Arena Pharmaceuticals (ARNA) 7 May 202020 Q1 Earnings call transcript

Good day, everyone. And welcome to Arena Pharmaceuticals’ Corporate Conference Call. This call is being recorded.

I will now turn the call over to Laurie Stelzer, Chief Financial Officer of Arena. Please go ahead.

thank joining and call. on everyone, afternoon, you us for our Good financial hope to announcing issued XXXX chance had our the quarter We a we review you news release first results. today

straight forward, the go into question a was As session. on directly quarter -and-answer call, we today's will relatively

and our Joining Research Head the President and Amit and Officer; Development. Munshi, is on Executive Dr. of me our call Chief Preston Klassen,

remind and Before statements everyone about I'd we to that forward-looking beliefs, risks business. like be those risks expectations, or that will goals, to and involve event uncertainties its and on future uncertainties potential pandemic including we our our making of related begin, timing COVID-XX impact the results,

can and our obligation currently that guidance, earnings Arena risks and to XXXX assumptions, risks Forward-looking these on our actual information be we could be available these in may certain statements. disclosure these statements. forward-looking financial A to about statements statements update and projections, based expectations involve forward-looking any uncertainties plans disclaim our materially SEC of All from results and related cause control latest description beyond are differ and financial found our and to to pipeline, release, press documents.

call I Q&A session. operator over Operator? turn Now, will to the the to begin the

[Operator instructions].

first the have from line from question We Wells our of Jim Fargo. Birchenough

open. line now Your is

had you’ve capturing the and I monitoring first for make just any of adjustments the other adequacy data you're you on through on make have what the talk FDA COVID-XX you've any remotely guess the to just is the of guess regulators thing Could I and adjustments to interactions like logistics you Mayo made? and sure with So, maybe protocol things Scores environment.

Amit. is Jim, Sure. this

Let me Preston it comment. hand to to off

to had of major haven't adjustments. as right now, we make Yes,

need when successful we've is Number visit to trial sure for a successful that front. that patients to access clinic patients really so. the front. on on that: are two, We've been have Again, in on focus drug. get making they in one, that enrolled Number to able been Our do

And make to needed so adjustments. net-net, overall, we haven't major

Mayo outcomes rectal finding is on patient electronic the the In something as frequency terms the site frequent obviously, patients that we very required for methodologies then and of for course, basis. to and of the on is the bleeding, for -- provide a endoscopic Score,

an issue. So, not that's

have into specific COVID we discussion the to So, need what the conducting or trial the we're do, the we executing specific to needed enter how normally would. about simply FDA trial with from as anything not we're we perspective,

what drug lot COVID understanding Now, and sites are the really need a to like again, we spending of supply site things visit. appropriate of on to patients that activation, when for they sure doing, the can get making time the is impact

with more just formulations, just that broadly, alternate And thing? management then lifecycle talk sort and could extended release any about have etrasimod efforts you you with of going

really best-in-class profile Amit. Yes, to from the best-in-class it this the got better, even -- designed announced is management. We and we CR of is a lifecycle make formulation a believe is and which of we've point view earlier compound take

you do So how about how into future bridging and the want Preston, to are trials. we program CR approaching talk and we’re quickly

Sure.

was press what number see call subject release of of might of an sure X to weeks controlled we ago. release So, an our of was work we've see what to intrinsic best-in-class profiles see cardiac thought we smooth a all that etrasimod to SXP a time what the in that impact this XX cardiac already like, class. take terms work, that of the lowest of we’re needed variety delivery inherent hour a dose first a period drug taken initial the that today. looking we we've done is has We Phase to believe we was And formulation in of speak, and that and terms and are what developed potential believe being make goal -- is entire with the look of conduction, at control could of of we delivery the out, this, with so overall could in if a just conduction to actual doing SXPs

even can and take we impact. that an So it make less of

just trial in one profile the saw single single-digit high to-date. We in is -- to point Gap] overall controlled clinical of single-digit heart We've part the talked taken the really from is rate important single-digits, that's the XX% baseline April, AV it's And which down the go. that largest didn't heart X we impact of change OASIS But terms in speaks a a our that it's low from now, and kind relative about [Audio delivery high release a the have reduction rate. was single-digits with delta to over clinical far so, greatest. perspective, we to to is low from of first block study, small of in on actually things X hours, to conducted -- actually that we absolute effect

in underway which get really with delivery the that clinical program profiles for X trial to clinical right that course program. formulation that we with now is and the of believe across pleased the turn of that step UC, is do into Phase an we're our formulation time and all -- into can exception now. of actual So, next We then a indications

release. to finishing switch immediate launching UC the And a so that product, controlled anticipate would and release appropriate the with then at market we doing the over time

to trial’s class. [indiscernible] or any could our to aspect extending patent that on then even that So, early think in important where play management view is and that's aggressive lifecycle fairly further will level terms a that of of nil potentially the effect it dose kind of first we conduction as be attributed a be think We franchise. close we diminishing of SXP high expanding

the RBC Kennen question is of MacKay, Next from Markets. line Capital

open. Your line is now

sort just sort how ELEVATE context, maybe Wondering of into if into enrollment looked the you of QX. throughout could put

COVID? If the how around trial Thank changes there? enrollment pace, has to the due any to see COVID around impacted in any you. specifics firm you sort Just senses to obviously really could trying up related of not

Sure.

started. have So and with -- I a we press dozens like for in mentioned today The We across well only track. really were today, terms we again this as others and easy came remain anybody as ahead slowdown involved geography emphasize, of some hundreds the in slow back on offline, of going lots we global trials down news of clinical sites were when sites. come good us for slowed activation, been of were affected a not as countries, to of study our in of back slow down the release, the continue board. ahead, of has We None enrollment but online. in also was others online enrollment. site And down, we in

us. really been fortunate that's So, for

But screenings everybody here. comes to enrollment, again, else, continue site broad and again experience of experience in I base the the just think like play into activations, get really slowdowns when you and trial

hospital of plays community-based, or The the the other impact seen based is really as sites. just U.S. so our the in sites experienced thing not comes are same bulk that into

of we some activated We how and an agent we've able infused study close well very an while to and agent this then as the to as terms back of Having we've to metrics. continue clinical extremely a before teams the in the everybody And are. well that online. site, slowdown. updating or the also lots experienced be time. forward difficult have having able of countries in be We're is seems caveat, oral were finally, fortunate is to the we absorb injected able see country, the we being agent sites And go every involved, some of coming for of fortunate and situation our But keep online, of and progressing helped. our were -- coming in getting same of actively the of back we'll ahead every some said sites, really sites terms been here, in every to screen all as position companies that of as and our patient all other monitoring we every day yes, slowdowns, to progress

there? a a just trying am get question atopic your clinical tangentially impact of dermatitis. whether there's on you of any Xb of can Phase year. you perspective trial changed there, a how this COVID similar sense into even anything in of again have has ADVISE And I lot if later enrollment to sort Obviously, put maybe the rate catalysts perhaps just coming up there's

it’s say, We're can enrollment. screening ahead same and well situation. the on exact I almost

we think guide toward year data on the before to a the continue end good in position. we're and We of ADVISE

be COVID. it's just some offline, were broad-based have helps being helps opened this. And with through coming states Plenty of closed, easy. we've trial. to some and delays none amazing an to been it's it need associated job the states teams again so be in trials, other absorb sites, and ahead ELEVATE I Similar able still were other up. navigate to we a doing been -- be The of of the really where states it So, able to like states of said, open. we been Those well to

again ranging clinical sites and balance number really broad of having a of a useful. So,

of having toward before the continue end the to guide data we'll So, derm atopic year. the

is line in Next Young Cantor. from Alethia

open. now is Your line

to change program going programs, a $X just program on thing? and same the priorities the want as with you cardiovascular bridges your of kind earlier like COVID billion have your of or with kind relates of continue different or phase programs. of in to I lot guess shift on the with light I Do massive kind it what's just -- here of pipeline

early the nothing program, or on guide down, can the some enroll changes Yes, slow so year, end there's we the really levers we continues still things toward of of push. preclinical so pain study the can we to there. things CAPTIVATE and Definitely

by to really things clinical medical important, early through but spent market a able being to mentioned fine really do development. or time two some in been our development some thing that. not G&A we've overall there. buckets, the that in to in more and take thinking the the release, really be we those of catalyst, handle into for different Kind kind normally spending through on then the of spend of and that keeping prioritize year, of to delay were driven of development, begin is a affairs, able do spending activities market really you tune one And and the also quarter tighter the to we've As really, terms thinking time market sort in of commercial, shaping, get press programs and able things would

spend reduce in the is do definitely areas. highly definitely long-term things for it stay at slow juncture impact company our But clinical hiring of and milestone. important we So, non-clinical to to on of this the really long-term continue delivery focused to the clinical like the and and want objectives involved not down value everybody

So, that's how approached kind of it. we've

And be might billion? it doing that of affect does $X anything with you cash

to other hold to looking We're storm, milestones our a cash to capital unlike to to really lot companies actively balance of us it get a have weather who allows need have in our position do. we find we that, we speak. be issue, No. incredibly do to don't are going to kind and going to the so And fortunate raise of to the ourselves an sheet and

the So, manage with do cash, to than nothing other else our to to milestones.

from Bank Gerberry is America. of Next Jason in line

Your line open. now is

on could able you do if do or wondering you're to get it ability endoscopy any Have capture are in Are if to wave, you you navigate just found thinking you're planning and was lately. us if things have forward. how going you challenging your give it? data insight thoughts we be I second a any to about going

Preston hand trial Sure, let me on combo. this to

right? necessarily team the unmet say staff. procedures. talked not first it's the and easy. that necessarily not significant our vendors, It’s the we But it's GI, that’s over a et I'll about sites the really it's really to navigated absolutely that XX then a up and Yes, and our to just we've acute This that to It's added internal that. site weeks with a elective testament testament is illness patients exists, And on testament elective -- not our This XX from XX lives. patients everything and is looking of know an avoid UC follow societies, cetera. need get along the CRO, you And for top the the wave. them it's staff study. a an for They're get let's really for their important benefit things perspective. for an and clinical study then that for again them, because and having cetera, procedure, not into you're critical weeks flare et to There's have

six recognizing get been are done. it hard was that logistics We site so we've sure is put guidance months around and stay But able to try ago, and sure fact the also get That no to is to supposed to far, to do out these And can make making we how into question. I’d the as navigate have the deal top And right than can everyone this with time. so it. they're patients trying FDA’s best today in sponsors credit, say more have to of at possible. on as manage things difficult we

sure industry be make problem utilize may with we area might moving where think we well data an need with to not you it's I So, able in and a have forward together experience we collected as FDA being -- waves of this, that to made to out of additional have some don't going working this adjustments. come to

I right way, industry, thinking everybody our patients. is So, think FDA, our sites the staff and

So, to with that caveat our we've of We this been clinical guidance. is Amit right as do said, fortunate on as to-date. it's programs. remain now and And track today, important today's very

Guggenheim We Partners. next from have from question our Suneja Yatin

Your your line is question. now open. Please ask

So, because QX. ozanimod announced data today competitor have question I Bristol I on think that are a in coming first is

that could direct So, be have maybe about what ozanimod? the readout perspective to the could etrasimod, expectation about relatively relative help from should us product at talked you differentiation to you from talk your your guide to and that looking we --

Sure.

the a and compound. the because So, the I is features already intrinsic differentiation it's good think of part been story of written the about of

with control. from lot drug as their safety the compound been very we of both and to a know efficacy being they seen the etrasimod. clinician drug trials at for of sort issues and important of interaction the titration. conduction of an is of exciting heart As then X no And we And story very, see half that's of smaller, the expect with faster very X is [ozanimod]. None low no know we recognize accidental no already with with we’ve intrinsic demonstrated on-rate again of discussed to And that's we clinicians, What's a that titration, before maintain and compound important top Phase the a in all active active. the saw LFT, picture, see that is with written know etrasimod off-rate, we we community we efficacy, to head we PFT that their their patients faster ozanimod, have no for pro are that magnitude a rate We've was really from advantages, features type to [MSI]. different. cardiac safety is, terms We into seeing very what on compound abnormalities clean metabolites, a issues. signal and overpower here which Phase of able approximately significantly had label the compared looking

efficacy see potentially a potentially that we've safer to signal that efficacy compound our to here -- of to our signal deliver and is but we firmly terms an both expect in got better believe comparing the has We compound a ozanimod. ability

Preston Phase So, X? add to else their anything to you'd like relative

I No, it. covered think you've

more here. one follow just And up

X,XXX bigger, ozanimod be remember you much I of patients. is a that it has size design the upsized. the signal you that trial trials confidence you're given enrolling trial the sufficiently What that detect Because ozanimod I trial to are the powered much because to think, that close obviously want. do to On gives smaller

your the So, just help pilot? and the confidence in understand difference us

Sure.

we is patient their it data, a of So, not see level. details their get to on trial, their the data don't knowing

do to X-domain X-domain delta why the our difficult their as delta upsized Mayo it's the exactly was Score trial. So, they asking We that Mayo XX, about XX. was know -- Score approximately

big Again, has adjusting piece effect of with studies. size, That's a So, it. where study part for big their a they did do knowing size. to not the overall

far if heterogeneity when have et looking deviations may database. larger And had biologic, they sample larger get world For may afield they the are patient naïve would to they taken more patients China hunting longer, seen require who countries, standard that example, population, have for were RNF for patient that in for to or countries you have you go build cetera again, to move India, which size. to those that example,

hypothesize of coming saw patients fact we TNF that simply or that Phase and is that the do they function they effect So, X. a some to for naïve has size of out had been just some the that looking of with biologics their of that

hypothesis. when had a those reasons be dataset So, to would they I two out. would comes this why is just trial. But see full their upsize potentially We'll guess the it logical have

I about efficient And of as sorry, to want utilization our Preston, something though, this point of certainly in in specific terms program, more just program out past, streamlined in here. patients. I to jump was talked a efficient is want we've the

ozanimod to programs program of that's and are then it's responders trials. you fine, order past. way that's had period to the done period two will, So, power particular the the in means previous in clinical enough those the two that have the the into induction maintenance for have year, to or overpower and induction the re-randomized that the study. end induction rest trials the one of at in you if But overenroll And the clinical been maintenance responders

of a efficient is use less patients. So, that

a conducting We a and have XX one week week study. XX XX co-primary we XX and with a second then are study week week where at program endpoint

So, clinical responders. of re-randomization there's no

of discussed absolute with sense powering whole enable induction maintenance part the doesn't period FDA versus and starts that a maintenance the the don't we sense. And for an a to so of because the where the period make to And ones makes we idea oral day that have change, dose upsize to it induction just period. less

continuation early as response. it view later and we So, of response

that a of same. itself all the assumptions And powering just us are other in and saves so, hundred several perspective, even from patients if

is Carr. line Alan in Next

is now Your line open.

how explicitly in the etrasimod So, the that? see some this on the update right? of a you're the to in Can is around I it you. think didn't some release. you the of might still don't But 'XX, that an second is environment. on give this in then But Thanks. couple half UC for heard have And planning call. press I data other you you cash said that programs, the us that impact thing other conserve XXX? does I

Sure.

all the as concerned, Phase of to move bit a there. you that and Phase XXX study. are little terms done including ours to really like studies environment That's sites. ability are trials ongoing very this to our get that's the sites track. Phase that on of external to EoE to be as control able it's year different haven't on in start a We that's those and as environment especially in remain rest X So, A be out on studies temporary yet, already The depend like this what is Again, this the and still Phase year X. ongoing, lot we're again, to X. again, that the trials. expect year AA. start share that But still started studies of X looks clinical hoping the know on going far And hold. to of going But dependent a it's

-- thinking and Phase X you’re your in But understand to what's the XXX? design what for accomplish timing I in Phase that might off thinking be what's on X And your current year. later

Phase anything disclosed X the design. around haven't We

get soon as we So, as through

initiate to Phase X, X. able successfully and Phase we're

the X and about as macro to a we'll bit continue environment, little soon As out talk Phase design. come the and things improve

line have Beatty of from next We from our question Joel Citi. the

Your line now open. is

the guess safety about that to ask first you just and ongoing I to trial, from beyond and and…? XXX do I'll what see one, Phase the a follow-up how anything X expect

to Preston, X? take Phase you that XXX, do want Sure.

Yes, XXX, Phase X.

not things So, the as just the receptor in the talked one in highly expressed state. normal actually that it's of thinking, you is is said the past -- we βX about

see to a expect necessarily wouldn't you lot. so And

that so we high safety just there on perspective opposed into focus we going the lengthy outcomes. we get at if look we there example, And Amit and we said more through that And But for we'll a sure Phase X. at And the and about clinical isn't as need specifically to more the talk make what a think will we and is as data talking to take wrap X, X, action, you of clearly about data. get excited for that about that’s a to but possible doing able kind pretty -- conclude we as compound at in from Phase mechanism looking be can we what we planned we're a then and fashion mechanistic of a level -- are rapid something and have should Phase to be proof-of-concepts. do, really to be

update on Beacon or then And Any Arena Discovery one other Neuroscience question. collaboration?

Sure.

So, Arena Neuroscience continues work. to do its

just As track. mentioned, that’s ongoing work, in completing and of be out to wrapping of that's and about on the up pre-IND mid-year we'll kind be we'll midyear self-mode intellectual it then still that now some work and some we timeframe. A up property wrapped get talking of has the around coming been lot

QX continue the to and has that to allow They're of to experienced and to we'll having on some about Beacon expect. work we both slowdowns The as excited updates a services into those provide us to come middle course better and will continues of and one having provide might those collaboration, lab the of lab-based QX and online also the Beacon functioning two. starting pace. better visibility updates on get the So, back as year

line in is Martin Next from Suisse. Credit Auster

Your now line is open.

maybe on rate details going me more us if burn. think Thomas can on one a Marty. guess forward. cash This burn any on how I you just quick to is give for Curious from about

doing any said Thanks. think how to that managing obviously, down? forward Can caveat during to that think judiciously got about uncertainties. with you the release then, that these specifically you're plan uncertainties? we've ongoing the going in COVID-XX And today on color you these keep I press you burn maybe on cash what discuss

Sure.

So, yes.

put me is, color whole programs, the cash Laurie. let So at The then the burn. and catalyst, milestone, act idea do the time a sure judicious to a is, of you same out hand long-term of -- a the little the long-term how balancing about bit continuation be color make here

done really for the hiring long-term done that's growth able areas, in of the a year. then of slow so, company non-clinical parts systems, for a things down kind spend the market the things hold of development, reassess this. and we've certain of again those think year. couple to things quarters reassess We get couple out prudent the at to we we put can And that end later put be on a wanted handling and company, There’s quarters in way of the the of of in

If company internally, the you but want -- not rails, want you over you the to we to discussed off pick to don't react want as react.

impact able to around burn. So, deliver being and to edges the key fairly the manage on company, for can catalyst sure that while we want has the substantial make still that we a

So you to want do Laurie, on that? just touch

Absolutely.

of did million $XXX So, new level to we Thomas, $XXX burn cash to a operating cash -- million. burn guide

$XX all last earnings and the that call, out at million. about laid did $XX out. from QX point on down million in I reasons burn it's a So, guidance previous for we're guide to will And we Amit the the

to million we range. hit the to of last we've get the $XXX that $XXX that, year reduced year million full three us So quarters into but

Munshi, I for like Mr. and it time, back to remarks. closing to Amit CEO, this turn President would At

us for joining We for technical everyone, today. apologize issues. the Thanks,

sort for course been of But it's patience. your thanks again, think the I today. par for

continue timelines, toward and we the we're track, the milestones clinical of to as we'll thank programs, get around As focus reduce next aware to time work, this to the execution continue unwavering during ongoing bringing that ongoing to we medicines just take in for on. to trials, continue updates, We're potential want opportunity build remain this and these excited quarter team patients and impacts we support I spend what's period. for going really tightening on and of our timely the clinical and important areas. we'll the relentless ongoing so to company, key the the everyone key the monitor ways to their the thank to provide is everyone of Arena COVID-XX non-clinical the explore building

out and for out, that I opportunities. employee As easy paramount our safety Preston multiple patient progress pointed pointed balancing simultaneously making across anybody, has with is and been this sure safety, not then

everybody. So, again and you stay thank safe

Thank you, presenter.

apologize So well gentlemen, participating. Thank conference today’s the all you technical for encountered. do I as ladies and issue concludes call. for This

now may You disconnect. great a day. Have