Name: Eloxx Pharmaceuticals, Inc. Q1 2023 Earnings Call
Start: 2023-05-16T00:00:00.000Z

Executive Summary

Q1 2023 delivered tighter operating discipline (OpEx down 49.9% YoY to $5.48M) with net loss improving to $6.23M from $11.62M YoY; cash fell sharply to $4.90M, intensifying near‑term financing needs .
Topline readout for ELX‑02 in Alport syndrome expected in the first half of 2023; management reiterated meaningful proteinuria reduction in one patient to date, positioning clinical data as the key near‑term catalyst .
FDA cleared the IND to initiate a single ascending dose trial for ZKN‑013 in RDEB in May 2023, expanding the clinical pipeline beyond ELX‑02 .
Debt terms amended in March: $7.5M principal repaid, minimum qualified cash reduced to $2.25M, and interest‑only extended to September 1, 2023; management guides cash runway into Q3 2023 assuming covenant compliance and Phase 3 initiation .
Nasdaq listing risk disclosed post‑quarter; an extension to regain compliance was granted through July 30, 2023, adding headline risk until milestones are met .

What Went Well and What Went Wrong

Clinical momentum: “We are approaching a significant milestone for Eloxx, with topline data, including kidney biopsy results, expected for ELX‑02 in Alport syndrome in the coming weeks.” – CEO Sumit Aggarwal .
Pipeline expansion: FDA clearance to begin a SAD clinical trial for ZKN‑013 in RDEB; preclinical data showed up to an 18‑fold increase in full‑length COL VII protein levels with prolonged treatment improving protein levels further .
Cost discipline: R&D and G&A decreased materially YoY (R&D $3.49M vs $7.90M; G&A $1.99M vs $3.05M), driven by reduced CF‑related clinical activity, lower salaries, and lower professional fees .

Liquidity tightened: Unrestricted cash and cash equivalents declined to $4.90M from $19.21M at YE22, reflecting debt repayment and operating cash burn; runway guided only into Q3 2023 .
Listing risk: Nasdaq Hearings Panel granted an extension to regain compliance with market value of listed securities through July 30, 2023, keeping near‑term listing status in focus .
Pre‑revenue profile persists: No revenue line reported; operating loss of $5.48M and net loss of $6.23M underscore continued reliance on external financing and partnerships .

Metric	Q3 2022	Q4 2022	Q1 2023
R&D Expense ($USD Millions)	$4.88	$3.30	$3.49
G&A Expense ($USD Millions)	$2.26	$2.73	$1.99
Total Operating Expenses ($USD Millions)	$7.14	$6.03	$5.48
Loss from Operations ($USD Millions)	$(7.14)	$(6.03)	$(5.48)
Other Expense, net ($USD Millions)	$0.37	$0.29	$0.75
Net Loss ($USD Millions)	$(7.51)	$(6.32)	$(6.23)
Net Loss per Share ($)	$(0.09)	$(2.92)	$(2.88)
Weighted Avg Shares (Millions)	86.66	2.17	2.17

Notes:

No revenue line was reported in the consolidated statements of operations for these periods, indicating a pre‑revenue status .
Per‑share comparability is impacted by a significant change in weighted average shares between Q3 2022 and Q4 2022/Q1 2023 .

KPI	Q3 2022	Q4 2022	Q1 2023
Unrestricted Cash & Cash Equivalents ($USD Millions)	$24.55	$19.21	$4.90
Current Portion of Long-Term Debt ($USD Millions)	$2.53	$3.98	$1.54
Long-Term Debt (net of current) ($USD Millions)	$9.86	$8.56	$4.03
Advances from Collaboration Partners ($USD Millions)	$12.22	$12.54	$12.54
Minimum Qualified Cash Balance Covenant ($USD Millions)	N/A	$2.25 (post‑March amendment)	$2.25

Metric	Period	Previous Guidance	Current Guidance	Change
Cash Runway	Q1 2023	Into Q3 2023 (stated at YE22)	Into Q3 2023 (assuming covenant compliance and Phase 3 initiation)	Maintained
Interest-Only Period on Term Loan	Q1 2023	Principal payments to begin Sept 2023	Interest‑only extended to Sept 1, 2023; then principal payments begin	Clarified/Confirmed
Minimum Qualified Cash Balance	Q1 2023	Reduced to $2.25M post‑amendment	$2.25M confirmed	Maintained
ELX‑02 Alport Topline Timing	Q1 2023	H1 2023	H1 2023; biopsy results included	Maintained (additional detail)
ZKN‑013 RDEB IND/SAD Start	Q1 2023	IND filed; FIH expected end‑2022/early‑2023	FDA cleared IND; SAD in healthy volunteers to initiate	Raised (regulatory progress)

Topic	Previous Mentions (Q3 2022 and Q4 2022)	Current Period (Q1 2023)	Trend
ELX‑02 in Alport syndrome	Phase 2 started; topline expected H1 2023; preclinical poster at ASN	Dosed 3 patients; meaningful proteinuria reduction in one patient; biopsy results in topline	Positive clinical momentum
ZKN‑013 in RDEB	IND filed; FIH Phase 1 targeted end‑2022/early‑2023	FDA cleared IND; SAD in healthy volunteers to start	Regulatory advance
Cash runway & debt	Cash sufficient into Q4 2023 subject to covenant restructuring/raise	Runway into Q3 2023; reduced minimum cash, interest‑only extended to Sept 1	Runway narrowed; terms eased
CF program (ELX‑02)	Phase 2 combo did not meet efficacy; path forward with CF Foundation TBD	Focus shifted to Alport; CF work de‑prioritized in OpEx commentary	Strategic refocus
Listing/Compliance	Not highlighted	Nasdaq extension to July 30, 2023 to regain compliance	Elevated listing risk

“We are approaching a significant milestone for Eloxx, with topline data, including kidney biopsy results, expected for ELX‑02 in Alport syndrome in the coming weeks.” – Sumit Aggarwal, President & CEO .
“Positive data from the [Alport] trial would also be a validation of our potential to treat other rare kidney diseases and develop small molecule genetic therapy products.” – Sumit Aggarwal .
On ZKN‑013: recent preclinical results demonstrated read‑through activity across multiple COL7 genotypes, with up to an 18‑fold increase in full‑length COL VII protein and functionality confirmed .

No Q1 2023 earnings call transcript was found in the company document set; therefore, there are no Q&A highlights to report for this quarter [ListDocuments returned none; Search returned none].

Wall Street consensus estimates via S&P Global for quarterly revenue and EPS were unavailable for ELOX during Q3 2022–Q1 2023. As a result, estimate comparisons cannot be provided for this period.

The near‑term stock catalyst is the ELX‑02 Alport topline readout (including biopsy results) expected in H1 2023; any durable proteinuria reduction or evidence of COL IV expression could materially impact valuation and funding optionality .
FDA clearance for ZKN‑013’s SAD trial broadens clinical optionality beyond ELX‑02 and provides a second potential data path to value creation in RDEB .
Liquidity is tight (cash $4.90M) with runway guided into Q3 2023; the amended Hercules facility (lower minimum cash, interest‑only to Sept 1) helps, but capital raise or partnering remains a likely requirement if Phase 3 is initiated .
Operating discipline is evident (OpEx down ~50% YoY), primarily from reduced CF activities and lower SG&A, but continued pre‑revenue status keeps funding needs acute .
Nasdaq compliance extension to July 30 adds headline risk; timely clinical milestones and financing could mitigate listing risk and sentiment overhang .
EPS comparability across quarters is distorted by the significant change in weighted average shares between Q3 2022 and Q4 2022/Q1 2023; focus on absolute loss/OpEx and cash trends for better signal .
Collaboration advances remain a stabilizer (advances from partners ~$12.54M), but non‑dilutive funding and strategic partnerships will be critical to bridge to Phase 3 and beyond .