Miromatrix Medical Inc. (NASDAQ:MIRO) This fall 2022 Earnings Convention Name March 30, 2022 4:30 PM ET
Jeff Ross – CEO
Jim Douglas – CFO
Convention Name Members
Alex Novak – Craig-Hallum Capital
Greetings, and welcome to the Miromatrix Medical Fourth Quarter 2021 Earnings Convention Name. At the moment all individuals are in a listen-only mode. A short question-and-answer session will observe the formal presentation. [Operator Instructions]. As a reminder, this convention is being recorded.
It’s now my pleasure to introduce your host, Hanna Jeffrey [ph]. Thanks, Hannah, it’s possible you’ll start.
Unidentified Firm Consultant
Good afternoon, and thanks for becoming a member of us right this moment. Earlier right this moment Miromatrix Medical launched monetary outcomes for the quarter and yr ended December 31 2021. The discharge is at the moment accessible on the corporate’s web site at www.miromatrix.com.
Jeff Ross, Chief Government Officer and Jim Douglas, Chief Monetary Officer will host this afternoon’s name. Earlier than we get began, I wish to remind everybody that administration will probably be making statements throughout this name that embrace forward-looking statements inside the assembly of the Federal Securities Legal guidelines, that are made pursuant to the Protected Harbor provisions of the Non-public Securities Litigation Reform Act of 1995. Any statements contained on this name that aren’t statements of historic info ought to be deemed to be forward-looking statements.
All forward-looking statements are based mostly upon present estimates and numerous assumptions. These statements contain materials dangers and uncertainties that might trigger precise outcomes to vary materially from these anticipated or implied by these forward-looking statements. Accordingly, you shouldn’t place undue reliance on these statements. For an inventory and outline of the supplies dangers and uncertainties related to our enterprise, please see our filings with the Securities and Alternate Fee. The data supplied on this convention name speaks solely to the dwell broadcast right this moment, March 30 2022, Miromatrix disclaims any intention or obligation, besides as required by regulation to replace or revise any data, monetary projections, or different ahead wanting statements, whether or not due to new data, future occasions, or in any other case.
I’ll now flip the decision over to Jeff.
Thanks, Hanna. Good afternoon. And thanks for becoming a member of us right this moment. For all of the biotechnology traders on our name, the volatility we noticed in our sector final yr, expanded into the broader inventory market indices with a tightening rate of interest setting and geopolitical tensions. On high of that, our particular segments of the organ transplant market skilled extreme volatility earlier this month, which I will contact on later. At Miromatrix we’re centered on what we will management and our group is dedicated to using the money on our steadiness sheet to perform key preclinical and medical milestones. We’re very enthusiastic about our future.
Miromatrix is a life science firm, pioneering a novel know-how for bioengineering absolutely transplantable human organs to assist save and enhance sufferers lives. We accomplished our IPO in June 2021 and we had $52.8 million of money available on the finish of 2021. We’re effectively capitalized from our IPO enabling us to attain key milestones for our first three bioengineered organ packages, MiroliverELAP, Miroliver, and Mirokidney.
As well as, we use a small portion of the IPO proceeds to construct out our new headquarters incorporating world-class in home manufacturing capabilities, permitting us to fabricate our bio-engineered organs underneath our personal management and timelines.
We’re one in all a small group of firms on the forefront of growing alternate options to human donor organ transplant. Inside this small group of firms, there are vital variations between the applied sciences being developed. Our proprietary know-how as a scalable platform that makes use of a two-step methodology of decellularization and recellularization, designed to successfully take away the porcine cell from the organs obtained from pigs and change them with unmodified human cells.
Whereas our preliminary growth focuses on liver and kidneys, our know-how platform can be relevant to growing different organs together with coronary heart, lungs, and pancreas.
We’ve got collaborations with the Mayo Clinic Mount Sinai in Texas Coronary heart Institute, and have acquired strategic investments from Baxter, CareDx dx and DaVita.
Earlier than we go deeper into our enterprise, I wish to spotlight 4 latest transplants that happened at main transplant facilities. Due to their distinctive state of affairs, these transplants weren’t a part of official FDA medical trials. Nonetheless, they reveal a few of the nice developments occurring within the organ transplant subject culminating from many years of scientific analysis. We thank these establishments and the sufferers for his or her dedication to advancing the sphere of organ transplant.
In September surgeons at NYU Langone Medical Heart efficiently hooked up a genetically modified pig kidney to blood vessels in a mind useless sufferers leg. The kidney wasn’t rejected and produce urine throughout a 54-hour statement interval. Additionally in September surgeons on the College of Alabama at Birmingham, went a step additional and absolutely implanted genetically modified pig kidneys right into a mind useless affected person. These kidneys had been additionally not rejected and produce urine throughout a 77-hour statement interval.
In November, NYU Langone Medical Heart accomplished one other transplant utilizing a genetically modified pig kidney, they usually’re capable of replicate the success full outcomes of their first examine.
Lastly, in January, surgeons on the College of Maryland Medical Heart, reported the primary transplant of a pig’s coronary heart right into a residing human being. A 57-year previous man with extreme coronary heart illness who’s ineligible for a standard coronary heart transplant obtain the genetically modified pig coronary heart underneath a compassionate use exemption.
This transplant was initially deemed success, because the affected person did not expertise an instantaneous rejection and the organ continued to operate for over two-months. Sadly, the affected person handed away on March 8, and our condolences exit to his household. Docs proceed to investigate the outcomes and haven’t given an actual explanation for demise that we’re conscious of.
After the unhappy information of this incidence, we skilled vital quantity and volatility in our inventory. You will need to reiterate, that medical doctors haven’t established an actual explanation for demise. And it was a difficult case. Whereas I can not touch upon the specifics of any of those instances, I simply highlighted what I can say is we proceed to consider Miromatrix know-how is probably the most differentiated within the class.
First, our know-how doesn’t depend on genetically modified pigs. And our decellularization step removes all residing biologic materials from the porcine organ we supply. Subsequently, we consider we won’t be labeled or regulated as a xenotransplantation.
Second, we recellularize the decellularize organs with unmodified human cells, which we consider may end in a good organ rejection profile. These two vital factors of differentiation assist our objective of being first to market with alternate options to human donor organ transplants.
That will help you additional perceive why we consider we will probably be first to market, it’s important to differentiate between our bioengineered organs and xenotransplantation. The FDA defines xenotransplantation because the transplantation of dwell cell tissue or organs from a non-human animal supply. The company has additionally printed xenotransplantation steering which we consider we’ll enhance the regulatory timeline for that know-how classification.
Past the potential regulatory challenges for xenotransplantation, organ rejection is a major points xenotransplantation should overcome as effectively. Sadly, the size of the latest research have been comparatively quick, and the long-term survivability of genetically modified residing pig cells in people stays unknown.
Let me present you a bit of deeper understanding of our know-how platform. And I feel it will assist everybody higher perceive and recognize how are bioengineered organs are differentiated amongst our friends. On the highest degree our proprietary know-how of a scalable platform that makes use of a two-step methodology of decellularization and recellularization.
Step one decellularization is a course of that’s designed to take away porcine cells from the organ obtained from pigs to create a purified A Mobile Extracellular Matrix or ECM. The elimination of animal cells from the ECM is why we consider our bioengineered organs won’t be regulated as xenotransplantation.
To assist this view, we rely on two commercialize merchandise we developed, for hernia and wound care functions using porcine liver decellularization. And neither of those merchandise have been labeled or regulated as xenotransplantation. In 2019, we license these merchandise to a third-party to focus 100% of our sources on growing bioengineered organs.
Throughout decellularization our bioengineered organs are individually perfused with a delicate answer to purify the organ whereas preserving the mechanical constructions and vascular networks. This can be a good time to level out that sustaining or replicating mechanical constructions and vascular networks is a major problem for different organ transplant applied sciences, resembling 3d printing to beat.
The second step recellularization incorporates a perfusion course of that receives DCM with unmodified human cells inside bioreactors. The combination of unmodified human cells into the A mobile ECM, is why we consider our bioengineered organs could have a good organ rejection profile.
We sourced the human cells from human kidneys and livers not positioned for transplant. We’ve got settlement with a number of organ procurement organizations, or OPOs to safe our provide of human kidneys and livers. Hopefully, this temporary dialogue of our two-step know-how platform helps everybody higher perceive and recognize how our bioengineered organs are differentiated amongst our friends. This can be a great place to segue into an replace on our three bioengineered organ packages.
Our first program MiroliverELAP is our exterior liver help product or ELAP, and is designed to deal with acute liver failure sufferers. The system consists of an exterior perfusion system and our preliminary bioengineered liver that may reside outdoors the human physique to offer momentary liver assist. We consider this would be the first ever medical trial program designed to evaluate the flexibility of a bioengineered organ to ship essential liver operate in people.
We’re pioneering a brand new class of remedy and like different new lessons of therapies resembling CAR T and gene therapies, the innovators work intently with the FDA to determine the unique regulatory pathway to approval. We’re very appreciative with how constructive The FDA has been throughout our regulatory interactions. And simply this month we acquired a proper response to our pre IND submission. This was an vital step in additional establishing our regulatory pathway. And based mostly on these interactions, we anticipate submitting an IND utility for MiroliverELAP within the second half of 2022 and initiating a Part 1 medical examine shortly after our IND clearance is acquired from the FDA.
Our second program is Miroliver. Our absolutely implantable bioengineered liver supposed to deal with sufferers with acute and persistent liver failure that we have now been growing in collaboration with the Miro Clinic. Miroliver is bioengineered by recellularizing a decellularized porcine liver with human vascular liver and bile duct cells.
Miroliver will probably be implanted utilizing orthotopic liver transplantation the place the native liver is totally eliminated and changed with a Miroliver. Orthotopic procedures are the usual of look after liver transplants, which suggests surgeons will not must study a brand new process.
On the regulatory entrance, we have now had consultations with the FDA, and we anticipate submitting our pre IND requests in 2023. Much like MiroliverELAP after the FDA responds to our pre IND submission, we’ll have a greater sense of timing relating to the submitting of our IND utility for Miroliver and our path to the clinic.
In October 2021in collaboration with the Mayo Clinic, we printed a examine in Nature Communications biology, asserting the primary ever heterotopic implantation of our bioengineered livers into massive animals. The outcomes present that the pigs that acquired our bioengineered livers maintained detectable hepatic well being within the graph sustained blood perfusion and demonstrated early liver operate put up transplantation. This examine supplied wonderful proof of idea relating to our bioengineered livers as we progress in direction of human trials for Miroliver and MiroliverELAP.
Our third program is Mirokidney, our absolutely transplantable bioengineered kidney, supposed to deal with sufferers with finish stage renal illness. Mirokidney was awarded the kidney X prize from the Division of Well being and Human Providers and the American Society of Nephrology in 2019. Mirokidney is bioengineered by recellularizing a decellularized porcine kidney, with human vascular and renal particular cells.
Mirokidney will probably be implanted utilizing heterotopic kidney transplant procedures the place the native kidneys are left in place and a single kidney is grafted into the vasculature. Heterotopic procedures are the usual of look after kidney transplants, which suggests surgeons do not need to study a brand new process. On the regulatory entrance we’ll start consultations with the FDA this yr, and we anticipate submitting our pre IND requests in 2023.
In step with our different packages after the FDA response to our pre IND submission, we’ll have a greater sense of timing relating to the submitting of our IND utility for Mirokidney and our path to the clinic.
Switching to the operational entrance. One of many issues I am most enthusiastic about is our new headquarters in Suburban Minneapolis. The state-of-the artwork facility contains world class in-house manufacturing capabilities, we consider our in-house manufacturing facility gives us with sufficient capability to fabricate bioengineered organs underneath our management, and timelines via medical trials.
As we proceed to make strides in direction of essentially remodeling the organ transplant trade, we’re centered on guaranteeing the corporate has the appropriate group to execute our technique. As a part of constructing out this group, we just lately employed Jim Douglas as the corporate’s new Chief Monetary Officer who brings vital life science expertise.
Jim joins us from Piper Sandler, the place he was a Managing Director on the healthcare funding banking group specializing in advising biotechnology and med tech firms. Previous to Piper Sandler, Jim was at Abbott Laboratories and Value Water Coopers. Jim will succeed Brian Niebur, who will stay a significant a part of Miromatrix group in his new function as Vice President of Finance.
Brian performed a essential function via the corporate’s IPO. And we’re excited that he’ll work alongside Jim throughout this subsequent section of our growth.
In closing, a particular thanks to the Miromatrix staff who work tremendously exhausting each day to make bioengineered organs a actuality for sufferers. We consider that Miromatrix is uniquely positioned and effectively capitalized from our IPO to hit the milestones I’ve outlined right this moment. We stay devoted to saving and enhancing sufferers lives with our bioengineered organs.
Thanks on your continued assist. And I’ll now flip the decision over to Jim Douglas, our Chief Monetary Officer to debate our monetary ends in the fourth quarter and full yr 2021.
Thanks, Jeff. And it is really an honor to be a member of the Miromatrix group working in direction of one of the aspirational and noble missions an organization may have.
On a private notice, my father acquired a kidney transplant after years of dialysis, so I’ve seen firsthand the optimistic impression organ transplants have on sufferers and their households.
Shifting to our monetary outcomes. Miromatrix generates a small quantity of licensing income from two commercialized merchandise that we licensed to a third-party with a purpose to focus 100% of our sources on growing bioengineered organs.
Value of products bought represents the royalty we pay to the College of Minnesota to license our platform know-how. The licensing income and value of products bought ought to absolutely offset one another as each have $500,000 annual minimums. The gross loss place arises as a result of we’re reserving in opposition to a good portion of the licensing income. Attributable to us, whereas we aren’t reserving in opposition to the royalty funds we’re obligated to make to the College of Minnesota.
Transitioning to working bills. Within the fourth quarter of 2021 complete working bills had been $5.3 million versus $2.2 million within the fourth quarter of 2020, a $3.1 million enhance. For the complete yr of 2021, complete working bills had been $16.5 million versus $9.8 million for a similar interval in 2020, a $6.7 million enhance.
The first drivers of the spending development in each reportable durations are prices attributable to being a public firm, hiring of further staff, and the buying of medical and lab provides to advance our bioengineered organ packages.
Web loss for the fourth quarter of 2021 was $5.5 million, or $0.27 a share, as in comparison with a internet lack of $1.1 million or $0.50 per share for the fourth quarter of 2020. For the complete yr of 2021, internet loss was $14.7 million, or $1.28 per share, as in comparison with a internet lack of $10.3 million or $4.76 per share for a similar interval in 2020.
The $4.4 million enhance in internet loss in the course of the fourth quarter was primarily pushed by the rise in complete working bills, in addition to internet funding positive factors that had been recorded within the fourth quarter of 2020, with out comparable positive factors recorded within the fourth quarter of 2021. The $4.4 million enhance in internet loss for the complete yr was pushed by the rise in complete working bills and partially offset by a $2.4 million fairness loss and affiliate recorded in 2020, which was considerably bigger than the quantity recorded in 2021.
Web loss per share was impacted by the gadgets talked about, in addition to the numerous enhance in our weighted common variety of shares following our IPO.
Lastly, we ended the yr with $52.8 million of money, which we consider is adequate to final us via 2023. And can permit us to attain key milestones for our bioengineered organ packages that Jeff highlighted earlier.
And with that, I’ll flip the decision again over to the operator to open up the road for questions. Thanks.
[Operator Instructions] Thanks. Our first query is from Alex Novak, with Craig-Hallum Capital Group. Please proceed together with your query.
Nice. Good afternoon, everybody. Jeff, I hoped we may kick issues off by getting a bit of bit extra diving in diving into the suggestions acquired from the FDA on ELAP and the pre IND submission. What had been a few of the feedback that you simply received again the place you are comfy, you have already got the info essential that FDA is requesting? And the place as well as, do you assume that extra information goes to be wanted over the following couple months right here?
Sure, I recognize the query, Alex. Nicely, I can not go into the specifics, precisely what the dialogue was or what a few of the requests had been, what I can say is that all the pieces that we had been requested, we consider may be very achievable. So, as we talked about earlier, being the pioneer in a subject, we had been very, we felt the suggestions was extremely constructive, easy. And most of it actually relied round only a key space of Leucine off a few of our information packages that we have already been engaged on. In order that’s actually what led to a few of the steering of accelerating our confidence and having the ability to submit our IND, after which transferring ahead with that. So we had been very proud of the response.
And that is good, and perhaps for a simply little bit extra simply, do you assume there’s going to be a necessity for added animal research, probably totally different fashions past the pigs that you have achieved probably non-human primates? Or is that this extra all bench information for probably the most half?
Sure, I imply, the FDA at all times has the aptitude to ask for extra at numerous steps the place we really feel assured within the method that we have now, and no feedback on something that we acquired from them was there any requests for primate information related to something.
So, as I discussed earlier than, I feel we have now a extremely good path ahead and understanding the place we’re to the IND. And I feel given the steering on the place we put the timelines that ought to signify the extent of information that is wanted. The extra information that’s wanted, is not overly onerous, or one thing that we really feel is not achievable.
Sure, understood. That makes complete sense. So perhaps communicate to a few of the actions you are taking to get transplant facilities prepared to begin enrolling within the ELAP liver medical examine right here. When you do get that IND accepted. And what kind of timeline or lead time ought to we count on from as soon as IND acceptances acquired to beginning that medical trial?
Sure, that is an awesome query, Alex. And you recognize, what we take a look at with which are what are a few of the key facilities that will be seen these ELAP sufferers? So we take a look at it each from what is the capabilities of the facilities. What are a few of the physicians which are there, in addition to the flexibility to deliver these facilities comparatively lively comparatively quick. The perfect steering within the subject often is, we attempt to goal round that 90 days put up IND approval, to have the ability to have that heart up and dwell. And people are the timelines that we’re striving in direction of when it comes to actually working with facilities transferring ahead, to have the ability to transfer as quick as we probably can as soon as we have now that IND in hand.
Alright, excellent. After which simply lastly, when you do file the IND, perhaps stroll us via the method in direction of searching for numerous FDA designation resembling breakthrough or quick monitor? After which any further research or publications, abstracts that we ought to be looking forward to over the rest of the yr?
I feel we take a look at it from that standpoint, as soon as we have now that IND, our focus is absolutely going to be on Part 1 medical examine in driving that ahead. That is our alternative to reveal the security of our product. However once more, you bought to recollect we consider that that is going to be the primary bioengineered organ that is going to be clearer for IND. So our focus is absolutely going to be on executing that Part 1 medical examine. After which we’ll take a look at the choices on the bottom of that for a breakthrough or quick monitor or any of these different issues as soon as we have now a few of that medical information in hand.
After which something on the publications or research to look at for?
Sure, I feel on the publication, I would not count on a lot on the ELAP over the following yr, actually, as a result of we’re transferring in direction of the clinic. And that is actually the place our focus is in producing that human medical information.
On our different packages. We proceed to maneuver these ahead and proceed to take a look at alternatives to publish, when accessible, however our focus is absolutely on producing these pre IND packets and transferring that ahead as effectively.
Understood is smart. Thanks, Jeff, and Jim for the replace. Appreciated.
Completely. Thanks Alex for the questions.
Thanks. There are not any additional questions at the moment. I would like to show the ground again over to Jeff Ross, for any closing feedback.
Nice. Nicely, I recognize all of the shareholders tuning in right this moment and everybody else. And we look ahead to proceed to execute on our plan. Thanks, everybody. Have an awesome day.
This concludes right this moment’s convention. Chances are you’ll disconnect your traces at the moment. Thanks on your participation.