Release Date: August 21, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Theralase Technologies Inc (TLTFF, Financial) reported a 6% year-over-year reduction in net loss, primarily due to decreased spending on research and development expenses.
- The company successfully completed multiple financings, raising a total of approximately $2.725 million in the first half of 2024.
- The Phase two bladder cancer clinical study showed promising results, with 63% of patients demonstrating a complete response at any point in time.
- The company has made significant progress in patient enrollment for the Phase two bladder cancer clinical study, with 72 patients enrolled to date.
- Theralase Technologies Inc (TLTFF) has demonstrated the ability to activate its lead drug formulation with metformin, potentially allowing for more flexible and less invasive treatment options.
Negative Points
- Total revenue decreased by 30.5% year-over-year, indicating a significant decline in sales performance.
- Gross margin decreased from 47% to 33% year-over-year, primarily due to increased material costs.
- Net research and development expenses for the device division increased by 225%, reflecting higher costs associated with new software development.
- The company faces significant financial challenges, needing to raise approximately $10 million to become shelf-eligible for a $100 million base shelf prospectus.
- Theralase Technologies Inc (TLTFF) reported 14 serious adverse events (SAEs) in its clinical studies, although none were directly related to the study drug or device.
Q & A Highlights
Q: What is the company's strategy for financing the rest of the Phase two clinical study on bladder cancer?
A: The company estimates the cost to complete the clinical study to range between $15 million to $30 million over the next three years. The primary mandate is to secure funding through a $100 million base shelf prospectus, which would allow the company to access funds over 25 months. To be eligible, the company plans to raise approximately $10 million in debt and/or equity instruments this year.
Q: Are there any plans for private placements or capital raises in the near future?
A: For future financings, it is best to contact Matthew Parity to discuss what has been approved by the Board and announced to the market either through a press release or Form 4. His email is posted on the screen for contact.
Q: How does the company plan to fund the brain cancer and lung cancer clinical studies?
A: A Phase Ib clinical study for both brain and lung cancer is estimated to cost approximately $5 million. This funding would be available through the same base shelf prospectus mentioned earlier.
Q: Is Theralase planning to extend the warrants that expire on August 22, 2024?
A: The company is unable to extend the 57,499,000 warrants expiring on August 22 due to exchange rules. However, subject to exchange approval, the company will attempt to extend the 10,058,734 warrants expiring on September 22 for another three years.
Q: How many patients do you think will be needed to complete the enrollment and finish the clinical study?
A: Theralase has enrolled 72 patients to date and plans to treat another three in the next four to six weeks, bringing the total to 75. The company aims to treat 85 patients by the end of 2024, which should be sufficient to complete the recruitment for the study.
Q: Why is duration of response so important to the FDA?
A: Duration of response is crucial to all stakeholders, including regulators, insurance companies, practitioners, and especially patients. It helps ensure that the treatment is effective over a long period, preventing the progression of bladder cancer into more severe stages.
Q: What is the status of breakthrough designation approval?
A: The company submitted a pre-breakthrough designation submission to the FDA in July 2023. Based on FDA feedback, Theralase is working to update the submission with clinical data clarifications. The company aims to resubmit the pre-BTD submission by the end of Q3 2024, with a decision expected in Q4 2024.
Q: How does Theralase's technology stack up to the competition for bladder cancer?
A: Theralase's interim clinical data has proven to be world-class and competitive with larger, better-financed competitors. The technology has demonstrated a 63% complete response rate and a 71% total response rate at any point in time, with a high duration of response.
Q: What is the status of any licensing, acquisition, or partnering agreements?
A: The company aims to have an acquisition or distribution partner in place by mid to end of 2026. These negotiations can take up to two to three years, and any agreements will be announced via press release.
Q: Can you provide any updates on brain cancer, lung cancer, or blood cancer clinical studies?
A: Non-GLP preclinical research and toxicology have been completed for glioblastoma multiforme and are underway for lung cancer and lymphoma. GLP tox is expected to be completed by the end of the year, allowing for Phase 1/2 clinical studies to commence in 2025, subject to funding and regulatory approval.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
