Dogwood Therapeutics (DWTX) Conference June 11, 2025 09:15 AM ET Speaker0 Of our June 2025 SmallCap Conference. I'm Alex Antman, and I serve as an equity research analyst here at Sidoti and Company. Today, we're pleased to be in conversation with CEO and Chairman, Greg Duncan, of Dogwood Therapeutics, ticker DWTX. During the presentation, please feel welcome to submit questions using the Zoom Q and A interface at the bottom of your screen. After the presentation, we'll open to your questions. And with that, ...

Company Overview - Dogwood Therapeutics, Inc. is a development-stage biotechnology company focused on creating new medicines for pain and fatigue-related disorders [2] - The company has two main research platforms: a non-opioid analgesic program and an antiviral program [2] Product Pipeline - The lead candidate in the non-opioid analgesic program is Halneuron, which targets voltage-gated sodium channels to reduce pain transmission [2] - Halneuron has shown pain reduction in clinical studies related to general cancer and chronic chemotherapy-induced neuropathic pain, with interim data from the ongoing Phase 2 CINP study expected in Q4 2025 [2] Antiviral Program - The antiviral program includes IMC-1 and IMC-2, which are fixed-dose combinations of anti-herpes antivirals and the anti-inflammatory agent celecoxib [3] - IMC-1 is advancing to Phase 3 development for fibromyalgia and is a focus for external partnerships [3] - IMC-2 has demonstrated successful fatigue reduction in Long-COVID patients and is set to progress into Phase 2b research following FDA agreement on using fatigue reduction as the primary endpoint [3] Upcoming Events - CEO Greg Duncan will present a corporate overview at the Sidoti Small-Cap Virtual Conference on June 11-12, 2025, and will be available for one-on-one meetings [1]

Financial Performance - Total operating expenses for the three months ended March 31, 2025, were $4.4 million, significantly higher than $1.3 million for the same period in 2024[142] - For the three months ended March 31, 2025, the net cash used in operations was $4.7 million, consisting of a net loss of $10.9 million and non-cash items of $6.4 million[152] - In comparison, for the three months ended March 31, 2024, the net cash used in operations was $0.9 million, with a net loss of $1.3 million[153] - Net cash used in operating activities for the three months ended March 31, 2025, was $(4.7) million, compared to $(0.9) million for the same period in 2024[151] Expenses - Research and development expenses increased by $2.1 million to $2.4 million for the three months ended March 31, 2025, compared to $0.3 million for the same period in 2024[143] - General and administrative expenses rose by $1.0 million to $2.0 million for the three months ended March 31, 2025, from $1.0 million in the prior year[144] Cash and Financing - As of March 31, 2025, the company's cash totaled $17.5 million, expected to fund operations through the first quarter of 2026[145] - The company raised gross proceeds of approximately $4.8 million from a registered direct offering of 578,950 shares of Common Stock at $8.26 per share on March 14, 2025[147] - Net cash provided by financing activities during the three months ended March 31, 2025, was $7.4 million, attributed to cash proceeds from a Loan Agreement of $3.0 million and gross proceeds from a registered direct offering of $4.8 million[154] - There were no financing activities reported for the three months ended March 31, 2024[155] - The company entered into a Loan Agreement for a total principal amount of $19.5 million, with $16.5 million disbursed on October 7, 2024[136] Future Financing Needs - The company anticipates needing additional financing beyond the first quarter of 2026 to continue its clinical trials and operations[150] - The company has incurred losses and generated negative cash flows from operations since inception, with substantial doubt regarding its ability to continue as a going concern within the next 12 months[150] Clinical Trials - The HALT-CINP-203 clinical trial commenced in the first quarter of 2025, involving 200 patients with moderate to severe neuropathic pain[129] Accounting and Reporting - There were no significant changes to critical accounting policies during the three months ended March 31, 2025, compared to the previous year[159] - The company is classified as an "emerging growth company" under the JOBS Act, allowing it to take advantage of reduced reporting requirements[160] - The company is not required to provide an auditor's attestation report on internal controls over financial reporting as per the JOBS Act provisions[161] - The company did not disclose any quantitative and qualitative disclosures about market risk, as it is not required for smaller reporting companies[162] Off-Balance Sheet Arrangements - As of March 31, 2025, the company did not have any off-balance sheet arrangements or relationships with unconsolidated entities[156]

Financial Performance - Net loss attributable to common stockholders for Q1 2025 was $12.2 million, or $8.45 per share, compared to a net loss of $1.3 million, or $1.68 per share, in Q1 2024[9] - Cash on hand as of March 31, 2025, was $17.5 million, providing operational runway through Q1 2026[1] - Total assets increased to $96.98 million as of March 31, 2025, compared to $94.31 million at the end of 2024[20] - Total liabilities decreased to $14.24 million as of March 31, 2025, down from $30.03 million at the end of 2024[20] - An affiliate of the company's largest shareholder converted a $19.5 million loan into equity, improving the company's balance sheet[3] Expenses - Research and development expenses for Q1 2025 were $2.4 million, a significant increase of 700% compared to $0.3 million in Q1 2024, primarily due to clinical trial expenses[7] - General and administrative expenses for Q1 2025 were $2.0 million, up 100% from $1.0 million in Q1 2024, driven by increased legal and accounting fees[8] Regulatory and Development Updates - Dogwood Therapeutics commenced dosing in its Halneuron® Phase 2b Chemotherapy Induced Neuropathic Pain program, aiming to be the first FDA approved therapy for this condition[3] - Halneuron® has been granted fast track designation by the FDA for the treatment of chemotherapy induced neuropathic pain, with interim data expected in Q4 2025[10] - The company received confirmation from Nasdaq that it has regained compliance with the minimum stockholders' equity requirement of $2.5 million[5]

Core Viewpoint - Dogwood Therapeutics, Inc. is advancing its Halneuron® Chemotherapy Induced Neuropathic Pain Phase 2b study, with interim data expected in Q4 2025, while maintaining a strong financial position with $17.5 million in cash to support operations through Q1 2026 [1][6]. Company Developments - The company has commenced dosing patients in the Halneuron® Phase 2b study, which aims to be the first FDA-approved therapy for chemotherapy-induced neuropathic pain [6]. - Halneuron® has received fast track designation from the FDA for the treatment of chemotherapy-induced neuropathic pain [6]. - An affiliate of the largest shareholder converted a $19.5 million loan into equity, enhancing the company's balance sheet [6]. - A recent capital raise of $4.8 million, combined with existing cash, provides operational runway through Q1 2026 [6]. Financial Performance - Research and development expenses for Q1 2025 were $2.4 million, a significant increase from $0.3 million in Q1 2024, primarily due to the business combination with Pharmagesic and increased clinical trial expenses [5]. - General and administrative expenses rose to $2.0 million in Q1 2025 from $1.0 million in Q1 2024, driven by higher legal and accounting fees [7]. - The net loss attributable to common stockholders for Q1 2025 was $12.2 million, compared to a net loss of $1.3 million in Q1 2024, reflecting a substantial increase in operational costs [8][14]. Research Pipeline - The proprietary pipeline includes Halneuron® as a non-opioid NaV 1.7 inhibitor for pain conditions, with interim data from the ongoing Phase 2b study expected in Q4 2025 [9]. - IMC-1 and IMC-2 are antiviral treatments in development, with IMC-1 ready for Phase 3 for fibromyalgia and IMC-2 in Phase 2a for Long-COVID [10].

Core Points - Dogwood Therapeutics has regained compliance with Nasdaq Listing Rule 5550(b)(1), which requires a minimum stockholders' equity of $2.5 million [1][2] - The company has a strong cash position of $17.5 million as of the end of Q1 2025 and is currently dosing patients in its Halneuron Phase 2b trial for chemotherapy-induced neuropathic pain [2][3] - Interim data from the ongoing Halneuron Phase 2 CINP study is expected in Q4 2025 [3] Company Overview - Dogwood Therapeutics is a development-stage biopharmaceutical company focused on new medicines for pain and fatigue-related disorders [3] - The company has two mechanistic platforms: a non-opioid analgesic program and an antiviral program [3][4] - The lead candidate, Halneuron, is a voltage-gated sodium channel modulator effective in reducing pain transmission, with demonstrated pain reduction in cancer-related and chemotherapy-induced neuropathic pain [3] Antiviral Program - The antiviral program includes IMC-1 and IMC-2, which are fixed-dose combinations of anti-herpes antivirals and celecoxib [4] - IMC-1 is advancing to Phase 3 development for fibromyalgia, while IMC-2 has shown successful fatigue reduction in Long-COVID trials [4] - The company has agreed with the FDA to use fatigue reduction as the primary endpoint for future Long-COVID research and plans to advance IMC-2 into Phase 2b research [4]

Product Development - The company is focused on developing new medicines for pain and fatigue-related disorders, owning Pharmagesic and its subsidiaries[24]. - The lead product candidate, Halneuron®, is in late-stage clinical development for chemotherapy-induced neuropathic pain (CINP) and utilizes highly purified Tetrodotoxin as an active ingredient[26]. - The company commenced the HALT-CINP-203 Phase 2b clinical trial in Q1 2025, targeting 200 patients to assess the efficacy and safety of Halneuron®[43]. - The antiviral program includes IMC-1 and IMC-2, which are novel combinations of anti-herpes antivirals and celecoxib aimed at treating fibromyalgia and Long-COVID[50]. - The company plans to initiate a Phase 3 program that includes two pivotal trials to demonstrate the safety and efficacy of IMC-1 in treating FM[68]. - The Phase 2b study, known as FORTRESS, is designed to further assess the efficacy of IMC-1 in a larger patient population[63]. - The company plans to engage with the FDA in the second half of 2025 regarding the synthetic formulation of Halneuron® for Phase 3 development in 2026[115]. - The company is developing IMC-1 (famciclovir/celecoxib) and plans to explore additional therapeutic combinations in the future[109]. Clinical Trial Results - In a Phase 2 study, 51% of patients receiving Halneuron® experienced at least a 30% reduction in pain compared to 35% in the placebo group, with a pain response duration of 57.7 days for Halneuron® responders versus 10.5 days for placebo[37]. - Halneuron® has shown a favorable safety profile, with 84% of patients in a study experiencing at least one treatment-emergent adverse event, primarily mild or moderate[40]. - IMC-1 has been granted FDA fast-track review status for the treatment of fibromyalgia (FM) based on significant unmet needs and promising Phase 2a data[62]. - In the Phase 2a study, IMC-1 demonstrated statistically significant improvement in pain reduction compared to placebo, with a p-value of 0.001[56]. - The FORTRESS study showed that IMC-1-treated patients had a statistically significant improvement in pain reduction (p=0.03) and fatigue assessment (p=0.006) during the second half of the trial[65]. - Statistically significant improvements in various health metrics were observed, including a p-value of <0.001 for NRS Fatigue and 0.002 for Orthostatic Intolerance Symptoms Assessment Scale[83]. Market Potential - The global CINP treatment market is approximately $1.5 billion annually, with the larger cancer-related pain market reaching about $5 billion[36]. - Approximately 1.7 million CINP patients exist in the seven major markets, with opioids currently accounting for about 30% of the global CINP treatment market[36]. - Approximately 3.6 million patients in the U.S. are diagnosed with FM, with around 2 million currently receiving treatment[71]. - The market for FM treatments is significant, with peak sales of pregabalin and duloxetine reaching approximately $10 billion, highlighting the need for more effective therapies[91]. - Approximately 10 million Americans suffer from FM, with chronic pain conditions costing the U.S. economy between $560 billion and $635 billion annually[92]. Financial Overview - The Company incurred consolidated net losses of $12,349,724 and $5,296,015 for the years ended December 31, 2024 and 2023, respectively, with an accumulated deficit of $73,818,946 as of December 31, 2024[191]. - The Company raised approximately $4.78 million in gross proceeds from the March 2025 Offering, selling 578,950 shares of Common Stock at a price of $8.26 per share[184]. - The Loan Agreement with Conjoint Inc. provided a total principal amount of $19,500,000, with $16,500,000 disbursed on October 7, 2024, and $3,000,000 on February 18, 2025[181]. - The Company expects to incur significant additional operating losses for the next several years as it advances Halneuron®, IMC-1, and IMC-2 through clinical development[192]. - The Company has not commercialized any products and has never generated revenue from product commercialization[191]. - The Company will require additional capital to fund operations and may face challenges in obtaining necessary financing[194]. Regulatory Environment - The FDA review process for new drug applications (NDAs) typically takes about 10 to 12 months from submission, with a substantial application user fee required[125]. - The FDA may refer a novel drug application to an advisory committee for independent expert review and recommendations[130]. - The FDA typically inspects manufacturing facilities before approving a New Drug Application (NDA) to ensure compliance with current Good Manufacturing Practices (cGMP)[131]. - The FDA may issue a complete response letter if the NDA does not meet regulatory criteria, requiring additional testing for reconsideration[132]. - The FDA has expedited review programs, such as fast track designation and priority review, to accelerate the approval process for drugs addressing serious conditions[134][137]. - A drug may receive accelerated approval based on its effect on a surrogate endpoint that predicts clinical benefit, with post-marketing studies required to confirm its effectiveness[141][144]. - Orphan drug designation can provide exclusivity for seven years if the drug treats a rare disease affecting fewer than 200,000 individuals in the U.S.[145][146]. Challenges and Risks - The company has a limited operating history and no history of commercializing pharmaceutical products, which may complicate future viability assessments[203]. - The company is heavily dependent on the success of its product candidates Halneuron®, IMC-1, and IMC-2, which are still under clinical development and have not yet received regulatory approval[206]. - IMC-1 did not achieve statistically significant efficacy outcomes in the Phase 2b FORTRESS study, which raises concerns about future approval and commercialization[207]. - The regulatory approval processes for the FDA and comparable foreign authorities are lengthy, expensive, and unpredictable, potentially harming the company's business if approvals are not obtained[214]. - The company may face delays in clinical trials due to various factors, including disagreements with regulatory authorities and challenges in patient recruitment and retention[212][221]. - Clinical trials are expensive and time-consuming, with outcomes that are uncertain, leading to potential delays and increased costs[211]. - The company relies on third-party contract research organizations and clinical trial sites, which may impact the timely conduct of clinical trials[213]. Intellectual Property - The company holds 21 issued patents related to its antiviral portfolio, including three Composition of Matter patents for IMC-1, with exclusivity extending to 2033[102]. - The company has filed multiple U.S. patent applications related to the synthesis and use of Tetrodotoxin, including Application No. 63/652,113 and 63/672,146[106]. - The company holds U.S. patents for drug combinations involving famciclovir and celecoxib, with specific patents including US 8,809,351 and US 10,034,846[106]. - The company has a Know-How License Agreement with the University of Alabama, granting a non-exclusive, worldwide, royalty-free license for herpesvirus-related technical information, effective until June 1, 2037[112]. Corporate Structure and Operations - The Company changed its name from "Virios Therapeutics, Inc." to "Dogwood Therapeutics, Inc." on October 7, 2024, and its stock began trading under the ticker symbol "DWTX" on October 9, 2024[185]. - As of December 31, 2024, the company had twelve full-time employees, with four in the U.S. and eight in Canada, relying heavily on independent contractors for development projects[177]. - The company operates a virtual office in the U.S. and leases office space for its Canadian employees in Vancouver, B.C.[178]. - The company is subject to various federal and state laws targeting fraud and abuse in the healthcare industry, which may impact its sales and marketing programs[158]. - The company must comply with the federal Physician Payment Sunshine Act, requiring tracking and reporting of payments to U.S. physicians and teaching hospitals[159].

Financial Performance - Net loss attributable to common stockholders for Q4 2024 was $8.2 million, or $6.29 per share, compared to a net loss of $1.1 million, or $1.43 per share, in Q4 2023[10]. - For the full year 2024, net loss attributable to common stockholders was $12.9 million, or $12.52 per share, compared to a net loss of $5.3 million, or $7.05 per share, in 2023[14]. Expenses - Research and development expenses for Q4 2024 were $2.3 million, a 567% increase from $0.3 million in Q4 2023[8]. - General and administrative expenses for Q4 2024 were $5.2 million, up 575% from $0.8 million in Q4 2023, primarily due to nonrecurring transaction costs[9]. Capital and Funding - The company converted $19.5 million in debt to equity, significantly strengthening its balance sheet[5]. - A recent capital raise of $4.8 million, combined with existing cash, provides operational runway through Q1 2026[5]. - As of December 31, 2024, Dogwood Therapeutics had cash totaling $14.8 million, sufficient to fund operations through Q1 2026[14]. Assets and Liabilities - Total assets increased to $94.3 million as of December 31, 2024, compared to $4.2 million in 2023[23]. - Total liabilities were $30.0 million as of December 31, 2024, compared to $0.4 million in 2023[23]. Clinical Development - Dogwood Therapeutics commenced dosing in its Halneuron® Phase 2b CINP program, with interim data expected in Q4 2025[5].

Core Viewpoint - Dogwood Therapeutics, Inc. has made significant advancements in its Halneuron CINP Phase 2b study and improved its financial position through a recent capital raise and debt-to-equity conversion, positioning the company as an attractive investment opportunity moving forward [2][6]. Financial Performance - Research and development expenses for Q4 2024 were $2.3 million, up from $0.3 million in Q4 2023, primarily due to increased clinical trial costs [5]. - General and administrative expenses for Q4 2024 were $5.2 million, compared to $0.8 million in Q4 2023, largely due to nonrecurring transaction costs related to the acquisition of Pharmagesic [8]. - The net loss attributable to common stockholders for Q4 2024 was $8.2 million, or $6.29 per share, compared to a net loss of $1.1 million, or $1.43 per share, in Q4 2023 [9]. Pipeline Development - Halneuron is in Phase 2b development as a non-opioid NaV 1.7 inhibitor for chemotherapy-induced neuropathic pain (CINP) and has received fast track designation from the FDA [4]. - IMC-1 is ready for Phase 3 development as a treatment for Fibromyalgia (FM) and has also received fast track designation from the FDA [4]. - IMC-2 is in Phase 2a development as a combination antiviral treatment for Long-COVID, with plans to seek external funding or partnerships for further development [4]. Capital and Liquidity - The company raised $4.8 million in common stock and converted $19.5 million in debt to equity, enhancing its balance sheet and providing operational runway through Q1 2026 [7][12]. - As of December 31, 2024, Dogwood Therapeutics had cash totaling $14.8 million, indicating sufficient resources to fund operations through early 2026 [12][19].

Core Insights - Dogwood Therapeutics is advancing Halneuron, a first-in-class, non-opioid treatment for chemotherapy-induced neuropathic pain (CINP), with the first patient dosed in its Phase 2b clinical trial [1][2] - The global market for CINP treatment is valued at $1.5 billion, indicating significant commercial potential for effective non-opioid therapies [1] - Halneuron specifically targets the NaV 1.7 sodium channel, which is crucial in pain transmission, and has shown a statistically significant reduction in cancer-related pain in previous trials [2][3] Company Overview - Dogwood Therapeutics is a development-stage biopharmaceutical company focused on creating non-opioid treatments for pain and fatigue-related disorders [3] - The company has a research pipeline that includes a non-opioid analgesic program centered on Halneuron and an antiviral program targeting conditions related to herpesvirus reactivation [4] - Halneuron has been evaluated in over 700 patients across Phase 1 and Phase 2 studies, demonstrating no signs of addiction potential [2] Clinical Development - The company aims to recruit 100 patients for the HALT-CINP trial by Q4 2025, with plans for an interim analysis to adapt the trial design if necessary [3] - Interim data from the Phase 2 CINP study is expected in the second half of 2025, which will provide insights into the efficacy of Halneuron [3] Antiviral Program - Dogwood's antiviral program includes IMC-1 and IMC-2, which are novel combinations of anti-herpes antivirals and celecoxib, targeting conditions like fibromyalgia and Long-COVID [4] - IMC-1 is set to progress to Phase 3 development for fibromyalgia, while IMC-2 has shown success in reducing fatigue associated with Long-COVID in clinical trials [4]