Moberg Pharma AB (publ) (MOB) Earnings Call Transcript & Summary

Hello, and welcome to the Moberg Pharma Press Conference. [Operator Instructions] And just to remind you, this conference call is being recorded. Today, I'm pleased to present Anna Ljung. Please go ahead with your meeting.

Thank you. Hello. My name is Anna Ljung, and I'm the CEO of Moberg Pharma. I also have our Executive Chairman, Peter Wolpert; and our Chief Scientific Officer, Amir Tavakkol, with me here today. We're happy to present the press release sent out this morning that you can find on our website. There, you can also find a Powerpoint presentation for this call, and I'll start from that presentation. And from the Powerpoint presentation, I'll start on Page 3. We have now completed the expert evaluation of the results from the North American Phase III study. The analysis has confirmed the validity of the top line data presented in December. Further, there are 3 key conclusions. First, MOB-015 delivers a very high mycological cure rate that compares favorable to oral antifungal drugs with the added advantage of an earlier onset of action. Second, confirmation that the vehicle technology increases the hydration of the nail plate, which enables efficient terbinafine delivery, but it also confounds the assessment of clinical cure and complete cure. And a likely solution to that problem, a shorter dosing regimen with the potential to deliver superior complete cure rates. On Page 4, you will find the study outline. In both studies, there is 48 weeks of daily treatment, followed by a short 4 weeks washout period. And all patients had at least one great toenail that was affected between 20% to 60%. And the primary endpoint there was complete cure. The setup in the ongoing European study is similar to the North America study. The only difference between the 2 studies is that instead of being vehicle-controlled in EU, MOB-015 is compared head-to-head against ciclopirox, the most widely used topical treatment. We presented top line data for the North American study in December and expect top line data in EU during the second quarter of this year. On Page 5, the primary endpoint, complete cure, is a combination of mycological cure and clinical cure. Mycological cure is an objective measurement, composed of 2 laboratory results: fungal culture, where the nurse takes nail trimmings which are sent to central laboratory for analysis. If fungus cannot be cultured from the sample, then a negative fungal culture is achieved. And the second measurement, microscopy, if no fungal elements can be seen in the microscope. Clinical cure is a subjective measure where an experienced physician at each clinic performs a visual assessment on how much of the nail is affected by onychomycosis. No signs of infection and no discoloration should be visible on the nail to achieve complete cure. Slide 6 summarizes key endpoints and provides some overview also for current therapies. The fact that MOB-015 at 52 weeks achieved mycological cure in 70% of the patients is exceptional. The outcome of the study is surprising since the high mycological cure normally over time is followed by complete cure. Looking at data from our competitors, mycological cure rates even at 50% range have [ 6 days less ] to complete cure rates of around 15%. While mycological cure rates in the 30% range resulted in complete cure rate of 6% to 8%. Finally, we have oral terbinafine, the current gold standard for treatment of onychomycosis, with mycological cure of 70% and complete cure of 38%. This is the same substance that we use topically, and we also get 70% mycological cure. Furthermore, the onset of advanced antifungal effect is more rapid than for oral terbinafine, with MOB-015 delivering 55% mycological cure at 6 months versus 40% for oral terbinafine and 37% already at 3 months, versus 15% for oral terbinafine. The fast turnaround is expected since we are applying terbinafine directly on the nail. This has also then additional advantage of avoiding the systemic side effects of oral treatment. Moving to Slide 7. In Phase II, we show that treatment in MOB-015, already at 6 months resulted in 1000x higher amounts of terbinafine in the nail plate and 40x higher amounts in the nail bed compared to oral terbinafine treatment. We conclude that we get high amounts of terbinafine to the nail plate and nail bed where it is needed, it's obvious that [indiscernible], as demonstrated by the mycological cure rates, that there must be something else happening as well. On Slide 8, after analyzing the photos and the data, the company experts and key opinion leaders found that the vehicle enables delivery of high amounts of terbinafine to the nail plate and to the nail bed. However, the hydrating properties of the vehicle also caused whitening and discoloration in nails. This phenomenon can be seen in a majority of the nails, but this is transient as the water content normalizes after end of treatment. This whitening makes the assessment of clinical cure challenging since the physicians cannot distinguish between a nail that is discolored due to nail fungus or a nail that looks whitish due to the high water content in the nail. Moving on to Slide 9. Based on all available data, the company experts and key opinion leaders have identified the solution: a shorter treatment time has the potential to increase complete cure rates. This is based on the high mycological cure of 70% and early onset for oral terbinafine is 40x time higher terbinafine levels that we see in the nail bed than compared to oral terbinafine. We know the 3-month treatment with oral terbinafine is the standard treatment, and this is effective. Reduction of the hydrating effect after initial treatment phase and thus reducing the impacts of clinical cure assessment at week 52. The experts concluded that once-daily treatment for not more than 3 months followed by maintenance treatment once-weekly is preferred. This should provide sufficiently high concentrations of terbinafine in the nail and nail bed and the nail normalization of the water content in the nail during the maintenance treatment period. And from a patient perspective, shorter treatment period is highly attractive. Since the North American trial met its primary endpoint without safety concerns and provided that the EU study also provides positive results, these studies could form a basis to register the product. The timing to optimize the dosing regimen will be dependent on the outcome of the EU trial. On Slide 10, these key opinion leaders all have decades of experience with terbinafine and the key ingredients in MOB-015. They're all very excited about the high mycological cure rates and fully support a shorter treatment regimen that it has the potential to achieve attractive complete cure rates. They also stressed that such a shorter dosing regimen will be highly preferred by their patients. Newest market data also indicates that real-life usage of current topicals is, on average, 3 to 4 months despite being labeled for 48 weeks daily treatment. This [indiscernible] holds detailed analysis of the key opinion leaders that enabled us to find an objective solution. To conclude the presentation, we may need to navigate some hurdles. But the latest trial also provides us evidence supporting high potential on MOB-015. We look forward to receiving data from the new trial in the second quarter, and we remain fully committed to creating the future market leader in onychomycosis. The exceptional ability to cure the fungus with an early onset and the prospects of a shorter treatment plan are very exciting. I'll stop there. And I'm happy to open up for questions.

[Operator Instructions] And our first question comes from the line of Klas Palin of Redeye.

Thank you, Anna. With this deeper understanding of the data from the U.S. Phase III trial, it would be interesting to hear a comment what you think you can say about what MOB-015 could be able to show superiority compared to ciclopirox in the European study. And my next question is, if you would be willing to start to get an approval for MOB-015 in the U.S., even if it's not showing superiority in the European study.

Thank you, Klas. If I start out by -- with a question on the expectation of the outcoming EU study. I think we expect the high mycological cure rate, but we also expect this hydration effect to affect the EU study as well. There may always be differences between trials. And for ciclopirox, we also know that the complete cure has ranged between trials from 3% up to 8%. And the lower cure rates were in the trials where frequent debridement was used -- sorry, were not used similar to our trial. So I think all outcomes are possible in this study. Superiority, noninferiority and not meeting any of those. And positive results could provide a basis for registration. Otherwise, a new study will be required.

Anna, would you like me to take the second question regarding the U.S. approval?

Yes, please do.

Okay. So this is Peter Wolpert, Chairman of Moberg. We know that the FDA will require 2 studies as primary endpoints of the North American study that could form a basis for this study. And I think the situation is a little bit new. No trial before has shown this very high mycological cure rates. But we know that FDA is looking to complete cure rates at the primary endpoint. So I think if we get superiority in the European trial that would provide the basis for the total dose share in the U.S. If we don't get superiority, but I think it really depends on the outcome, and we need to have a discussion with the FDA. So if we show, for example, very good treatment success, very high mycological cure rates but noninferiority on the complete cure rate, I think that is a situation where we need to discuss with the agency and we can't assume that we get approval without an additional study being performed.

Our next question comes from the line of [ Simon Yava ].

I have 2 questions. One of them is like, are you going to do any adjustments to the study that is in Europe now based on the case of the information we got today? And the second question is what do the partners think? What are their thoughts about this result and outcome, the expert outcome? So that's my question.

Sure. Let me start maybe with the first question then. It is too late in the game to make any adjustments to the European study. So most of these studies have already completed in the European trial, and these are big logistic things. If you're making changes to these trials, you need approval to get these changes -- to be able to do such changes. So -- and there are less than 100 patients out of the 450 that still remain in the trial. So if you're making any change at this point, we wouldn't get focused with results of that, but it's actually practically very, very difficult to do so. So the EU trial will be completed as it has been designed. I think that is the only option at this point. And when it comes to your second question with partners. Of course, all of this information is very new. And we will -- now once we have the cure evaluation, we will discuss and present that in -- together with our partners. So that is something that will take place now over the next period. And of course, all the partners are also looking forward to see the European trial data.

Okay. Perfect. And can I have another question? Or is it possible?

Please do.

And your thought is still like you're going to be the -- how do I say, the leading in the market, right? That's still the...

Yes, I think -- yes. That is a great question. And we think that the long-term market potentially may actually increase by this new findings. Since the shorter treatment plan that we think we can get to approval of over time is much more attractive. And also, if you're looking into the pricing of -- how the pricing works for many of these markets, the pricing is based on a full course of treatment. And we know that, on average in the U.S., over 3 to 4 months of treatment is actually used in practice. So if we, over time, get enabled, where 3 months dosing is the mainstay or up to 3 months dosing is the mainstay, we will actually be able to capture more of the total value. And I would also say that before this trial and the trial results, I don't think it is unexpected this topical to be able to deliver 70% mycological cure to get 70% of the patients free from their fungal infection. And if you think about those type of claims that we get from the U.S. trial, so 8% of patients could finally 3 -- 8 of the patients -- 8% of the patients reported improvement only after 12 weeks, those are very strong claims to use in the market. We need to navigate to get to approval. And over time, we need to deliver a higher complete cure rates. But this is very possible.

Perfect. So you guys are very satisfied with the outcome, I suppose, right?

I would say the following. We would have preferred, of course, a trial outcome where we had higher complete cure rates. But we are very satisfied with this expert evaluation and the strong belief that we have in the concept.