Humacyte (HUMA) 12 May 232023 Q1 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to the Humacyte First Quarter Results Conference Call. Currently, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions will follow at that time.

As a reminder, this conference call is being recorded.

I'll now turn the call over to Lauren Marek with LifeSci Advisors. ahead. go Please

operator. Thank you,

statements proceed materially remind with call would we expectations. actual laws. call, forward-looking uncertainties risks that could historical the that certain experience to cause These securities everyone federal this to under like subject statements to statements and differ Before results U.S. I are from made are present during or

periodic from reports could statements factors with information that cause contained actual in to is concerning our on made SEC. differ filed this the call Additional results

The our contained made the the or Information filing issued call as statements obligation company after during forward-looking except release only this the law. this update as may be date is on undertakes accessed call of presented page website. in revise to XX-Q, the Humacyte Form of from statements, the by speak the which forward-looking hereof, and press and in Investors we required this morning no

Joining for XX, Executive Dr. Officer. review me Chief Officer on today's Prichard, President and the and company's quarter Dale Officer Dr. recent Dale Chief and Corporate of Chief Officer; will will a and XXXX. and March the Development results Heather are Financial Niklason, Laura Sander, Operating call from Humacyte Chief company's quarter progress weeks, financial ended provide Dr. the Niklason during the summary

for questions. your prepared their available team the remarks, be Following will management

turn call Niklason. the over now will Dr. I to

us you and joining thank Thank business and for first you, call. quarter Lauren. morning, Good financial update for our XXXX results everyone,

Acellular access March, enrollment completed HAV vascular our of multiple completing product III candidate III in our trial of as Vessel, continued very to Human advance tissue implantable and productive trauma. Phase and universally bioengineered Humacyte for quarter close the in enrollment human late Phase arteriovenous indications. or our HAV, highly trial in we're we was This We or to

trauma. from FDA. This received the received FDA and for indication repair makes the vascular which the RMAT for Advanced the Therapy HAV Regenerative arterial the We designation following also HAV the extremity second recently Medicine has designation from the

In publications potential addition, the to to growing the clinical HAV. the of scientific continue of add we body highlighting

And product our with Juvenile or the our pancreas advance biovascular JDRF Foundation, recently we to candidate. lastly, Diabetes announced collaboration Research

these open call, this results. more for to up call in call review for I'll of financial we'll turning recent a detail the highlights be During over before review to happy Then your Dale our questions. the

begin have Therapy, extremity This arterial urgent with repair program designation Medicine for designation to first is trauma. the access arteriovenous for HAV HAV second Advanced recently the I'll FDA's vascular for for following vascular or being our Humacyte's trauma. HAV, in Regenerative excited We're hemodialysis. RMAT received for the the RMAT

our a RMAT planned for as With our vascular designation potential defense received filing BLA department, priority the higher in the from trauma of designation we previously extremity anticipate the review priority in well as indication. trauma

Phase in trial our enrollment vascular very trauma, VXXX we're to II/III Regarding close completion.

of of will an patency the the comprise XX a or trauma recall endpoint our arm of VXXX of the XX-day patients may XX endpoint extremity, HAV last efficacy the of either based have in primary quarter, you the date, As population on leg. in trial, suffered who XX which the have trial currently we extremity HAV VXXX in who the total received To injuries. patients discussion from be the vascular

we the synthetic trauma consistent is in with past with we've the discussions our FDA meeting extremity primary the a that patients be are of file vein efficacy had when is for the more not XX XXXX in BLA after enrolled feasible. patients, indicated and with other the and including BLA to We vascular BLA believe have for We FDA extremity the pre-BLA when over graft extremity plans the will analysis This injuries. with several that or months. filing, plan not treatment autologous later with

the that function model of study metrics, potential recovery highlighted a surgery. April of are Journal of publications. Trauma recent in conduit of that Teflon X following XXXX, recellularization. trauma further and ePTFE this was ischemia, vascular HAV across In was a graphs, compared repair arterial grafts and of prolonged published potentially peer-reviewed suggested vascular in and superior the to from Results in porcine care HAV acute the host is in patency The which including HAV limb trauma ePTFE the preclinical multiple study after

Importantly, infection, or degradation, aneurysm study. failure the HAV of evidence showed no mechanical in the

using the was week, published of Europe. HAV a the to Lancet in letter In HAV surgeons trauma a reports Ukraine. describing and the this injuries X limb addition, save also setting This time of describes battlefield vascular how the with Regional the war outcomes to in publication first announced treated clinical and life are Ukrainian the treat use in other as patients HAV earlier Ukraine in Health and

of to under a XXXX, been HAV and most total overall treated blast outcomes humanitarian with date. of from the with our injuries program sustaining and with vascular excellent patients patients have June XX shrapnel Since

conflict. be our those medical for humanitarian save the help and support, continue to program to colleagues in grateful their professionals Ukrainian to we're these and involved We of lives during to proud all this

reached filing VXXX patients. of trial to the trial. BLA hemodialysis now enrollment III indication. our access planned pleased milestone Turning to brings of arteriovenous in in our recently Phase this to in We us a this closer have We're that completion of announced HAV

usability will the is to the VXXX hemodialysis conduit are renal evaluate results line be in available year the with HAV first compare in fistula trial to As XXX patients a top reminder, the dialysis This that end-stage the to arteriovenous XXXX. suffering during from of an designed anticipated for disease. trial

and patients designed collaboration Humacyte of with X type announce survival as type a collaborate insulin-producing The HAV the world's treatment to the biovascular JDRF, Finally, is BVP on for carrier or of Humacyte development patient. we're Research the funder the Foundation, will is is our diabetes the the Juvenile happy the islets, with using largest delivery of JDRF research. and pancreas BVP, enable which our for X of delivery into or nonprofit Diabetes which the product diabetes. candidate to

We the potential we're of this that BVP to JDRF and thrilled in transform believe technology. the have to type advancing the diabetes, X support treatment has

it Dale I'll And turn review for now over of a results developments. with to business that, our other financial and

Thank you, Laura.

investments As we XX, reported short-term XXXX, and cash of March cash, equivalents $XXX.X million. of

up of commercial HAV $XXX the agreement while resources for with cash We the ensuring to trauma. release. are funding of runway allows arrangement Capital, extend report of vascular were completion details in the our which today's an The in adequate to press to pleased Oberland us launch the planned million

for equivalents are our approval HAV and believe adequate cash investments fund past expected from trauma. that operations funding We short-term vascular in planned time the and lines the our to of potential agreement well

Regarding to XXXX financial there $X.X XXXX. of no for the quarterly for results, compared the quarter first first quarter was revenue million of the

clinical Revenue development to development period million a personnel grant initiatives trials. to of first for was the for expenses the increased from Research research $XX.X were and increase XXXX XXXX million our related XXXX. quarter HAV. and expenses of for compared $XX.X support resulted expanded to the of first support supporting The current primarily of and development quarter

resulted $X.X of first and XXXX in XXXX. to primarily General reduced for million the million first were XXXX. year fees administrative the from of The quarter expenses compared quarter decrease professional $X.X for current

earn-out XXXX first to for August the associated totaled of XXXX. increase XXXX net current net $X.X with of liability current from Net expense quarter the other million to quarter $XX.X with net increase the for contingent previously. the first loss the $XX.X XXXX first compared Corp. other for The income of and expenses of resulted of the period compared merger in described million net the other Healthcare net remeasurement quarter from for quarter Other XXXX. expense million $XX of The our in loss Alpha million first increase in resulted Acquisition period primarily was

was year compared operations used for of first with quarter the first quarter to million for $XX.X planned increase net of property million for to $XX.X million of was cash in XXXX, commercial used prepare equipment HAV. quarter cash XXXX compared purchases the first to and million of XXXX. Total quarter related Net the for the of of first XXXX the launch to $XX.X the for current $XX.X

I'll concluding remarks. over that, back for turn to it Laura With

throughout updates as make earlier progress We're excited access. like And apprised all year, we stage Dale. progress to while BLA already in conclude, you, to NAV look keep in remainder BVP. milestones. regulatory to filings programs indications, momentum be closer we've significant the XXXX approach continued the our of and We in clinical you further moving in late-stage and made Thank of to trauma HAV continuing vascular our both I'll forward the in to programs HAV

Operator, ready to questions. we take are

question. the from line proceed comes our with And Sandler. your Matthew Instructions]. first Please with Piper [Operator question of O'Brien

Friday. it relates or trauma? just This a I or the Congrats or as per on is of all recent to future And for royalties royalties curious Happy HAV Phil flat of Are on these it their indications is financing, the for rate just mechanics a on HAV. Matt. the was percentage revenues?

it's that. but value, us, answer period later when compared to to by I is full But the it's it's a of arrangements details the a tends to the we those during or XX-Q royalty very where comes arrangement debt the payments similar debt our our -- on a mechanics there'll full to from outlined the essentially details periods arrangement the shift happy best out of available obligation, will Yes, single-digit revenues that with essentially, will we repayment in The today. in net Paul, present but Yes. today. filing be that to a repay think what the XX-Q can were be more be royalty repayment. revenues that it matching

during the on X wondering And here on enroll were XX patients still there I to update X getting wanted you patient And then is and running? the month. is just given last call. per up confirm quarterly And I tracking if Ukrainian any extremity more was still about if sites the goal one just enrollment. patients just wanted VXXX to to the you

Right.

in yet Ukrainian They're the and of the still So up running effort. part sites VXXX. as are enrolling humanitarian not

uptick in an tracking had enrollment. and patients have we enrolled had patient been April, We X in X month. per We around

a little still X X or to we give patients So recent go cushion, now, but We're just a perhaps we're order us to in XX, past at uptick. earlier, had right said we XX. aiming have as had

line next Please Ryan Our the from Zimmerman question. your question proceed BTIG. with of is with

Laura all the progress. and Dale, to see. nice Congrats it's on

this with anticipate other is pulling pipeline On Do and access forward milestones programs are recent understand trauma AV the capital, track. that you on those trials vascular for in agreement, with and Laura, your capital now? but the are of the enrolling more financing directed additional any the the additional

the of as minor, are far that's Yes, program less programs, and there is interesting track BVP now, our actual an pipeline as even because Ryan, primates, right the our certainly still on than in pretty we're XX% really these proceeding our question. budget. preclinical CABG programs spend are though

So see of terms investments in it our long-term If those. changes I then don't those we might further exciting, what encouraging next programs over couple in the really yes, huge depends do and on are years, although find results. things of in we

is sense, your today, with your any impact Laura. agreement Makes to any think existing And related about you in strategy financing change commercial how then the or with agreements Fresenius. there

dynamic kind thinking curious commercially. of may this shift how Just your

equity do and this current us It we going to sort can our pull had this the removes which at an helpful debt even optionality near gives the previously trauma. get about that is and certainly market us which on the out see really at in mind, launch we not the optional facility in this most environment, we that most and the for was financing XXXX concern communicated XXXX. debt, felt market hand companies cash down facility, is always commercial certainly, term this of in to before in especially We having vascular raise had sufficient stage. we years our This our of forward, like really Well, any exactly into have option. also, in

But -- optionality of amount that original like in which Dale, as are by in to I'd our the but this and not the So were facilitated place well. still future, you we in have comment view commercialization changed. we plans, really as hand, we money

place. strategy already No. Ryan, was in the complements this think I that

within where now with States in market has they relationship the we regards market they have have with planned States. United and the particularly and HAV, the intent to Our indications right directly the the AV our in rights really access that indications HAV doesn't the impact and to Fresenius, all to United efforts States, United are its initial then for certainly with cooperate outside been

I'll debt The back paying you in last SVB, queue. me. back existing agreements? that -- just these hop are from with anything then And for one

the that a then Yes, with the working is and It's But in debt benefit exists arrangement that interest paid to our going very payments Oberland. great is purchase back having yes, technically, forward. this no principal a And not we team. with and We're from SVB pleased Oberland. longer associated be with relationship. royalty

debt this with company only so hybrid instruments forward. is our associated And going the

The question line next Jennings Cowen. coming Please TD is with your of with from proceed the Joshua question.

agreement just up and follow to Medical partnership. Wanted the on Fresenius

points, you that if then -- just it box. are for I we plans standard clinical that your be HAV what economic would access of HAV patients, supported is and on for health about economic care AV how be in cost-effectiveness results, just filings, Fresenius by would hit about results particularly my required taking adopt end on develop Can And and and think primary analysis the understanding, data. should the it's talked part, clinical what it's the thinking health you check you their analysis. the trial if the guys will to

that's timely question. a Josh, very

a would subsets also for know of specific fistula failure. dialysis at be the endpoints So at for and are the endpoints we for the population that yes, population hitting combination it risk higher in broad looking

data partnership diabetics, So be cost might diving might very and of we're be but undertaking that with continue that work into care. Fresenius, their been have on on we a where women, strategic to elderly whatever,

As you to the complications. dialysis of spend able comprehensive patients total Fresenius sort different care are may access to these services provides for of a through some U.S. the dialysis addition in providing their to complications, also including subsidiaries track patients fraction know, in and for of

now. So right that database we're drilling into

had we Fresenius with yesterday on fact, leadership In call the a this.

get and ourselves is and next have here that results time we the by really so complete year So clinical for to top the hand and goal picture the economic the we for in results health Fresenius then also analysis a payers. have line

And having forward with you started agreement international then up they markets. with to international work able in regions? Or to TBD? open guys for Fresenius to some is move HAV have those just be them -- Have there run an that any to

that then comment is regulatory as But further and this Well, with again, I'd as Fresenius for approval, Dale in part agreement, missing with on would agreement if geographies. Humacyte follow with like obtaining responsible the example, of I'm Fresenius, commercialization our on anything. efforts. to that, And for part they work and of European we would

and So I efforts there. focused as laser-focused kind past been, regulatory the in strategy would the say as of that far year, Humacyte over our been our U.S. have has

commercial conversations, based about However, preparedness? these in those we would indications, additional Europe appropriate with and XXXX, Fresenius of are to of early the to going begin we including conversations to expect in trauma access. dialysis begin And the some work outcomes on

only that the planning cycle. of undertaking activities, this in research would life is and normal other going the stage, on this been thing regions third-party certain you be product's only kind expect Josh, And in other but of a at to and world of at the market stage I Fresenius has activities, Europe add that not would

they there there. myself Excellent. the ahead in in funding and just a a I the get provided wanted I of of you just potential lot then over vascular RMAT the could front a Department of HAV Last to the review of approval review And kick trauma. of status, to U.S. priority with little DOD? on agreement just to us years. the also, understand upon lot bit you for support have combination the in does help a prior for question, about -- supply that well as Defense, you and think -- is as DOD can

want Dale, talk and touch do on to about maybe I'll you then regulatory. supply

HAV customer Defense, would -- certainly happy other for certainly agencies. expect of other to the international agencies, Josh Yes, Yes do we'd that. Josh, even include Department Laura,

are you I those with supportive. with market, been move certainly, in HAV, with to Ukraine highly that think of insured conversations. government XX contract there we in tell work the is any can the purchase place that that's the today, in patients to conflict I have certainly, closer no were as done we but been that as HAV agency treated undertaking

approved. great interest to a wanted Department that they been of the they deal X this of obviously There's products their HAV. in expressed that selected The the Defense indicated had FDA as of one top priority

so government event And that conflicts this forward. fully in be will part of deployment picture procurement of expect for commercial of we our going future forward the

we to respect designation now you're and RMAT trauma. regulatory the the right, with in a have designation, trajectory, have we And priority

a As you'll through regulated as remember, for Biologics. biologic are we the Center

a and makes a grant we priority will from with believe decision path Again, having as Having our that receive always, so the the likely it's we'll designation priority helps And which X BLA designations up to review review regulatory more is likely but the that. the FDA's lines. our these it RMAT, time filing. FDA, both certainly priority speed the

next of with from proceed Instructions] Suraj Kalia & the Company. is The with line question your question. [Operator Oppenheimer Please

you Dale, hear all me can right? Laura,

can. we Yes.

Perfect.

Oberland Dale, congrats confused. forgive a deal, little a me, little So about your the -- all comments still progress. I'm on the

kindly debt royalty articulate reason pretty classify deal comments Maybe a do paying deal? I a terms a but agreement. your about back this right? follow wait still the some as But this well you math couldn't debt. revenues, sharing the the talking total sharing if -- debt. a for as all about And royalty of you if the royalty could kind -- say, just is becomes we'll debt are on a of Or X% this is -- we I let's Well, could pretty So as the you dense in as XX-Q, is structured you the ask agreement? do of

Suraj, to address. Yes, happy

the a a by liability technically, and of from principles Oberland. essentially financial type From purchase So what interest reporting and royalty on characteristics, royalty has through debt is the a the a arrangement rather payment of of the our interest is, of view, interest. than underlying is economic through view company and repayment the this it of where point books the point

about We the in potential think have funding segments. to here overall

the is in are down under of provided this product. elect down, see Other million to would the at of point arrangement will of the that take $XXX they approval company available milestones which time whether the anticipated are the but sales-based we through parts those the arrangement. road,

financial point of expense expense From with to nonoperating a purely the associated flows reporting income. view, as through this interest

when of ultimately over there In road details payments. be down over to a are by terms the royalty funding repayment you time look deadlines repayment the time, very see has this of footnotes, at I you'll are, this, which in think there arrangement. flow cash overall associated as the or completed with the certainly, favorable the of But other it's through the

think, by would under few that return had repayment deadlines payments quite felt or that were strategically strongly return to fit you. We we arrangement. essentially that for that been in proposals Oberland future Hopefully, give of attractive submitted time years that it right us. arrangement Oberland much, the this royalties the better needs I adequate where better or and arrangement through were number from require supplemental anticipated not much the to a We profile, clarifies pure point royalty was this are the to for with is a that now. the but a that's the is in future method of of very us, debt obligation have that primary our proposal Humacyte's Oberland and

period a extent are kick And would deferred Dale, presumably any there me until whatever there this, To for be deferred in, And they are? a period right? forgive revenues belaboring minimums.

day kicks first than and December start details years minimums date X road the royalty some XX-Q, by But There revenue. that on minimum of are certain down other down no is but quite the certain in see after road. XXXX, XX, the payments so would we made, in dates, the the the repayments you'll

I'll And back hop enough. Laura, queue. for Fair in one you. question

partnership at the direct? Oberland also potential seek getting the Or deal with the does still doorstep you would of And distribution get For any regulatory Is how the action. partner a approvals. U.S., this partners? or of at all need to might with go that you looking strategic plan are to the cut because all presumably, you mesh the

Suraj. Sure,

a good question. I think that's

facility, So I that to in obligations again, regard we want Oberland Dale to bring start revenue. said that repayment is no with until we emphasize something to have the

So it to compared go much there's makes no view, in which, standard interest along that more that, a with payments early debt favorable arrangement. our as

centers XX out and market, XX very health we're marketing X With is sized first the that where makes to a the of to bring It handle importantly, force, trauma. example. in as we're really HAV set to going regard And to building said sales severe going take the for also vascular vast and trauma points call before, economic now, reps, trauma, trauma X and it for to the we've this of our U.S. majority to reimbursement ourselves. vascular XXX very tractable reasonable a our to but centers, commercial there again the our targetable Level going how because ultimately, plan. level right to trauma and and We're indication teams market are we're still in indication be surgeons, that

it having same that these using their dialysis indication with hopefully HAV Again, in to get a these we whatever, are and and and surgeons, or the of and surgeons the the same one same -- that are the the then centers is the of people, be and of at on centers advantages shelves. being trauma already terms users second of the HAV when starting high-profile these going both all so hospital in

look more at subsequent the Fresenius a to our dialysis of about, some with centers from to going for and so out reach. it's expanding example, in And distributed partnering outpatient more launch, smaller

to launch the in U.S., the with not top. plans means the we another initial currently we then have trauma do partnership which believe partner the firm the in that of that with royalty take Fresenius a would potentially and distribution off combination So

part not now. that's So of our right strategy

of is with Bruce next Benchmark question. Jackson the your line The proceed Please Company. question with from

regard the further there funding get to BVP, road? down of additional JDRF possible it for grant do the they funding. project? could nondilutive possibility to some It's is is of the any With And nice maybe that other that the funding for always types funding

is Well, Humacyte opportunistic not nondilutive trying just advanced for always about our frankly, pipeline, be to programs. even more funding, our but for

yes, JDRF identify stick excited they So believe who about those many we're this does and to kind like partners. absolutely initial partnership partners in But then foundations with with the JDRF. tend of

BVP So as some yes, But for them additional at. to looking well pending expect of our even said, continue try potential encouraging that we're programs results, to with funding the would sources also to I there's think obtain that non-dilutive other I dilutive on to work clinical project.

you I'm participating. all showing first call. this Humacyte no Thank further quarter questions in results the time. for XXXX queue concludes at conference the This

much. Thank you very