TFF Pharmaceuticals, Inc. (TFFP) Q2 2021 Earnings Call Transcript

TFF Pharmaceuticals, Inc. (TFFP -2.25%)
Q2 2021 Earnings Call
Aug 12, 2021, 4:30 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good afternoon, ladies and gentlemen, and welcome to the TFF Pharmaceuticals second-quarter 2021 financial results conference call. As a reminder, this conference is being recorded. I will now turn the call over to our host, Corey Davis of LifeSci Advisors. You may begin your conference.

Corey Davis -- Investor Relations Contact Officer

Thank you, operator. Hello, everyone, and welcome to the TFF Pharmaceuticals second-quarter 2021 financial and business results conference call. With me on the line today is Glenn Mattes, president and CEO of TFF; Kirk Coleman, CFO; Dr. Dale Christensen, TFF director of clinical development; Dr.

Bill Williams of the University of Texas at Austin; and Chris Cano, TFF's chief operating officer. Announcing our second-quarter results is available on the TFF Pharmaceuticals website. Please take a moment to read the disclaimer about forward-looking statements in the release. The earnings release and this teleconference both include forward-looking statements, and these statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from the statements made.

Factors that could cause actual results to differ are described in the disclaimer and in our filings with the U.S. Securities and Exchange Commission, including the risk factors section of our 2020 annual report on Form 10-K filed with the SEC. And now, it's my pleasure to turn the call over to Mr. Glenn Mattes.

Glenn Mattes -- President and Chief Executive Officer

Thank you, Corey. Good afternoon and thank you for joining us today to review TFF's second-quarter operations and recent highlights. During the call, I will provide an update on our clinical and corporate progress, and then I'll ask our head of clinical development, Dr. Dale Christensen, to update us on the important progress we are making in our internal clinical programs.

Following Dale's remarks, Kirk Coleman, our chief financial officer, will then review the company's financials for the quarter. Following Kirk's comments, Dr. Bill Williams, of the University of Texas at Austin, will provide an update on the latest R&D advancements using our thin film freezing platform technology, as well as an update on the expansion of our intellectual property estate. Finally, Chris Cano, our chief operating officer and head of business development, will update us on business development and operational initiatives for the company with the value of our thin film freezing technology enabling us to expand the number of meaningful partnerships with pharmaceutical companies, academic institutions and the government health agencies.

We'll then open up the call for your questions. As we enter the second half of 2021, TFF is now poised to reach several value-creating inflection points in the voriconazole and tacrolimus development programs. Each of the therapeutic markets represent a substantial commercial opportunity for our company. We estimate the yearly market potential for both compounds to be meaningful.

Voriconazole is forecasted to take a significant share of the invasive pulmonary aspergillosis market, focusing on the patient segment requiring treatment beyond 30 days. For tacrolimus, we have forecasted sales potential to exceed $1 billion once approved for lung, kidney, heart and liver transplant patients. Given the optimal pharmacokinetics of our inhaled formulations, we are confident that both vori and tac will demonstrate efficacy and better adverse events profiles over the oral formulations currently on the market. Let me briefly review our progress made to date and then what investors can expect in terms of our catalysts in the second half of 2021.

In July, we announced the successful completion of single ascending and multiple ascending dose studies for tacrolimus. Later in the call, Dale Christensen will describe the significance of these data in greater detail on why TFF tacrolimus represents an exciting opportunity in the setting of lung treatment. With respect to voriconazole, earlier in the year, we announced the successful completion of the phase one clinical trial, and based on these results, TFF plans to study the 80-milligram dose of TFF vori in the planned pivotal trial. So for you, the investors, I want the message to be clear TFF pharmaceuticals is now poised to enter 2022 with pivotal trials being conducted for our two lead internal programs, each of which represents a substantial commercial opportunity.

At our present valuation, I believe that many investors are simply not paying close enough attention to the progress we have made to date, but with expected advancement of TFF tacrolimus and voriconazole into pivotal testing, we anticipate a positive shift in how investors perceive the value of our internal pipeline. TFF has two later stage, differentiated proprietary drug candidates, each targeting highly attractive markets with the potential to generate significant future revenues. To help investors better understand the TFF story, we held a virtual science day event back in June, highlighting our thin film freezing technology and its applications in transplants and vaccines. The event featured three key opinion leader perspective.

Dr. Deborah Levine from UT Health San Antonio provided background on lung transplantation, the current toxicity limitation of oral tacrolimus for immunosuppression and the potential improvements with an inhaled formulation of tacrolimus, referencing, of course, our TFF tacrolimus program. Dr. Kartik Chandran from the Albert Einstein College of Management then discussed the benefits of using the TFF technology to create a dry powder pulmonary formulation for rVSV vaccine against COVID-19.

And Dr. Ted Ross from the University of Georgia discussed his experience utilizing the TFF process for creating a universal influenza vaccine for pulmonary delivery and its potential benefit over their existing annual vaccination. For those investors who could not attend our science day, the webcast and presentation materials for this event can be accessed on the TFF corporate website. As the TFF development programs advance for voriconazole, tacrolimus, niclosamide and our antibody collaborations with Augmenta Bioworks, we also understand the importance of building the company's capabilities to further support maturing clinical programs.

As part of that effort, today, I'm very pleased to announce the formation of TFF pharmaceuticals scientific advisory board. We have assembled an extraordinary group of accomplished individuals who are globally recognized as thought leaders in their respective fields. The members of the TFF scientific advisory board are: Dr. David Kornfield.

Dr. Cornfield was professor of pulmonary medicine and the director of the Center for Excellence in Pulmonary Biology at Stanford University. Dr. David Denning, who is a professor of infectious diseases and global health, University of Manchester.

Dr. Anthony Hickey, Director of the University of North Carolina, UNC at Chapel Hill, catalyst for rare diseases. Dr. Jay Peters, chief of pulmonary and critical care medicine at the University of Texas Health Science Center in San Antonio.

Dr. Ted Ross, professor at the University of Georgia in the animal health research center, center for vaccines and immunology, and the department of infectious diseases. Dr. Michael Saag, professor of medicine and associate dean for global health at the UAV School of Medicine in Alabama.

And last but not least, Dr. Drew Weismann, professor of medicine for the Perelman School of Medicine at the University of Pennsylvania. I'm sure you will agree that this is an outstanding scientific advisory board. These renowned experts share the interest in the potential of the thin film freezing technology and are excited to help contribute their expertise and guidance to help the company optimize its potential.

At this point in our company's growth, we believe that this was the right time to have significant depth and expertise in medicine, medicinal chemistry, virology and the formulation sciences as we continue to advance multiple programs, both internally and for our numerous and growing portfolio of partnerships. The full biographies of our SAB will be posted on our company website. Before moving on to a review of our existing partnership and business development programs, I also want to share with you some important additions to the TFF team. In the area of manufacturing and product development, Dr.

John Koleng will be transitioning from his current role as a consultant to a full-time position as vice president of product development and manufacturing. John has been a key contributor to TFF since its inception. now, as the internal programs progress and the number of partnership programs increase, I've asked John to join the team in this role. We have also added another key person to this group reporting to John.

That person is Don Owens, who will join the company as director of product development. Don has an extensive background in the field of inhaled drug delivery and formulation. now, having reviewed the progress on our internal programs and company growth initiatives, let me review the recent development in our external partnerships. As you all know, the TFF business strategy has two elements, applying the thin film freezing technologies developing products internally and then licensing those assets to partners for commercialization, and then licensing access to the technology, to pharmaceutical company partners to formulate their assets.

Last quarter, we highlighted our worldwide licensing agreement with UNION Therapeutics, the thin film freezing to produce both an oral and inhaled version. Importantly, recent data from UNION suggests that niclosamide is effective against the new prevalent COVID-19 variants. TFF is progressing the development of niclosamide, and we'll begin the phase one program later this year. Just recently, TFF announced additional progress in our second COVID-19 directed program with our partner Augmenta Bioworks.

DFF and Augmenta announced the selection of a lead monoclonal antibody, AUG-3387, which is being developed for the prevention and treatment of COVID-19. Similar with our UNION collaboration, we consider our partnership with Augmenta to be an important example of how our thin film freezing technology can be applied to develop proprietary therapeutics, addressing a large unmet medical need in the area of public health. And also demonstrates the application of the thin film freezing technology in biologics. We're also pleased that Catalent Biologics has been selected to conduct cell line development, utilizing their proprietary GPEx platform and to lead drug substance manufacturing and scale up efforts for AUG-3387 as the program advances through our clinical development.

Our work with PLUS Products on the thin film freezing versions of cannabinoids has entered into the market testing phase. PLUS has successfully produced formulations that they determined to be ready for consumer input. We expect feedback from those efforts shortly. And finally, our work with NeuroRX and GreenLight is also moving forward well.

Currently, we were working with the majority of the top 20 pharmaceutical companies as measured by sales. In some cases, on multiple open MTAs at various stages. Our number of material transfer agreements and statements of work also steadily increases. I remain highly confident in our ability to close two meaningful transactions by the end of 2021.

This has been our stated annual goal for licensing transactions. Later in our call, our chief operating officer and head of business development, Chris Cano will provide a more detailed review of our partnership and business development activities. Before reviewing our quarterly financial results, I want to turn the call over to Dr. Dale Christensen, our head of clinical development, who will give you more detail on the outstanding progress we continue to make with our programs.

Dale?

Dale Christensen -- Director of Clinical Development

Thank you, Glenn, and good afternoon to everyone who has joined our update call today. In the last quarter, we made tremendous progress in our internal clinical development programs. On our first-quarter conference call, I provided details about the safety and pharmacokinetic results from our phase one trial of inhaled voriconazole powder or TFF vori, in healthy normal volunteers. These data were used to initiate a phase 1b study in asthma patients to understand if the TFF Vori is likely to trigger bronchospasm in patients with hyperreactive airway diseases when dosed up to the 80-milligram dose that we intend to pursue for our pivotal clinical studies.

Despite the effects of the pandemic on clinical trials globally, we continue to enroll asthma patients and have demonstrated that the 40-milligram dose was well tolerated and upon completion of the safety review of pulmonary function testing and complete clinical data, dose escalation to the 80-milligram twice daily dose was approved. We're currently completing the enrollment of that 80-milligram dosing cohort. Importantly, this reactive airway study sets the stage for our pivotal studies by providing guidance on whether patients with asthma or other diseases with hyper-responsive airways should be premedicated with a bronchodilator or whether this pretreatment will not be required. To be clear, pretreatment would not stop development because other anti-infectives that are inhaled do require pretreatments.

But if we don't require pretreatment, our label claims would be cleaner than those compounds. The data generated to date suggests that we have a clear path to initiate our phase two studies and to get this moving. We have begun to interact with regulatory agencies to define endpoints for the pivotal studies and will file for regulatory approvals to start treating patients with invasive pulmonary aspergillosis by the end of the year. In addition to the voriconazole results, I am also pleased to report that dosing of all subjects in our Phase I study of tacrolimus inhalation powder was completed successfully.

We have also completed the chronic toxicology study that is required by the FDA for registration, and we are preparing for a phase two study in lung transplant patients. During our science day, Dr. Levine provided guidance that lung transplant patients undergo therapeutic drug monitoring of maintenance 12-hour trough tacrolimus levels so that they achieve blood levels of five to 15 nanograms per mill after transplant. Dosing to these blood levels for oral tacrolimus is required to get a high enough concentration of tacrolimus in the lung tissues to prevent acute allograft rejection.

In our phase one study in healthy normal subjects, we dosed for a total of seven days and found that the TFF formulation as inhaled tacrolimus has greater bioavailability than oral program and with a 1-milligram, twice-daily dose of inhaled tacrolimus, the mean blood levels of the subjects in the cohort reached almost 15 nanograms per ml. That's the upper limit of what's needed for successful immunosuppression in lung transplant patients. We believe this ability to efficiently reach therapeutic drug levels with our tacrolimus inhalation powder, dramatically reduces the risk for the program. Furthermore, this data, when coupled with the demonstrated deposition in the lung during toxicology study supports our working hypothesis that we can reduce systemic exposure to levels that are safer for the kidney and other organs while maintaining sufficient levels in the lung to prevent rejection.

We are currently preparing for dialogue with regulatory agencies and expect to initiate phase two study activities by the end of the year. Turning to our partnered programs, I also want to report that TFF Pharmaceuticals has completed dosing and toxicology studies with our niclosamide product designed to treat COVID-19 and other respiratory viral infections. These data are supportive of continued development, and we expect enrollment in our phase one study of inhaled niclosamide to begin in early Q4. Finally, we also announced that we had selected a lead monoclonal antibody as part of our collaboration agreement with Augmenta Bioworks.

Together with Augmenta, we selected Catalent biopharma to manufacture the antibody for toxicology and clinical supplies, and this work is ongoing with promising early results. We've also been screening for binding and neutralization of the lead antibody known as AUG-3387 to measure potential efficacy against newly emerging variants as an ongoing part of the development program. We were excited to find that our lead compound neutralizes the Delta variant that is currently sweeping through the U.S. and locations around the world.

This exciting data underscores the critical need to accelerate development of AUG-3387, which could provide a critical therapy not only for newly infected patients but for preventing infection in patients who are at high-risk of COVID-19 complications once infected with the SARS-CoV-2 virus. This becomes possible because the stable dry powder created using the TFF process can easily be administered at home and the dose reduction that can be achieved by direct pulmonary delivery means that more people can receive the drug for every manufacturing run. The stability at room temperature also means that it can be more easily distributed to places where the cold chain requirements of most biological drugs limit their availability. And with that update, I'd like to turn the call over to chief financial officer, Kirk Coleman, for a review of the financials.

Kirk?

Kirk Coleman -- Chief Financial Officer

Thank you very much, Dale. For the three months ended June 30, 2021, research and development expenses for the company were $2.8 million compared to $2.6 million for the same period in 2020. The increase in research and development expenses during 2021 was due to increased preclinical activity related to niclosamide and increased clinical activity related to vori and tac. The ramp-up also includes our preliminary analysis and testing of dry powder formulations of several drugs and vaccines, we believe, have the potential to become product candidates.

General and administrative expenses for the three months ended June 30, 2021, were $2.4 million compared to $1.3 million in 2020. The company reported net loss for the quarter of $4.7 million compared to a net loss of $3.8 million in 2020. Weighted average common shares outstanding, basic and diluted, for the three months ended June 30, 2021, were 25,369,144 compared with 19,071,658 for the same period in 2020. As of June 30, 2021, we had total assets of approximately $57.2 million and working capital of approximately $53.9 million.

At the end of the quarter, our liquidity included approximately $52.1 million of cash and cash equivalents. And with that, I'd like to turn the call over to Dr. Bill Williams, who will talk about some of the groundbreaking work we're doing using our thin film freezing platform, particularly with large molecule biologics and how our technology is unique in its ability to successfully transform these complex molecules into an inhalable dry powder. Bill?

Bill Williams -- Scientific Consultant

Thank you, Kirk. Good afternoon, everyone. I am pleased to report that we have continued to advance the science and partner applications supporting thin film freeze drying. This includes strengthening our robust intellectual property portfolio.

We have filed an international patent application based on our work on biologics and completed supporting work for three additional provisional patent applications based on our work on vaccines, adjuvants and monoclonal antibodies. Our most recent research for providing stabilized powder forms of liposomes, liposome-based compositions, adjuvants, adjuvanted vaccines and monoclonal antibodies is key to further applications of thin film freeze drying to the stabilization and pulmonary delivery of vaccine antigens and monoclonal antibodies. We have continued to publish and file intellectual property around our innovative work in applying thin film freeze drying to the delivery of low molecular weight hard to deliver drugs, as well as biologics. These activities are key to our continued work to differentiate, improve the advantages of our process and powder characteristics to therapy as enabled by the thin film freeze-drying process.

We were invited by the American Editorial Board of the journal, KONA Powder and Particle Journal, a high-impact, internationally recognized journal that publishes papers in powder science and technology. We just published our paper titled "The Development of Thin-film Freeze-drying and Its Application to Improve Delivery of Biologics as Dry Powder Aerosols". This is important recognition of our technology and its impact. Also, our paper titled, "Niclosamide Inhalation Powder Made by Thin Film Freezing: Multi-dose tolerability and exposure in Rats and Pharmacokinetics in Hamsters", was recently published in the high-impact journal, International Journal of Pharmaceutics.

And the paper's findings directly support the company's efforts developing inhaled dry powder niclosamide to treat viral infections including COVID-19. Lastly, our paper-based on a research collaboration with Takeda Vaccines that began during a poster presentation at an AAPS PharmSci 360 meeting a couple of years ago, was recently published in Bioarchive and recently peer-reviewed by the International Journal of Pharmaceutics. This paper confirmed that thin film freeze-drying successfully transformed a liquid suspension form of a bivalent norovirus vaccine candidate absorbed onto aluminium oxyhydroxide into powders by thin film freeze-drying without causing antigen loss or particle aggregation, all while maintaining the potency of the antigens within a specified acceptable range. Notably, we showed that the potency of the antigens in our dry powders was maintained in the specified acceptable range for eight weeks at 40 degrees C, 75% relative humidity in a completed stability study.

Thus, confirming the potential to eliminate the cold chain requirement for transport and/or storage of this adjuvanted vaccine. These findings have broad applicability to other adjuvanted vaccines that we are currently working on. Our technology validation efforts for applying thin film freeze-drying to partner compounds has been robust, as highlighted by Glenn and Dale. At a high level, I'd like to describe some of those efforts.

First, our work with Augmenta monoclonal antibody, AUG-3387 has confirmed that thin film freeze-drying resulted in stable inhalable dry powders suitable for dry powder inhalation. As recently confirmed, the antigen binding and virus neutralization activities of this monoclonal antibody and the powders were indistinguishable from the monoclonal antibody before being subjected to thin film freeze-drying. These efforts will allow us to demonstrate that a sufficient dose of AUG-3387 to achieve a neutralizing concentration in the lungs can be delivered using an already approved commercially available dry powder inhaler device. I note that we are similarly validating other partner monoclonal antibodies with the goal of stabilizing and delivering them as dry powders.

Next, we continue to validate applications of thin film freeze-drying through stabilization and delivery of partner mRNA lipid nanoparticles, including those for improving cold chain requirements and creation of dry powders for inhalation. These studies demonstrate the benefit of the intermediate freezing rate and very small interfacial area as used in thin film freeze-drying, such as maintaining particle size of the mRNA lipid nanoparticles and the encapsulation efficiency, integrity and function of the mRNA in the lipid nanoparticle as compared to those of spray freeze-drying, which has high interfacial area and sheer stress created during the atomization step. Next, we have applied thin film freeze-drying to various other partner peptides and proteins and confirmed their potency, stability and deliverability as a dry powder, including those to improve storage stability and delivery by dry powder inhalation. I would like to acknowledge my colleague, Professor Zhengrong Cui for his continued commitment to our efforts to leverage thin film freeze-drying to solve drug delivery problems.

I would also like to acknowledge the significant contributions of postdoctoral fellows Chaeho Moon, Willy Sahakijpijarn, and [inaudible] for their dedication and commitment during these most trying of times during COVID. I want to also thank the graduate students supported by the sponsored research agreement and technology validation agreements with TFF Pharmaceuticals for their scientific contributions upon which our platform as possible. Thank you all for your continued efforts in supporting TFF Pharmaceuticals. And now I'd like to turn the call over to Chris Cano, chief operating officer, who can update you on more of the progress the company is making in its business development and partnership efforts.

Chris?

Chris Cano -- Chief Operating Officer

Thanks, Bill, and good afternoon, everyone. Thank you for joining us today. As previously shared, the TFF business development team is focused on three key areas of growth for the company. These three key areas are, one, growing the TFF pipeline of internal development programs.

Two, our pharma partnering efforts. And three, our government and academic contracting efforts. We continue to make great strides in each of these key areas. For today's call, I will be focusing on the wide breadth of different modalities where the TFF technology has differentiated itself from other dry powder technologies.

TFF continues to be very active in the mRNA space. We currently have 10 ongoing projects, and we are in discussions with other potential companies to discuss additional mRNA projects. This number continues to grow. We are working with pharma partners to formulate their proprietary mRNA into a dry powder.

For some partners, we are formulating a dry powder for inhalation, delivering the dry powder mRNA deep into the lung to treat respiratory elements. For other partners, we are formulating their proprietary mRNA vaccines into a dry powder to form a more stable vaccine that is not subject to cold chain storage and transportation. This dry powder is then quickly reconstituted for injection on site. Cold chain storage and transportation continues to be a tremendous challenge for many regions of the world.

TFF also has many other nucleic acid projects underway, including formulating siRNA, oligonucleotides, plasma DNA and other RNA compounds into our TFF dry powder. These programs predominantly focus on delivery of the nucleic acid formulated as a dry powder for delivery directly to the lung to treat different respiratory diseases. TFF continues to be very active in the monoclonal antibody space, formulating either mAbs or fabs. We currently have eight ongoing projects and are in discussions with other potential companies to discuss additional antibody projects.

The number of antibody projects is on the rise. As mentioned previously, we have made very good progress with our partner, Augmenta Bioworks, and we continue to build our expertise in formulating antibodies, utilizing our innovative dry powder technology for delivery of these therapeutics directly to the lung. The TFF dry powder technology is differentiated when it comes to formulating both peptides and proteins. We are currently partnered with eight different companies formulating their proprietary peptides and proteins.

The number of our vaccine projects continues to grow. We are currently formulating numerous vaccines, seven projects as of last month. We are currently in the process of negotiating with USAMIRID in order to put a new CRADA, a Cooperative Research and Development Agreement in place. We expect the CRADA to be signed over the next few weeks.

This CRADA will progress one of our vaccine projects into an animal efficacy study. TFF is also working with four different partners on their proprietary phase products, again, by formulating a dry powder, which after testing reflects minimal tighter loss and high viability, we can deliver active phase directly to the lung. On the government contracting front, we continue to work very closely with Leidos, the prime on the DARPA contract. This is the first government contract for TFF, and we are actively pursuing additional government contracting opportunities.

With our academic partnerships, we continue to make very good progress with Ted Ross at the University of Georgia, we are moving our universal influenza program into a second species of animal testing. We previously reported our results in a mouse immunogenicity study, and we are now moving into ferrets. With Karthik Chandran at the Albert Einstein College of Medicine, we are now moving our VSV program into animal studies. With Drew Weisman at UPENN, we are beginning our initial mRNA formulation work and have finalized our protocols for animal testing, which we expect to start in the next month.

In summary, the TFF BD team has been making tremendous progress in our partnering efforts. We continue to grow the number of collaborations we have with pharma partners, and we continue to expand the application of our thin film freezing technology. The TFF pharma team is currently working with the majority of the top 20 pharma companies, and we have ongoing discussions with many others as we continue to expand our collaborative projects across the wide range of modalities. From an IP perspective, building our patent portfolio is a key value driver and foundational component of the TFF corporate strategy.

As of August 1, 2021, TFF has 58 issued and/or filed patents. Patent protection and exclusivity is interwoven into the fabric of everything we do at TFF as we grow our company and expand our technology. In closing, I would like to thank our partners at the University of Texas at Austin, with the continuing support and efforts of Dr. Bill Williams and his research team, we continue to expand the applications of the thin film freezing technology into new and innovative areas of drug delivery.

The TFF BD team is focused on closing at least two signature licensing transactions in 2021. We are very well positioned to meet this objective, and we continue to foster future growth opportunities for both our technology and our company. Thank you for your time today. Enjoy your evening.

I will now hand it back over to Glenn.

Glenn Mattes -- President and Chief Executive Officer

Thank you, Dale. Kirk, Bill and Chris. Let me conclude this call by saying that TFF Pharmaceuticals remain steadfast and confident in the progress we are making to build short, mid and long-term value for you, our shareholders. We are making steady progress on our internal portfolio of clinical assets and producing strong data positioning these assets for meaningful value creation.

Remember, we are a platform technology company applying thin film freezing to both internal and external opportunities. Our business model has already created significant opportunities that are moving ahead with purpose with numerous and diverse partners. The team is intensely focused on execution of our existing programs, as well as delivering transactions on the business development front. My confidence level continues to grow on a daily basis.

As always, we appreciate the support of our investors and partners, and we look forward to speaking with you next quarter. And with that, I'll turn the call back to the operator and open it up to questions. Operator?

Questions & Answers:

Operator

Thank you. [Operator Instructions] And our first question comes from Jonathan Aschoff with ROTH Capital Partners.

Jonathan Aschoff -- ROTH Capital Partners -- Analyst

Thanks a lot. Glenn, I was wondering if you can tell me about how your GreenLight agreement is going and how it might be energized by the recently announced stack agreement?

Glenn Mattes -- President and Chief Executive Officer

Hi, Jonathan. Hope you're well. So we generally don't make a lot of comments about the partnerships. In this case, I can.

We've done have really good interactions with GreenLight. We've worked on their materials. We've produced some really stellar results in formulation. And I'm actually quite excited about the fact that they've been able to gain financing.

So that this gives us an opportunity when we do get to the level of a transaction, we can do a meaningful transaction. We don't -- we will not do deals where there's not meaningful economics. So having GreenLight funded is really a very, very positive step in the relationship with them. So that's moving along and even looks better now that they're funded, right.

Thanks for the question.

Jonathan Aschoff -- ROTH Capital Partners -- Analyst

Also are you still confident in cannabis revenue in third quarter this year?

Glenn Mattes -- President and Chief Executive Officer

Yeah, Jonathan. So you get one chance and one chance only to launch a consumer brand, right? So we have really done a lot of formulation work with PLUS. And right now, I think we're at the point where we are in position to test these formulations and different put ups with consumers. And once we have a good handle on what that reaction is, assuming there's no tweaks we need to make, we'll be ready to move forward.

Jonathan Aschoff -- ROTH Capital Partners -- Analyst

OK. Do I have time for a third question? Or should I get back in the queue?

Glenn Mattes -- President and Chief Executive Officer

Yeah. Sure, Jonathan. Yes you do.

Jonathan Aschoff -- ROTH Capital Partners -- Analyst

By activities by year-end '21 for vori and tac, do you mean patient dosing or some earlier activity?

Glenn Mattes -- President and Chief Executive Officer

Yeah. So Dale, do you want to take that? I don't want to -- these are your trials. So I'll let you speak to those. OK.

Dale's the one that's -- I want to compliment Dale. He just doing, as is the whole team, Jonathan, an incredible job. If you look at the trials, the outcomes, the amount that we've been on time and on budget, I think it is time to give Dale and the team a real big shout out here. But Dale, go ahead, please.

Dale Christensen -- Director of Clinical Development

Thanks, Glenn. And thanks, Jonathan for -- yes, Jonathan, for the question. So we are doing everything we can to push into scientific advice meetings and so that we can negotiate some of the endpoints and then get our regulatory filings in place. And unfortunately, we're going to be doing our best to actually dose patients by the end of the year, but some of that is dependent upon regulatory approvals and how various countries handle those regulatory approvals.

It could be pushback based on -- but we will file for approval. And hopefully, we'll have everything in place and be dosing. The other thing with all of these trials, as you know, is that even if you have sites activated, regulatory approval, drug on site, you may not end up with the patient ready to enroll. So we're going to -- we'll be doing everything we can to make sure that everything is in place, and we hope that those patients come this year.

Glenn Mattes -- President and Chief Executive Officer

Yeah. So Jonathan, it's in our headline, right? So we have some more -- we'll get the RAD data back from -- on vori. We'll publish the phase one data report on tac. And we intend to do everything we can and we intend to be moving forward with the phase two pivotal trials by the end of the year.

Jonathan Aschoff -- ROTH Capital Partners -- Analyst

Thank you, Glenn and Dale.

Glenn Mattes -- President and Chief Executive Officer

Thanks, Jonathan.

Operator

And our next question comes from Jason McCarthy with Maxim Group.

Michael Okunewitch -- Maxim Group -- Analyst

Hey there. This is Michael Okunewitch on the line for Jason. Thanks for taking the question and congrats on the progress this quarter.

Glenn Mattes -- President and Chief Executive Officer

Thanks, Mike.

Michael Okunewitch -- Maxim Group -- Analyst

So I'd like to ask just regarding the timelines in tac and vori, it looks like we're on track to enter those pivotal studies in the second half. And if I recall, those were supposed to be relatively short positioning potentially for filings in the first half of '22. Are we still looking at that time frame? And then based on the enrollment you've seen in the phase one, how should we look at the time lines for data in those?

Glenn Mattes -- President and Chief Executive Officer

Yeah. So we believe that we'll have the interim analysis done in the first half, and the trials will probably now conclude in the second half of next year, Michael.

Michael Okunewitch -- Maxim Group -- Analyst

All right. Thank you very much. Then going forward, it looks like we're pretty quickly approaching tac and vori crossing that finish line. So I'd like to ask, in your view, what comes next? It seems like much of the pipeline is in the form of your platform collaborations.

So is this more so how we should think about the future of TFF? Or do we expect to get some additional internal pipeline compounds that come on board?

Glenn Mattes -- President and Chief Executive Officer

Great question. And it speaks, I think, to our strategy. So you're right. First, you think about the fact that Kirk mentioned that we do have significant capital that will cover the trials that we have planned.

And that Kurt's assumption here is also that that includes no, which is a really extreme assumption, no internal revenue -- no generation from our transaction. So we -- yes, we plan on identifying other internal portfolio opportunities. And if you look at our last transaction, it was a co-development with Augmenta, right? So in that transaction, we agreed to share the cost of the preclinical and clinical work through phase one and then look for a partner going forward. So I'm not saying definitively that we do more transactions like that.

But it could be some of those. It could be something we would take on. But we are, as I said in the script, we are a drug development company, and we'll develop those, apply the technology to either internal assets or partner assets, and we'll keep churning. So this is, I think, the quintessential, short, mid and long-term value creation opportunity here.

And if you listen to Chris, the partner programs are growing dramatically. We've increased the patent portfolio now to 58. I think the last time we reported 45. So this is just -- it's just really -- it's just accretive every day in terms of how many more opportunities.

But yes, to answer your question surely, we will look to add to the internal portfolio, either with partner programs or programs that we would do by ourselves.

Michael Okunewitch -- Maxim Group -- Analyst

All right. Thank you very much. And then, just one more for me, and I'll hop back in the queue. So sometime last summer, you were discussing a TFF formulation of remdesivir.

We haven't heard much on that recently. But the reason I'm bringing it up is because Gilead recently stopped developing their own inhalable remdesivir due to deposition challenges. So what I'd like to ask is, were you able to get lung deposition with your remdesivir formulation? And as we thought of as a prime example of just how difficult dry powder inhaled formulation can be and the value of the TFF platform.

Glenn Mattes -- President and Chief Executive Officer

I'm going to give this off to the man who did the work, and it's Dr. Williams. So Bill, could you comment here?

Bill Williams -- Scientific Consultant

Yes. Yes. Thank you, Glenn. Yes.

So we have shown in multiple rodent models, one of which was hamster, and that's the preferred infection model for COVID. We showed very good deposition in the lungs, and we modeled it in the two papers that are -- or the one paper I referenced in the script. So we believe we can do it. Gilead, to the best of our knowledge was testing a liquid form.

And it does, it goes to show you that these inhaled drugs, they are difficult. The formulations are difficult. We spend every waking hour trying to figure these out, and we believe with the remdesivir, we nailed it. And up through animals at least.

So great question and thank you.

Michael Okunewitch -- Maxim Group -- Analyst

All right. Thank you very much.

Glenn Mattes -- President and Chief Executive Officer

That is a great example of just how broad the application is here. And we actually think we -- it has to be tested, right? But we solved their problem, at least in terms of drug in getting to position. Is it an effective therapeutic? That only would remain to be seen here. But Bill, I think, solved the formulation problem.

Michael Okunewitch -- Maxim Group -- Analyst

Yeah. Thank you very much.

Glenn Mattes -- President and Chief Executive Officer

Thank you.

Operator

Thank you. And our next question comes from Mayank Mamtani with B. Riley Securities.

Sahil Kazmi -- B. Riley Securities -- Analyst

Hi. Good afternoon, team. This is Sahil Kazmi on for Mayank. Thanks for taking our questions.

Maybe just a brief one for Glenn. Kind of going off the last question, nice to see the progress across the tac and vori programs and looking forward to see those trials start. But as you kind of think beyond that, it would be great if you could opine on any thoughts you had on the Philip Morris Vectura transaction that closed today? How do you think about kind of expanding the platform into that consumer space, including your discussion with PLUS products, etc.?

Glenn Mattes -- President and Chief Executive Officer

Yeah. So Mayank, I mean, obviously, we've watched the Philip Morris interest in in delivery companies. As I sit here today, we're certainly focusing on execution and moving our business forward. And certainly, we'll always be opportunistic.

But more importantly, I think we're just going to -- our focus is on creating value for the shareholder. If that moves on to some other opportunistic activity, so be it. I think sum of the parts here right now are perhaps worth more than the whole. But that remains -- but I think that's getting closer.

It's kind of catching up to it because some of the whole is starting to look pretty good. So we just -- we come to work every day thinking about moving the needle forward and closing more partnerships, etc. So I think that's the best way I can answer that question. Did I answer the whole question or is there a second part to that?

Sahil Kazmi -- B. Riley Securities -- Analyst

No, no. That's very helpful. And then, maybe just a quick follow-up is, do you have any deal sheets that you're reviewing right now that you can talk about?

Glenn Mattes -- President and Chief Executive Officer

The answer is yes. And I can't talk about them. I don't think you'd want me too because we will -- we're looking to create meaningful economics. And hopefully, these discussions will result in that.

And when we have the deal signed, we'll report it. But we're at all levels with these partnerships that Chris described, in vitro, in vivo and term sheet.

Sahil Kazmi -- B. Riley Securities -- Analyst

Great. Thanks a lot. Thanks for taking our questions and congratulations on the progress.

Glenn Mattes -- President and Chief Executive Officer

Thanks so much. I appreciate that. Say hello to Mayank for me, OK?

Sahil Kazmi -- B. Riley Securities -- Analyst

Absolutely.

Operator

And our next question comes from Daniel Carlson with TW Research Group.

Daniel Carlson -- Tailwinds Research -- Analyst

Hey, guys. Thanks for taking my questions and congrats on the progress. First off, Glenn, on tacrolimus, the clinical PK data release so far shows that the drug can reach blood levels needed for systemic immunosuppression. And I'm wondering if you have reason to believe that you can lower the dose for lung transplant patients to a level closer to what is used in the other transplants like heart, liver, and kidney.

Glenn Mattes -- President and Chief Executive Officer

Yeah. I guess, we are going to go to Dale. Dale, could you take that one, please?

Dale Christensen -- Director of Clinical Development

Yeah. Thanks, Glenn, and thanks, Dan, for the question. So to date, as you mentioned, we have the clinical PK data that shows that we can reach that upper limit, the 14, 15 range with a low dose. We're getting about 80% bio availability.

In our 26-week toxicology study, what we've demonstrated is that we can achieve about three-to-four-fold higher levels of the drug -- of tacrolimus in the lung tissue, compared to the blood. And so, what that gives us is the ability to -- when you dose from an oral perspective or from an oral route, you have to push the blood levels high enough to get enough into the long to prevent the rejection in the lung tissue itself. But because we have a higher blood level or a higher tissue level from the inhalation, we can reduce the blood level and still have that same or more in the lung tissue. And so, we think that essentially, this is like topically delivering it right to the site where it needs for the immunosuppression, and then we can reduce the systemic level down to levels that would be protective of the kidney.

Daniel Carlson -- Tailwinds Research -- Analyst

Got you. OK. That's helpful. Thank you.

Switching gears, your augmented TFF lead has shown activity against the delta variant. And I'm wondering if you've tested against the new Delta Plus variant that Fauci has mentioned recently?

Glenn Mattes -- President and Chief Executive Officer

OK. Go ahead Dale. I think that's going to be for you also.

Dale Christensen -- Director of Clinical Development

OK. Thank you. Again, a very good question. So the delta plus that has been mentioned, it has the full complement of mutations that are in the delta variant, but it's also picked up this K417 N mutation.

And that K17 -- or K417N mutation was also in the beta variant that was first identified in South Africa last year. And we already have data showing that AUG-3387 works against the beta variant. So we have strong reason to believe that 3387 will work on the delta plus. And we're -- again, as each of these new variants emerge, it takes -- there's a lag time in being able to get all the reagents to perform that testing, but that is something that will be coming up.

Daniel Carlson -- Tailwinds Research -- Analyst

OK. Great. And then, Glenn, can you talk a little bit more about your relationship with Catalent?

Glenn Mattes -- President and Chief Executive Officer

Yeah. Actually, I'm glad you picked up on that, Daniel. So we're very pleased that -- Catalent is obviously one of the leading in fact the leading CMO, especially in the area of biologic. So the fact that we have Catalent on board to help produce Augmenta, the map is a great signal because they now become a provider of manufacturing GMP materials and beyond that can help us satisfy the needs of our maturing discussions with partners, right? So there's an evolution here.

We've never talked about manufacturing before, right? So we weren't kind of -- except for our internal pipeline, which was satisfied with the relationships we have with Corex and [inaudible]. But now, you're into this whole sort of biologics sterile product environment, right, which is really being -- the genesis of that is all of the partnerships that Chris described in those categories. So getting Catalent on board is really critical because we need to develop capacity and expertise to start producing products as these products get into animal testing and beyond, especially even in the sterile environment. So to me, in running this business holistically and looking at the life cycle and the evolution of the business, that's a great -- they're a great partner, and I think it's frankly to the investor, that should be signaling something.

And it is. So I think that congratulate for bringing up on that. I generally don't like to be -- use a lot of hyperbole. But putting -- mentioning catalyst, I think it should -- is a signal to just where we are in the life cycle, especially on the biologic.

Daniel Carlson -- Tailwinds Research -- Analyst

Yeah. No, they're great. So congrats on that. And then, one last question for me, if I could, is I know your vaccine work would help relieve cold chain issues.

And a company that has been working over in Africa on some vaccines is Dyadic. And I'm wondering if you've done anything in conjunction with them at all?

Glenn Mattes -- President and Chief Executive Officer

OK. Well, I had permission from their CEO to say this. So Mark Emalfarb, I want to congratulate Mark on his transaction with Sorrento, which again is good, I think, because it now gives Mark some capital to do something. So we have successfully formulated a vaccine candidate.

And I think it's just now, we have the opportunity, I think, to really hopefully -- again I think hopefully and hypothetically, look at how, and if we can, move that project project.

Daniel Carlson -- Tailwinds Research -- Analyst

Great. OK. Well, Congrats on the progress.

Glenn Mattes -- President and Chief Executive Officer

We don't comment on who all these MDAs are with. No. 1, a lot of companies don't want us to. In the case with Mark, because we are close with Mark, we feel comfortable disclosing that we have a relationship with them.

Daniel Carlson -- Tailwinds Research -- Analyst

Yeah. OK. Well, thanks, guys. Appreciate it.

I'll jump back.

Glenn Mattes -- President and Chief Executive Officer

Right. Maybe we have time, operator, for one or two more questions if there are any others.

Operator

And that question will come from Richard Deutsch with National Securities.

Richard Deutsch -- National Securities Corporation -- Analyst

Yeah. Thanks for taking my call. And if you don't mind a little pun here, your presentation is just breathtaking. I really heard such a detailed, broad, and incredible presentation, especially for what you've done in the last quarter.

It's phenomenal. I got a couple of questions. First of all, I thought I heard you say out of the business deals that have been percolating for a while, did you say you actually put out finished term sheets that are under review right now?

Glenn Mattes -- President and Chief Executive Officer

We have -- we do have term sheets in place with some partners. And Richard, I just want to be really clear. It doesn't mean that we're going to get transactions done with these partners, but we are in the term sheet stage.

Richard Deutsch -- National Securities Corporation -- Analyst

OK.

Glenn Mattes -- President and Chief Executive Officer

And look, I wanted to say, and why wouldn't you do a deal? Well, maybe the economics won't be right, OK? And/or something happens in diligence. But yes, I want to put a big qualifier on that. So people don't single out, you said you're going to get a deal done in two weeks. We do have some term sheets, and we are -- and that's good.

Richard Deutsch -- National Securities Corporation -- Analyst

All right. Well, I mean, you've got a term sheet out there that you're happy with. Money is -- it's all a matter of it going further.

Glenn Mattes -- President and Chief Executive Officer

I'm saying we're happy with them either because we do have term sheets, OK?  

Richard Deutsch -- National Securities Corporation -- Analyst

OK. And the other thing --

Glenn Mattes -- President and Chief Executive Officer

You can count on me and my team to get -- if there's a deal to be done, to get it done in a value-creating way.

Richard Deutsch -- National Securities Corporation -- Analyst

Yeah. Well, if you give them the ring, and all they got to do is accept, that's pretty much progress. One other thing. I've got a whole list of all your projects which are -- as everybody can hear, more numerous than anybody can deal with.

But there's some very, very short-term things that are coming up. When do you expect -- or have you heard about orphan drug status for tacrolimus?

Glenn Mattes -- President and Chief Executive Officer

We actually have orphan drug status already for tacrolimus. That was, I guess, about a year ago or so that we actually received. Yes.

Richard Deutsch -- National Securities Corporation -- Analyst

Then I misspoke. I'm looking for vori then. Aren't you --

Glenn Mattes -- President and Chief Executive Officer

Vori. Yes, we are in the process of applying for the orphan designation for voriconazole.

Richard Deutsch -- National Securities Corporation -- Analyst

And what's the time frame on that?

Glenn Mattes -- President and Chief Executive Officer

Yeah. I don't want to say specifically. Again, I don't want to give everybody a date because we're at the mercy of the regulatory authorities, right? So -- but it is something we're pursuing.

Richard Deutsch -- National Securities Corporation -- Analyst

OK. And you also had the GLP results coming? Are those going to be showing up soon?

Glenn Mattes -- President and Chief Executive Officer

GLP?

Richard Deutsch -- National Securities Corporation -- Analyst

Good laboratory practice.

Glenn Mattes -- President and Chief Executive Officer

Help me, Dale or Bill. Do we know what Richard's --

Dale Christensen -- Director of Clinical Development

So we -- sorry, we do have GLP tox studies that have been completed and ongoing. And we also have good manufacturing -- we've been manufacturing to GMP for all of our clinical work to date. So we are fully GTP, GLP and GMP-compliant for all of our work.

Richard Deutsch -- National Securities Corporation -- Analyst

Wow. That's outstanding progress for a company your size. It's incredible. Well, thank you very much.

Appreciate your presentation.

Glenn Mattes -- President and Chief Executive Officer

Thank you, Richard, for your support. Operator, maybe one more if there's someone else in the queue.

Operator

At this time, there are no further questions, sir.

Glenn Mattes -- President and Chief Executive Officer

OK. Well, thank you, operator. Thanks to my team. To all of those that are still on the line, thanks for your support.

I urge you all to stay healthy. I want to tell you, be careful out there. My 11-year-old granddaughter is recovering from COVID, healthy young little girl. Thank God.

But it's coming back. So be careful. I want you all to be healthy and well and happy. So thanks again for your time and your attention.

Good afternoon.

Operator

[Operator signoff]

Duration: 62 minutes

Call participants:

Corey Davis -- Investor Relations Contact Officer

Glenn Mattes -- President and Chief Executive Officer

Dale Christensen -- Director of Clinical Development

Kirk Coleman -- Chief Financial Officer

Bill Williams -- Scientific Consultant

Chris Cano -- Chief Operating Officer

Jonathan Aschoff -- ROTH Capital Partners -- Analyst

Michael Okunewitch -- Maxim Group -- Analyst

Sahil Kazmi -- B. Riley Securities -- Analyst

Daniel Carlson -- Tailwinds Research -- Analyst

Richard Deutsch -- National Securities Corporation -- Analyst

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