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PCSA Processa Pharmaceuticals

Participants
James Stanker Chief Financial Officer
David Young Chief Executive Officer
François Brisebois Oppenheimer & Co. Inc.
Aydin Huseynov The Benchmark Company, LLC
Robin Garner Craig-Hallum Capital Group LLC
Call transcript
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Operator

Greetings and welcome to Processa Pharmaceuticals Second Quarter 2021 Earnings Conference Call and Corporate Update. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions].

As a reminder, this conference call is being recorded. pleasure Jim my Officer. Chief now is to Stanker, introduce Financial It you, Thank sir.

may You begin.

James Stanker

welcome second to results and you Thank Processa's development conference and quarter update call. drug quarterly XXXX

Executive presentation Chief Operating everyone want Mike the are call filed Joining call, before to will that Officer, David Form our me our our remind second Floyd. on quarter Chief accompany and Dr. Young; Officer, this today PowerPoint we Shortly a Dr. I XX-Q.

Reform go will statements to view click of the Section forward-looking considered of To Section Securities prepared XXXX. call the the statement please of of with pursuant call, the Securities This release Private of made and link Act this PowerPoint within of the Young's is by statement. historic earnings the and XXE described may to the All exception slides, Safe Act on XXA to the remarks. XXXX. press follow the start reading Securities meaning webcast in Litigation for of the facts Harbor Harbor on statements made along. statements be Safe I Act our XXXX forward-looking

expectations in statements reasonable, that from to risks those these can in statements assumptions we implied are forward-looking correct. assurances and and prove due such various make may forward-looking no to will differ materially Although we expectations uncertainties. be believe results reflected Actual expressed or

XX-K, time-to-time cause well obligation events subsequently circumstances. then made other that our on of implied For Securities only in see as Dr. our Exchange we results time, as a and turn on factors in it not At subsequent please any knowledge, the I discussion in statements, any to filed Form could will to file are undertake differ date financial reports report included actual forward-looking risk from this annual on contained call. earnings reports of or uncertainties and briefly from Any in this over expressed the XX-Q, We results, update forward-looking Form as the with statements to risks or to reflect touch of forward-looking quarterly those statements or such call in those supplement do Commission. this detailed published

an drug development activities, Young on by be update Q&A. provide followed to will our which

well Before oral a June patents gemcitabine I'd pharmacological profile I XXXX license into financial of review our other results, RX-XXXX. to Pharma pancreatic nucleoside as Food Dr. like the and in and anticancer Drug orphan that treatment published Administration Ocuphire with to extending a analogues. with an as cancer. relative entered agent of we is highlight family improved license an into agreement to U.S. XXXX for of on XXXX, XXXX has XX designation

Young will in for the call. PCSXXXX discuss later plans our

we net $X.XX quarter or of share $X.XX loss a period we second share, loss to the net a reported per per costs increase Lipoidica and $X.X for XXXX. for same XXXX, or in million clinical licensing as of compared For of in of relates $XXX,XXX Ulcerative the loss Necrobiosis trial trials incurred our commenced we PCSXXXX. PCSXXXX gastrointestinal incurred advanced to costs PCSXXX and The primarily net in tumors

pipeline we for As advancing execution of increase Business from forgiven. received the advanced of other notification to for programs. anticipate Administration XXX,XXX has the the the continue our continue we recently been that PPP year costs the our activities development of we Small We associated most enter our programs, will as remainder patients that phase our loan enroll exciting and

was period XXXX. payments including during operating advanced compared in related used preparing due the The ended for XX, to the X and trial by CROs million months and PCSXXX, trial Our commencing our of activities for XB of $X.X to increase costs net Phase XXXX for to when XB licensing and to to our month Phase XXXX. $X.X PCSXXXX, increased incurred our we cash our payments million, X June

of XXXX, and XXXX. R&D in totaling costs the our second research XXXX incurred costs X increase of the was to in The During trials. due for $X.X we period development compared incurred quarter to same expenses in our to $X.X $XXX,XXX active clinical million relative million, primarily we

stock-based Our primarily and period to increase totaled XX, X in to administrative general the million compensation. The increases for the same June expenses months fees related XXXX. compared for professional $X.X in XXXX ended and $XXX,XXX

general XXXX Our $XXX,XXX. the and total in quarter second in was administrative expenses stock-based compensation of included

equivalents June over issued turn As to go we million concludes shares CEO, please and Young. That ahead. had my outstanding. of XX, common XXXX, remarks. David in our cash and XX.X and I'll call cash million $XX.X David, the

David Young

you evening. Jim. Thank you, Good joining for us today. Thank

slide, with next During so my not I will briefly but the want plan over should accomplished today, if our programs, the highlight to slides what details be you study each XXXX X website in in drug I our on be time to share you to them all more. months. expecting XX far we've then posted on what you the be will covering development

Both our met of the our slide. improve determine approach before, for the our it pipeline. seen in the that that that pipeline. briefly talk be the describes are to select benefit will to sure risk first slide I criteria. criteria go our I'm a only we we corporate while to use drug this Today, Let's discovery you profile most our X also or drug about have the But to of describe first to wins everything That's for to how drug uses why company market We market the large and approach achieve reward Processa on evaluate advantage. criteria to a regulatory to company, we fundamental an bets small asymmetrical development order risk be that X potentially is must in and our opportunity. cap science Processa risk drug benefit a approach, corporately. not and for make

life. These an unmet must that quality drug condition, who options what need their are the of to something need is and survival are provide treatment already with treatment better criteria need first to improve improve patients The medical patients exists. their than

for be that of must pharmacology efficacy the regulatory in drug options to And the clinical of demonstrated efficacy the target drug population develop evidence there This profile, third, must science in the similar must a targeted the compared more the better with some have target Second, risk drug approach demonstrated therapy or some benefit means a patients. population. provide population. path patient to a existing efficient for drug

slide. Next

look let's at programs over our drug months. X in what accomplished the Now, development we've last

in can to our to present closer move red Our drugs overall accomplish be And describing submission. of the the box was seen FDA the pipeline. we status development that, goal as

sites For patients, have being XB have with sites in the over other X been and next study the trial, Phase XXX, its we of the few X X and X initiated patients weeks. recruiting enrolled

September. plan XA end submit we before of For XXXXX Phase IND and the to its the trial,

first and data treatment likely During patient. for will select the compared cancer second some to begun we will identify waiting to other more are specific which drug colorectal To drug patient cancer patients our another efficacy would do PCSXXXX. develop and define, existing has screened in first to XXXX as respond PCSXXXX, and is its its clinical Other these have this combination screening second who in quarter, treatment on already capecitabine cohort. cancer the if on resistant first to better also in drugs, This used that pancreatic of cancer drug lab, some appropriate few weeks patients. be patients our biomarkers can we in-licensed enrolled with and the demonstrated pancreatic we the drug after room, chemotherapy. patients existing cancer to treat enrolled patients a obtain and

And drug, are identifying organizations, expect PCSXXT, our they and We to up drug. manufacturing before the cancer last evaluating sites contract we all end can of this have the September. manufacturing

Next slide.

need and which NL and FDA last infections review Phase as Let XB condition initially below is unmet appears condition, skin. Also, tissues skin that where a is be have to such designation. that with dermatological drug, NL complications the me months quickly medical years an amputation. XXX the from a to occurring we of our affects but NL over such condition skin as clinical can can presentation lesion, ulcers The they because patients than the occur biopsy, other different the or brittle. and diagnosis in accomplished is through the in only a becomes naturally the course, it's diabetic from to contact fragile ulcers. conclusive can ulcers, be about the occur XX% more where can histological orphan trauma

significant than importantly, of of More the see or patients, encourage side NL to often includes treatment PTX. work the complete patients. that drugs used efficacy. and off-label the dose ulcers Currently, these to are at PTX all And care. can first because FDA prevents a drug side standard than given which of dose it, X drug natural some X% called effects, as enough after limit possibly high closing approved administered. be healing X effects there dose in inadequate, a be to of no years less is I them the for ulcers call no limiting of onset, does but pentoxifylline, This moderate-to-severe

XX,XXX the U.S. approximately $X XX,XXX are Given U.S. billion. NL The ulcerative there to patients potential is in market

than of in PTX. a XXX not one day metabolites administration hits but the changes well PTX, day are its exact X deuterated all drug studies are and is of XXX that in a pathophysiological profile metabolites coming at X gram studies. metabolites directly and the toxicology effects identical the XXX patients, X its clinical it major The pharmacological Phase targets the as XXX than PTX. XXX XXX metabolites. and to cocktail, pharmacological of analog it X.X It XXX of of X.X has better different and the X to pathways, per these as pharmacokinetics similar the profile slide. occur like is of shown results It's from profile NL. X of efficacy in safety PTX, affect in identical. different Phase grams the which X better in The the know and same as of per and Next safety acts safety PTX, after same metabolites affects although resulting multiple

of complete that per ulcers, Phase X.X presented found of and left patients XXX. patients XA NL day and to trauma drug the ulcers trial, on we one X only the who these The with on prior closure with each month. wound was addition, receiving shown XXX gram the picture in X In the is closed had achieved ulcers within our contract in those patient also

Phase after in X for And the The the hope ulcers in our hope XXXX. slide everyone first trial in study second X meet the an circled, reminding treatment see of slide of this half a Special to to completely in to that we the for the begin as the the closed Assessment interim analysis of are right. complete a meeting complete with plan from can to XXXX. XXX FDA ulcers picture is Protocol pipeline the of on Phase We seen half You we XXXX. pivotal grant end the of design then to bottom

slide. Next

The than the XHTX that treatment to XHTX drug gastroparesis. is potent drug shown increase approved agonists. other been has a better the non-cancer is is FDA while indication The also PCSXXXXX. and the motility our This for drug drug to in the other And to presently profile effect and is gastric being a more other the side or of than target treat significantly gastroparesis, XHTX requirement clinical specific having agonist more trial by pipeline receptor any drug investigated.

slide. Next

label a have market use. wide off the used that all side sales. their approved with so for limiting for gastroparesis, gastroparesis potential market gastroparesis, only enormous Given open is for drugs serious The drug effects, and

the and XXXX enroll there's IND we Fortunately, been in that XA so the to XXXXX, of preclinical lot and beginning first done our the work of of Phase clinical expect of a XXXX. completed XA should submit for in be first analysis Final of this in patient a study XXXX. September Phase in half end

PCSXXXX. The recently one first drug to the we oncology our that discuss of is acquired

of an gemcitabine, analogue of used XX% acquire The well for slide. million the $XXX cancer occur therapy greater can which of of the resistance is FDA treatment of as biological a cytidine, for cancer. resistance X reasons, an inherently the and drug. our the cell than or attractive has orphan Next sales pancreatic nucleotide alternative patients and drug and lung endogenous to life cancers. analogue the because most XXXX Gemcitabine while on is first-line patent has as designation XXXX multiple gemcitabine, resistance, for to receiving U.S. to agent may the metastatic the XXXX or which an for XXXX development. causes of therapy It gemcitabine. exist cancer advanced use and in Unfortunately, presently other chemotherapy pancreatic of gemcitabine as of non-small second-line types to is XX% are resistant cancer cancer,

gemcitabine. the regulated, normal enzyme for activation exist in dCK. activation dCK, than is more dCKX dCKX, first enzyme in gemcitabine patients than And down is activation Our resulting is The less different in cells cells. from which XXXX cancer many

Secondly, enzyme compete results reductase RRMX with cytidine killing cancer the increase in is ribonucleotide gemcitabine and RRMX up-regulated, with in nucleotide. the this an nucleotide, which then endogenous active

RRMX up-regulation the production this XXXX XXXX, RRMX cancer For of now killing actually stimulates of nucleotides. and the

demonstrated note pancreatic addition, in cancer also DNA gemcitabine-resistant efficacy following cancer affects the patients. not gemcitabine. to cell than pathway, that XXXX follow resulting of a only RNA a pharmacological different In XXXX methyltransferase, pathway same DNA has gemcitabine and of number apoptosis, It it cancer the cell but been important small in affecting is already apoptosis

slide. Next

on our mission to be Our development existing benefit/risk program treatment overall options. improve will over the based profile

means to to done targeting respond do the and identify or not respond this biomarkers activate believe molecules more of or patients few gemcitabine. which or gemcitabine. over likely patients to not XXXX this refinement for development probably to XXXX, a biological through are can We who will For be assays

in XX Assessment Over the and we move X we pancreatic to evaluate a half second the pivotal study X months, hope be to the Phase XXXX Protocol assay cancer that such biomarker the Special of XXXX. able in biomarker or XB Phase our to complete to next in initiated assay FDA trial development, XXXX then will

slide. Next

chemotherapy a profile we capecitabine, progression-free this billion chemotherapy since second or benefit/risk capecitabine the in other oral first oncology XXXXs. Xeloda, PCSXXXX, therapy, altering potentially just drug the and the of XXXX $X is combination, drugs metabolism second the the line dollar survival the XXXX by the improving a is potential results of treatment a colorectal If in the multiple market one include of making used which a the widely for of X-FU, drug cancers a decrease metastatic where or modifier capecitabine the patients, while targeted of potential side-effects, cancer. for cornerstone market billion The of of to is has market. form improve capecitabine cancer capecitabine the

information these regulatory science exists identify Using have demonstrating the improve of to related likely who future. with help most in compounds. Next this slide. Phase over to those potential XB drugs trial design XB will design present Preliminary only a capecitabine but also presently will efficacy found that Phase related from benefit trial, safety, patients the we therapy X that profile administration will the better or evidence X-FU not like also targeted for obtain adaptive XXXX Phase we X-FU treatments. the From biomarkers our to near a approach, expect an

of of X in And first XXXX. we or Over the interim months, fourth in expect our half XX the Phase define next in an to second trial to Phase XB tolerated quarter pivotal XXXX of X the or analysis complete XXXX. our XXXX, dose the maximum cohorts X our then begin

slide key these summary This presents but in in timeline for clinical of just the for slide. all already drugs our timeline months pipeline. milestones a X X slide the XX this Next next to over milestones mentioned milestones, a provides I've the format. the

we the and expect months. last accomplished we to development the over Next next expect summarizes next to accomplish first even slide over in lot a slide. We second This months. more the quarter, but in accomplish X X what

enrollment First, for interim of XXX. analysis complete patients the a of

Gastroparesis. for Second, IND in XXXXX clearance

XXXX presenting Congress we'll X August presenting Fifth, and and World that And biomarker that XB to analysis It's in at lastly, XX, are have capecitabine Phase cash Healthcare of of trial, the September with identification dose efforts XB that we the Conference the through Phase the we trial, our administered as Fall of XXX and Science of well the development hope note $XX.X tolerated with months when XA to Life be XX MedTech escalation to understanding XXXXX at Phase assays. completing of in dose the on of earnings Third initial XX X XX. first XXXX, X of a Orphan Oppenheimer Jim call of X have XXXX, - we the development XX. the as important June in cash XXXX the assays. the in everyone the Fourth, what Phase last biomarker mentioned, million Drug XXXX. XXXX I support better this we've accomplished the Cohort study. given XXXX to months as trial, XB maximum over has while the enough

to more see, we start lot we of a And interim become Processa you believe next have value as seeing months. can the As X do we the results. over also apparent And program, for my concludes closer can one Q&A. ask remarks. FDA open lines you please Operator, operator questions? I'll step to poll with to now phone for the each That the will approval.

Operator

gentlemen, is [Operator questions. and first for open the Ladies Certainly. coming François Brisebois. floor is from Instructions] now Your question

Your line live. is

François Brisebois

Hi, thanks taking question. for the

interim XXXX see shortly So on having for some you I in side? I mentioned biomarkers there's And you. you look. What just if on think to shared anything look? wondering that is coming up for wondering interim just found I are XXXX. an hoping there Thank was was this

David Young

question, the biomarkers David. not are sharing Frank. really right now. This what Thanks for the is We're

going or what I you so, But and to long us enough can and the efficacy enough improve Xeloda of look is the capecitabine. out actually that. and metabolism is can't affecting And give safety to figuring the I advantage we're if tell share an be interim XXXX

out that with by So what's the be side the year. to of effect be And we'll what end we'll be metabolism of the multiple the really That's doing. view. report the on at actually metabolism, able looking we'll cohorts

François Brisebois

on for of DPD levels instance. And you any will look get

David Young

looking be at to going DPD. We're

One other. the than assays. on a may And better assay bit be so, little we're working multiple

kind And being so, now. that's of evaluated

will do DPD, We could But for look not sure but to use. we to assay multiple with what's what that are assays DPD, using that a XXX%. with, be try yes, we're we at feeling have there because going we'll on will

François Brisebois

terms XXXX, sneak away. And just if further I great. on opportunity, know that's in of then, I one Understood, little a in, commercial another that's the

a And alone this to would However, depending right advantages? move safety XB, can question, it efficacy sufficient? is I Phase you Thank guess, and from data, and important X-part guess? safety into X on a also, show be how the I Or Phase you.

David Young

Okay.

me Let and safety-only might if All problem number. safety. improving just efficacy or studies is size That done that safety, the would But yet. that right, larger had the question second usually being The life, sample answer with safety be former your it better occurs. we be first. safety, what require better before may having problem. don't We studies know a in

trying you're it prove the is requires If larger to better, sample usually size. safety

And So will see we also that have it All safety. was we're if both. exact safety. be better would will We it be. able efficacy think we some be for right. we're But But to efficacy be think not saying what improvement. going improvement us again, it and the we'll know to efficacy

question. second your that's So

Your I Frank, forgot, first question, first what was your question?

James Stanker

go what be hereafter? was X. of asking question The whether be you could - He the next to would what Phase phase XB can Phase from is, development

David Young

right. all Okay,

choose a the we an to. we might What Phase on we might Phase do then, depends efficacy, then XB some get really we're design go do efficacy adaptive a not X. on If X. we're though, be seeing And able XB. it a straight design going efficacy in after just then, in we If We in we're to So what's Phase would adaptive be Phase terms able fact, a a might we X. choose of instead. or able to Phase overall seeing to If do that. do X X. We not, XB survival wouldn't would on Phase enough is call an progression-free what we're would in Phase

what depends really results getting. we're it So on

But don't until possibility. we know just see the I now So right it's data. a

François Brisebois

Thank you very much.

Operator

Huseynov. Your next is coming question from Aydin

live. Your line is

Aydin Huseynov

my taking for quarter. questions congratulations you on and thank question the XXXX. One with Hi,

you trial gemcitabine, gemcitabine? how to XX% are design? a or given that structure a would population the imagine, One your So resistant would randomized has XXXX mention PCSXXXX hypothetically, fashion this So similar of slides in versus would with you Phase gemcitabine? try XX% to that you X target

David Young

thinking a about question. That's we're And all right the good now, options.

a we're the We doing haven't conclusion biomarker. up that's on reason final come with But it. one

biomarker study. respond identify helps gemcitabine type And to the or who and could approach, resistant to gemcitabine take XXXX, patient. treatment just then we doing XB If those theoretically be with go so, will we XXXX biomarker against of patients the

just lot biomarkers. with sure get options and the until yet the Phase there the XB for is Phase a X, So, not after we're data study we of from

Aydin Huseynov

the and Okay, response the But to I now all to improve develop you in of obviously, a appreciate approach. had you had you about to design right gemcitabine, to biomarker would biomarker for And if if the biomarker XXXX, commerce improve assay that. what rate to for of of patients assay it's gemcitabine, just a for terms how efficacy gemcitabine? looking be

David Young

the done in been and resistance acquired points it's treatment whether are gemcitabine level ribonucleotide treatment to with cell could different everywhere that of the lot dCK resistance, work that to actually different work transport from be or resistance level. a treatment gemcitabine. resistance biological membrane that of X there or steadily X the things of the a pharmacological reductase across And be the to areas, occur lot looking causing the or at through inherent There's gemcitabine

resistance things efficacy. and possibilities that gemcitabine those of All could affect are

of part be, also consider for may pancreatic have our in for looking the so XXXX in in existence going at biomarkers gemcitabine the to we're biomarkers general. cancer and And be that also goal will to

we're entities monitoring. we're a to really we biomarkers biological potential of biological looking But, again, So, be gambit whole markers. on at not specific real or which going molecular are being

Aydin Huseynov

another PCSXXX. on Thank Understood. you. question I have

but patients patients, X the So, you apparently. fit criteria who XX didn't pre-screened, were enrolled

criteria be comment which of So didn't to you would these able patients meet?

David Young

the do X criteria, visits was tests, that to from there Yeah, one. it not was it and wanting a all all mixture was travel patients mixture, not was the a

the having of and criteria the it those more erosion things. that skin, skin, the ulceration an of of of instead an types than was of the rather ulcer, With

to the example, going the when So an qualify, for an to this oh, see the ulcers ulcer, it's physician come They screened. be it's large they not should or just phone real enough. because, started would, if on patient patient in isn't the to small, really erosion, talking not it's to realize,

So what's really, based it phone the upfront, and was with again, then qualified. on wouldn't looking the some call, going that be just on at they making patient decisions

Aydin Huseynov

very for Okay. taking Thank you much my questions.

David Young

Thank you.

Operator

Your next question is coming from Robin Garner.

live. Your line is

Robin Garner

quarter. good evening, on congratulations Hi, and the for me. Few questions

first, do to analysis many reveal? patients And you expect necrobiosis interim The hoping what be that part lipoidica? you the look for will interim how of are that

David Young

Okay.

have analysis. our expect and the on somewhere because formally group, X it placebo between of we So we the expect response the will nobody XX probably rate that. us that patients that's about most tell And important something thing, to interim actually has studied

really will away, just tell talk years ulcers. placebo to you standard the the and of It away them you may go that years go quickly. goes all patients, care, if talk physicians, test away group. is nothing well, at all, It so take years and can you, to You and use can the it heal if of to doesn't

terms FDA, of response if get, that doesn't placebo that's becomes And again our it's just X evidence so discuss it then in to in biggest that's Phase we'll to study, healing. group rate and with does a piece healing natural smaller is it's sample easier have information And options lower the natural occur. what, true, us of the for design because, a size the have easier

Robin Garner

that. thank Okay, for you

we little far we about length study? mentioned is read this earlier that of program? should a for it I to Phase oncology the XXXX study a and Phase How know out but relative X advanced You when a out, how is most XXXX your bit - X think should this asset. would And

David Young

biomarker a Phase XB I Yeah, a relatively that answer I it's trial. the on us X. dose. we're of is, don't to XB to quickly Phase the and Phase was was into study Phase if XXXX, in we the say we The the quickly, I the one Phase yet. patients That to then XXXX. advanced And results do. already we analysis, to see we know trial need XB a see gemcitabine in most any tough Well, think can depending based trial guide that kind the of efficacy tough the going XB We that some that Phase reason doing terms treatment that get determine there for believe maximum with answer. resistance is what and we're go one. the of have or X quite in efficacy will an to one tolerated

So we information that have already.

So that's we're we that kind might there's steps a couple take just XXXX. extra of where coming it's to from, have with

be could Phase get neck the see neck we could between efficacy in may Now, that we XXXX. results X. and some lucky, it the XB for Then, and course, of

now. which what say of of kind we just our have, be in will to front what X me given the for timing hard hitting or That's have it's we one will Phase be really, I first. right the data So guess us

Robin Garner

the about going forward my programs thank be for trial question, X costs you Okay, that. we very for should in will how all just that clinic think last clinical And then shortly?

David Young

costs the trials Phase talking for like clinical going you're clinical talking X? you or Are that about about are on trial trial now, future costs

Robin Garner

current, gastroparesis including [indiscernible] the just Really XXX. but

David Young

Right.

are million. That's range XXX, those the gastroparesis study, so Yeah, of on which in of study, to of one. the and all million the XXXXX the kind $X depending range XXXX Okay. study, $X

range $X similar million million. and $X very a in all they're between So

to developing again, to XX biomarker. the study, about going XXXX to That's months develop. X the Now, we're take

So we really haven't gotten to the whole study design of yet. that

But the I be somewhere would to give cost. you guess, can't my around you if it's give a million So going I a range. cost, $X

these be all the those in of I million $X range. to drugs. all going million X That's to studies $X of think So for are

Robin Garner

you. Okay, thank

David Young

Thank you.

Operator

this this Thank lines gentlemen, and are questions at concludes you, There event. today's no the from time. further ladies

You may and for wonderful this disconnect a have you time at day. Thank participation. your

David Young

Thank you. Bye-bye.