Viridian Therapeutics, Inc. (NASDAQ:VRDN) Q1 2023 Earnings Call Transcript May 13, 2023

Operator: Welcome to the Viridian Therapeutics First Quarter 2023 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to hand the call over to Ms. Louisa Stone, Manager of Investor Relations for Viridian. Please go ahead.

Louisa Stone: Thank you, and welcome, everyone, to our first quarter 2023 earnings conference call. The press release reporting our financial results and corporate updates is available on the Investors page of our corporate website at www.viridiantherapeutics.com. Joining me on the call this afternoon are Scott Myers, our President and Chief Executive Officer; Kristian Humer, our Chief Financial and Business Officer; Dr. Deepa Rajagopalan, our Chief Product and Strategy Officer; Dr. Thomas Ciulla, our Chief Development Officer; and Todd James, Senior Vice President, Corporate Affairs and Investor Relations. Before we begin, I would like to remind everyone that this conference call and webcast will contain forward-looking statements regarding our financial outlook in addition to regulatory, product development and commercialization plans and research activities.

These statements are subject to risks and uncertainties that could cause actual results to materially differ from those forecasted. A description of these risks can be found in our most recent Form 10-Q and 10-K on file with the SEC. I would now like to turn the call over to Scott Myers, our President and CEO.

Scott Myers: Thank you, Louisa. Good afternoon, everyone. Thanks for joining us today. We had a productive quarter, and I’m excited to report on our progress today after completing my first 3 months as Viridian’s President and CEO. 2023 is an important year for Viridian, a year that includes key milestones in all of our clinical programs. I am proud of all the progress our company has made thus far and looking forward to continuing our work to bring potential best-in-class therapies to patients with thyroid eye disease and additional disease areas in the future. Our team has grown rapidly throughout the first quarter, and we made several key hires on our senior leadership team, helping to strategically position us for future success.

Additional details can be found in the press release we issued earlier today, but these hires include Tony Casciano, Viridian’s first Chief Commercial Officer; Dr. Tom Ciulla, Chief Development Officer; Dr. Felix Geissler, Senior Vice President of Medical Affairs; and Dr. Erik Kupperman, Vice President, Program leadership. Each of these individuals have already made valuable contributions to the organization and will be integral leaders for our company as we continue to expand our teams, mature as an organization and prepare for future success. I’ll now review the progress we made in our clinical programs during the first quarter, and Kristian Humer, our CFO, will discuss our financial results before we take your questions. Let’s begin with our TED programs, starting with our lead asset, VRDN-001, a humanized monoclonal antibody administered intravenously once every 3 weeks, which acts as a full antagonist of insulin-like growth factor I receptor, or IGF-1R.

In the second half of 2022 and at the beginning of this year, we reported a series of positive topline clinical data announcements from 3 dose cohorts of the Phase I/II clinical trial, evaluating the safety and efficacy of VRDN-001 in patients with active TED. In December 2022, our team initiated the global Phase III THRIVE trial, which will evaluate the efficacy and safety of VRDN-001 in patients with active TED. Based on our recent discussions with key stakeholders in the TED community, there is particular enthusiasm for our shortened 5-dose 12-week treatment regimen of VRDN-001 compared with the 8-dose 21-week regimen of FDA approved TEPEZZA. Success in the 5-dose arm has the potential to provide welcome convenience to patients by shortening their treatment course and eliminating 3 trips to an infusion center.

Enrollment is ongoing, and we continue to anticipate reporting top line results from THRIVE in the middle of 2024. Moving to chronic TED, we are excited to announce that our proof-of-concept study evaluating VRDN-001 IV in patients with chronic TED is fully enrolled. As a reminder, the trial design in chronic TED is similar to our proof-of-concept design that we used in active TED. Two infusions of VRDN-001, one at day 1 and the second at day 21 with evaluation of safety and clinical activity at week 6. There are 2 dose cohorts, 10 mg per kg and 3 mg per kg will target enrollment of 8 patients in each cohort. Randomized 3:1 in favor of VRDN-001 versus placebo. Inclusion criteria include any clinical activity score at baseline. We expect to report results from both dose cohorts of this proof-of-concept trial in either June or July.

Following the results, we plan to start our second global Phase III trial, THRIVE-2, to evaluate the safety and efficacy of VRDN-001 in patients with chronic TED. Topline results from THRIVE-2 are expected by the end of 2024. I’d now like to move to our subcutaneous programs, which include VRDN-001, VRDN-002 and VRDN-003. All 3 candidates have the potential to be developed for delivery with a patient-friendly self-administered pen device, which could significantly increase access, reduce burden and expand treatment options for patients living with TED. We plan to select one of these candidates as our lead subcutaneous program before the end of the year. With our many learnings from VRDN-001 IV preclinical and clinical work, we believe that the differentiated mechanisms of action with full antagonism of IGF-1R achieved by VRDN-001 and VRDN-003 make either of them the most likely to bring a best-in-class subcutaneous product to patients.

As a result, a trial evaluating VRDN-002 in patients with TED will only proceed in 2024 if VRDN-002 is selected as the lead subcutaneous program at the end of the year. This allows us to keep VRDN-002 as a potential backup while steadfastly focusing on advancing our efforts with VRDN-003 and VRDN-001. I will now highlight the upcoming priorities to get the subcutaneous lead program selection by year-end. For VRDN-001, Phase I results in healthy volunteers are expected in the fourth quarter of 2023. For VRDN-002, we continue to generate data from the ongoing Phase I healthy volunteer trial. For VRDN-003, our plans remain on track to file the investigational new drug application with the FDA during the second quarter. We expect Phase I results in healthy volunteers in the fourth quarter of 2023.

After the lead subcutaneous candidates selected, we expect to advance the program to a pivotal Phase II/III trial, which is planned for the middle of 2024. Last month, our team was thrilled to present multiple abstracts at the 2023 Association of Research in Vision and Ophthalmology Annual Meeting. A platform presentation featured data from our Phase I/II trial of VRDN-001 in patients with active TED, while the poster presentations featured new clinical and preclinical research on VRDN-002 and VRDN-003. This marked the company’s first presentation of VRDN-003 research at a medical congress, an exciting milestone that programs development. Our team looks forward to presenting at additional medical congresses and further engaging with TED patient and physician communities throughout this year.

Finally, we continue to advance our earlier-stage preclinical pipeline and will expand our disease focus beyond TED and into the rare and autoimmune space. Our preclinical programs include VRDN-004, 005 and 006. Yesterday, we announced a partnership with Enable Injections to utilize their enFuse on-body drug delivery system for one of our preclinical programs. We plan to provide additional information on at least one of the programs later this year. With that, I will turn the call over to Kristian, who will provide a financial review for the first quarter of 2023. Kristian?

Kristian Humer: Thank you, Scott. Good afternoon, everyone. I’d like to refer you to our press release issued earlier today for a detailed summary of our financial results for the first quarter 2023 and take this opportunity to review a few items. We ended the first quarter with approximately $373.9 million in cash, cash equivalents and short-term investments compared with $424.6 million as of December 31, 2022. We believe that our current cash, cash equivalents and short-term investments, excluding our $75 million credit facility will be sufficient to fund our operations into the second half of 2025. Research and development expenses were $50.7 million during the first quarter of 2023 compared with $17.7 million for the same period last year.

Research and development expenses for the first quarter of 2023 include a one-time $15 million upfront payment to Enable in consideration for the rights granted to Viridian to utilize Enable Injections’ enFuse on-body drug delivery system. Other drivers for the increase in research and development expenses include higher CMC expenses in preparation for the IND application for VRDN-003 as well as development activities. Higher personnel costs due to an increase in headcount, higher preclinical costs due to early-stage collaboration expenses. As of May 1, 2023, Viridian had approximately 58 million shares of common stock outstanding on an as-converted basis. With that, I’ll ask the operator to open the call for questions. Operator?

Q&A Session

Operator: [Operator Instructions] Your first question is from the line of Derek Archila with Wells Fargo.

Operator: Your next question is from the line of Alex Thomson with Stifel.

Operator: Your next question is from the line of Gavin Clark-Gartner.

Operator: Your next question is from the line of Thomas Smith with SVB Securities.

Operator: Your next question is from the line of Laura Chico with Wedbush Securities.

Operator: Your next question is from the line of Kalpit Patel with B. Riley Securities.

Operator: Your next question is from the line of Jason Butler with JMP Securities.

Operator: [Operator Instructions] Your next question is from the line of Rami Katkhuda with LifeSci.

Operator: Your next question is from the line of Gavin Clarke-Gartner.

Operator: At this time, we have reached the conclusion of the question-and-answer session. I would now like to turn the call back over to Viridian’s President and CEO, Scott Myers, for closing remarks.

Scott Myers: Thank you, operator, and thanks, everyone, for your time this afternoon. Please feel free to reach out to Todd or Louisa if you have any follow-up questions, and we are happy to touch base with you. Thanks again, and have a great evening.

Operator: This concludes the conference call today. You may now disconnect your lines. Thank you for participating.