Q4 2019 Earnings Call
Good morning, ladies and gentlemen, welcome to the.
Holdings Yearend 2019 earnings conference call.
So I'm all participants are in listen only mode. Following the formal remarks, we'll open the color for your questions I would now like turn the call there will a corner of Stern Investor Relations. Please proceed.
Thank you operator, well bypass Holdings conference call broadcast Tervita companies yearend 2019 earnings results to provide an update on recent funding the growth.
Earlier, we issued a press release, which outlines the topic I just discussed on todays call releases available.
Holdings Dot com.
With me today by another President and CEO, Peter Nielsen, Vice President Finance and accounting ethylene price.
Where do we get Nicola there to remind you that today's discussion will contain forward looking statements involve risks and uncertainties. These risks and uncertainties are outlined in today's press release in the company's recent filings with Securities Exchange Commission, which were urge you to <unk>.
Actual results may differ materially from what has discussed on todays call.
With that I'll now turn the call over about CEO Peter Nielsen.
Thanks wealth.
Good morning, everyone. Thank you for joining us today.
Hi.
Am I still on the call.
Yes that was all girls line disconnected.
Okay.
So.
Good morning, and I'm pleased to be addressing your old today to discuss the significant progress we made in 2019.
So important advances across our clinical development pipeline.
And meaningful improvement for companies valuation.
The progress we made throughout 2019 formed the foundation for us to advance and expand our clinical portfolio or key inflection points in 20 Twond.
Throughout 2019, we continued to execute on our clinical development plans across our DNA belies platform of in innovative or are they like nanoparticle therapeutics to treat patients suffering with a variety of life threatening cancer indications.
Despite.
Some grew up groundbreaking progress with immune oncology and combination therapies.
There continues to be a large unmet medical need.
For a great number of cancer indications.
We're very excited about the potential for de enable wise to play an important role as a treatment paradigm for these difficult to treat cancers and look forward to building on our compelling body of clinical evidence in support of those goals.
So let me begin with a review of DNA Blaze platform. So you can understand and hopefully sure enthusiasm for its potential.
As you know the de enable EIS platform is our proprietary any sense or they are nano particle technology, which we use for the creation of nucleic acid therapeutics.
Enable wise therapeutics integrate with the cellular remembering.
Because of their unique structure, allowing the antisense drugs to be delivered to the diseased cells, hi uptake into the sell the incorporation into the weapons layers.
There's been no evidence of toxicity associated with our technology.
We are extremely enthusiastic about the potential for our DNA otherwise platform for developing novel treatments for patients suffering from diseases with high unmet medical need.
Now, let's turn to the progress we've made advancing our lead product candidate Brexit your birthday.
What's your berson as being studied in a phase two clinical trial for the treatment of being a mill.
As a reminder, this trial is a multicenter trial that originally study parts of your boroughs in combination with low dose I terror.
Held back.
And then overall patients with previously untreated AML, who were not otherwise eligible for standard or high intensity chemotherapy regimens.
You had elected a low intensity regimen.
Trial was open label for the two stage design to assess the safety profile pharmacokinetics, pharmacodynamics and efficacy of Brexit Your birthday.
The primary import employing a that study was complete remission, including patients who achieve incomplete hematologic recovery and complete remission with incomplete platelet recovery.
Secondary endpoints assess the safety and efficacy purchase your burst of including overall survival time to response duration of response and adverse events is evaluated by physical examination findings vital signs and clinical laboratory tests.
In April of 2018, we presented compelling interim results for our phase two study.
And during the first quarter of 2019, we were pleased to report additional analysis from this study.
In our original interim analysis from this ongoing phase two study our results showed that 47% of the a valuable patients showed some form of response to the combination treatment, including for patients with complete remission C R, 24% and for patients with stable disease, including one.
Patients, who achieved the leukemia pretty status and one patients who had significantly reduce bono blast <unk>.
As you may recall during the first quarter 2019, we announced updated interim results from this study.
The updated interim results show that the efficacy profile.
Improve to where 11 were 65% of 17 Evaluable patients had a response, including five or 29% who are cheap CR, including once the our with incomplete hematologic recovery or see ROI and one more people logic leukemia free state.
Six stable disease responses, including two patients who had greater than 50% reduction so glass. Moreover investigation by the principal investigators observed at 68%.
These patients were secondary and no had extremely difficult class to treat.
These updated interim results from stage one of our phase two study Patrick your berson and de Novo.
Patients only increase our confidence in the safety and efficacy profile.
Brexit your burleson and underscore the tech to treat CML patients.
The complete response rate for El DAC Friedman alone for the class of patients in this study.
It was benchmark at seven to 13 cents, whereas flexing your burst of treatment with L. dagger showed a 29% CRC ROI.
Right with a highly favorable safety profile.
These data are particularly compelling and encourage us to prioritize advancement of Brexit giberson in combination with standard of care.
The approval of the frontline therapy, Connecticut box provides an opportunity to add crexus your person to the combination of banana KLAX plus the site for treatment of de Novo AML patients.
We view proxy giberson as an ideal combination candidate with frontline therapy.
Our aim is to add parts of your gruesome with a leading frontline therapy is 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 Giberson has a treatment brand now reflects these changes.
Firstly, we have amended the existing stage two clinical trial, we keep changes in the amended phase two study is in the patient high risk Myelodysplastic syndrome, or M.D.S. had refractory relapsed AML patients the restructured phase two clinical trial Dow has two cohorts of.
Patients the first cohort b untreated AML patients as per the pre I'm going to trial, but with the addition of high risk Mds patients.
And the second cohort comprised of refractory relapsed AML patients at high risk Mds patients.
The amended phase two study evaluated the safety of Brexit Your berson in combination with decided it both cohorts of patients had a dose of 60 milligram per square meter in combination with decided.
The study evaluated evaluated patients for a safety assessment of Brexit Your Burleson and decided been determined the combination to be safe and 60 valuable patients.
We're in the process of modifying testing.
Both cohorts of patients to add Moneta class two that for purchase your burst of decided that combination treat.
What do we have completed six patient safety assessment of.
The private passenger burst and decided that the kinetic wax combination the F. <unk> efficacy segment of this trial and commence.
It is anticipated that each cohort will include an interim assessment of 19, a valuable patients that would assess whether the treatment of efficacy or the combination of Brexit giberson decided to the banana KLAX exceeds the efficacy of current standard of care therapy with the statistical significance.
Upon such favorable data, we intend to petition the U.S. food drug administration or the FDA for accelerated approval.
The efficacy segment of the trial is expected to be conducted at 10 clinical sites in the United States.
Which we now have nine sites committed to the phase two program.
Two additional sites remain as candidates to build attempt spot site spot.
Moving forward, we plan 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 I am now is planned for both cohorts. The study proxy giberson, plus decided plus banana KLAX one for untreated A.M.L. in Mds and the other for real.
Lapsed refractory AML and Mds.
Before turning to our other programs I'd like to briefly touch on are quite in phase one clinical trial that Brexit your berson 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 is planned initially to evaluate the safety of Brexit your burleson and solid tumor patients.
Patients diagnosed with recurrent ovarian and endometrial cancer, often have poor outcomes and it is our hope that person to person may provide clinical benefit for such patients.
We filed.
And investigational new drug application or I N D and expect to begin the study in 2020.
Turning now to plans for BP, one or two second therapeutic candidate, which targets the bcl two protein.
During the fourth quarter of 2019, we filed an eye candy application for our second pipeline candidate BP, One Oh too.
But at a KLAX has also shown activity against the any uptick protein Bcl two and works by neutralizing the proteins be age three domain.
It is an approved treatment for chronic lymphocytic leukemia, or CLL patients and untreated AML patients. However, with the exception of some patients treated with cell transplantation.
Disease relapse in invariably occurs often times due to be age threed domain mutation over time.
BP what Oh, two also targets the bcl two protein however.
BP one Boe to activity is based on blocking the bcl two messenger aren't hay and not to be age three domain. As a result, we believe that BP 102 could provide an alternative for banana KLAX patients, who have relapse, including AML patients who.
Previously, we see the net o'clock treatments.
In November 2019, Yep, D.A. granted I N D clearance to study BP, one oh too as a potential treatment for CLL, including Veneta KLAX relapses handling fault.
We can amended this registration to including a male relapses if those occur.
The plan to modification of our phase two clinical program and AOL to include Veneta KLAX combination treatment with Brexit Your Bursa will give us and early experience with treating bcl, two driven and I'll hop topic in these patients.
We expect to begin our first in human study.
BP one Boe too in the first half of 2001.
Finally, let me review our progress with our third drug candidate BP 103, which targets the statthree protein.
This is a program for which we have considerable excitement for its future based on very promising preclinical data presented in 2009 G.
We're studying BP, one or three for the treatment of pancreatic cancer.
Patient derived tumor model.
Previous models have shown that drug to successfully penetrate pancreatic tumors and enhance the efficacy of standard frontline treatments.
The results from our preclinical studies of BT 103 were highlighted in a poster presentations at the American Association of cancer Research annual meeting well the HCR in Atlanta in April.
2019.
The potential where our statthree is compelling for a number of reasons.
Signal transduction in activator of transcription three or Statthree.
So typically inactive in normal cells is apparantly active in cancer cells, the abilities of tumor cells to proliferate uncontrollably resist apoptosis or cell death.
Induce vascular formation and even big distant organs are well recognize hallmarks of cancer Statthree is a regulator of the genes involved these cancer processes more recently the capability of tumors to abate.
Immune surveillance and avoid destruction by the immune system has also gained significant except wins in the cancer research field Statthree, which is a point of convergence with many on Cogs oncogenic pathways has emerged as a critical in mediator of tumor.
You evasion at multiple levels.
Activation of Statthree has been found in many types of cancers, including non small cell lung cancer.
M.L. and pancreatic cancer.
Activation of Statthree correlates with poor clinical outcome high grade disease, and metastasis and has been linked with resistant to chemotherapy, including jumped decitabine 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 the poster at a CR highlighted for antisense oligo sequence is directed to get Statthree Messenger all right.
Benefit by bio path and manufactured using the enable lives antisense are they nano particle technology.
Cell viability tests westar blocks.
Conducted.
To determine the inhibitory effects of liposome incorporated Statthree antisense all ago on non small cell lung cancer and am else cells.
And ex vivo like tissue sensitivity assay was performed with a panel of 20 pancreatic patient derived xenograft just started the overall activity a b P. One oaktree alone and in combination with Jim sided.
Using previously defined criteria tissue sliced viability inhibition greater than 30% with a P value less and 0.05 was a response.
We're validation of ex vivo result, pancreatic cancer patient derived xenograft tumor bearing mice were administered BP what O three engine side of it twice a week for 28 days.
Super volumes were modeling or for up to 49 days.
No I tissue asked say BP, what Oh, three at a dose of 10 micro more significantly inhibited the tissue slice viability in nine out of 18 pancreatic cancer patient derived xenograft by more than 30%, what the P value less important or by the.
The combination of the one all three and Jim sided further enhance.
Ex vivo efficacy of BP one O three.
On a subset of patient derived xenograft.
And the Invivo study with pancreatic cancer patient derived xenograft model.
A combination of BP, one all three and Jim side of it caused tumor regression during the 28 day drug treatment period.
80 cancer activity was maintained for another 21 days, even with drug treatment had seats.
He is very encouraging data were well received earlier this year and a CR well we had universally enthusiastic response from the audience.
We're particularly excited to launch this program as it will be our first in humans validation of this cutting edge therapy in especially challenging cancer indications that has limited treatment options.
In addition, BP 103 was selected as the most potent liposome incorporated statthree antisense sequence and decreasing non small cell lung cancer cell viability.
Further value validation in AML cells demonstrated that BP, one all through inhibited cell viability and statthree protein expression.
We're excited by these preclinical data and for the potential will be P. One old three may play in addressing solid tumors and area that to date has shown difficult to treat.
Current therapies.
Moving forward, we are undertaking I N D, enabling studies for BP want all three this year with a goal to file an eye is de application with its very promising product candidate later in the year.
As you can see 2019 was a very productive year in terms of our clinical development programs.
We continue to advance those important programs and remain committed to evaluating new opportunities to people capitalize on the potential of our DNA blogs technology platform and other oncology indications.
With that I'll now turn the program over to answer the price for a brief review of our 2019 will your financials, along with balance sheet highlights Anthony.
Thanks, Peter the company reported a net loss of 8.6 million or 324 prepare for the year ended December 31st 2019 compared to a net loss of 8.6 million for 14 38 per share for the year ended December 30, Onest 2018.
Research and development expense for each of the years ended December 31st 2019 in December 31st 2018 was 4.6 million.
General and administrative expense for the year ended December 31st 2019 increased to 4.1 million compared to 3.4 million for the year ended December 31st 2018, primarily due to increased legal fees and salaries and benefits expense.
As of December 31st 2019, the company had cash of 20.4 million compared to 1 million at December 31st 2018.
Net cash used in operating activities for the year ended December 31st 2019 was 8.4 million compared to 6.1 million for the comparable period in 2018.
Net cash provided by financing activities for the year ended December 31st 2019 was 27.8 million.
With that I'll now turn the call back over to Peter.
[noise] Thanks Anthony.
We have an exciting year ahead with all three of our clinical development programs.
We look forward to advancing each of these.
Through to value, creating inflection points, but the coming year and remain confident that our strengthened balance sheet will support these goals.
As ever we appreciate your support as together, we advance our DNA utilize platform in a number of important.
In college indications that should benefit cancer patients worldwide.
With that operator, we're ready to open the call for questions.
Ladies and gentlemen, if ever question or comment at this time. Please press Star then one key on your Touchtone phone.
If your question has been introduced him or herself from the Q. Please press the pound Keith first.
First question comes from each end with H.C. Wainwright.
Thank you for taking my question. My first question is regarding the Triple combo trial of prostate universum close to something that they need a plots oh.
Can you give us the timeframe that expect within which you expect to complete the safety evaluation of the Triple combo.
Well that should have the safety valuations are typically taken.
Maybe three to six months, including the wrapping up the results I mean, we're gonna have quite a few oh.
Quite a few oh sites involved and so I think we should come who would comfortably be able to do that.
So just to clarify no patient have has being dosed twister triple combo, yet right and if you can comment on additional European based sites that would be helpful.
Yes, no one has been.
Treated with a triple combination.
We are being readying just to get that too I arby's for approval and we have all the documentation done this just now but.
The paperwork process as you know can take some time.
Depending on the frequency of [noise].
Site IR be meetings.
Those kinds of things European.
Sites will be I've had some are CR Roe.
Was are you know is its roots come from actually European operations, and then they expanded the U.S. fairly large we're very confident so oh, we're using those people could to pull us, but we central Europe is more the area that we.
Plan to go and you know, we we believe based on discussions with RCR Roes that those or.
Places that we should be able to have access to patients.
For the Central Europe area, though.
[noise] up second question regarding the.
Such a person combo therapy for C.M.L. visit skew being considered.
What we did.
That's a good question do you see a mile.
Is there's a lot of flux in that in that treatment now our drug works very well it accelerated and blast crisis, we've gone through two amendments to.
To expand the the trial for enrollment and the issue is that a advances is in Teekay high treatments.
Just continued do extend the period upon which.
Patients remain.
In the a chronic phase so what we had done is engaged.
Okay.
The CR road. It was on that study to go out and evaluate.
15 sites and so we're pulling the results the devaluation being of course their interest in the number of patients that.
They think that they can.
Produce so we're not going to beat a dead horse, we'll evaluate this and is the fact, they're just not that many.
Blast crisis.
Accelerated crisis patients out there that will probably take a look with just a stopping it so.
Good question, it's a little early we haven't we need to go through all the results.
We do have couple of sites that were interested but we just need to complete our evaluation of whether we want to continue with that.
Oh My last question is regarding the solid tumor study up Brexit your person or do you expect to start patient enrollment in first half of fiscal year or that's likely to occur in the second half.
Well, what we're doing is again, we've got our I.D. and already filed and we had some additional.
When we did.
One Oh too I mean, the we advanced our testing along to the really.
State of.
The art for CMC issues, and so the FDA had wanted us to apply some of that or to the solid tumors.
Study recall that really is PRX your burleson.
It is dash a it's got some modification minor very minor to the Oh to the final product we engineered it so that we get smaller and smaller.
Particle sizes with the goal of wanting to work.
Enhance.
Tumor uptake in the interior through.
The poor spaces vascular poor spaces. So drug substance is the same but when you make a small modification.
I have to redo everything and bring it up to date, so we're waiting on that but by.
By the first half we could we certainly should be open and.
And ideally we'll have some patients recruited in there. It's a study that's had a lot of interest from sites. So.
So that's that's the current hold up we're just waiting to complete a couple of tests. These days appropriate Dahlia Validations testing is fine, but you have to get everything proper so.
That's what we're doing.
Thank you.
You're welcome.
Your next question comes from Laura Engel with Stonegate capital partners.
[laughter].
Good morning, How're you.
Hi, good morning.
Good morning, So just one financial question I'm looking at that the falling from yesterday, no actually had a decrease year over year for your R&D line item and with everything going on and ramping up I had expected I'm a little bit more than that can you make any comments on the upcoming year, especially maybe first or second quarter.
Given the plans you've outlined I'm on today's call and thanks.
Historically any any insight on that would be helpful.
Well remember.
We had a lot activity going on the issue is that a way again its accounted for.
This is not an approved drug yet so well we finished batches GMP batch is you know in the process of producing them and it takes a while because recall we have a drug substance. It has its own clinical batches. So it has its own Q.
You know and investments into the long away and then that becomes a raw material.
The product. So we we go through a period of accumulating costs.
And in the balance sheet item, which is a holding area.
It's not an inventory because it's not to recruit products. So doesn't have that status, but it's a prepaid expense and then once the drug product the final product.
Which includes again all those cost for the drug substance that was released.
Once that final drug product is released to the company then it is expensed again, it's not it's not Uh huh.
Through product so it doesn't have inventory value. So as soon as its released its expense then at that time it goes into the R&D expense. So.
Really what drives what drives the.
So a lot of the R&D expense, it's just that cycling when we get drug batches no. We certainly had things in in line last year, but.
They had release, we've got several batches coming in that or close to being released this year. So it's it's that as well plus we engage some see our ROE.
I do see our ROE and a lot of times that payments as you initiate new trials can can create prepaids, which are not necessarily of course are not research expense. So it's really.
I think cycling things that Oh has that.
Effect that you see.
Anthony any other comments.
Yeah, just to piggyback on that you know if you look on the balance sheet at our prepaid drug product for testing you'll see that.
Year over year, we we actually have an increase of 450000.
Approximately $450000 and so that all right. There that's a that's an area will yield where you'll see an increase with all of our upcoming activities because we'll need all that drug.
Moving forward.
Okay, and so not coming here, we should see some of that flat trade.
Correct.
Okay. Okay. That's helpful. Thank you so much.
[noise], you're very elements.
Again, ladies and gentlemen, if you have a question or comment at this time. Please press Star then one key when you're Touchtone telephone.
[noise] [noise] no I'm not showing any further questions at this time.
All right.
Thank you again, everyone for joining us.
And we appreciate your continued support for bio past.
I have a great day.
Ladies and gentlemen. This concludes todays presentation you may now disconnect never wonderful day.