Spero Therapeutics, Inc. Q3 FY2023 earnings call

• Tebipenem HBr: Partnered with GSK, received SPA agreement on Phase III trial design, PIVOT-PO enrollment expected soon, received $30M cash payment from GSK, eligible for up to $120M in development milestones, up to $150M in commercial milestones, etc.
• SPR720: Phase 2a Proof of Concept trial ongoing with 26 sites initiated
• SPR206: On track for Phase 2 IND submission by yearend, funded by grant and non-dilutive funding
• Management changes: Sath Shukla became President and CEO, Ankit Mahadevia transitioned to Chairman, Esther Rajavelu appointed CFO and CBO effective November 6

Spero Therapeutics had total third quarter revenues of $25.5 million in 2023, compared to $2 million in the third quarter of 2022. Research and development expenses for Q3 2023 were $16.4 million, up from $7.4 million in the same period in 2022. General and administrative expenses were $5.7 million in Q3 2023, down from $6.6 million in 2022. Cash and cash equivalents were $93.8 million as of September 30, 2023. Revenue contribution: Collaboration revenue from GSK was a key driver, with total revenues including $23.2 million from the GSK license agreement.

• Target commercialization date for Tebipenem with GSK is 2026, development milestones of up to $120M expected over next two years
• Tebipenem is expected to have peak sales potential as a blockbuster due to high prevalence of complicated urinary tract infections

Forward-looking statements are subject to factors that could cause actual results to differ, as detailed in Spero's SEC filings, including risk factors in the Form 10-Q for Q3 2023

Q: Could you give more color on the $120 million in development milestones from GSK as the Phase 3 program progresses? How are you thinking about peak sales potential of Tebipenem?

A: Sath Shukla said $120 million in development milestones expected over next two years with target commercialization in 2026; Tebipenem has potential for blockbuster status due to high prevalence of cUTI patients Q: As you think about advancing SPR206 interphase 2, can you discuss the regulatory path forward in the hospital acquired or ventilator associated bacterial pneumonia indication? Thought process behind exclusion criteria in PIVOT-PO study?

A: Sath Shukla said SPR206 IND expected to be submitted by yearend, details on regulatory path to be disclosed later; Kamal Hamed said exclusion of patients with <=30 mL per minute creatinine clearance is due to dosing adjustment for mild/moderate renal impairment but exclusion for severe renal impairment