On August 10, 2022 DiaMedica Therapeutics Inc. (Nasdaq: DMAC), a clinical-stage biopharmaceutical company focused on developing novel treatments for neurological disorders and kidney diseases, reported that financial results for the quarter ended June 30, 2022 (Press release, DiaMedica, AUG 10, 2022, View Source [SID1234618062]). DiaMedica will host a conference call on Thursday, August 11, 2022, at 8:00AM Eastern Time / 7:00AM Central Time, to discuss its business update and second quarter financial results.
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Clinical Developments
DM199 for the Treatment of Acute Ischemic Stroke
As previously announced, the U.S. Food and Drug Administration (FDA) placed a clinical hold on the Company’s Phase 2/3 ReMEDy2 trial for the treatment of acute ischemic stroke (AIS). The clinical hold was issued following the Company voluntarily pausing patient enrollment in the trial to investigate three unexpected instances of clinically significant hypotension (low blood pressure) occurring shortly after initiation of the intravenous (IV) dose of DM199. The hypotension was transient and blood pressure levels of all three patients recovered back to baseline within minutes of stopping the infusion and the patients suffered no ongoing adverse effects.
After pausing enrollment, the Company immediately initiated an investigation and conducted a comprehensive analysis to determine the likely cause of the hypotensive events. The Company learned that these adverse events likely resulted from changing to a new formulation of IV bag in the ReMEDy2 trial, as compared to the IV bag used in the prior, Australian ReMEDy1 trial, which was not readily available at many U.S. study sites. Recent testing of the prior IV bag has shown that as much as half of the DM199 protein bound to the IV bag used in the prior trial. Whereas, the DM199 protein does not bind to the current IV bag. This effectively increased the dose of DM199 delivered to patients in the current trial as compared to the prior trial. DiaMedica notes that hypotension is a known response to KLK1 therapy and that DiaMedica’s prior safety studies revealed orthostatic hypotension as the dose limiting tolerability for DM199.
DiaMedica plans to submit this data and its proposed modifications to the study protocol to the FDA in September requesting a removal of the clinical hold. The Company’s proposal will include utilizing a reduced IV dose level that will be comparable to the delivered dose that was well tolerated in the 46 patients in the previous ReMEDy1 trial. Although DiaMedica is confident that this change will sufficiently mitigate the risk of clinically significant hypotension in future ReMEDy2 trial patients, no assurance can be provided that it will or that the FDA will release the clinical hold in response to the Company’s submission. The FDA will have up to 30 days to respond to DiaMedica’s request to lift the clinical hold.
DM199 for the Treatment of Chronic Kidney Disease
DiaMedica continues to work toward completing the study close-out and the final data analysis for its completed REDUX trial studying the use of DM199 for the treatment of chronic kidney disease (CKD) and preparation of plans for next steps while maintaining Company focus on the ReMEDy2 AIS clinical program.
Balance Sheet and Cash Flow
DiaMedica reported total cash and investments of $38.4 million, current liabilities of $1.5 million and working capital of $37.6 million as of June 30, 2022, compared to total cash and investments of $45.1 million, $1.5 million in current liabilities and $43.9 million in working capital as of December 31, 2021. The decreases in cash and investments and in working capital were due primarily to cash used to fund operating activities during the six months ended June 30, 2022.
Net cash used in operating activities was $6.4 million for each of the six months ended June 30, 2022 and June 30, 2021. Cash used in operating activities is driven primarily by the Company’s net loss, partially offset by non-cash share-based compensation and the effects of the changes in operating assets and liabilities.
Financial Results
Research and development (R&D) expenses were $2.0 million for the three months ended June 30, 2022, down $0.2 million from $2.2 million for the three months ended June 30, 2021. R&D expenses decreased to $3.9 million for the six months ended June 30, 2022, compared to $4.6 million for the six months ended June 30, 2021, a decrease of $0.7 million. This decrease for the six-month comparison was due to a number of factors including reduced costs incurred in the current year for wrap-up related activities for the REDUX Phase 2 CKD trial, decreased non-clinical testing costs which were incurred at greater levels in 2021 in preparation for the Phase 2/3 ReMEDy2 trial which initiated during 2021 and decreased manufacturing process development costs. These decreases were partially offset by current year ramp-up of costs incurred in performing the ReMEDy2 trial and increased personnel costs associated with R&D operations.
General and administrative (G&A) expenses were $1.4 million for the three months ended June 30, 2022, up from $1.2 million for the three months ended June 30, 2021. G&A expenses increased to $3.0 million for the six months ended June 30, 2022, compared to $2.4 million for the six months ended June 30, 2021, an increase of $0.6 million. The increase for the six-month comparison was primarily due to increased directors’ and officers’ liability insurance and personnel and professional services costs to support the Company’s expanding clinical programs. These increases were partially offset by a reduction in non-cash share-based compensation.
Conference Call and Webcast Information
DiaMedica Management will host a conference call and webcast to discuss its business update and second quarter 2022 financial results on Thursday, August 11, 2022, at 8:00 AM Eastern Time / 7:00 AM Central Time:
Date:
Thursday, August 11, 2022
Time:
8:00 AM ET / 7:00 AM CT
Web access:
Dial In:
(888) 440-4368
Conference ID:
4814247
Interested parties may access the conference call by dialing in or listening to the simultaneous webcast. Listeners should log on to the website or dial in 15 minutes prior to the call. The webcast will remain available for play back on DiaMedica’s website, under investor relations – events and presentations, following the earnings call and for 12 months thereafter. A telephonic replay of the conference call will be available until August 18, 2022, by dialing (800) 770-2030 (US Toll Free) and entering the replay passcode: 4814247.
About ReMEDy2 Trial
The ReMEDy2 trial is an adaptive design, randomized, double-blind, placebo-controlled trial studying the use of the Company’s product candidate, DM199, to treat AIS patients. The trial is intended to enroll approximately 350 patients at 75 sites in the United States. Patients enrolled in the trial will be treated for three weeks with either DM199 or placebo, beginning within 24 hours of the onset of AIS symptoms, with the final follow-up at 90 days. The trial excludes patients treated with tissue plasminogen activator (tPA) and/or mechanical thrombectomy. The study population is representative of the approximately 80% of AIS patients who do not have treatment options today, primarily due to the limitations on treatment with tPA or mechanical thrombectomy. DiaMedica believes that the proposed trial has the potential to serve as a pivotal registration study of DM199 in this patient population.
The ReMEDy2 trial has two separate, independent, primary endpoints based upon both the results observed in the first ReMEDy1 phase 2 trial and published results from the urine-derived form of KLK1 used to successfully treat AIS in China. ReMEDy2 is powered for success with either endpoint: 1) physical recovery from stroke as measured by the well-established modified Rankin Scale (mRS) at day 90, and 2) the rate of ischemic stroke recurrence through day 90. Recurrent strokes represent 25% of all ischemic strokes, often occurring in the first few weeks after an initial stroke and are typically more disabling, costly, and fatal than initial strokes.
About DM199
DM199 is a recombinant (synthetic) form of human tissue kallikrein-1 (KLK1). KLK1 is a serine protease (protein) that plays an important role in the regulation of diverse physiological processes including blood flow, inflammation, fibrosis, oxidative stress and neurogenesis via a molecular mechanism that increases production of nitric oxide and prostaglandin. KLK1 deficiency may play a role in multiple vascular and fibrotic diseases such as stroke, chronic kidney disease, retinopathy, vascular dementia, and resistant hypertension where current treatment options are limited or ineffective. DiaMedica is the first company to have developed a recombinant form of the KLK1 protein. The KLK1 protein, produced from porcine pancreas and human urine, has been used to treat patients in Japan, China and South Korea for decades. DM199 is currently being studied in patients with acute ischemic stroke and patients with chronic kidney disease. In September 2021, the FDA granted Fast Track Designation to DM199 for the treatment of AIS.