Prothena Corp PLC (PRTA) Q4 2024 Earnings Call Highlights: Strong Financial Position Amidst ...

GuruFocus.com
21 Feb
  • Net Cash Used in Operating and Investing Activities: $150.3 million, at the low end of guidance range ($148 to $160 million).
  • Net Loss: $122.3 million, at the low end of guidance range ($120 to $135 million).
  • Cash, Cash Equivalents, and Restricted Cash: $472.2 million as of December 31, 2024, in line with guidance of $468 million.
  • Ordinary Shares Outstanding: Approximately 53.8 million as of February 20, 2025.
  • Debt: Zero debt.
  • 2025 Financial Guidance - Net Cash Used in Operating and Investing Activities: Expected to be between $168 and $175 million.
  • 2025 Financial Guidance - Year-End Cash, Cash Equivalents, and Restricted Cash: Expected to be approximately $301 million.
  • 2025 Financial Guidance - Estimated Net Loss: $197 to $205 million, including $41 million of non-cash share-based compensation expense.
  • Warning! GuruFocus has detected 3 Warning Signs with PRTA.

Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Prothena Corp PLC (NASDAQ:PRTA) has a robust portfolio of therapeutic drug candidates targeting neurodegenerative and rare peripheral amyloid diseases, with 4 wholly owned and 4 partner programs in various stages of clinical development.
  • The company's wholly owned clinical programs are nearing significant inflection points in 2025, setting up a transformational year.
  • Prothena's drug candidate, Fortamumab, has shown early survival benefits in AL amyloidosis, with potential for a US launch by the second half of 2026.
  • Prothena's Alzheimer's disease portfolio includes PRX 12 and PRX 123, with PRX 12 designed for easy at-home administration, potentially improving treatment access.
  • The company has strong financials, with $472.2 million in cash and no debt, providing a solid foundation for future growth and development.

Negative Points

  • Prothena Corp PLC (NASDAQ:PRTA) faces significant competition in the amyloidosis and Alzheimer's treatment markets, which could impact market share and revenue potential.
  • The company's reliance on partnerships for some of its programs may limit its control over development timelines and outcomes.
  • Prothena's financial guidance for 2025 indicates an expected net loss of $197 to $205 million, reflecting ongoing high costs associated with clinical development.
  • The company's success is heavily dependent on the outcomes of clinical trials, which carry inherent risks and uncertainties.
  • Regulatory approval processes for Prothena's drug candidates are complex and may face delays, impacting commercialization timelines.

Q & A Highlights

Q: What is considered the base and best case scenario for the phase 3 Affirm AL trial, and how are you thinking about the market opportunity in AL amyloidosis? A: Gene Kinney, President and CEO, explained that the best case scenario would be demonstrating a survival benefit with a p-value of 0.10 or less, as per their SPA agreement with the FDA. Brandon Smith, COO, added that the market opportunity is significant, with a strong uptake expected for an anti-amyloid therapy that directly clears amyloid from vital organs, especially in patients at high risk of early mortality.

Q: Can you discuss the baseline characteristics of patients in the Affirm AL trial and what would be a clinically meaningful overall survival benefit for birtamimab? A: Gene Kinney noted that the focus is on Mayo stage 4 patients, who are at the highest risk of early mortality. Chad Swanson, Chief Development Officer, added that about 80% of the subjects in the trial are on daratumumab, and success is defined as a p-value of 0.1 or less.

Q: Do you have any visibility on long-term mortality trends beyond the randomized phase of the trials, and what drove treatment-emergent deaths in the standard of care arm in the Vital trial? A: Gene Kinney stated that the Pronto and Vital trials are no longer ongoing, but in Pronto, there were more deaths in the placebo group than in the active treatment group. Chad Swanson added that all-cause mortality was considered in the analysis, and the timing of events in Affirm AL is similar to what was observed in Vital.

Q: How do you differentiate between statistical significance and clinical meaningfulness in the Affirm AL trial, and what is the expected demand for birtamimab? A: Gene Kinney emphasized that any treatment meeting the statistical criteria of a p-value less than 0.10 would be meaningful due to the significant unmet need. Brandon Smith highlighted that the unmet need is well-known, and any early separation in survival curves would be very meaningful to physicians, patients, and payers.

Q: What data will you have for PRX-12 by the end of the year, and what information are you looking for to design a late-stage development program? A: Gene Kinney mentioned that they are looking at risk-benefit profiles and treatment burden. Mark Johnson, VP of Investor Relations, added that initial data will come from about 225 participants, focusing on safety, tolerability, and pharmacokinetics to find the optimal dose regimen for a registration-enabling trial.

Q: How do you view the impact of daratumumab on the control arm in the Affirm AL trial, and what are your expectations for the control arm's performance? A: Gene Kinney expects the control arm to behave similarly to the Vital trial, with a median survival of around 8.3 months. Chad Swanson noted that the timing and nature of events in Affirm AL are aligned with Vital, and daratumumab does not seem to impact early mortality events.

Q: How many patients are actively treated with current standard of care, and what is the rationale for the 200 mg expansion cohort in PRX-12's Ascent trial? A: Mark Johnson stated that there are about 16,000 diagnosed and treated patients in the US, with an increase since daratumumab's approval. Chad Swanson explained that the expansion cohort allows for a larger data set and opportunistic enrollment due to patient demand.

Q: How do you plan to build commercial infrastructure ahead of and after the Affirm AL readout, and what are your plans for the European market? A: Gene Kinney noted that the medical need is similar globally, and they expect productive dialogue with regulators. Brandon Smith mentioned that the goal is a seamless launch experience, focusing on market education and ensuring the mechanism is known in the marketplace.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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