Inventiva S.A. Q4 FY2023 earnings call

• Lanifibranor development: In January 23, changes to Phase 3 design for MASH/NASH based on FDA discussion. Sino Biopharm received ILD approval in China, participated in global NATiV3 trial, first patient enrolled in China, breakthrough therapy designation from NMPA. Positive study results on MAFLD/NAFLD and Type 2 diabetes. Licensed lani in Japan and South Korea with $10 million upfront payment. Resumed screening and randomizing in NATiV3 Phase 3 after protocol changes. Positive interim analysis of Phase 2 clinical trial combining lani with empagliflozin showing reduction of HbA1c and fat redistribution.
• Financial milestones: Secured ~$39 million in financing in 2023, $50 million non-dilutive from China partner, $10 million from licensing agreement, drew second tranche of €50 million EIB loan (€25 million in second tranche).

In 2023, company revenues were €17.5 million, a record, up over 40% from €12.2 million in 2022. Revenues came from continuing milestones, an upfront payment from AL, and non-cash consideration. R&D expenses increased 82% to €110 million in 2023 from €60.5 million in 2022. G&A expenses were €13.8 million, a slight increase of 7% from 2022. Net financial income was a loss of €5.1 million. Net loss for the full year was €110.4 million compared to €54.3 million in 2022. Cash position started the year with close to €61 million, a decrease from €88.4 million at the start of 2022. R&D in the company represents 87% of overall expense, with lanifibranor accounting for 85% of that R&D expense and 75% of overall financial efforts dedicated to the program.

• Expect last patient first visit in first half of 2024 for Phase 3 NATiV3 clinical trial. Confident in achieving target with over 75% of patients targeted randomized in main cohort and over 350 in screening, close to 90% of randomized patients from North America and EU. R&D expense expected to increase slightly in 2024, then decrease in 2025 due to end of recruitment and finishing up recruitment.
• Regarding EIB loan, second tranche of €25 million already drawn, discussions ongoing for potential additional tranches but timeline depends on future cash injections and active work on that.

• Impact of screen failure rate following introduction of autoimmune antibodies recommended by data monitoring committee. Uncertainty on how much this will affect recruitment progress. Need to monitor and confirm if screen failure doesn't significantly change from past experience to meet recruitment end as planned.

Q: Follow up on data presented, view on market and confirmation of being next oral MASH therapy available.

A: Steve Harrison prefers giving lani to diabetic patients with MASH. Lani has good profile for stated and pre-diabetes patients. Confident in being next orally approved drug as other oral drugs are behind in Phase 3 and injectables are less preferred.

Q: When ex-U.S. sites to begin enrolling, milestones for EIB loan.

A: Ex-U.S. sites like Canada with central IRB to open soon, focus on Europe. Second tranche of €25 million from EIB already drawn, discussing additional tranches but not started yet.

Q: State of randomization, impact of safety concerns, partnership discussions.

A: More than 75% of patients targeted randomized in main cohort, over 350 in screening. Pool of patients in screening diminishing not due to pushback but lab/test/biopsy validity. Partnerships: strategy to partner Europe and U.S. together, prefer to wait till post Phase 3.

Q: Guidance on R&D 2024, achievement of 950 patient target.

A: R&D expense expected to increase slightly in 2024, then decrease in 2025. Target of 950 patients includes contribution from outside North America, FDA wanted certain percentage from US which is largely achieved.