Q3 2019 Earnings Call

Good morning, ladies and gentlemen, welcome to the Bio pass Holdings third quarter 2019 earnings Conference call. At this time, all participants are not listen only mode. Following the formal remarks, we will open the call up for your questions I would now like to turn the call over to carry calling of Stern Investor Relations. Please proceed.

Thank you operator.

Come to the Biotype Holdings conference call and webcast to review the company's third quarter 319 earnings results and to provide an update on recent type one and corporate development.

Earlier, we issued a press release, which outlines the topics that we plan to discuss on todays call releases available at Www Dot bypass holdings Dot com.

With me today from bypass, our president and CEO , Peter Nielsen and Vice President of Finance and accounting Anthony price.

Before we begin the call I would like to remind you that today's discussion will contain forward looking statements that involve risks and uncertainties.

These risks and uncertainties are outlined in today's press release and the company's recent filings with the securities I suppose conditions such as eateries.

Actual results may differ materially from what as discussed on today's call.

With that I'll now turn the call over to bypass CEO Peter Nelson.

Thanks, Gary.

Good morning, everyone and thank you for joining us today.

Throughout the third quarter, we continued to execute or clinical development plans across our DNA boys platform.

Innovative R&D nano particles therapeutics.

There's always described in more detail later in the call. We continue treating patients are nearing completion of the safety portion of the phase two clinical study of Brexit giberson in combination with deciding.

Study contains two cohorts of patients the first it untreated acute myeloid leukemia, or AML and high risk Myelodysplastic syndrome, or Mds patients and the second cohort in refractory relapse and Bell said high risk Mds patients.

Going forward, we plan to add genetic wax to evaluate the efficacy of the triple combination of Brexit Giberson, Decitabine, and banana Claxton, both cohorts of patients.

I'll begin my discussion with a review of our platform technology.

As you know the DNA otherwise platform in our proprietary and he says already identified particle technology, which we use for the creation of nucleic acid therapeutics.

DNA belies therapeutics integrate with the cellular membrane because of their unique structure, allowing the antisense drugs to be delivered to the diseased cells with high uptake into the sell the incorporation into lifted layers.

There's been no evidence of toxicity associated with our technology.

We are extremely enthusiastic about the potential of our DNA and being able wise platform for developing novel treatments for patients suffering from disease with high unmet medical need.

Let's review the progress we've made advancing our lead product candidate proxy giberson.

Brexit your person is being studied in a phase two clinical trial for the treatment of AOL.

As a reminder, this trial is a multi center study that originally study Brexit your boroughs in combination with low dose cytarabine or elsewhere in denovo patients with previously untreated AOL, who were not otherwise eligible for standard or high intensity chemotherapy regimens.

Or who had elected a low intensity regimen.

Trial was open label with a two stage design to assess the safety profile pharmacokinetics, pharmacodynamics and efficacy of proxies your berson.

The primary endpoint or the study was complete remission, including patients who achieved incomplete hematologic recovery and complete remission with incomplete platelet recovery.

Secondary endpoints assess the safety and efficacy with Brexit your berson, including overall survival time to response duration of response and adverse events as a evaluated by physical examination findings vital signs and clinical laboratory tests.

In April 2018, we presented exciting interim results for phase two study.

During the first quarter of 2019, we were pleased to report additional analysis from the study.

You know our original interim analysis from the ongoing phase two study our results showed that 47% of the Evaluable patients showed some form of response to the combination treatment.

Including four treatments with complete remission or 24%.

And for patients with stable disease, including one patient who achieved a leukemia free status and one patient who had significantly reduced bone marrow blast.

As you may recall during the first quarter of 2019.

We announced updated interim results from this study.

The updated interim results showed that the efficacy profile had improved were 11 or 65% of the 17th of valuable patients had a response, including five or 29% who achieved complete response, including one CR I had one more for your logic leukemia free state.

Great and six stable disease responses, including two patients who had greater than 50% reduction in bone marrow blast.

Importantly through investigation by the principal investigators it was observed at 68% of these patients were secondary A.M.L. patients and extremely difficult class to treat.

These updated interim data from the stage one of our phase two study with Brexit universe and de Novo A.O.L. patients only increase our confidence in the safety and efficacy profile of Brexit your burleson and underscore its potential to treat AML patients.

The complete response rate core eltek treatment alone for this class of patients in this study was benchmark that 7% to 13%.

Whereas Brexit your berson treatment with L. that showed a 20 for 29% CR rate with a highly favorable safety profile.

The recent approval of the frontline therapy, but at a KLAX provides an opportunity for combining Brexit your for us and with the combination of Veneta KLAX plus decided that for the treatment of de Novo AML patients.

We have said before we view Brexit caparison as an ideal combination Campbell.

With frontline therapy.

Our aim is to match Brexit giberson with the leading frontline therapies to improve treatment options for patients.

As a treatment landscape evolves, we will continue to respond to those advances.

The plans for our registration directed clinical development program for Brexit universe, and as a treatment for AOL reflects those changes.

Firstly, we have us amended the existing stage two clinical trial.

The key change in the amended phase two study is the inclusion of patients with high risk Myelodysplastic syndrome, or Mds and refractory relapsed AML patients. The restructured phase two clinical trial, though has two cohorts of patients the first being the untreated AML patients.

Has existed in the prima trial, but with the addition of high risk Mds patients.

The second cohort comprised of refractory relapsed AML patients at high risk Mds patients.

The amended phase two study is evaluating the safety of Brexit person in combination with decided that in both cohorts of patients.

They have a dose of 60 milligram per square meter.

In combination with the side of it.

The study is evaluating evaluating patients for safety assessment of Brexit Giberson the decided.

With a goal of the terminating the combination to be safe and at least six evaluable patients. Once completed we plan to modify testing of both cohorts of patients to add veneta KLAX to the Brexit giberson be side have been combination treatment.

Once we have completed the six patient safety assessment of Brexit as you Berson decided.

The data KLAX combination the efficacy segment of this trial can commence it is anticipated that each cohort will include an interim assessment of 19, evaluable patients that would assess whether the treatment efficacy of accommodation of Brexit your burleson decided and but edit KLAX exceeds the efficacy.

Of current standard of care therapy with statistical significance.

Upon such favorable data by the bio path would put it petition the U.S. food drug administration or the FDA.

For accelerated approval.

The efficacy segment of this trial is expected to be conducted at up to 10 clinical sites in the United States moving forward the company intends to evaluate potential clinical sites in Europe with an emphasis on patient accruals.

Overall these transformational steps will result in two registration directed cohorts of our phase two clinical trial and they about.

Both cohorts will study Brexit Brexit giberson, plus the side of the plus panetta plaques one for untreated AML and Mds the other for relapsed refractory AML and Mds.

Before turning to our additional programs I'd like to briefly touch on our planned phase one clinical trial of Brexit universe in patients with advanced solid tumors, including ovarian and uterine pancreatic and hormone refractory breast cancer.

This trial is expected to be conducted at several leading cancer centers and as planned initially to evaluate safety and efficacy of Brexit your berson, starting with ovarian and endometrial cancer.

Patients diagnosed with recurrent ovarian and endometrial cancer.

Often have poor outcomes and is our hope that Brexit your person may provide clinical benefit for such patients. We are finalizing our high end D and expect to begin the study in 2020 .

Next let's review the preclinical data for our third drug candidate.

BP, one or three which targets the statthree protein.

We're studying BP, one or three for treatment of pancreatic cancer and appreciate patient derived tumor model.

Previous models have shown the drug to successfully penetrate pancreatic tumors and enhance the efficacy of standard frontline treatments.

The results from our preclinical studies of BP 103.

Were highlighted in a poster presentation presentation at the American Association of cancer Research annual meeting or the a CR and Atlanta in April .

We're excited to be targeting statthree for a number of reasons.

Signal transduction transduction, and activator transcription three or Statthree.

So typically in active in normal cells is absolutely active in cancer cells.

The abilities of tumor cells to proliferate uncontrollably resist apoptosis or cell death.

Induce vascular formation and invade distant organs are well recognized hallmarks of cancer.

Statthree is a regulator the genes involved in these cancer processing as well.

Well recently, the capability of tumors to evade immune surveillance and avoid destruction by the immune system has also gained significant acceptance in the cancer research feel.

Statthree.

Which is a point of convergence for many oncogenic pathways has emerged as a critical mediator of tumor immune evasion at multiple levels.

Activation of Statthree.

He has been found in many types of cancers, including non small cell lung cancer.

AOL and pancreatic ductal adenocarcinoma.

Activation of Statthree correlates with poor clinical outcome.

Hi, great disease, and metastasis and has been linked with resistance to chemotherapy, including Jim side to be.

Considered a standard of care agent for advanced.

Pancreatic cancer.

Therefore inhibition of Statthree in combination with chemotherapy is expected to produce enhanced clinical benefit.

The poster at a CR highlighted for and he says Oh go sequences directed against Statthree Messenger on every day.

Identified by bio path and manufactured using DNA belies antisense arent AI nano particle technology.

So viability tests and western blocks blots were conducted to determine the inhibitory effects of liposome incorporated Statthree antisense O ago, non small cell lung cancer and AML cells.

In ex vivo like tissue sensitivity as say.

It was performed with a panel 20 pancreatic.

Ductal carcinoma patient derived xenograft to study the overall activity of BP, One Boe three alone.

And in combination with Jim side of being.

Using previously defined criteria.

Tissue slice viability in addition, greater than 30% with a P value less than <unk> 0.05.

It was a response for validation of the ex vivo results pancreatic cancer.

Cancer patient xenografts of tumor bearing mice were administered BP one of three and Jim Seidman twice a week for 28 days tumor volumes will moderate for up to 49 days.

In the tissue sensitivity Asaib BP what O three at a dose of 10 micro bowlers significantly inhibited the tissue sliced viability in nine out of 18 pancreatic cancer derived xenograft by more than 30%.

[noise] excuse me the combination of BP 103 engine side of me further enhance ex vivo efficacy of BP What O three in a subset of patient derived xenograft.

And the Nvvault study with pancreatic cancer patient derived xenograft models, a combination of BP, one or three and Jim side, I mean cause tumor regression during the 28 day drug treatment period.

This anti cancer activity was maintained for another 20 days, even when the drug treatment had ceased.

He is very encouraging data were well received earlier this year at a CR, where we had a universally enthusiastic response from the audience.

We're particularly excited to launch this program is that will be our first in human validation of this cutting edge therapy, and especially challenging cancer indication that has limited treatment options.

In addition, BP what O three was selected as the most potent liposome incorporated Statthree, Andy said sequence and decreasing non small cell lung cancer cell viability.

Further validation in AML cells demonstrated that BP, what O three inhibited cell viability and statthree protein expression.

We are excited by these preclinical data and to be tackling some solid tumors with our proprietary technology platform. We look forward to our R&D, enabling studies for BP y O three in 2020.

With a goal to enter first in human trials with this very promising product candidate next year.

Finally, we have also updated our plans for BP, one owed to our second therapeutic candidate, which targets Bcl two.

We recently filed an investigational new drug or I N D application for our second pipeline candidate BP one or two.

But then it KLAX has also shown activity against the anti apoptotic.

Protein Bcl, two and works by neutralizing the proteins BH three domain.

It is an approved treatment for chronic lymphocytic leukemia, or CLL patients and untreated AML patients in combination with decided that however, with the exception of some patients treated with allergenic hemo poetic cell transplantation disease relapse and variably occurs often.

Times due to be age three domain mutation overtime.

DP one owed to also targets the bcl two protein however.

BP what Ho to activity is based on blocking the bcl two messenger, our today and not the BH three domain.

As a result, we believe the BP want to owed to could provide an alternative that a KLAX patients who have relapsed further we believe there could be a ml patient relapses from but adequate treatments, representing an additional opportunity for bio path to treat those patients with BP one.

Oh too.

As a result, we have filed for registration of BP, what owed to in CLL patients, including but medical acts relapses.

We can amend this registration to include A.O.L. relapses, if those occur.

The plan modification of our phase two clinical program and AOL to include the data KLAX combination treatment with Brexit two berson will give us early experience with treating bcl two driven anti apoptosis. In these patients we have filed and I'd be and expect to begin.

Our first in human study and BP, what owed to next year.

And as always we continue to evaluate opportunities to expand our DNA belies technology platform to other oncology indications.

Importantly, we remain well capitalized to fully execute our clinical development plans.

For our three promising therapeutic candidates as a result of our successful financing earlier. This year. We now have the resources to achieve a number of key milestones that we believe should significantly enhance shareholder value.

With that I'll now turn the program over to Anthony price for a brief review of our third quarter financials, along with balance sheet highlights Anthony.

Thanks, Peter the company reported a net loss of 2.2 million or 78 cents per share for the three months ended September Thirtyth 2019, compared to a net loss of 3.1 million or 538 per share for the three months ended September Thirtyth 2018.

Research and development expenses for the three months ended September Thirtyth 2019 decreased to 1.4 million compared to 2.3 million for the three months ended September Thirtyth 2018, primarily due to lower benches in 2019 related to drug material releases for phase two clinical trials for presage person.

In AML and CML.

General and administrative expenses for the three months ended September Thirtyth 2019 increased 2.9 million compared to point 7 million for the three months ended September Thirtyth 2018, primarily due to increased legal fees and insurance costs.

As of September Thirtyth 2019.

Company had cash of 15.4 million compared to 1.0 million at December 31st 19.

Net cash used in operating activities for the nine months ended September Thirtyth 2019 was 6.1 million compared to 4.8 million for the comparable period in 2018.

Net cash provided by financing activities for the nine months ended September Thirtyth 2019 was 20.5 million.

With that I'll now turn the call back over to Peter.

Thanks Anthony.

In closing.

Throughout the third quarter 2019, we've made meaningful progress, particularly in our proxy Giberson program.

We are dosing patients in new cohorts in our phase two study of Brexit Giberson, and we are moving our preclinical candidates towards first in human clinical trials, which should begin next year.

We are enthusiastic about the opportunities ahead throughout the balance of 2019 and beyond.

And we have a number of exciting milestones ahead.

We look forward to achieving these goals in coming months and year.

With that operator, we're ready to open the call for questions.

Thank you as a reminder to ask a question you'll need to press star one on your telephone to withdraw your question press the pound keep our first question comes from Laura Engel with Stonegate Capital Partners. You May proceed with your question.

Good morning, Thanks for taking my question on first a great progress and again still fall the cash position. So on other than the details provided Peter I'm, just looking online and looking at.

What's going on in some of the basis as far as other clinical trials can you give us just any update on the competitive landscape in general as far as anything else, you've heard or seen on progress with other clinical trials, either and now I'm from the solid tumors or the pancreatic cancer space.

Well it AOL.

We're really seeing the results of a pretty active space over the last several years.

Versus side, and then of course, the medical ex being the most recent news and I think that is.

In the things that we're looking at that is the most important the compound.

The other KLAX in some respects is similar to our drug it has to be combined with a chemotherapeutics agent to that will cause the.

Up kotick signal and than other clecs treats the ability of bcl two to neutralize that message so.

That's an important drugs that I think we need to target on for right now.

And.

And as I said, we believe we can be a for a follow on to waste the benefit one to make that other clecs treatments, even better because we'll reduce the number of.

Of those cancer proteins.

The Division and then secondly, if indeed, there are relapse and mechanism. So we can follow and behind and as far as solid tumors or theres nothing that I'm focusing on I think.

From the research as we deal with.

Solid tumors is just to know radiation and keno chemotherapy. This tough.

Advanced ovarian.

Is it is a difficult area write down of course, though.

I think dry.

You know we have a systemic.

Treatment.

Has shown the ability to penetrate the stroma the pancreatic tumor.

The we're told by the investigators that.

This is the only thing they exceeded the could do that so we're very excited about that.

Okay, well, thanks for the update I'll get back into queue and again appreciate all that is there a detailed thinks calls so.

Thanks.

Thank you.

Thank you and next.

Question comes from Yi, Chen with H.C. Wainwright you May proceed.

Thank you for taking my question.

I don't know if you could give us some color regarding how many of the six.

Patients.

That are in growth after the protocol amendment aren't even now versus Mds patients when do you expect to complete the.

What the analysis of the safety results.

That the analysis a should be a.

Coming shortly we just weren't ready the habit close for this quarter of the interested in the trial has picked up of course I think most people are waiting for the genetic flex come on board.

As far as the Mds inclusion at this point.

It's mostly am Mel and I think that there may be one or two I don't have the table in front of me.

That has that information but.

It's mostly A.O.L. at this point.

Clearly mds needs a treatment that's been based on the numbers, we see for comparison going forward I think the outcome expected value at least for a CR is.

In the 16% to 20% range. So that's the side of entry, but so I think.

Yes.

Hi risk is something that we think will we get going war will be a good opportunity for us.

Thanks, and second question is when do you expect to file the R&D for.

Solid tumors.

Is it going to be in the first half of 2020 and also.

Considering the potential initiation.

Trials for P. P, one or two and and 40 solid tumor and potentially even if you want to know three in 2020.

How should we look can be pretty expensive [laughter], that's going to potentially increase.

Okay. Let me so if I can remember these first of all the timing on the solid tumors is very close we've we've been very active with the F.D.A. as you know.

You know or you heard.

We filed the high end D.

So.

Response seems to be have been good but you know that takes a additional information requests, which we've done we haven't had to have any conference calls so.

We're pleased with how it feels.

But we've also had amendments for the A.M.L. processing to get submitted and then the high end de for the solid tumors. The reason why site that is it.

The filing the it's more a function of the Q with our electronic submission people.

And.

Say that the.

Based on where we're at now.

You could expect.

We will file in ER in December frankly, there's just a Q process. So we're much much closer than you might think so we've been pretty busy on this front.

Now you probably won't hear about that until we do on next.

Until either we do our next.

[noise] earnings call, when we announce activities or.

Or in fact, the idea is granted we don't generally press release on filing and I'd be it's not.

In our view significant enough news, but we're very close on that.

As far as dollars.

Recall.

One or two in solid tumors are you know those are designed to three plus threes.

You know the cash yes. It is more trials and you know more CR lows, but.

That's kind of a scaling up activity, particularly when you consider you're dealing with lower doses and so it's manageable and.

In the second thing is 100 to its our goal stark that trial by the ended the year, but.

We have to per one zeros or three.

It's our goal to start that trial by the end of year, but.

So in some respects you know we deal with some uncertainty about how much testing.

Maybe needed the important variable is the effect that this drug has and.

Controlling immune system and so.

Part of the design, we're doing is looking at what is needed.

In vivo right wise.

To satisfy you know the safety of those treatments with respect to an abuse potential immune response, which we don't think will be any but we have to test and.

So.

But anyway that's.

Color if you will have to.

You know the potential timing of one 003. So we think our cash is very manageable tend to 15 should a million should more than do it and so.

You know, we can look to be.

Bracing for phones or actually we're getting to a point here.

Well you know.

Have enough assets in play.

With quality.

As stated on the technology to pick on partners.

Thanks, My last question is whether theres any updated preclinical results regarding.

Jeff This item in combination with decitabine and Benito class.

Yes, we we test with a.

We test what we look for testing.

Is.

Is the combination with with Venetoclax, we already know the benefit we received with.

Decitabine and.

Three combinations are difficult topics now.

We haven't released any of that.

Because we want to keep doing.

More testing, but the other issue of course as you know is.

Potential for.

The paper so I.

I think.

When we come out with that Oh, we can release, what we think are the incremental benefits. That's typically what we released that's what we did I think what we talked about the.

Starting accommodation with L. basket I think we also mentioned at that time.

The side of it but.

We do have the consideration, particularly if we're working with somebody or they absolutely for the clamp on us on the data because they want to do a paper that's what happened with.

BP one over three with the work in pancreatic cancer that had to help quiet because they want to do as a CR April or poster.

So we'll really.

What we can but we are doing that kind of testing, but not triple double.

Okay. Thank you.

Yes.

Thank you and I'm not showing any further questions. At this time I would now like to turn the call back over to Peter Nielsen for any further remarks.

Thank you again, everyone for joining us and for your can continue in support of bio path, we're making good progress and Oh.

We hope to have some significant milestones in the near future.

Have a great day.

[noise]. Thank you ladies and gentlemen. This concludes today's conference call. Thank you for participating you may now disconnect.

[laughter].