SPRUCE BIOSCIENCES, INC. (SPRB)·Q1 2024 Earnings Summary

Executive Summary

• Q1 2024 collaboration revenue was $2.00M, net loss improved to $11.63M, and diluted EPS was -$0.28; operating expenses declined YoY as R&D tapered post-enrollment completion .
• Management highlighted positive mechanistic signals (ACTH mean reduction up to 45% in CAHmelia‑203 open-label) and emphasized correlations between tildacerfont response and baseline GC dose/compliance; topline CAHmelia‑204 (adult GC reduction) and interim CAHptain‑205 (pediatric dose-ranging) data remain expected in Q3 2024 .
• Cash and equivalents were $81.2M; the company expects its current operating plan to be funded through end of 2025, extending runway beyond the Q3 clinical readouts and planned EOP2 meeting in Q1 2025 .
• Near-term stock catalysts: Q3 2024 readouts for CAHmelia‑204 and CAHptain‑205 interim cohorts; strategic collaboration with HMNC in MDD adds optionality beyond CAH .

What Went Well and What Went Wrong

What Went Well

• Mechanistic engagement: Open-label CAHmelia‑203 analyses showed a maximum mean ACTH reduction of 45%, indicating pituitary target engagement (mechanism of action) .
• Execution and visibility: Upcoming Q3 2024 toplines for CAHmelia‑204 and pediatrics (CAHptain‑205 interim), plus an EOP2 FDA meeting planned for Q1 2025, reinforce program momentum .
• Quote: “We are encouraged by key learnings… tildacerfont demonstrated a maximum mean reduction in ACTH of 45%… higher GC doses at baseline as well as higher rates of study drug compliance were associated with larger placebo-adjusted reductions in A4.” — CEO Javier Szwarcberg .

What Went Wrong

• CAHmelia‑203 missed its primary endpoint (placebo-adjusted A4 change at week 12); compliance was low (~50% ≥80% compliant), resulting in lower-than-expected drug exposure, and the study was terminated .
• Pediatric dosing variability: CAHptain‑205 showed therapeutic activity but less consistent than anticipated, with PK suggesting faster clearance in children, implying need for higher doses/dose-optimization .
• OpEx mix: G&A increased YoY ($4.32M vs $3.45M), partially offsetting R&D declines; cash decreased QoQ as clinical programs progressed .

Financial Results

Notes:

• Prior quarter (Q4 2023) line-item quarterly P&L was not separately disclosed; Q3 2023 is shown for trend context .
• Margin metrics (gross/EBITDA) are not applicable given no product sales and collaboration revenue accounting; net income margin not disclosed in filings .

Liquidity and Operating KPIs

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “In the open-label portion of the study, tildacerfont demonstrated a maximum mean reduction in ACTH of 45%… higher GC doses at baseline as well as higher rates of study drug compliance were associated with larger placebo-adjusted reductions from baseline in A4.” — CEO Javier Szwarcberg .
• “We look forward to reporting data from the CAHmelia‑204 study in the third quarter of this year.” — CEO Javier Szwarcberg .
• “Compliance in 204… appears to be north of 80%… gives assurance we’ll achieve tildacerfont exposure required to demonstrate efficacy.” — Management on call .
• “73% of all pediatric patients met the efficacy endpoint of A4 or GC reduction… PK suggests tildacerfont is cleared more rapidly in children… we plan to continue dose‑ranging.” — CMO commentary .

Q&A Highlights

• Compliance/exposure drove 203 miss: Lower exposures vs prior 202 PoC; ~50% of patients ≥80% compliant; mgmt emphasized sensitivity of A4 to missed doses .
• Differentiation vs Neurocrine’s CAHtalyst: SPRB’s 203 baseline A4 (~1,151 ng/dL) and GC dosing differ materially; mgmt attributes divergence to compliance/exposure and severity .
• 204 titration algorithm: Patients near/within ULN for A4 can down‑titrate GC based on scheduled A4 assessments per protocol .
• Registrational path: Likely requires confirmatory Phase III even with strong 204; potential combined adult/pediatric design under consideration .
• Pediatric dosing: Faster clearance implies higher relative doses may be required; further dose‑ranging ongoing .

Estimates Context

• S&P Global consensus estimates for Q1 2024 EPS and revenue were unavailable due to data access limits; therefore, estimate comparisons cannot be provided at this time. Values retrieved from S&P Global were unavailable.*

Key Takeaways for Investors

• Near-term binary catalysts: CAHmelia‑204 adult GC reduction topline and CAHptain‑205 pediatric interim data in Q3 2024 will likely drive stock direction; management confidence centers on better compliance/exposure in 204 .
• Mechanism intact despite 203 miss: ACTH reductions (45% max mean) and observed exposure–response relationships support biologic activity; response appears stronger with higher baseline GC dose and full compliance .
• Pediatric program needs dose optimization: Faster clearance signals a path to improved consistency via higher dosing or regimen adjustments; interim readout expected Q3 2024 .
• Runway through end‑2025 mitigates financing overhang in the near term and spans key data inflections and EOP2 meeting; macro/banking risks still disclosed .
• Strategic optionality beyond CAH: HMNC collaboration in MDD introduces a precision psychiatry angle (diagnostic‑guided CRF1 antagonism) with a Phase 2 POC planned Q4 2024, expanding addressable indications .
• Watch for guidance updates post‑Q3 data: Mgmt indicated potential need for confirmatory Phase III; adult+pediatric combined design could streamline registrational path .
• Trading setup: Outcome of 204 (registrational endpoint on GC reduction) is the principal narrative mover; strong efficacy plus safety could reset sentiment following 203, while further ambiguity on dosing/compliance would weigh on the story .

Additional Q1 2024 Materials

• Q1 2024 8‑K/Press Release: financials and program updates .
• Q1 2024 10‑Q: detailed financial statements and MD&A .
• Relevant press releases: HMNC Brain Health strategic collaboration in MDD (Q2 announcement proximate to Q1 period), PES posters on adult/pediatric baseline characteristics .

Citations:

• Q1 2024 8‑K press release and exhibits .
• Q1 2024 10‑Q financials, MD&A, risk factors .
• Q3 2023 earnings 8‑K .
• FY 2023 results and corporate update 8‑K (Mar 13, 2024) .
• HMNC Brain Health collaboration press release .
• Earnings call transcript (Mar 13, 2024) –.