Arcturus Therapeutics(ARCT) - 2022 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company reported revenues of $160.3 million for Q4 2022, a significant increase from $5.8 million in Q4 2021, primarily driven by the CSL collaboration upfront payment [24][25] - Total operating expenses decreased to $38.8 million in Q4 2022 from $43.4 million in Q4 2021, mainly due to lower COVID-19-related expenses [25] - The net income for Q4 2022 was approximately $117.3 million, or $4.43 per diluted share, compared to a net loss of $38.7 million, or $1.47 per diluted share in Q4 2021 [25] - For the fiscal year 2022, the company reported a net income of $9.3 million for the first time in its history [26] Business Line Data and Key Metrics Changes - The strategic collaboration with CSL Seqirus resulted in a $200 million upfront payment and an additional $90 million invoiced for development milestones related to COVID-19 and seasonal flu vaccine programs [21][22] - The agreement with Meiji Pharma for ARCT-154 as a booster vaccine for COVID-19 is progressing well, with the Phase 3 study in Japan fully enrolled with over 800 participants [10][22] Market Data and Key Metrics Changes - Japan has one of the highest rates of COVID booster vaccination, and the government is focused on public health, which is expected to drive high levels of COVID booster utilization for years [9] - The collaboration with CSL is aimed at developing next-generation mRNA vaccines targeting COVID, influenza, and other pathogens, leveraging CSL's manufacturing infrastructure and Arcturus' mRNA expertise [8] Company Strategy and Development Direction - The company aims to advance its RNA platform technology and earlier-stage clinical programs while strengthening its management team with experienced leaders in mRNA therapeutics and vaccine development [6][18] - The focus is on achieving multiple near-term value-creating milestones for vaccine and therapeutic programs over the next 12 months [26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the collaboration with CSL, highlighting early milestones achieved and the potential for significant commercial opportunities [27] - The company expects to report interim clinical data for ARCT-810 and ARCT-032 later this year, showcasing the applications of its proprietary mRNA and delivery technologies [27] Other Important Information - The renegotiation of a manufacturing loan with the Singapore government resulted in a significant reduction of the loan obligation, enhancing the company's financial position [23] - The cash runway is projected to extend to the beginning of 2026, based on current pipeline assumptions [24] Q&A Session Summary Question: Progress on the Meiji trial and expectations for clinical data - Management confirmed that the primary objective of the trial is to establish non-inferiority compared to Comirnaty, with relevant immunogenicity data being collected [30] Question: Non-inferiority margin and potential economics from Japanese regulatory approval - The trial is powered to achieve statistical relevance, and while specific economic guidance is not provided, it will be shared when available [37][38] Question: Enrollment rate and kinetics of response for the OTC program - Nine active sites have been onboarded for the OTC deficiency trial, with a six-administration trial design allowing for kinetic data collection after each dose [45] Question: Initial healthy volunteer data for the cystic fibrosis program - Initial feedback from the Phase 1 study in New Zealand may be available this year, with potential for adding cystic fibrosis patients depending on safety data [48] Question: Characteristics of patients enrolled in the OTC deficiency program - The focus is on stable adult and adolescent subjects, with expectations for biological impact across the patient population [50][53]