Resverlogix Corp. (RVX) Earnings Call Transcript & Summary

Thank you for standing by. This is the conference operator. Welcome to the Resverlogix Corporate Update Conference Call and Webcast. [Operator Instructions] The conference is being recorded. I would now like to turn the conference over to Donald McCaffrey, President and Chief Executive Officer of Resverlogix. Mr. McCaffrey, please go ahead.

Good morning, ladies and gentlemen. My name is Donald McCaffrey. I'm CEO and President of Resverlogix. It's my pleasure to be able to update you today on some of the company's progress since the start of this crazy COVID-19 environment. We've only been in the COVID world for 6 months, but many of us feel like it's a decade. Although we have been quiet lately, we've also been very productive, as you may have noticed from yesterday's announcement of the new and very exciting data in renal, kidney research, with a 50% reduction in events in prespecified category. This adds to our ability to finance a deal-related development program. As you can see, on the attached slide, this was the first-ever evidence that a drug of any kind could actually reduce the incidence of MACE, major adverse cardiovascular events, and hospitalization for congestive heart failure. Our new chronic kidney disease information is in addition to the equally impressive data that we revealed 4 months ago in congestive heart failure. This is showing a 63% reduction in MACE events. This data is linked to patients taking a class of diabetes medication called SGLT2s. They're becoming a standard of care in diabetes. And in conjunction with apabetalone, they work 63% better. Both of these major advancements have allowed us to expand our various partnering discussions with major pharmaceutical companies. Much of what we have in progress, I still cannot share due to related sensitivities. I will explain some of these sensitivities as we proceed today. Now I'll be able to give you some greater detail, dealing with our COVID-19 research; new ongoing progress with clinical work in PAH, that's pulmonary arterial hypertension, which is also helpful in COVID-19; and we'll talk a little bit about our FDA progress and support, our business plan and our go-forward modeling. But before we get started this discussion, let's talk about the 800-pound gorilla in the room. What is with the large stock selloff in the past month, especially in the last week? That one is simple. I've heard speculations like bad news pending or a cheap financing on the horizon, but these simply are not accurate. The real reason is one failed hedge fund in New York, which will remain unnamed here. They held a large number of RVX shares and chose to quickly sell them off as opposed to other alternatives that I believe would have likely posed a better return for their investors. And it is my belief that this situation is either done or close to it. A related activity to this selloff may continue for a short while, but the following details and strategies should put the stock back into a more realistic value as it was about a year ago. The good news, however, is in the past few days, we have many new shareholders. They are very excited about the value -- great value that they got on the stock, a stock with huge potential. Now let's discuss the progress in the future. Let's start with the topic that rules all of our lives 24/7 these days, COVID-19. Please keep in mind that this is not our main project, but it could have a huge potential in the future. The whole story is based on the power of epigenetics. In February, when it started, the COVID-19, it became very clear to the world that a pandemic was upon us, and a very prominent consortium of 22 international universities started their own Manhattan-like project to hopefully solve the COVID-19 problem as early as possible. They first studied the virus to understand its makeup, ultimately understanding that it's comprised of about 30 various proteins. They then studied 20,000 known drugs to see which one would have a positive impact on COVID-19. On March 23, they published a list of only 63 drugs that they felt could have an impact. Apabetalone was prominently included on that list. The publication even went as far as highlighting the involvement of BRD2 and 4, our exact target, in the coronavirus interaction. Near 2.5 months since the information reached our ears, we've had some very solid advancements towards future programs. The consortium's next step was to run simple cell assays to determine if any of the 63 drugs would have an antiviral impact on the primate cells. Some of those tested showed as much as a 400% increase in virus present instead of a reduction. Ours showed no change and no safety issues. Their test was mainly for antivirals, and we are not an antiviral that we currently know of. Our drug's mechanism is different as its epigenetic potential can stop or slow the virus from replicating as opposed to killing the virus outright. This is the equivalent of sterilizing mosquitoes as opposed to using DDT to kill them. The long-term results could be very positive. The consortium's test was done in vervet. That's an African green monkey, which is an animal that Resverlogix has extensive experience with. We're also aware that the vervet's bromodomain system is differentiated from humans. Therefore, we compiled our extensive data and applied for COVID-19 study funding from various groups. With third-party funding in place now, we are currently moving forward with studies in human lung and related human lung tissues. These cells are instead of the monkey kidney cells. These studies will aid us in forwarding our planned human clinical trials involving COVID-19. Our primary goal will be to show that -- the reduction of the viral load in patients as well as the swifter recovery time from hospitalization. We view this as a program with large future potential as most seasonal flus and the common cold are coronavirus-related. If we are -- if we can prove reduction or impact of coronavirus-related issues, we may have discovered a potentially huge new market for seasonal flus. We are not a vaccine, and we are not an antiviral, but we can stop virus replicating. That could have a huge impact. Okay. Enough of the COVID-19 for today. Let's briefly discuss another clinical-related program that has been overlooked due to this new economy. In the past, we have discussed our pulmonary arterial hypertension program. Although this program started pre the existence of COVID-19, it could further support our efforts in that arena due to the positive impact it has on pulmonary or lung issues. We have already completed our treatment of some patients in our Québec center, and our Calgary site paperwork has been completed and ready to progress. We have not witnessed any health-related problems to date. Unfortunately, as of March 2020, both sites, Québec and Calgary, were sidelined due to COVID-19. They are still in lockdown since the start of the pandemic. However, both are expected to open soon, and we will continue with this program. Now let's discuss our breakthrough therapy designation and our exciting new relationship with the FDA. The breakthrough therapy designation was awarded to Resverlogix in February of this year, only 4 months ago, and it is considered the highest endorsement that you can get from the FDA short of actual drug approval. As of last year, only 130 drugs had ever been given this designation. The FDA website states that, I'll quote, "A breakthrough therapy designation is for a drug that treats a serious or life-threatening condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement on a clinically significant endpoint or endpoints over available therapies." So a breakthrough therapy designation conveys all of the Fast Track program's features and more intensive FDA guidance in development. The program also involves an efficient drug development program and an organizational commitment involving senior managers from the FDA, the eligibility of rolling review and priority reviews. On June 2, we had our first of these priority and guidance review meetings. It went exceptionally well. We are following up on this meeting's advancements and recommendations as we speak. And upon written confirmation from the FDA, we will gladly inform the market and our ongoing potential pharma co-development partners of the content of the full plans of our BETonMACE 2 registration trial. Now this brings us to our discussion about our current business plan and go-forward model. As many of you already know, Resverlogix currently meets all of the general parameters of a successful pharma partnership: efficacy, prespecified results from BETonMACE; safety, 1,900 patients have been dosed and FDA reviewed; regulatory approvability, that's evident in the FDA breakthrough therapy designation status; understanding of the mechanism of action. We have in-depth knowledge and publications. We have over 60 publications now and a strategic commercialization plan. Collectively, we have a solid program that has attracted the attention of several pharmaceutical groups. As the final Phase III registration trial will be expensive, we have decided to partner with a major pharmaceutical group at this development and commercialization point. The pharma will be responsible for funding the trial and operations. Discussions are going very well. And upon completion, the future of Resverlogix will be very solid. Continuing discussions will be adding the new data, its commercial implication as well as FDA planning and approval information. Until such time we can confirm a partnership, we will continue to fund the company internally and through whatever other methods may become available to us. We will be taking questions in a written format. And our IR department will get back to you as soon as possible. Best regards, and thanks for listening today.

Thank you for joining the Resverlogix' corporate update today. This concludes today's conference call. The company wishes to advise that this presentation may include certain forward-looking statements. Please refer to SEDAR for further information. You may disconnect your lines. Thank you for participating, and have a pleasant day.