Guard Therapeutics International AB (publ) (GUARD) Earnings Call Transcript & Summary

Welcome to today's broadcast of Guard Therapeutics. We will begin the presentation here. [Operator Instructions] And with that said, I'll leave it over to you guys.

Thank you so much. And good afternoon, everybody, and welcome to this web conference. We host this web conference because of the press release that was announced this weekend, addressing the top line results of our Phase IIb dose-finding study called the POINTER study. So the purpose of today is to address the main findings of the study, and of course, the implications of some of these study results. So with me today, I have our Chief Medical Officer, Michael Reusch, I also have our Chief Financial Officer, Karin Botha. So again, thank you so much for taking the time to be here and listen, and let's get started. So I'll get over to Michael to start digging into the data.

Thanks, Tobias. Before making you familiar with the main study results, just a short reminder on the study background and the rationale for the study. Where the setting we are studying is open heart surgery patients who are of elevated risk for acute kidney injury, a population very similar to the previously designed AKITA study. The intervention we are looking at is recombinant human alpha-1-microglobulin known as RMC-035. Again, the same formulation as used in the previous AKITA study. The design of the POINTER study and the concept of the POINTER study was based upon evidence of efficacy seen in the AKITA study where we showed improved kidney function in terms of estimated glomerular filtration rate, eGFR, and also reduction of severe kidney injury expressed as major adverse kidney events, MAKE. Also, postop findings showed that biomarker data were consistent with the key efficacy results. Based upon these findings -- encouraging findings, we designed the POINTER study with the following objectives: number one, to confirm the beneficial effects seen in the AKITA study; and secondly, identify the optimal RMC dose to be carried forward for future Phase III development. Key endpoints in the POINTER study where the estimated change for baseline in eGFR -- estimated eGFR change from baseline, which is an endpoint directly linked to chronic kidney disease progression as well as end-stage renal disease. Also in interaction with the FDA, this Phase IIb endpoint was considered as an appropriate dose finding end point. We also studied a secondary endpoints, the occurrence of MAKE90 events. So those MAKE events occurring at day 90. This is the anticipated regulatory endpoint for approval by the FDA, and it represents a significant loss of kidney function, death and nephrorenal replacement therapy. The POINTER study design was very similar to the AKITA study design. Patients were randomized to 3 different dose arms. 30 milligram, 60 milligram of RMC and placebo. And we used 2 to 3 randomization scheme ending up in a number of treated patients as shown here, 47, 50 and 73 in the corresponding treatment groups. The dosing was given as 3 dose -- 3 infusions, 1 prior to surgery, the other one, 6 hours and the third one, 24 hours after the first dose. Patients were followed up after the hospital period at day 60 and day 90 for the primary endpoints as well as for the key secondary endpoint, again, eGFR and MAKE. Out of the 170 patients treated, 76 were treated and cared for in the European Union and 24% were recruited in Canada. And now the key efficacy and safety results. While I explained this, we are having only those key top line results in hand, full analysis data sets are expected to come later in 2 weeks' time. And what we see on the key top line results is that: number one, in terms of eGFR change from baseline, this primary endpoint was not met. We saw a net change versus placebo of minus 2.76 milliliters per minute, which was not statistically significant. Also, if we looked in this single doses 30 milligram -- 30 and 60 milligram, no statistically significant improvement was seen with any dose. Clearly, these findings in eGFR change from baseline are inconsistent with what we had previously observed in AKITA. Also from MAKE90, there is no significant benefits seen. We have seen a relative risk of 0.89, which is not statistically significant, numerically favoring RMC-035. However, also here, no statistically significant improvement was seen with any dose. Particularly the findings for the eGFR decline component of more than 25% decline were inconsistent with the AKITA results where it was the main driver of the MAKE outcomes in AKITA here in POINTER, this is not the case. The safety profile is nothing remarkable. It's reflective of the underlying condition and no safety concerns were identified at this stage. Allow me a couple of comments on the dose considerations because from the questions raised upfront, we learned a lot that those were circulating around whether we have met the right dose or exposure. And I think my message here clearly is the exposure we have observed in the POINTER study is clearly aligned with the target levels which we had looked for when designing the study. This means the 60-milligram dose achieved levels of RMC-035 in the blood comparable to the lower and most efficacious dose in the AKITA study. Also, the 30-milligram dose was associated with numerically better efficacy outcomes than 30 and 60 milligrams. In terms of the dosing frequency, based upon the preclinical findings presurgery and the 6-hour doses are the most critical doses critical for efficacy. And that's where POINTER and AKITA are aligned. We -- when designing POINTER, we removed the 48-hour dose compared to the AKITA study, in order to optimize the safety ahead of Phase III. The reason being that we wanted to have a dosing, which is associated with a clean safety profile in POINTER, and that necessitated the removal of the 48-hour dose. So if you look at dose and exposure considerations, our conclusion at this stage is that the exposure observed in POINTER is consistent with target levels and with a safe AKITA exposure. We also think that the removal of the 48-hour dose is unlikely, but cannot be fully excluded as a contributor to the efficacy outcomes and the study failure. However, I have to emphasize again, from a clinical point of view, the 48-hour dose was associated with an unacceptable safety risk in AKITA and therefore, could not be advanced for future or potential Phase III study. And that's why we moved it in the POINTER study. In summary, basically, what we have to convey today is that eGFR MAKE90 do not carry any benefits in the POINTER study, which is in contrast to the AKITA findings. Also the preliminary data with further analysis ongoing tell us that we have a full data set review to be done in the coming weeks. We will look into pharmacokinetic and pharmacodynamic relationship relating basically exposure to efficacy and look at the effect of potential confounding factors on the study results. However, even if we take these all into considerations, these uncertainties, our interpretation at this stage is the findings are not expected to change materially with the full analysis, which brings us to a situation where we have 2 clinical studies with conflicting outcomes, which carries elevated risk for further development if we think about it. So that's why we think, at this stage, RMC-035 development in heart surgery is likely to be discontinued. However, we will -- in the coming weeks, we will assess the strategic value of both the RMC-035 range as well as the GTX platform for further potential implications and then get back to you. I'm sorry that I have no better news for you today. You all saw it from the press release, and I'm now happy to take questions and try to address them as much as possible.

Thank you so much for the presentation here. [Operator Instructions] And the first caller here that we will give the word is Filip Lindkvist from Redeye.

You mentioned the removal of the 48-hour dose may partly explain the negative outcome in the POINTER study? But besides how do you explain that AKITA can deliver such strong data? Was it maybe that AKITA reflects a chance finding or maybe a combination of the two.

At this stage, I'm not in a position, unfortunately, to deliver the full explanation why there is such a difference between those two studies and whether -- which of the confounding factors or any other implicating factors is driving those results. And I think that's all I can say at this stage. We are looking, as I told you, in several perspectives at the data. But at this stage, it's too premature to make any conclusions.

Okay. Do you have any reason to believe that there may have been any deviations or irregularities during the POINTER trial, such as issues with the vial handling, labeling or administration.

We have investigated this and we have no indication that this would be a systematic cause of error here in the study.

And how does the POINTER results change your outlook when it comes to the preclinical GTX platform?

I think with regard to the mechanism of action, we still believe that the mechanism of action is valid based upon the preclinical findings and are also supported by the clinical results from the AKITA study. So there is no reason for us at this stage to review the validity of this mechanism.

And maybe to just add to that question, obviously, as discussed in the press release that now we look strategically review both RMC data, the full data package coming through and also GTX platform, but I think the wealth of the preclinical data we have to support this program, both in the acute as well as in the chronic setting, and I think also the purpose of the GTX peptides being delivered in a completely different setting, in a non-acute setting. So at this point, we're not in a position to dismiss that or consider this not to be a validated target. But of course, this will be subject to strategic review in the coming weeks. And obviously, once we have a more clear view of how to proceed with either RMC or the GTX peptides, we will, of course, communicate that to the market.

Yes. And I'm sure you will await all the complete data before making a decision on the future, but if you find nothing, maybe the next step could be a delisting and distributing remaining cash to shareholders or a reverse takeover. Even if this ultimately is a question for the Board, can you share your view on this?

No, I think it's really too early because as pointed out here, we think we have a very sort of solid background package before going into the POINTER. I think we're all very surprised and of course, this is not really -- the results are not in line what we expected and hoped for. And I think we really need to make a more thorough assessment of the results that we have before we can actually comment on the next step. As I said, I think it's too early to really speculate about delisting and reverse merger and things like that. That will really come once we have made a more scientific and scientifically based assessments of the totality of the data that we have, both for RMC-035 and as well as for the GTX platform.

That's clear. And a final one for me. If you could elaborate on the cash position and your cost expectations for Q3 and Q4. Will, for example, some study costs go over into Q4?

Yes. So briefly, we haven't yet published the Q3 report by the last -- the Q2 report, we have about SEK 100 million cash. Obviously, we will have some spillover in terms of study cost that goes into the Q3, but we still expect to have a relatively solid cash position also when the POINTER study is being fully paid off. And of course, now since we're actually immediately halting a lot of the ongoing work streams towards the Phase III start and I think the Phase III planning, that also brings us essentially to have a cash runway, which extends throughout the next year in 2026. So I think strategically, this gives the option of really making a thorough assessment, I think, both from a scientific standpoint and of course, in terms of preserving shareholder values. And I think that's exactly the conversation we will have now in the coming weeks.

And earlier, you expected cash to reach summer 2026. Do you expect to extend that period?

Yes.

Yes. So as indicated, we are now comfortable to say that, that can be extended. Since we have a very small team in principle, and we have very low running costs when we're not executing clinical studies. Obviously, there are high CMC costs, which are attached to development work and also manufacturing of clinical trial materials. All those work streams will now be paused, which of course, brings additional cash and extends the runway comfortably into the end of next year.

And we will now carry on the next caller here. It's a cell phone number that ends with 858. Please, you have the word.

Maria here from DNB Carnegie. A lot of good questions before, so I'll keep it short, the strategic review that you have talked about, can you tell us anything about the timeline of that? How long time do you think it will take? And which alternatives are you considering? If you can give us a bit more detail on that.

Yes. So obviously, this is not something we expect to finish in a year's time. So obviously, we fully understand that this is something which needs to be accelerated and executed as quickly as possible. But I think as Michael alluded to, the full data package from the POINTER study will come in, in approximately 2 weeks. So of course, we have a couple of weeks before we'd have the full insights in what happened in the POINTER study. Then we, of course, need some additional time to work through that material. We need to do a lot of the analysis, as pointed out by Michael, the PK/PD modeling being one of those efforts. So I think realistically, we need at least 1 or 2 months to make a thorough assessment and look at all the possible sort of angles from this and make a decision on the path forward. If that can be expedited, we're happy to do so, and we will communicate as soon as we know more. But I think that gives you a reasonable ballpark on how we think right now. And in terms of options, I think we commented on that already. But I think from now it is -- we need to first understand the data. We need more assessment of the totality of the data for both RMC as well as the GTX platform. Then I think we can discuss the more conservative options in terms of just looking at reverse mergers and other solutions for the company going forward.