Q1 2020 Earnings Call

[music], ladies and gentlemen, please remain on your line is the cellular Biomedicine group Inc. first quarter 2020 results conference call will begin momentarily once again, the cellular Biomedicine group Inc. first quarter 2020 results conference call will begin momentarily. Thank you for your patience.

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Ladies and gentlemen, thank you for standing by and welcome to the cellular Biomedicine group Inc. first quarter 2020 results conference call. At this time all participants are in listen only mode. After the speaker presentation, there will be a question and answer session.

Yes. Good question during the recession, you will need to press star one on your telephone. Please be advised the today's conference is being recorded if you require any further assistance. Please press star zero.

It is now my pleasure to introduce head of strategy Investor Relations Derrick Lee.

Good afternoon, and thank you to everyone. Joining us this evening speaking today, its chief Executive Officer, and Chief Financial Officer of cellular Biomedicine Group Tony view.

After he completes its quarterly update we will open the call two questions.

Please note that some of the information you will hear during our discussion today will consist of forward looking statements, including without limitation that those regarding revenue gross margin operating expenses other income and expenses taxes capital allocation and future business outlook.

Actual results or trends could differ materially from our forecast for more information. Please refer to the risk factors discussed and see DMG. Most recently filed a periodic reports on form 10-K, and form 10-Q cellular Biomedicine group assumes no obligation to update any forward looking statements or information, which speak as of there.

Spectra dates.

I'd now like to turn the call over to Tony for introductory remarks.

Thank you Dick.

Thank you to everyone joining us today.

The World has changed quite a bit since Oh last conference call.

The age of novel could Volvo's, well covert 19 has dominated the mines and the cause of every person on this planet.

And our prayers are going out to those who are sick and the family members who.

Have lost loved ones.

I believe that this new paradigm with see becoming together.

Of the global biotechnology industry in helping to support the development a novel vaccines.

And therapeutics to combat this terrible disease.

Although see BMG was off to a bump you start with the owns it all the cause one advisors hitting China.

Separately in March.

Conditions have improved significantly.

We are happy to report that we're back to nearly four capacity on our operations in China.

And we hope to have all give his book meld and research and development facility back to enormously when's, the state and local government stay at home.

Directives.

With that.

We have taken the problem precautions and have stepped up our protocols.

To protect our people and facilities from infection.

We're consistently monitoring symptoms and have put in place measures to combat potential conversion.

Overall.

This first quarter was productive for both our clinical and manufacturing teams.

Let me start by a part in the hard work and commitment.

I'll point out that Oh manufacturing team has been very productive in continuing our process development efforts across all of our targets and continuing to make sure.

My quick progress for new facility in Rockville, Maryland.

The first program.

That I will provide an update on his own anti bcl maturation androgen all bcm, a car T to treat patients suffering from.

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Refractory multiple myeloma.

Were excited to announce that the national medical products and administration or an M.P.A.O., China accepted our investigational new drug application.

Application.

For clinical trial.

Which means that we will be soon moving the started from investigator initiated trials.

<unk> tool to a formal clinical trial and I indeed.

Additionally.

You know code I T trial, we're happy to report that we have now infused 19 patients.

With only one patient being observed to have with me so yes.

Overall.

The observed data has given us greater confidence to continue clinical development.

We believe that this early signals safety and efficacy will give us a unique competitive advantage.

When combined with L., we spoke manufacturing advantages.

Well, we have shown a mark do they reduce veined vindheim.

We will continue develop this program and update everybody as we make progress.

A second program that I like to highlight.

<unk> anti Cdnineteen cdtwenty by call.

Which trees, no hodgkin lymphoma or and Isabel.

Mainly in diffuse large b cell lymphoma audio bcl patients.

To date, we have infused four pages and are optimistic over the only thing though of safety and efficacy.

With the support of our new Brooksville Melanin facility, we plan to explore visibility for to U.S. clinical trials, namely the anti Cdtwenty think 19 by specific car T four new Hodgkin lymphoma.

And the tumor infiltrating lymphocytes auto platform for non small cell lung cancer.

Barring another step back from the coupon 19 pandemic.

The rock vis a facility should be Lady in Q4 this year.

We ended the quarter with 21.6 million in cash compared with.

15.4 million in cash as of the end of 2019.

Oh net cash used in operating activities. This quarter totaled 9.7 million compared to 7.9 million for the fourth quarter of 2019.

We executed a breach along 60 million in Q1.

And recently obtained approval of a line of credit for approximately 4.2 million.

We continue to seek additional funding sources, two boys, though balance sheet to support all clinical development.

Well, we do not expect covert 19 to materially impact our ability to maintain liquidity and secure additional capital resources, we cannot predict the actual impact given the rapidly evolving global situation.

Overall, we continue to progress on both the clinical and operational size, although business and all continuing to execute our vision to better global platform capable of research in developing and a manufacturing involving cell therapies to benefit pages.

With that I'll tell you back to Derek opening <unk> discussion for any questions. You may have was.

Thank you Tony.

Oh, let's take the first questions [laughter].

The first question will be from Madu Kumar from RW Baird.

Hey, Thanks for taking my questions. So the first one is you mentioned that you have data from patients for multiple myeloma trial give a sense of what kind of efficacy signals you're seen so far and when you would expect to presented data at a public for him.

Hi, My do good afternoon How're you.

All right. That's a quick question I think the yes, hi, so for the.

Certainly from the 19 page infused perspective.

We certainly.

Look at the.

In the comparable from the other peers in the sector, we feel confident Oh did it looks very competitive and safety profile is a very good.

As Weve 40, only when she is.

But on the only had that somebody or do you pages continue fallout.

Three months in four months and and we see some pages Ah Ah continue to progress from the see all of perspective. So we feel a the drug is working well within patients as we continue those.

From the low to mid those we can do a dose behind and we see clear or the corporation and it that's will give us confidence what could you do move forward.

Certainly as we have more data <unk> from the patient flow perspective, we'll look for some online opportunities and as as you know these days are the presentation, mostly ads as as we deal with the coffee bar or the virus and globally, we're fine nics opportunity.

We have the Oh my presentation, we started this year when when whenever visit the next opportunity.

Okay and then when you you mentioned that discussion and then they came about the bite and then a car T. Pristine banking team 20, showing efficacy clinical I think as he in three out of four of the valuable patients. So far what exactly does that mean and kind of what are they kind of response rates and kind of how would you do come.

To give some color Alan.

Advocating you've seen with the buy cars so far.

Sure sure well the we're very excited a would only limited patients available for us to evaluate a evaluate on it with three months, but as you know somebody with only.

Three pages with Siemens, it's still too early to report in the we're going to continue well actually one more pages.

As the pull them show a great safety profile and Oh, the indication from the a patient so since treated for three months and I think there.

It is a it is sony.

Great to know that after we've seen some early results and other page inside the patient enrollment has continued to to come in and that is good sign. So we'll just continue Monsanto as we have more patients to your mobile, but I can say.

Yes, so far based on the limited pages or that the Evaluable has two months it looks very good from safety perspective, and a the oh can choose a good good results I would say again of course, you. There's very limited only from patient perspective. However, it is because signed website.

Scott.

Well it till probably has also like I said much too.

So what do I know, but as I could say we.

Yeah, we.

For years, we now see a feel confident with based on so far we've seen and we'll continue to.

To develop and appear in the clinical studies in U.S. I'm, sorry, I cut you off you ask about two. Please go ahead, yes, yes, its until probably do you mean non small cell lung cancer, obviously kind of on top of a lot anyone's mind that the data presented by the market at the AC our presentation, they got last week or so and so.

What are your learnings from that or how do you think behavior. It till program relative to what moderate pursue it so far both in terms of kind of.

Manufacturing considerations, but also comes the target patient population based on them off a data.

That's great question in my view, yes. Overall, we are very excited and we saw the we representation done by Moffat and that they have done a the exceptional job.

In my mind or from the you know non small cell lung cancer as you know a five fall or from the.

The data what we hope to solid and it's just fantastic. So we all preparing a they use study a eventually.

Andy the U.S. in the coming soon U.S., what we're doing definitely that Oh, the we don't know the details of manufacturing.

Side, a bit of of what's been done at the Moffat. We all preparing you know Cbms you traditionally has been very good from the ER manifest through from system as far as automation.

Reduce the cycle et cetera, So we're taking advantage of our strength in this area hopefully 2020.

We will be focusing on get the manufacturing streamlined to put together a as industry knows the challenge part of two is manufactures one key component of the whole.

From the process perspective, so we.

We are at the moment doing process development, but when we're ready to come to trial study and U.S. and that we feel.

There is about.

What the work has been that Moffat and hopefully Cbms you will.

And develop own from the till pull them perspective, the first indication folks on the that's mostly on intensive U.S.

Okay, great digging a little bit you plan to approach at the way like it did which was to bank tales from patients kind of before immune checkpoint blockade and they administer it after progression or do you plan to do and where are you select them right. After that progression that has happened like how do you think about one.

The tumor symbol population and go after then I guess more specifically based in the market data would you look at for example, tyrosine kinase need to pay has it generally go do well on PD, one blockade or like helmet population the looking to pursue for in non small cell lung cancer tell trial based on them off a data.

Right.

I on that side of it we probably would be a you know certainly.

In terms of specific Pocos, we're still going in discussion with the pie and I think the in general a war, we would be probably similar approach as we think that it's it's been working well already and we would be oh.

Look at what the has been done in the past from NIH and what Scott.

And then they have been doing at the Moffat from forward spread so.

As we have fun laws, we still far as protocols, but a one can certainly see that you know you loom from that and you would be more or less and funds approach prospectus similar and however, a in manufacturing side of it we would be putting a lot of emphasize in ensuring that the we.

I've been joked a boost from leading from went as far as reagent reagent respect to crosses perspective and combined with the the money that they have done at the Oh Moffat trial.

And of course from the.

Using.

The overall from our two and specific practices, while we're still finalizing and certainly we would do a again take advantage of what do you have done and also put some improvements.

Oh.

Different there isn't if you will from our perspective and a we'll put that.

And in the same trial.

Okay, and then kind of one of the operations perspective, he mentioned the idea of looking for additional sources of.

Cash over the next few months. So obviously you asked him I did everything attached to it could be 19, there or do you kind of like small business loan programs that exist kind of each by the government and pardon my ignorance diagnosed as much about kind of what happened with China economically after the carbon 19 pandemic happened there are there equivalent.

Programs in China that are going to accessible by CB Mg.

A quick question or do you actually a we were extremely consume a one a virus outbreak happens in China or as you know this was the most first NAND a with strong measure <unk> put in place in China that.

Things are really under control quickly.

As as you know so far in China. It's the there has been very a very good it from the as far as Oh the outbreak concerns in.

The Shanghai.

Operation perspective, there will be back and back in a normal.

You know more from the conversion perspective. Similarly are there some programs available Cbms you has been very lucky the only yes as we reported we have some we have access to bank loans perspective interest where he is very attractive. That's why we take advantage of this a small loan.

Programs. In addition, Cbm GE has are being continuing able to attractive investors some of them the or the sector or the specialists and to a war general funds and we have being able to attract that investors from from.

The short term loan loan perspective, yes, we continue.

The.

<unk> government are encouraging interest rate, although as you know.

It globally has been low in China as well so.

We believe that we should be able to can do to tap into a.

From the are you know.

Joe to credit line perspective, and also from the invested equity perspective. So quick question might do I feel confident we can to should be able to leverage of these in helping slippage from the.

True up to balance sheet.

Okay. Thank you so much Jenny.

[laughter].

Thank you.

And with that concludes the Q in a session for our analyst call. So I. Thank you again for everyone to who has joined and we look forward to update you on iron next quarter. Thank you again.

Ladies and gentlemen, this concludes todays conference call. Thank you. Thank you for participating and you may now disconnect [noise].

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HM.

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