PTE - Earnings call transcript Q1 2020

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Operator

Good day, and welcome to the PolarityTE First Quarter 2020 Earnings Conference Call. Today's conference is being recorded.

And at this time, I would like to turn the conference over to Mr. Richard Haerle, Vice President of Investor Relations. Please go ahead, sir.

Rich Haerle

Operator. you, Thank thank first and joining call PolarityTE's Good XXXX you results. discuss quarter to morning for I'm Vice Rich Haerle, President of Relations. Investor

David call CFO. Interim the team President today members COO; Seaburg, includes and of Hague, CEO; Jake On and Richard the are which Patterson, Executive

of forward-looking I and include prospects purposes forward-looking cause the XXXX. for about statements from under Before Harbor that to Private these risks discussion we Reform Act everyone of today's differ future caution the like constitute Securities forward-looking would begin, the We the provisions are remind and Litigation that company's uncertainties actual to materially to subject that will indicated. statements plans Safe that expectations, statements those may results

expectations results are Report "Risk from differ These XX, today. forward-looking XX, and including the detailed filings be the statements may SEC, with ended due factors March that a are actual with variety for XXXX, our more well of fully Annual for quarter in on XX-Q our caption under SEC the current as the materially Factors" XXXX, filed based Form XX-K to our the the December to ended year on as

this except Monday, as on such required by we call, made only statements today's reflect speak events date to statements forward-looking Any any obligation of occur that May today's after as and XXXX, update XX, call disclaim to or circumstances law.

call being that to is the like participants today on I'd highlight to recorded.

the the via and available our Investor on are shortly Relations the making to be conclusion will call. We a website replay the of available and following webcast it investors in media section

the in is prohibited. redistribution, PolarityTE's form the retransmission any is property and expressed it of written or rebroadcast any of call Additionally, consent strictly without PolarityTE

the I like to Seaburg. turn call over would David to now

David Seaburg

for today. morning, us Rich. thank and joining you all Thanks, Good everyone

This for I'd recently we offers Three by to the range or wounds accepted is SkinTE value of begin milestone. are of today's highlighting believe published a separate encouraging to involving a call publication. testament achievement an the publications SkinTE wide like patients.

detail remarks, a the Global data the Plastic Cureus another from involving XX during patients in report in Hague for Journal. go case Warfighter Richard published One his greater Wound publication we're pleased in to was International accepted was study and but into prepared was pilot accepted for - and our series study DFU Reconstructive Surgery of will Open. that publication

Now for a I'd BLA few our points decision SkinTE. address to important regarding recent to pursue like a

most from received we for decision? Rather, FDA First, pathway why feedback a data will which catalyst from this the SkinTE determination for formal a believe preliminary this and was be decision made through SkinTE would will we appropriate. clinical this the be a the gained that BLA. asset FDA. from BLA or We it's the benefits The that decision because a indicated final that create designation made of BLA we submission the for a more as result exclusivity our support regulatory valuable pathway can that not

to a by more making interest approach the that is in the PolarityTE with think and that likely pivot to also a we're company FDA taking a shareholders. successful We development primarily clinically-staged be of collaborative best

hopeful our demonstrate effectiveness leverage to to the we're will Second, safety SkinTE. data be we existing of that and able

SkinTE in wounds, clinical outcomes a venous and ulcers and control completed we clinical years, includes Over approximate the study XXX trials which engaged SkinTE program randomized past from diabetic many completed our two have of ulcers ongoing cases foot to-date. actively in burn a development the been data in leg

there zero Importantly reactions SkinTE product. to adverse of been since reported have launch this the

in will support FDA a and this clinical -- hopeful are submit to considered be BLA. intend data to We set a the they these package data to

already on be program speculate the our FDA for us and taken will precise cutting until it important potential to development steps we've operating determined timeframes. that our a has SkinTE, It related expenses. in to the changes to for cost be and cost, strategy reduce to imprudent for requirements new BLA the organizational to the Third, is addition note would

provide over with the and we investors plan. next development updates on meet will periodic several We as with agree FDA months a the

by payroll to taken recognize QX, It sales. COVID-XX operating our had million from expenses, spend to cuts organization. believe the operating is contribution down to the FDA; monthly in meaningful that receiving also We the important end reduce below pandemic. burn and weeks bring took rate to prior cutting several we lowering expenses to across zero these of assuming the in cash preliminary discretionary expenses response feedback will reduce SkinTE steps the steps by already $X We several entire our from

Now would expenses. given $X our to in strategy, the cash BLA-related our case business close per than a which the we consider is with a less month, the burn cash burn year change for absent goal million of base

due second period notice periods for transition the expect will to reductions. be a quarter of We certain required

we XXXX. in So quarters to impact of and of see these expect savings fourth third cost the the

significantly SkinTE basis our transition significantly this subject with during functions. time operations. opinion and a continue the commercial We the We at our costs to the this approach in allow we're commercial the same to and related discussions limited with Fourth scaling finally, FDA. future plan to believe leaders, will back to key us reducing with associated force connectivity sales maintain while offer

objectives. data the and for execute reducing and for today's three, most submission significantly The and the BLA to away SkinTE; our from efficient approval the managing three thing, SkinTE; development burn. cash BLA generating with pathway to clinical obtain a determine is take specific two, I the to on following FDA commitment support to working necessary important closely a call investors One, hope most

of versus first XX relevant XXXX the guidance paid and The QX XXXX; XXXX; going $XXX,XXX $XXX,XXX $XXX,XXX follows: in move on of that were compared quarter versus note XX Now XXXX. $XXX,XXX users quarter XXXX; in in plan commercial of SkinTE and versus paid SkinTE paid the QX XXXX revenue metrics BLA our XXXX preliminary in as of of to in Please of let's in QX to users forward; on of more paid XXXX XX clinical development XX XXXX cases QX was repeat in to were our to cases, commercial in nine first catalysts were metrics. one, QX for metrics. QX were we QX XXXX new versus XX to focus QX versus performance in in

steps call go Richard the turn through to this of taking as an on like provide business the I'd operational the to Hague to of update over and we're we some Richard? transformation. aspects Now

Richard Hague

David. Thanks,

products involved that previously were BLA a for right been two a SkinTE BLA the ultimately the halfway, confident as for I'm approved that decision autologous Having company. pursuing with is

that have SkinTE past. outcome a the As adoption in critical two should successful eliminated areas, address

First clarity. is regulatory

and Given in the FDA, of systems, their manufactured by effective, hospital to is products approval healthcare and safe scrutiny according The and the XXX product provides in pathway, this released strict clearly nature significant a is validation self-confidence providers and are BLA to class susceptible payers. and inherently that standards.

the that value comprehensive care this deliver adopters approval. can Second SkinTE development Early delivery BLA real a physicians and SkinTE positive its data through based to to to seen results required of we world receive on wound clinical that is believe have experience, demonstrate patients. of BLA to and outcomes the wide the pathway, and range

backgrounds a and have we of including pathways, devices, with people my other the in on GMP with to as addition, team own variety In as regulatory possessing medical manufacturing. experience, well experience extensive biologics

in our in Additionally, team care BLA specific we the be strategy. development comprehensive BLA consultants expertise with will to wound outside engaging assist the for of a

continued SkinTE direct but intend to differentiated to leaders. with our interaction limited We're a which to compelling and and with to patients, in the As David for result grateful those their mentioned, their for and the especially to outcomes these with a Many is that do complex expressed our key we're strong direct order operations relationships SkinTE patients, of with experienced articulate a also scaling SkinTE. significantly wounds our alternatives. their physicians desire connectivity support maintain process commercial brings BLA through their back treatment have with review willingness those support they've FDA for value of access opinion

multicenter DFUs patients In DFU currently analysis target of for with trial, the trials, XX our XX two interim the chronic the ongoing been patients has trials, patients through Regarding enrolled. clinical wound pre-specified enrolment we VLU one VLUs. one for randomized XX the met trial currently and have In are enrolled. currently already there

supportive As time. advancing of VLUs we single closure. we given these larger look studies were wound RCTs at from data the in appropriate time to have these DFUs evaluations previous of to reported, the closure the presenting and application SkinTE rates for And forward and pilot the

the a as support develop data part time, speculate the BLA extent trial meet submission intend of with Until our mentioned David our might related discuss plan current the to As we as plan. to or have our what In through the related BLA to we closely strategy FDA clinical process extensive who possible we soon to our with previously, patient be other pivot development experience consultants work to meantime, trials. data that a as to package cannot current we to BLA. and

any we investments fully until developed. RCTs result, limit VLU of trials strategy in a DFU our other and will outside is As the

technology product. is multiple by That continue and in many we of and are this treated processes, tremendous validation with to of stages of SkinTE parties. this time, the various an do outcomes publication we publication which review manuscripts clinical at are of independent patients believe the see said, our of third which promise in expect the we important And There review. disruptive not controlled

wound was XX case application. like recent weeks article mentioned exposed pertaining detail Now week, a active for of SkinTE, extremity earlier. most offer Warfighter successful of square treatment closed Skin wound on Construct published lower was the reviewed treatment a entitled I'd weeks traumatic the the an Nine SkinTE remain and wound the Homologous in Zone Autologous post XX centimeter who to after that Last exposed publications while at application War the suffered completely duty. tendons some additional David closed follow-up the using This Cureus. involved to the of tendons peer with

a the have to we're play in solely proud a able As part company, recovery. to remarkable been

in XX utility equally been both in and and Open, difficult ranging chronic that Reconstructive wounds Plastic in We're of publication case SkinTE. has acute accepted closing to patient to of single XX paper therapies. wounds of to This conventional square details - the study application Surgery SkinTE with that centimeters landmark which X,XXX and failed closure pediatric demonstrated for from pleased report XX Global patients size a adult in treat clinical a

data the in International accepted publication DFUs study Wound treated SkinTE with patients for from the XX been addition, successfully of our Journal. suffering rather from pilot In have

thought We strength we and these from publications. inspiration draw great

shift collaboration in that updates and I entire with community. forward company, the ensure made major a strategy While that the of to be progress decision patient keep the a for our in is throughout BLA drive outcomes for remainder the to SkinTE could the just available that to executing pursue to We the us to a committed strategy described providing look wound and is FDA SkinTE XXXX. care it developing on us

Now for I'd like turn over Jake update. to a to Patterson call financial the

Jake Patterson

Thank you, Richard, and good morning everyone.

XXXX, reported of revenues total as of quarter SkinTE the in sale we our in services revenues revenues as $XXX,XXX the to first we refer from the to which Research which Services, refer includes XX-Q Contract which in and products XX-Q. approximately from we For

$XXX,XXX during revenues were quarter Revenues and were the products from from $XXX,XXX. services

is $XX.X XXXX, cash the approximately $X.X fees of million quarter. cash of in $XX.X million of or used February in during cash were operations quarter fees first which million the raise. used were The included lower the million per issuance these approximately operations net operations issuance the from than which $X.X in used month, For fourth

cash April earlier further spending As reducing salary the have and to payroll already by across we XX wage and minimal the press David expense, reducing future to noted taken in and levels. burn on release, reduction call, action by adopting discretionary a our organization reduce

to and XXth further our decrease press substantially strategy SkinTE, cash corporate in updating regulatory burn. other for operations we're functions commercial and April discussed reducing pathway release As

to the finished cash, we sheet $XX.X and months. equivalents cash short-term operations of the quarter We on fund XXXX XX million balance sheet. there's balance investments beyond first our liquidity believe sufficient our in of next And with the

highest SkinTE. BLA the cash reduction enable Our of the to priority financial burn for is

Seaburg now I'd David remarks. to to for over back turn concluding some like call the

David Seaburg

Thank you, Jake.

us see to to adoption, we like the while saying conclude SkinTE passionate mission people I'd lives the that living debilitating remain by of with our cutaneous and widespread achieve defects, in a believe same improve at objectives. time value pathway to shareholders. delivering to of the our these pursue for decision appropriate our We accelerate and long-term BLA both to firmly is that achieve

the the I'd call call operator joining to open back Thank up it to turn Q&A. you and now Thank for over the you. like for today.

Operator

Thank you. Instructions]. [Operator

question comes go ahead. of Please the line first DeGeeter Our Oppenheimer. of Kevin from

Kevin DeGeeter

the and around VLU you Hey, regard speak extremely guys. Maybe of Thanks of to in it's for current enrollment, trial the a clinical transparency the call. DFU couple Appreciate questions. helpful. enrollment restrictions and actively the today, do are to those metrics you still appreciate both programs? your could and trends of hospital procedures, those for updates, With personally weeks to patients. to speak of confirm studies and outpatient sort COVID-XX have And those are months feel coming enrollment enrolling you data some over the studies light

David Seaburg

most the Thanks, line. Nik, call. Sopko Kevin Nik have I'd Nik adequately. for question maybe like your We can in you Kevin's answer actually

Nikolai Sopko

the for Thanks Kevin. Hi, Sure. question.

period. we seen any to follow thankfully, ulcers trials COVID-XX care and of untreated our closely shutdown time the any the done patient have this is possible sure the considered of care critical limbs. numerous haven't we into and we as make hospital loss lost during can or bring sites. these Wound steps for infectious And become to So patient patients

all of enroll. continue open remained of our actually most have and sites So to

decreased We well. through during But as did rates March. significant and May enroll has in to nothing incredibly some see continued April

enrolling have sure we're But see how make that we'll recommended trials and able our So finishing needed, have closely that we're potentially continue these continued allowed we it's the trial. safe the by things this enroll. to CDC end patients to the other couple But having year. to the a proceed. continued that know in trials the enrollment months patients; totally in our sites we've We've if follow DFU and anticipate hard to to next virtually, of be the to to thankful

Kevin DeGeeter

of clarification in of Can period the the Terrific. FDA XXX. talk just XXXX a and about sort that XX-Q you just ongoing in question, submission? means as that the doesn't the months mean highlights regarding the language the Appreciate November end company's enforcement that of discretion as there's BLA And yes, just dialogue update. of XX that what particularly around light what

David Seaburg

mean, are that to Whether absolutely to that meet respectful forward period that we them possible standpoint FDA for can Yes, the tells not make with cannot get the market are FDA pathway this SkinTE to what to after as make clarity allow expectations are working sure will this Kevin. a us or are. product, we from we’re I us or of sure we that want to. waiting we bet the their in making that our really around process. We a they during everything with collaboration, sure doing not

them conversations really on not and won't. and be, make that action better to what bet we are and around don't wait they get from will if high-level know to have going make their with information to remove people sure going very We requirements to take market. We're that. going or direct will that the products they fact We're some

Kevin DeGeeter

back review? some of update a a to one with queue. I'll last of sense. six thanks, for for months. you success it U.S. regard had and the last provide get in update? just filings one, Could potential U.S. You've balance you Can the an in XXXX the And talk makes outside about and specifically IP Fair, expectations patent the lot

David Seaburg

Sure Kevin.

very a be that confident remain receiving still -- are patent. U.S. We we will

concerned, on when dealing necessarily you're don't office, As have far as is timing patent full the that. with you clarity

a remain time. our U.S., U.S. been a we very matter it's we patent, just to successful ability and confident although of in the outside So very patents of in receiving have still retain

Rich Haerle

you much, Thank Kevin. so

David Seaburg

Kevin. you, Thank

Operator

Kluska Fitzgerald. Kristen take Cantor of We'll question go ahead. our Please Okay. next from

Kristen Kluska

Thanks that questions. team remains good I my well taking at your on And for Hi, morning. time. everyone hope this

So bit one my to collecting any the Kevin's, measure these physicians as trials. visits little closure about are entail looking any and first of the wanted relates virtually? related specifically Could challenges you talk virtual from see how question whether to from wound closure I is about wound depth data patients in what a you to in a to it the follow-up ongoing more talk

David Seaburg

I'll that Sure. Sopko. to actually question Nik back Nik? push

Nikolai Sopko

It’s Yes, hi great Kristen. question. a

the bit in the allow are haven't be to to totally sites to forth at to for given being in kind unable measures closely of CDC for is to also actually, that allowed some we virtual actually groups visits. the uncertainties again, are some those seen general, had patient very put So safe. a healthy we've in these the and and I patients if allow flexibility sure that that have and they're make the good of put place able visits. visits. thankfully have flexibility utilize that place follow of little other in the But timing the recommendations put the been and more and But of We've

part these dressing And each change know that week. patients as you of our protocols have a

this allowed that require So be of patients can will actually assistance. physically dress Many will them only themselves. for

to point, is weekly wound, perimetry But process for our patients digital then and seen using of that by documented and that measured protocol have all are the your in software the wound photography system.

time those and used quality sparingly can into to visits sites confirm they only visits get well required because the to those documentation that's as their only that XD So the ultimately be need the to virtual high software have, intermittent and closure. able as track closure be

is virtual appropriate. that the the be that visit with is ongoing safe, wound the some could or final a the infection dressing of visit ensure that just perhaps interim or visit used patient the for visit not acceptable. not for be virtual something, and there's But the would So, two, some to

Kristen Kluska

discussed SkinTE XXX of Okay, basis. via to a Nik. on limited you, market thank possibility the continuing And you

the to and be specifically might there. So how limited define where ask you wanted basis focus I

David Seaburg

product. limit really really have several Kristen, decided to product they Sure, fact the KOLs really their that the really to have -- reasons, in on SkinTE defined for this to we hands. this that physicians, our the marketing supported or this want They

also and We of package putting to recognize presenting FDA when relationships, importance our the together essentially. those the

most our limited do. to that time, that -- a a relationships. make the appropriate having expensive the making very preserve we we sure thing very not So effort maintain And to decided we're right, KOL and marketing spending limited conserve out we at same our build felt to that that sure effort; was commercial cash

the So when how really with important landscape been we're go down supportive this and have to to focus able or to necessary to important that side-by-side very or those very this supporters physicians process key I maintain that think now here I and pathway this been it's the look really And is us process. they've through at of relationships to continue the doctors right engaged we're of product, it's KOLs make with for as core to the that drive clinical entire with well. this the evidence us sure

Kristen Kluska

Thanks, question quarter; David. the had new implement a to were And pricing last to going recognized strategy last that wounds. larger the you here related you is,

this to still or you there? wanted update priority route have Thank considering not company the to you. BLA if the for is pursue a whether ask So the and change new any

David Seaburg

Yes, sure, Kristen.

out that was based time on the lining able see having came that that. and them, We're right design into new case decision. fortunately we're really That we certain really that we So development play. COVID but not up. with And frankly all we the confident did What's to was with in. is providers around pricing some did a meetings providers, roll confident that certain interesting structure right around super were this

it as because we that forward offer the And new will limited that but strategy that's do thing keep structure intend structure our in way that place right product. on Salesforce that we do. to a on it's anybody to in again, to the based do we'll continue roll move We and pricing using the pricing pricing to based -- out

Operator

question ahead. from Please Ramakanth of Swayampakula now Wainwright. go We'll our H.C. next take

Swayampakula Ramakanth

is sure. the There at your you XXXX feel you, on to the criteria, you Thank which register be first be and so question from you your products initially Has may And in you. follow-up criteria this. with considered those CFR team to a HCT/P. looked HCT/P do are Thank be CFR that was XXXX. asking for those four thinking, Kevin will able criteria? four in need the doing XXX could David -- regulations still My what the in are comply team aware XX comfortable you not for regarding

David Seaburg

to thank I'll Sure, Hague. to one? Richard turn like you. that take Richard, that you would

Richard Hague

the part we certainly analysis conversations criteria. RK. and Yes, of for -- you. FDA. Thank parcel good Sure. case we those feel have criteria. part a XXX there's the thanks question done the Obviously, of Certainly of extensive we an like a the we've had with meeting And for

earlier certain certainly areas. As FDA mentioned some we felt differently in

to with forward we a can product make to, how deeper going ultimately going our going So until this determination to they're decide we as market have FDA, can't ability discussions forward.

it's those from But discussions, that forward we do be to that. able this to plan until we have to clear certainly continue point

confident said, and here that And the the bit all path BLA. felt we HCT. felt a As David described was I I XXX as towards And little felt that differently. work FDA to an with best the appropriate up forward FDA earlier collaborative we be pathway for was think

right And future to it's to market stand probably meetings, how those now. where our ability determine we as to they're forward. product until going we have appropriate that's So the going especially not

Swayampakula Ramakanth

you, on And Okay, the follow-up Richard. a -- thank approval hello? BLA

David Seaburg

Hello?

Swayampakula Ramakanth

responses your got discontinue. [indiscernible]. I I Okay.

Operator

your with you Swayampakula, question, sir? Mr. done are

Swayampakula Ramakanth

one additional have I? can I question,

Operator

Go ahead.

Swayampakula Ramakanth

you. Thank

do will think Regarding required, to you do? large of will BLA, or you currently you need to pilot they feel a additional BLA you and if studies the do you do that of a be the need will studies for have how study couple studies ongoing, sufficient

David Seaburg

that to information. belief FDA more to are -- the is say get I'd here we need we with our Well, communicate

no don't XXX from we're is we've that And as are lot earlier we're lot about of But SkinTE of on an We got adverse going been a that amazing reactions, confident the be data that patients product. a treated -- trials asked us. with really to the know we that. running, talked in what's the really confident we plus have

what we FDA until the exactly meet more asked going be sure with is to we're So not of clarity, them. and get

trying and be we to as soon We meeting arrange information, hope open. with and absolutely we trying a to are. their can. back transparent we so, with to very with once meet and do Street we be And as to report have We're on the them very them them more what findings will

Operator

[Operator Instructions].

lines. on And we further no have the webcast hand I'd like our to for back it audio questions questions phone you. over to Haerle Mr. Thank today.

Rich Haerle

Thank you, Operator.

tangential but one of of you a the is to the with on have when FDA? questions the Somewhat expect webcast question, the file BLA we

David Seaburg

question, And we Back Yes, at that, around it have information of timeframes that any can very would of you, the to or be Rich. information which quarter with around to specific second more And is to then a time that timelines, last third going we specific forward. arrange we that and XXXX et about, late more once in again let's them. timely meet we're meeting, hoping we updates Street to the have promise information we cetera. similar more as a have on say is in fashion to once in can will filing, the early back response we report

Rich Haerle

later or date? to date to The question question later commercial to you you the operations plan one would back at so a plan a a when BLA, assuming for team. back more webcast successful operations and is ramp in would ramp Yes commercial

David Seaburg

-- is is focus absolutely our focus. pursue BLA. main our Right that to pursuant I a now mean

road early needs be right is answer those a much down to three to As have and necessary much focus That we down we to everything our you, we as where sure is more our make doing and more too information stand, we to Back and questions our again core Rich. our are get our -- we'll road, But get the focuses answer. et we now it's clarity cash a directly. and have we the understand But we're able more position now we'll around and -- capital that. right and BLA. around cetera, of to one position obtain

Operator

further webcast, There there questions. I no actually and are believe, more on the audio questions no

you confirm would you that me can gentlemen, like So close to off?

David Seaburg

yes. right, All

Operator

Perfect. everyone today. joining We Thank participation. for your appreciate you, us

Take have You disconnect a your and day may now care. lines everyone. wonderful

Polarityte (RGTPQ) 11 May 202020 Q1 Earnings call transcript