IntelGenx Technologies Corp. (OTCQB:IGXT) Q3 2022 Earnings Conference Call November 11, 2022 8:00 PM ET
Company Participants
Stephen Kilmer – Investor Relations
Horst Zerbe – Chief Executive Officer
André Godin – President and Chief Financial Officer
Dana Matzen – Vice President-Business and Corporate Development
Frank Pietrantonio – Director of Clinical Research
Tommy Kenny – Vice President-Intellectual Property, Legal Affairs and General Counsel
Conference Call Participants
Operator
Good morning ladies and gentlemen. And welcome to the IntelGenx’s Third Quarter 2022 Financial Results Call. At this time all participants are in a listen-only mode and the floor will be open for questions and comments after the presentation.
It is now my pleasure to turn the floor over to your host, Stephen Kilmer, Investor Relations. Sir, the floor is yours.
Stephen Kilmer
Thank you. Good morning everyone, and thank you for joining us on today’s call. With me on the line are Dr. Horst Zerbe, IntelGenx’s CEO; André Godin, our President and CFO; Dr. Dana Matzen, the Company’s Vice President of Business and Corporate Development; Dr. Frank Pietrantonio, our Director of Clinical Research and Tommy Kenny, our VP, Legal Affairs and Intellectual Property and General Counsel.
Before we begin, I would like to remind you that all amounts mentioned today are in U.S. dollars, unless otherwise indicate. And today’s call may contain forward-looking information that represents our expectations as of today and, accordingly, are subject to change. We do not undertake any obligation to update any forward-looking statements, except as may be required by U.S. and Canadian securities laws. A number of assumptions were made by us in preparing these forward-looking statements, which are subject to risks, and results may differ materially. Details on these risks and assumptions can be found in our filings with the U.S. and Canadian securities commissions.
I would now like to turn over the call over to Dr. Zerbe. Horst?
Horst Zerbe
Thank you, Steve. Good morning, everyone. And thank you for joining us for the IntelGenx’s third quarter 2022 conference call.
On today’s call, I will provide a corporate update and discuss the progress we’ve made on our key pipeline projects. Then André will review our third quarter 2022 financial results. Following that we will open up the line for your questions. However, before I start with the update, I would like to again take the opportunity and apologize for the mishap that happened yesterday with our scheduled call. Apparently there was a mix up with numbers or whatever happened there. So the call couldn’t happen again. Again, management apologizes for that. So having said that, let me know move on to the projects, I started with ATAI.
In September, we shipped a clinical trial batch of our previously undisclosed candidate Buccal VLS-01 to ATAI. VLS-01 is a pharmaceutical grade psychedelic Buccal film containing a synthetic form of an N-dimethyltryptamine or DMT.ATAI is developing the product as a novel therapy for treatment resistant depression, in combination with it’s digital therapeutic, designed to provide contextual mind-set and setting support to patients prior to dosing. With an estimated 100 million people living with treatment resistant depression globally, VLS-01s potential is significant.
Last month, ATAI announced that it had a dose the first subject in its Phase 1 clinical trial of Buccal VLS-01 with top line results expected in the first half of 2023. This is the first ever in-human clinical study, evaluating an all thin film psychedelic drug candidate. We’re thrilled to have achieved this milestone in partnership with ATAI and look forward to the results of the phase 1 trial, as well as other programs that could potentially arise from this partnership.
Subsequent to quarter ends, we responded to the Complete Response Letter for 505(b)(2) NDA for RIZAFILM, normally known as RIZAPORT VersaFilm received from the FDA in March 2020.
Based on the feedback from a previous Type A meeting, we conducted additional product testing and are confident that this response provides all of the additional chemistry, manufacturing and controls information that the FDA requires. Now looking forward to their response as we continue to work to make RIZAFIM available to acute migraine patients.
Recently we met with Exeltis, our partner for RIZAPORT in Spain. They reported great feedback from prescribing doctors and patients but have been struggling with significant products of execution at the pharmacy level. They are now working on a strategy to overcome the loss in sales. And I’m sure Dana can comment on that in the Q&A section.
In addition to BD team is working on finalizing another distribution agreement for RIZAPORT for additional regions.
Comment on Tadalafil [ph] as we reported last quarter, there was a slight delay as our partner Aquestive had encountered some API related issues, or Tadalafil. However, the R&D teams from both companies work diligently and formed a task force to address the issue. We believe that we have now solved the formulation issue and are waiting for some contractual arrangements to be put in place before we can move forward with the project.
On cannabis last week, we filed a new provisional U.S. patent application that covers a newly developed platform that enables incorporation of lipophilic active ingredients, and cannabinoids such as THC, in buccal and sublingual oral film formulations of cannabis-infused products, while optimizing onset of action. The technology may also be used when more than one ingredients, such as THC and CBD, is applied in a single film product.
This filing reflects our continued progress in developing non-combustible product alternatives for both medical and recreational use cannabis markets, and we intend to file applications in additional international jurisdictions to further strengthen our patent portfolio.
We’re also making progress on the commercial side. Our partner Heritage received an additional order in September and is selling the product to the medical as well as to the recreational channels. Here, Heritage received listing on the CB4 control strips at Pharmaprix [Ph] one of the largest Canadian retail pharmacy chains.
Now a few words on oral film technology, subsequent to quarter rent, our patent portfolio was further strengthened with the issuance of a U.S. patent covering our claims for an oral filmed dosage form designed for modulating drug absorption of sublingually administered pharmaceuticals, including some cannabinoids.
This is the latest in a series of patents recently granted to IntelGenx, and is expected to remain in force at least until 2038, not including any potential patent term extensions. This patent specifically covers an all field dosage form, designed for modulating absorption profile of sublingually administered actives, and will enable the development of a wide variety of protective products designed for improved drug delivery.
Few comments on Montelukast. During the quarter [Indiscernible] studies enrollment reached the halfway point. And we launched a Facebook awareness campaign to attract more study participants and accelerate enrollment. I’m pleased to report that this campaign has been successful and as of today, we have six sides activated a total of 38 patients randomized and 22 patients have completed treatment. Another seven patients will have completed treatment by year-end.
Assuming enrollment and continuous at the current rate, we believe, we will complete enrollment by the end of 2022. Finally, comment on Chemo subsequent to quarter end we announced that our previously undisclosed development candidate, Buprenorphine Buccal Film received a PDUFA date of April 28 2023.
We partner with chemo part of the Insud Pharma Group, on the development of Buprenorphine Buccal Film in September 2016 and we co-developed the candidates and that was filed to Xiromed and is currently under review by the FDA.
Buprenorphine Buccal Film is a generic version of Belbuca an opioid that is used to manage pain severe enough to require daily around the clock long-term treatment with an opioid when other pain treatments are inadequate.
Belbuca was approved by the FDA in 2015 and is applied to the oral or buccal mucosa every 12 hours. Buprenorphine Buccal Film incorporates our VersaFilm technology in a novel formulation and is designed to be bio equivalent lower cost alternative for patients.
According to IMS Health, global annual sales of Belbuca were $315 million as of July 2022. We’re looking forward to FDA decision and assuming positive decision by the FDA. We’re looking forward to the commercialization of Buprenorphine Buccal Film as soon as possible.
Moving to animal health. As you may have seen, earlier this week, we announced a new better film feasibility and development agreement with an undisclosed animal health company, or a better film based oral film formulation, containing CBD for use in companion animals.
This marks yet another milestone in advancing or unique drug delivery technology into the animal health space. In addition, we shipped additional VetaFilm, Buccal Films for another undisclosed animal health company for an upcoming clinical trial in companion animals in the U.S.
Further, ED is in discussions with academic institutions to collaborate on the VetaFilm platform and drive innovation forward.
And with that, I would now like to turn the call over to André for a review of our financial results. André?
André Godin
Thank you, Horst. Good afternoon, everyone. As Horst mentioned, I’ll take a few minutes to discuss the company’s financial performance for the third quarter ended September 30, 2022.
First of all, I’d like to make a slight correction on Montelukast, there might have been maybe a typo [Ph] or something but the enrolment that was initially supposed to be completed by the end of the year might be extended to 2023. We will keep you updated on any further developments. But I don’t think that end of 2022 is achievable for multiple reasons, which we can explain at the Q&A.
On the third quarter, the total revenue for 2022 amounted to $142,000, down 76% from $593,000 in the same period last year. The change is mainly attributable to decreases in sales milestone revenue of $320,000 and R&D revenue of $141,000.
Operating cost and expenses were $2.5 million for Q3 2022 versus $2.2 million for the corresponding the three-month period of 2021. For Q3 2022, the Company added an operating loss of $2.4 million, compared to an operating loss of $1.6 million for the comparable period of 2021.
Adjusted EBITDA was negative $2.2 million for Q3 2022 compared to $1.4 million for the same period last year. Our net comprehensive loss was $3 million or $0.02 on a basic, and diluted per share basis for Q3 2022 compared to a net comprehensive loss of $2.2 million, or $0.01 per share for comparable period is 2021.
It is also important to note that during Q3 2022, operating expenses, operating loss as well as EBITDA loss have been impacted by a non-cash expense related to the i-devaluation of the Canadian dollar versus the U.S. currency.
Without this extraordinary expense, the operating expense would have been approximately $200,000 less than Q3 of 2021.
I will now turn the call back to Dr. Zerbe. Horst?
Horst Zerbe
Thanks, André. In closing, I’d like to once again recognize our team for executing on our long-term strategy. And with that, I will now turn the call over for questions. I’d like to remind you that our forward-looking statements apply to both our prepared remarks and to following Q&A. Thank you.
Question-and-Answer Session
Operator
Horst Zerbe
Thanks, operator. So this concludes our Q3 2022 Investor update call. I would once again like to thank the entire IntelGenx team for its hard work and dedication, our board of directors for their continued support of the management team, and finally our investors for continuing to believe in and supporting us. Thank you and goodbye.
Operator
Thank you ladies and gentlemen. This does conclude today’s conference call. You may disconnect your lines at this time and have a wonderful day. And we thank you for your participation.
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