Chemomab Therapeutics Ltd. (CMMB)·Q1 2023 Earnings Summary

Executive Summary

• Q1 2023 delivered clinical progress and runway extension: CM-101 Phase 2a NASH topline showed safety and positive activity across multiple fibrotic/inflammatory biomarkers; IND cleared for the Phase 2 systemic sclerosis (SSc) trial; PSC Phase 2 trial expanded to include a higher dose and open-label extension; estimated cash runway extended to 1H 2024 .
• Financially, net loss widened year over year to $8.75M and diluted loss/share to $0.04, driven by higher R&D tied to clinical activity; G&A decreased vs prior year .
• Guidance: PSC double-blind topline remains targeted for 2H 2024; SSc trial opening shifted to around mid-2023 (from prior expectation of late 2022/early Q1 2023); cash runway raised to June 30, 2024 .
• Catalysts: further data flow at medical meetings (EASL/EULAR), Phase 2 PSC enrollment progression and higher-dose cohort, SSc trial start with tissue biopsies for proof-of-biology—each a potential driver of sentiment for a small-cap fibrosis/autoimmune story .

What Went Well and What Went Wrong

• What Went Well

  • CM-101 NASH Phase 2a topline: met primary endpoint and showed improvements in ELF, ProC-3/4/18, TIMP-1, and FibroScan; nearly 60% “multiple responders” vs none on placebo; positive PK/target engagement; safety maintained .
  • IND clearance and imminent start for Phase 2 SSc trial (ABATE), a multicenter proof-of-biology study with skin biopsies and comprehensive biomarkers, targeting an initial readout in 2H 2024 .
  • Management proactively extended cash runway to 1H 2024 by trimming expenditures while preserving clinical program milestones; CEO emphasized staying “laser-focused” on PSC and SSc execution .

• What Went Wrong

  • Operating loss widened: R&D rose sharply (+151% YoY) to $6.9M given clinical/preclinical activity; net loss increased to $8.75M, and diluted loss/share to $0.04 .
  • SSc trial opening shifted from late 2022/early Q1 2023 expectations to mid-2023, reflecting operational planning and regulatory sequencing; still aiming for 2H 2024 data .
  • Liquidity decline sequentially (cash, cash equivalents and deposits): $46.5M (Sep 30, 2022) → $39.9M (Dec 31, 2022) → $32.8M (Mar 31, 2023), highlighting the need for disciplined spend and future financing options .

Financial Results

Income statement and key metrics (YoY comparison)

Quarter-on-quarter snapshot (selected metrics)

Liquidity trajectory

Segment breakdown

• Not applicable; no revenue-generating segments .

KPIs (program and corporate)

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “CM-101 appeared safe and demonstrated improvement across multiple disease-related fibrotic and inflammatory biomarkers…consistent with…earlier CM-101 clinical trials” — Dale Pfost, CEO .
• “We are extending our estimated cash runway by another quarter through the first half of 2024” — Dale Pfost, CEO .
• “We are on track to open our initial U.S. [SSc] sites around mid-year…initial data read-out…latter part of 2024” — Dale Pfost, CEO .
• “We have done so [runway extension] through a thorough review of our budgets…trim expenditures, while maintaining the resources needed to advance our two clinical programs” — Don Marvin, CFO .
• “The trial [ABATE]…includes a 24-week double-blind period…followed by a 24-week open-label extension…with skin biopsy at baseline and after the double-blind period” — Matt Frankel, CMO .

Q&A Highlights

• Medical conference cadence: Management expects data presentations at EASL (biliary and main), EULAR, and potentially ACR, aiming to keep the community updated on scientific progress .
• Partnering scope: Dialogues include NASH and other liver fibrotic diseases; company remains focused on PSC and SSc while recognizing broader fibro-inflammatory potential of CCL24 neutralization .
• SSc trial design clarifications: 10 mg/kg chosen to demonstrate tissue effect in Phase 2a scale; inclusion of both diffuse and limited SSc to explore impact across patient populations and avoid neglecting limited SSc patients .
• PSC interim considerations: Management balances optional earlier looks with protecting statistical power and potential regulatory utility of the study .

Estimates Context

• Wall Street consensus EPS and revenue estimates via S&P Global were unavailable for Q1 2023 due to data access limits at the time of request; as such, we cannot assess beat/miss versus consensus for EPS or revenue. Values would normally be retrieved from S&P Global; consensus was unavailable at the time of analysis.
• Chemomab does not generate revenue at this stage; development-stage results are driven by R&D and G&A spend trajectories and financing income .

Key Takeaways for Investors

• CM-101 continues to show multi-organ fibro-inflammatory biomarker activity with consistent safety, bolstering the thesis in PSC and SSc ahead of 2H 2024 readouts .
• The addition of a 20 mg/kg cohort and open-label extension in PSC should enhance dose-response understanding and durability signals, important for eventual registrational planning .
• ABATE’s design (tissue biopsies, robust biomarker panel) targets clear proof-of-biology in SSc—an area of high unmet need—with the IND clearance de-risking near-term execution .
• Cash runway extended to 1H 2024 via cost discipline; nonetheless, sequential cash use suggests future financing will be necessary absent strategic partnerships or non-dilutive sources—prepare for capital events .
• Near-term narrative drivers: additional scientific visibility (EASL/EULAR/ACR), PSC enrollment cadence and higher-dose arm progress, SSc site openings mid-2023 .
• Watch for partnering developments in NASH/other indications where CM-101’s dual anti-inflammatory/anti-fibrotic mechanism may be complementary; positive external validation could be a stock catalyst .
• Risk management: timeline shifts (e.g., SSc start) and elevated R&D outlays are typical in clinical execution; monitor spending versus milestones and any regulatory or enrollment updates .

Citations: Q1 2023 8-K press release and financial statements ; Q1 2023 10-Q ; Q1 2023 earnings call transcript ; Jan 3, 2023 NASH topline 8-K ; Feb 21, 2023 SSc IND 8-K ; Q3 2022 earnings call transcript .