Tricida, Inc. (TCDA) CEO Gerrit Klaerner on Q4 2021 Results – Earnings Call Transcript

Tricida, Inc. (NASDAQ:TCDA) Q4 2021 Earnings Conference Call March 29, 2022 4:30 PM ET

Company Participants

Jackie Cossmon – SVP, IR and Communications

Gerrit Klaerner – Founder, CEO and President

Geoff Parker – COO and CFO

Conference Call Participants

Jessica Fye – JPMorgan

Phil Nadeau – Cowen

Operator

Good day and thank you for standing by. Welcome to Tricida’s Fourth Quarter 2021 Financial Results Conference Call. [Operator Instructions]

I would now like to hand the conference over to Jackie Cossmon with Tricida. Please begin.

Jackie Cossmon

Thank you, Norma. Good afternoon and thank you for joining the Tricida’s fourth quarter 2021 financial results and business update conference call. In today’s call Gerrit Klaerner our Founder, CEO and President will provide an update on our ongoing VALOR-CKD renal outcomes trial and discuss our business progress. Geoff Parker, our COO and CFO will discuss our financial results for the fourth quarter and review our financial guidance.

Please note that in today’s call, we will be making forward-looking statements, various statements that include forward-looking statements as defined under applicable securities laws. Forward-looking statements include our anticipated activities related to our ongoing VALOR-CKD renal outcomes clinical trial, including early termination of the trial and the estimated timing for receipt of top line data and our expectations regarding our financial runway. Management’s assumptions, expectations and opinions reflected in these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from any future results, performance or achievements discussed in or implied by such forward-looking statements.

Tricida can give no assurance that these statements will prove to be correct and we do not intend and undertake no duty to update these statements. We also urge you to read the risks and uncertainties associated with our business that are described in our filings with the Securities and Exchange Commission. We issued our fourth quarter and year-end financial results press release this afternoon, just after the close of market. For copies of our press release, please go to www.tricida.com and follow the link to our Investor Relations page.

At this time, I’d like to turn the call over to Gerrit.

Gerrit Klaerner

Thank you, Jackie, and thank you all for joining us today.

We’re making good progress on the execution of volatility against the backdrop of pandemic and a war. We have managed to remain on track with our projections for primary endpoint events in the VALOR-CKD trial. Enrollment was completed at the end of 2021 with 1,480 subjects randomized.

As of March 28, randomized subjects had an average treatment duration of approximately 24 months. The trial had accrued 217 subjects with positively adjudicated primary endpoint events, defined as renal death, end-stage renal disease, or greater than or equal to 40% reduction in estimated glomerular filtration rate.

As we previously reported, based on our financial runway we intend to stop the VALOR-CKD trial early for administrative reasons in the second quarter of 2022. We continue to accrue our primary endpoint events into the third quarter. We anticipate reporting topline results from the VALOR-CKD trial early in the fourth quarter of 2022, which would allow for approximately six months of financial runway, following the announcement.

We continue to believe that the VALOR-CKD trial will provide interpretable data to evaluate how treatment with veverimer impacts slowing of CKD progression in patients with metabolic acidosis and CKD. Our calculations show approximately 80% power assuming a hazard ratio of 0.70 and given the results from prior lecture, we believe that even with a fewer number of primary endpoint events than originally contemplated, we have a chance to reach our main trial objectives.

With that, I’ll turn the presentation to Geoff for an overview of our financial results for the quarter.

Geoff Parker

Thanks, Gerrit, and thank you all for joining us today.

Our fourth quarter results were in line with our expectations with R&D expense of $36.8 million and $27.3 million for the three months ended December 31, 2021 and 2020 respectively. The increase in R&D expense was primarily due to increased activities in connection with our Veverimer development program, related to manufacturing process optimization and the manufacturing of drug substance. G&A expense was $9.1 million and $21.8 million for the three months ended December 31, 2021 and 2020 respectively.

The decrease in G&A expense was primarily due to restructuring costs incurred in 2020 and to decrease administrative activities including reduced pre-commercialization and medical affair activities in 2021.

Net loss was $50 million and $54.8 million and non-GAAP net loss was $41.1 million and $37.4 million for the three months ended December 31, 2021 and 2020 respectively. As of December 31, 2021, cash, cash equivalents and investments were $150.6 million. We believe our current financial resources will fund our planned operations into early in the second quarter of 2023, which is anticipated to be approximately six months from the announcement of top line results for VALOR-CKD.

With that I will turn the call over to the operator for questions. Operator?

Question-and-Answer Session

Operator

[Operator Instructions] Our first question comes from Serge Belanger from Needham and Company. Your line is open. Serge, your line is now open.

Our next question comes from Jessica Fye. Your line is now open.

Jessica Fye

Good afternoon and thanks for taking my question. Can you just recap the number of events you expect to have when you conduct the administrative stop and when you expect that to occur?

Gerrit Klaerner

Yes, Jessica, this is Gerrit. I think, obviously, the administrative stop is tend by cash balances and not by a particular number of events. And given our cash balance and I think we expect to accrue approximately 240, 250 events, with 217 we’re pretty close. We’ve been, I think accruing on average over the last 15 months between 10 to 11 events and we expect to accrue into the third quarter. So we feel pretty good about our ability to reach that number of approximately 240 to 250 patients with primary endpoint events.

Operator

Thank you. Our next question comes from Serge Belanger with Needham & Company. Your line is now open. Serge, are you there?

Our next question comes from Phil Nadeau with Cowen. Your line is now open.

Phil Nadeau

Good afternoon. Thanks for taking questions. Just a few from us. First on the situation in Eastern Europe. I think when we talked last, you were assuming that no more events are going to be accrued from the Ukraine through the unfortunate war there. What is the most recent update? Have those events in fact stop accruing from Ukraine or are you actually still seeing some patients go to the clinic?

Gerrit Klaerner

We, I think in our projections, we are not counting on any additional event from Ukraine. I think as you said, it’s a very unfortunate situation. It’s a very serious situation and we – I think sort of we see bravery from the Ukrainian people across the board. We do have some patients actually showing up for study visits. I don’t think we have accrued any additional events and that’s a longer process. And again we don’t rely on any event from Ukraine. That will be pure upside and we – I think we’re comfortable with the 240 to 250, 255 number without any events coming from Ukraine, so.

Phil Nadeau

That’s very helpful. What about the neighboring countries such as Poland, any disruptions due to the refugee crisis or any other issues in those countries?

Gerrit Klaerner

We haven’t seen any impact and we would hope that NATO wouldn’t get involved, because then we have a bigger problem. We know that at hand, but again, I think so far we’ve seen the disruption really limited to Ukraine.

Phil Nadeau

Perfect. Second question is on, I guess, the process of the administrative stop. I think you said in your prepared remarks you’re going to stop the study in Q2, but continue to accrue events through Q3 with the data in Q4. So I guess technically, what does the stop mean and how do you continue to accrue events post stopping the study?

Gerrit Klaerner

I think that the study stop – we would basically asked sides to have the patients come in for a final study visit and obviously during those visits, the patients can have either confirmatory event or additional index events. And I think the way we restructured it is that shortly before the database lock, we would still allow for those visits to happen. And for those events to be confirmed to maximize really demand of follow up that we’re getting from this study. And so we – I think it’s pretty common practice, even under normal wind down, that sort of up to a month or two before database lock you, you do basically accrual events and collect data.

Phil Nadeau

Perfect. Third question is on the true hazard ratio. In your prepared remarks, you mentioned 80% power to detect hazard ratio of 0.7. Curious to get your updated thoughts if there are any? And what you think that true hazard ratio is based on the academic literature and your own experiences? 0.7 approximately, where you think it’s likely to fall out or is there a chance it could be even lower?

Gerrit Klaerner

Yes, I think some of the academic studies, those were obviously single center trials that were not necessarily double blind or randomized in all cases. They showed hazard ratios that were significantly smaller and as we said we would not rely on that. So we are quite comfortable with 0.7 and I think it could be lower than that, but from a statistical perspective that’s I think an important threshold. Also from a clinical significance perspective, I think this is the right threshold and so we still are very confident that, that’s the bar we can reach.

Phil Nadeau

Perfect. And last maybe – sorry, last question from us is on the FDA filing process. Once you have the data, should there be positive, how long would it take you to put together a filing in? Are there additional conversations, you’d have to have with the FDA in order to be able to file?

Gerrit Klaerner

Yes, I think we are – we continue to look at that and obviously the clearer and the more positive the data, I think the less need to delay the submission. And as part of the submission, obviously there is a pre NDA submission meeting that has more of mechanical, but so I think sort of the clearer the results, the more we’re going to run to us resubmission.

Operator

[Operator Instructions] And I’m currently showing no further questions at this time. I’d like to hand the conference back over to Jackie Cossmon for closing comments.

Jackie Cossmon

Thank you, Norma, and thank you all for joining us today. As always if you have additional questions, don’t hesitate to email us at ir@tricida.com. Thank you and goodbye.

Operator

Ladies and gentlemen, thank you for your participation in today’s conference. You may now disconnect. Everyone have a wonderful day.

Be the first to comment

Leave a Reply

Your email address will not be published.


*