submitting a marketing authorization application or MAA for potential European approval in late 2024 or early 2025.
Importantly, we'd like to review our development plans and upcoming milestones for Mavorixafor beyond WHIM and to define what success might look like as we explore the use of Mavorixafor in the treatment of chronic neutropenia or CN. To help understand the benchmark for success, I'd first like to start with what we've seen in WHIM syndrome. As I mentioned, our WHIM Phase 3 trial data were recently published in the peer reviewed journal, Blood. Specifically, WHIM patients were severely neutropenic at baseline with a mean ANC of less than 250 cells per microliter. Patients on Mavorixafor achieved increases of about 500 cells per microliter reaching ANC levels of about 800 cells per microliter on average over the 52 week trial. This increased neutrophil count of approximately 500 to 600 cells per microliter, corresponded with a 60% reduction in infection frequency versus placebo, as well as reduced severity and duration of infection.
Additionally, the benchmark of increasing ANC by at least 500 cells per microliter aligns well with what our CN physician experts describe as clinically meaningful. An increase of 500 cells per microliter was also the metric for success in our previously published CN Phase 1b study and has been published on by the NIH and others across various neutropenia conditions. I note this here because these results help inform our assessments of success for the ongoing Phase 2 clinical trial data in CN and our enthusiasm for advancing into the CN Phase 3 study in the first half of 2024. As with WHIM patients, chronic neutropenia patients phase an increased risk of infection every single day. This risk is greatest when they're severely neutropenic or with an ANC below 500.
Increasing ANC from less than 500 to between 501,000 cells per microliter correlates with a meaningful reduction in infection risk from severe to moderate. Increasing ANC to between 1000 and 1500 correlates with a risk reduction from moderate to mild, and increasing ANC above 1500 moves a patient into a normal infection risk category. Additionally, based on our market research, we believe that physicians prescribing injectable Granulocyte Colony Stimulating Factor or GCSF, currently the only therapy approved to treat severe chronic neutropenia generally target ANC levels between 1000 and 1500. With enrollment now complete in our Phase 2 trial, we'll have studied more than 20 CN patients, approximately 40% of whom have been treated with Mavorixafor monotherapy, and the remainder with a combination of Mavorixafor and GCSF.
We are currently planning an Investor Event in late June to present interim results from at least 15 participants in this study, which we participate will include data from those treated with Mavorixafor as a monotherapy, and those also treated with combination with GCSF. We'll be looking at increases in ANC while in treatment with Mavorixafor as well as the durability of increased ANC with time on treatment in those subjects with stable background therapy. The complete data set of the CN Phase 2 study is expected later this year, and we're aiming to present final results hopefully at a major medical conference at that time. More details on our planned investor event in June will be forthcoming and we look forward to further defining the potential of Mavorixafor in the first immune disorder beyond WHIM.
In the meantime, we remain on track to initiate our Phase 3 CN trial this quarter. This will be a pivotal global Phase 3 trial to evaluate the efficacy, safety, and tolerability of oral once daily, Mavorixafor with or without GCSF and people with congenital or acquired primary autoimmune and idiopathic chronic neutropenia who are experiencing recurrence and or serious infections. We plan to enroll approximately 150 participants in the trial, which will be a 52 week double-blinded placebo controlled trial with one-to-one randomization. The primary endpoint will be a two components endpoint comprised of both the annualized inspection rates and ANC responder analysis across the study population. Secondary endpoints will include the severity and duration of infections, antibiotic use, and quality of life measurements among others.
We continue to believe that there is a significant unmet need across the Phase 3 patient population, a market we estimate to represent approximately 15,000 people in the US alone who in many cases are being seen by the same practitioners who are also seeing those diagnosed with WHIM syndrome. With that, I'll now turn it over to our CFO, Adam Mostafa review the first quarter financials. Adam?
Adam Mostafa : Thanks Paula, and thanks to all of you for being on the call with us today. At the end of the first quarter, ended March 31st, 2024, X4 had $81.6 million in cash, cash equivalence, restricted cash, and marketable securities. We believe that these funds are sufficient to support company operations into 2025, and note that this runway estimate does not include the potential monetization of the priority review voucher we received as a result of the FDA's approval of XOLREMDI in the US. Our research and development expenses were $19.9 million for the first quarter, which compares to $22.1 million for the comparable period in 2023. R&D Expenses for the first quarter included $0.8 million of certain non-cash expenses.
Our selling, general and administrative expenses were $17.4 million for the first quarter as compared to $7.2 million for the comparable period in 2023. SG&A expenses included $1 million of certain non-cash expenses for the quarter. We would like to note several factors affecting our expenses this quarter. These expenses reflect the hiring of an experienced field force now in place to drive the launch of XOLREMDI in the US and launch preparation activities across our commercial and medical organizations. Lastly, we reported a net loss of $51.8 million for the first quarter of 2024 as compared to $24 million for the comparable period in 2023. Net losses in the current period include a non-cash loss of $13.8 million related to the company's Class C warrant liability, which is adjusted to fair value each reporting period.
Net losses also included $1.7 million of stock-based compensation expense. And with that, why don't we open up the call for your questions. Operator?
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