Q3 2020 Navidea Biopharmaceuticals Inc Earnings Call
Greetings.
Thank you for standing by welcome to the video Biopharmaceuticals Q3, 2020 earnings and been this call during the presentation.
They should all participants will be in a listen only mode. Afterwards, we will conduct a question and answer session.
Tom If you have a question. Please press the one followed by the four on your telephone if at any time during the conference you need to reach an operator. Please press Star Zero. This conference is being recorded Thursday November 12 2020.
Now I'd like to turn the conference over to Jed Latkin.
Oh, CEO C O and CFO. Please go ahead.
He's got a this call is first off I just want started to saying that this call is being webcast live on our website IR doesn't have any of that comment a replay will be made available. Following the prepared remarks here, we're just going to do a Q and a.
As well as always.
In the course of the conference call, we will be making forward looking statements regarding future events and the future performance of the company. These amounts relate to our business plans to develop the videos molecular diagnostics and therapeutics, which include clinical and regulatory developments and timing of clinical clinical data read out the one the capital resources.
And strategic matters as well as the impact of the COVID-19 pandemic on the video business operations. All of these statements are based on the beliefs and expectations of management as of today. These statements involve certain assumptions risks and uncertainties and could cause actual results to differ materially we assume no obligation to revise or update forward looking statements whether as a result.
A lot of new information future events or otherwise investors should read carefully the risks and uncertainties described in within the Safe Harbor section of our website as well as the risk factors included in the company's most recent quarterly and annual filings with the SEC.
I want to thank everybody for calling in today for today's third quarter conference call. The last several months for this company.
He's been quite busy and I'll provide a brief recap before I turn the call over to Dr. Vogel you go through the exciting news for a deeper dive into the arm three data now that we have more than half the patients that completion of week 24.
As all of you will know we engaged in several transformational transactions. This past quarter, we signed a binding yellow you would you want that one.
Completed will provide up to 20 million upfront capital as well as several hundred million in sales milestones along with significant double digit royalties in the future.
The whole year contained an exclusive negotiation period and we are currently in the middle of that period now we have ongoing due diligence and commercial clinical legal and financial all of which are moving along very nicely jubilant.
Has been quite thorough and as a result of that we are generating some excellent data that has validated our commercial assumptions and has given us a much deeper look into the data that we are generating dr. Roger will spend quite a bit of time. This evening presenting the data, which we are very very excited about.
Another area of Great change in the company, it's some degree of financial flexibility.
Ability after years of penury.
You will notice when you see our Q that financial language has changed significantly despite all the turbulence in the markets and the uncertainty surrounding cove. It even if we don't complete the jubilant transaction. We are fully funded to complete our phase three trials and bring our a product to market without further dilution we are working hard.
Word on all the little things and investors don't talk about supply chain product sourcing delivery efficiency and everything they will make this company quite successful for the long haul.
Coming months will not be easy as we will be quite busy finalizing the licensing and distribution agreement with jubilant moving forward with the FDA meetings and getting everything else aligned as we prepare.
To launch the phase three there's so many other things going on at the company, but I assure you that our A. remains the primary focus and we will not slow down until we are up and enrolling patients in 333.
I'm proud of my team and I would be remiss, if I didn't recognize and congratulate Joel Kaufman on his promotion to Chief business Officer.
You'll be hearing from him later on in the call and I know many of you have spoken to in the past as he discusses this quarter's financial results I also want to congratulate both Eric ease and Jeff Smith on their respective promotion in finance and operations now I would like to turn the call over to Dr. Rosell, who will go over the exciting news as it pertains to the week 24 data in arm three 331.
Hi, Mike.
Thank you John and Hello, everyone as always I am happy to participate in todays call and provide you with updates from the clinical side. So.
So I'll begin with the progress on our currently running phase Twob trial in already.
Earlier updates the trial is completely enrolled with only the latter half of subjects in our three continuing.
The longitudinal imaging and clinical assessments as outlined in the study protocol as a reminder, this phase to be as a three arm trial in arms, one and two we are evaluating the repeatability reproducibility and stability of our till Manocept imaging readout in healthy subjects and in patients with active all right and in the third arm, we are mirroring the upcoming.
Phase three study in order to enable us to obtain data to help with sample sizing for the phase three as well as to have a look at the ability of the manocept imaging to serve as an earlier predictor, an early predictor of treatment efficacy and the monitoring tool as we have discussed and presented in the past the interim results to date that all three arms habit.
I've been very positive we.
We have data demonstrating that technetium 99, m. to manocept can provide robust quantitative imaging and healthy controls and in patients with active already that this imaging is reproducible and can define joints within with out already involved inflammation and thats a manocept imaging can provide an array.
Early prediction of treatment efficacy of anti TNF Alpha therapy. This month, we presented the positive interim analysis results of arm three at the American College of Rheumatology annual meeting.
The last couple of months, we have focused quite a bit on the due diligence process with jubilant.
This has been a large effort and taking a great deal of time, but this is all.
So allowed us to continue to analyze the full six month longitudinal data on the first half of subjects and on three we believe these data will make an even stronger dataset to bring to the FDA in order to support our design and objectives for the upcoming phase three.
As we announced previously and as presented at the AACR meeting.
All the results of the second interim analysis looking at the first half of patients enrolled in arm three with imaging and clinical assessments out to 12 weeks were positive and supportive of our hypotheses. They provided evidence that to let us up imaging can deliver an objective quantifiable assessment of Ari involve joints that does enable early per.
Kind of clinical response, as well as the monitoring of clinical status.
Those results gave us the confidence to proceed forward with the study and to continue to prepare for the phase three since that time. Those then additional patients have continued on the trial and a little more than half of the total number now have their complete six month follow up Don.
So recall that the design of the third arm is that patients are enrolled prior to beginning an anti TNF alpha treatment and we acquire images as well as clinical assessments at the baseline time point.
Once they begin their therapy, we bring them back 512, and 24 weeks later in order to do repeat imaging as well as.
Obtain clinical assessments. The current standard of care practice is for their rheumatologists to put them on their new therapy, and then see them only at 12 or 24 weeks following at which point the doctors obtain their semi objective subjective clinical assessments in order to determine if the therapy is working or not in.
Well if the drug is not working and this will be the case about half of the time or more the patient might be getting worse or at best staying the same.
And co Morbidities can stack up and adversely impact the patient's life.
All of this in addition to the risk of side effects from the serious drugs by the way.
I should have correct correct myself I need to say at least staying the same not at best in any event. Our hypothesis is that till manocept imaging at week five can provide an early objective read out or whether or not the treatment is working and the doctor can then make an informed decision earlier about what to do to post benefit the patient. Additionally, we.
In the midst of believed that the baseline scan itself can provide information that is predictive of whether or not the anti TNF Alpha is are likely to work in at least a significant subset of our eight patients and that this would potentially make a tremendous impact on patient management. So with that in mind. We now update on subjects were followed out to 24 weeks.
And I'm going to go through that so we have a total of 16 patients with active moderate to severe already that have been included in this analysis. Each of these patients was set to begin a new or first time treatment regimen with an anti TNF alpha therapy whole body in hand risk planar gamut camera images were taken.
Looking at baseline prior to the start of their treatment again at five weeks post therapy initiation and then again at 12 and 24 weeks a panel of established clinical assessments was performed at each time point as well again. The reason weeks 12 and 24, our chosen is because those are the standard of care time points were.
Rheumatologist bring back their patients who have been put on anti TNF alpha therapy in order to determine if the drugs are working or not so the results of our preliminary analysis demonstrate one.
So manocept imaging from baseline to week five was predictive in this data set of clinical outcome at 24 weeks and 30.
We're not of 16 patients for an accuracy of just over 81% in.
In this dataset changed from baseline to week five until Manocept imaging had high positive and negative predictive values for clinical outcome at both 12 and 24 weeks. So at 12 weeks the positive predictive value was 100%.
Team negative predictive value was 83% at week 24, the positive predictive value was also 100% the negative predictive value was 77%. These preliminary results indicate that marked changes until manocept global uptake values by week five are in very good agreement with clinical efficacy evaluation.
It's made later at week 12, and 24 third the early results support the hypothesis that in a subset of our eight patients. The baseline scan alone can be a reliable predictor of non responsiveness to anti TNF Alpha therapy. These.
These data continue to support our hypothesis Thats, a manocept imaging can.
Can provide quantifiable imaging assessment of already involve joints that enables early prediction of clinical response, and if you have any questions about those data feel free to ask me during the Q and a and I'll go into a little more deeply we're going to continue of course to follow the remaining arm three subjects in the current trial and we are presently in the midst of Finnis.
Finishing up a flex a fleshed out package of all of our interim analyses data from all three arms of the trial to bring to the FDA to affirm our plans for the phase three following this we anticipate to begin to officially open up sites for the phase three as I've said numerous times in the past we're in an excellent position for the phase three.
As most of the sites that recruited into the ongoing trial will be rolled right into that trial and so the logistics and strategies for recruitment. Our already established you should also know that we are working on an aggressive and compressed timeline, but we are doing this smartly, usually an FDA meeting would occur at the completion of a phase two following full.
Analysis of the data with the phase III discussed and beginning thereafter in conjunction with the positive interim data from the current trial, we've sought and been in continual alignment with the FDA all along the development of this are a program and we are integrating the earlier suggestions into the proposed design of the phase three.
Because of this we believe we will have a strong data package to present in support of the design. The specific indications, we will be going for and the milestones. We will propose in order to achieve success. This will enable us to begin the phase three with confidence earlier than might otherwise be the case our goal in meeting with the FDA.
At this time is to ensure we maintain alignment and that they agree that at this time our proposed plan if successful could be used to make the case for approval of till manocept in our way.
We've also been preparing for the start of the separate phase to be comparative study of our imaging read out the histopathology.
And the joints of patients with Ari This will be an adaptive study, where we aim to recruit patients with each of the three known sub types of IRA and obtain comparative imaging and pathology results from joint biopsies of their already inflamed joints. We now have all of the necessary approvals with various regulatory bodies in place.
Firms as well as signed contracts with vendors and our key trial site in the UK.
Also contractually now signed off to begin. This study soon we will begin to scheduling we will schedule a site initiation visit soon for the our UK site. The reason we are running much of this in the UK is that our principal invest.
Instigator for this trial is located there he is both the world's leading physician and joint biopsy of patients with our eight and he also maintains a lab specializing in the examination of the past results of these biopsies.
We are in the process of opening a use site as well both the UK site as well as the U.S. site our hope.
People that they can begin recruiting in January contingent upon any new coded related restrictions and were pushing for that to happen sooner than January event, but.
Remember this trial is not required for FDA approval in the initial indications and already that were going for but we believe it is critical in order to achieve qualify.
Location of Cdtwo six of the biomarker for IRA as well as to engage with pharma fourth use in trials of new our eight therapeutics, who will also provide rheumatologist with gold standard information related to our imaging readout and the fundamental biology of a patients already as well as the some type of Ari they might have.
For example, how might this be use well.
Imaging a baseline can be used to classify a patient subtype of IRA. This has implications for what class of therapies might or might not work on that patient and would therefore have immediate impact.
In other indications I updated you previously that we've completed.
Well imaging and biopsy of all subjects in our NIH funded study of cap disease, Arkoma and we have all of the data in hand, we are making progress on the analysis and we'll update you. When it is complete on the cardiovascular disease front work continues on the clinical investigator initiated atherosclerotic plaque imaging study at MGH.
The all in Boston, and we anticipate an update discussion with them in the coming weeks I just heard from them that they are nearing full enrollment in that study, which is very encouraging.
After a slowdown to do to covert restrictions they've been on track again to.
To meet their targets to have all the subjects enrolled before the end of this year pre.
Preclinical studies of gallium 68 till Manocept imaging for our NIH funded project with the University of Alabama, Birmingham are also ongoing we've been granted an extension on the funding for that project by the NIH due to the earlier closedowns due to cold it the cardiovascular potential is large we've been having internal and clear well discuss.
Since about possible trial designs and specific indications to bring to the FDA to advance this part of our pipeline.
We also continue to make and significant strides towards producing the next generation of our molecule that we think will improve performance in both diagnostic as well as therapeutic applications during.
I should pass quarter, we converted a provisional patent focused on blocking off target organ uptake of till manocept to improve on target localization. We have had ongoing preclinical studies related to this with promising results.
We believe we have also improved the methods of syntheses for both diagnostic and therapy.
Thats good at constructs back in Q2, we filed a provisional patent application on an improved synthesis method and we are currently working on and intend to file another provisional patent covering another synthesis protocol, the resulting new imaging and drug delivery constructs are currently being evaluated in cell cultures and in animal models.
Models and position us well, we think for the future.
These are just some of the highlights of the last quarter that we wanted to touch on for this update as Jeff said, we remain largely focused on the RFP pipeline, specifically preparation for the meeting with the FDA planning for the phase three and preparation to open enrollment into the.
The other phase to be on imaging to histopathology, we continue to support and push for progress on our other diagnostic and therapeutic indications as I've told you today briefly.
And as always I want to thank the team here for their tireless efforts to keep things moving as well as our network of clinical trial sites in academic research collaborators.
For all of their hard work.
I wanted to keep these remarks relatively brief today I don't think I was successful there, but please feel free to ask questions. During the Q in a thank you now I would like to turn the call back over to Jed Jed.
It's more important than my remarks, the brief since I don't have much to say Dr. Rosen.
Thankfully has a lot to say because of the tireless efforts of this team, which we'll get to at the end of Joel's part. So Joel why don't you give us the financial run down please.
Thank you Jeff total revenues for the third quarter of 2020 were $268000 compared to $237000.
For the same period in 2019 total.
Total revenues for the first nine months of 2020 were $696000 compared to $539000 for the same period in 2019. The increases in revenue were primarily due to increased grant revenue related to SP IR grants from the National Institute of Health supporting the Manocept develop.
Research and development expenses for the third quarter of 2028 were $1.4 million compared to $1.8 million in the same period in 2019 third quarter decrease was primarily due to net decreases in drug product expenses, including decreased Manocept diagnostic and technetium 99 till Manocept development cost coupled.
With decreased employee compensation R&D expense for the first nine months of 2020 were $3.7 million compared to $3.6 million in the same period in 2019. The year to date increase was primarily due to net increases in drug product expenses, including increased manocept diagnostic development costs.
Offset by decreased Manocept therapeutic and technetium 99 till Manocept development costs, coupled with increased employee compensation.
As gene a expense for the third quarter of 2020 was $1.8 million compared to $1.5 million in the same period in 2019.
Third.
Quarter increase was primarily due to increased legal and professional services and employee compensation offset by decreased travel insurance and depreciation costs.
SGN expense for the first nine months of 2020 were $4.9 million compared to $5.1 million in the same period in 2019.
The year to date decrease was primarily due to decreased travel legal and professional services insurance depreciation and Investor relations related costs offset by increased employee compensation and franchise taxes.
Navideas net loss attributable attributable to common stockholders for the third quarter of 2021.
$3.3 million or 13 cents per share compared to $3.1 million or 17 cents per share for the same period in 2019, Navideas net loss attributable to common stockholders for the first nine months of 2020 was $8.4 million or 37 cents per share compared to $8.2 million or.
Or 62 cents per share in the same period in 2019 Navidea ended the third quarter of 2020 with $3.7 million in cash and cash equivalents. Since September Thirtyth 2020. The company has received $700000 of cash related to the August 2020 funding transactions and I will now turn it back to Jeff for closing remarks.
Thank you Joel before we turn to Q and eight I just want to once again, thank the clinical team for their tireless work and these very trying times. They are in the office every day wearing our masks and driving the trials forward. They also take the time to hit the road constantly to do their site visits regardless of the risks to their health and words can't Express.
Brett My continued appreciation of all of them from buying David Rachel all the way down to our insurance.
With that I would like to turn it over to Scott to open up the acuity.
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Okay.
MS told yes.
Yeah.
Yeah right.
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[music].
And we have a question from Jason Mccarthy with Maxim Group. Please go ahead. Your line is open.
Hey, guys. Thanks for taking the question is Michael accumulates on the call Jason.
Hey, Michael.
Good how are you doing yet.
So thankfully, we're chugging along here as good.
Yeah, and I'll, just say, it's a good.
Good result, congratulation.
I'd like to see.
I'm a bit more about this subset of patients where the baseline result can be predictive of the of nonresponsive mess what are the characteristics of these patients and how does the.
As the till Manocept signaling vary between patients who respond versus those who want to baseline.
Sure Great question. So this is like rosell for the record.
Hey, nice to speak to you. So there are thought to be.
Three general sub types of rheumatoid.
Chart arthritis, right at least according to one classification scheme.
Those sub types are the myeloid cell lymphoma, myeloid and the fibroid or pelosi immune.
One of the main distinguishing characteristics between those.
Different sub types is the amount of macrophage involvement in that.
In the rheumatoid arthritis pathophysiology for each of them.
With the lymphoma myeloid in the myeloid being macrophage rich rheumatoid arthritis is in the fiber to past immune to having a much lower level of macrophage involvement so.
So our molecule radiopharmaceutical to Manocept of course targets with very high affinity.
The activated macrophage, so you might say to yourself well by golly those fiber costs Humulin, maybe you are not going build image them and that'd be bad for you right because you're looking at the macrophage and you just told me there aren't that many.
While it actually turns out that this could be tremendously important for rheumatologist and their patients in a good way and so.
The thing is right now there is no way to distinguish those different sub types what type you as an hour a person might have.
No way at all unless you do a snowmobile tissue biopsy. This is something that is not done everywhere fully done at research institutions Theres no way, it's going to be standard of care.
And it has its own.
Don't deficiencies in terms of.
Accuracy and sensitivity so.
What we think is our hypothesis our hypothesis is this so.
Since we are measuring our radiopharmaceutical imaging the macrophage, we would expect that already subjects, who have already as diagnosed.
By all the other hallmarks of already.
Those who have the fiber to the policy immune sub types. There scans were till Manocept will likely look more like a healthy subject to our normal person than the other two that have a lot of low that have a lot of macrophage involvement and likely would have a lot of localization of till manocept right.
So.
It turns out.
That the fibroid subtype, there's a growing body of literature, suggesting that that subtype in particular does not respond well to anti TNF alpha therapies at all and that makes sense because really in the main pathway of the anti TNF Alpha therapies is the macrophage. So it makes sense.
That those fibroid sub types are likely going to be enriched are full of the nonresponders and so our hypothesis as I mentioned has been that our first scan the baseline scan before there's any changes.
Of a patient with the fibroid policy immune subtype will look much more like a healthy person and we would then predict based on that scan alone.
On that they are much less likely to receive a benefit of an anti TNF alpha therapy.
Now in the small numbers that we've looked at so far 16, and we actually have others kind of.
Accumulating along the way I can tell you that we do see a different sort of at least a couple or maybe three different popiel.
Relations of.
Localization accumulation in these patients that were imaging.
And for sure. We think we can divide them at least into the very little little macrophage activity in those who have much more macrophage activity right, because we see roughly a third or so a little bit more of the patients look more like normals and.
Maybe two thirds or a half look like they have seen significant localization in certain joints right and I should mention that the distribution of those different sub types across the populations is roughly across the population of our a. subjects is roughly thought to be about a third a third a third maybe more maybe 40% of the fibroids.
Then on what paper you read in who you ask so.
We're seeing above that number of patients and our scans, who look more like the normals and guess, what we followed them to 12 and 24 weeks. After they were put on their anti TNF Alpha and most of them don't respond and so that is accumulating.
Evidence that our hypothesis is going to hold to be true that just at that baseline scan. If you look more like a normal you are likely to be a fibria past humulin and you're less likely to respond to the anti TNF Alpha. So our data are accumulating that support that now the NAV Threethirty two phase Twob study where were doing synovial tissue biopsy.
As well as imaging will help establish that with ground truth.
Where we will not only be looking at the number in the density of the macrophages in the joints by sampling those joints with a needle, but we'll also have the the the rheumatologist than classify those cases as one of those three sub types to me.
It's much more important to look at the correlation with the actual number and density macrophages than it is to worry about the subtype Mimi.
Well I think we're going to be able to do is say look you are scans show you look you've got all the signs and symptoms have already been diagnosed.
Your scan at baseline looks pretty normal you probably have fibrosis.
Type or at least your subtype whatever we call. It we can call. It out there are some tight that doesnt have a lot of macrophages, you're less likely to respond to an entire class of drugs.
And so we don't have to go through all of those where you might be you're going to be wasting money. The insurer is going to be paying for drugs that are likely to be benefit to our benefit too.
Growing might have side effects. Because these are serious potent drugs were going to forget all those and we're going to put you on something else, which has a higher likelihood of success.
I talked a lot did I answer your question, maybe I missed something.
Yes, thanks for the kind of my hunch is that it was going to be really to what we find out in that 30.
The 32 cents.
Study, but you're seeing some initial signals from us.
Exactly.
See if you could.
You could highlight what you're seeing in the patients who don't get a predictive result, we buy for these patients not demonstrating a reduction.
To manocept.
Big value, we buy within they are spot.
Spawn, meaning we twelveth we bore.
Really good question of the test month detecting patients.
Who are responding or get in patients taking longer display our response.
That's a good question so.
Yes.
But my view, which is somewhat biased, but I try to base. It in fundamental facts. So the the way. It is determined that somebody is responding to or not to any therapeutic an hour. A these are done with the composition assessments and these consist of a variety of semi up.
Your active too subjective things for example, the rheumatologist will look at a patients can joints the wrists their elbows their shoulders, and say are they slow it or not and they will do account of those the ones that are swollen. There are 28 joints in particular that they look at that.
They will all.
Gentlemen, squeeze those joints and say does that hurt does that hurt does that hurt. So there you can see immediately that theyre going to be subject. There is a subjective nature to those the other kind of two main components that are used in these assessments are a global assessment of the patient him or herself.
Off of how they are doing which obviously has value and then the physician also contributes and overall global assessment you put all of those into the meat grinder and you come out with a number that says the patient you know is this this is the status of the patient, but because each one of those is subjective in its Nate.
Sure there is a lot of variability in those composite scores.
So they're pretty noisy one of the reasons that trials one of the main reason this not the main reason that trials in rheumatoid arthritis require lots of patients typically for new therapies and they need to be followed over usually significant chunks of.
Im are because of that fact that these are subjective measurements that are very noisy so to see a true signal across the noise takes big numbers or time. So if you ask me I think what we're doing is measuring a fundamental unit of biology the macrophage.
I think in the end biology wins eventually we're going to know if the patient is getting better or not because were measuring that biology, but in any given day theres going to be influencing those composite scores from how the patient or even the doctor is doing maybe they're really happy maybe they feel like they switched to a new drug.
By Golly it has to be work, maybe it's in their nature to be happier pessimistic with times of year. There are all sorts of variables I think as we accumulate more subjects are accuracy is potentially going to go up and as you look over time I'm pretty sure, we'll meaning that we will be able to make the right call.
Recall and it just might take a while for those clinical assessments to catch up Doesnt mean, thats always going to be the case, though there are some that.
So the specific to your question the ones that we've seen that our prediction has been.
Not correct at least not yet.
I really do think a lot of it.
Do with the target itself. So we're hitting in a more focused target the clinical assessments and I actually would be a little bit scared. If we hit 16 out of 16 of an a. morphis target because that might mean were equally a more subs. So again I think the biology will win out in some of these though are in all of these.
Three that we Havent met there there is borderline things going on with the macrophages that I would expect would eventually be borne out in the clinical assessments.
We're not going to keep following them beyond six months so.
So we may not learn that maybe we can follow up with some of these but you know.
I wouldn't I'm not surprised were not hitting a 100% in terms of these clinical assessments as the outcome that make sense.
Yes. It does makes sense. So then one thing I guess I have one more follow up on that.
Same point.
In the phase three is there any plan to.
Include a till Manocept assessment as well as the clinical assessment at weeks weeks 12 and 24.
Yes, so where are we are doing that in the current trial and we will we will do that in the phase three as well. So we're going for three main indications writer. The plan is one is.
The rig zero two week five change if any in the till Manocept scan is that predictive of clinical outcome at either 12 or 24 weeks. That's our main indication. Another indication is can the baseline scan itself be predictive of clinical outcome based on this kind of Paso type per sub type bucketing.
And the third indication is the longitudinal monitoring and that is imaging a multiple time points over or imaging over time.
And seeing how the patient's disease status at least as as assessed by macrophage activity is overtime and so the way to one way to get that is to look at correlations with the.
Clinical assessments and like I said in a may stand out to you you know I wouldn't expect us to match up at every time point with the clinical but I think what we're going to be seeing isn't in some patients that will be more anticipatory right. So the macrophages might be going down to our signal will go down and then long term the clinical is.
Estimates will catch up to that so there is a plan, though too and we are currently acquiring images that every single time point. So we do have those data and we're looking into the week 12, and week 24 imaging data as well and aligning those with the with the clinical assessment I can tell you something that I haven't said before it's.
It's not it's encouraging and that is when we have looked at the week 12 images and quantify those.
The trends are holding so it's pretty cool right. So if we see a subject for example, who has achieved a response.
As assessed clinically at week 12, or 24 by the clinical assessments a positive response to anti Tina.
Set alpha.
Our imaging for example.
The the localization has been going down at.
At least in some of these subjects from week to week five and then the ones who are still getting better.
Along the way or kick continue to get better as measured at every time point by those clinical assessments.
We actually see the signal goes.
Okay.
At week 12, even further up till manocept. So it looks like that thats something that reassures us that we're measuring something thats showing a real effect.
And that the effect is lasting right. So it's not a transient thing for the drug at least in those subjects to the signal is going down and.
Dan is going down so we'll keep looking at those data and quantifying those along the way.
Alright, Thank you Dan congratulations on the.
On the data.
Excellent Okay. So Michael Thank you.
Next question.
I have a question.
From Jacob notes with a private inspector please.
Please go ahead.
Hi, Jed.
So I know that you touched on it on a conference call just a.
Regarding the jubilant transaction can you tell us with more clarity as far as how long the exclusivity period is with them.
That's a good question I mean, we have not disclosed that but all I can say is that we're within the period.
We have constant discussions with them and I trust that based on our discussions we will be able to complete it within the time that they've allocated so we we have specific we've been we've.
Been in discussions with them consistently over how long each each.
Each subject will take we gave ourselves enough time to get it done to working for the kovar delays. Unfortunately on the clinical side, we had applied numerous issues with COVID-19ien people not being able to do calls or whatever but we're well within the timeline. So I do.
Anticipate that we will get it completed within the set timeframe, but it's not something that we've disclosed publicly what that timeframe is I do know that once we do continue to move forward with the FDA that'll sort of pushing forward a little bit faster.
Sort of push them to a decision faster.
But we are well within the the timeline and we do expect that as more data comes through on the remaining due diligence items and clinical legal and financial.
We're we're going to get this thing completed within the timeframe of the of the contracts or not I'm not worried about it nothing has really popped up.
That would would worry me other than the fact that things have gone a little bit slower pace, just because of cove. It and the fact that we can't get into a room everything's, obviously done remote by zoom, but.
But the one good thing is this is Don is one it has allowed us to have this addendum to the second interim look odd is also you know.
The company Jubilant has spent.
I just can't.
Countless amount of money on the commercialization feasibility all this other stuff money that we have intent that they did which further validates everything that we're working on and so that's something that's been a positive that we had not anticipated and it's something that we're excited about but we are.
We're very very confident that we will get this thing done within the timeframe allocated under the value.
Okay.
Same front.
The August 10th call you mentioned about the Investor Group.
It would be paying a $5 per share for up to a million shares of navidea.
And then they also talked about if the stock.
Were to rise to that $5 range they'd be making at least or they'd be making another 3 million share investment, which is $15 million. What's the exact latest state of the first investment of the first $5 million on the 1 million shares and then what exactly is the last date.
The remaining $15 million so that.
The first is approximately a 23rd or 24th because it was it to 45 business space contingent on the acceptance and of the of the application. So.
Then there's 45 business days thereafter, and what I want to stay.
Yes is that the agreement we have is the first 5 million is.
A guarantee that is definitely coming in at $5 a share for the 1 million shares the remaining in its actually 20 million is at the company's option if the stock trades between five and 575 for five consecutive.
This given the financials, we have in place.
As I've said numerous times I'm not you know the.
One of the Ceos of these biotechs that you'll get some good news and look to raise $100 million just to have it on the balance sheet I know how much it's going to cost to get us to our product I don't want to needlessly dilute so.
Dave.
We have the option to do that if the stock goes about five.
But given the 15 million series B that we have in place.
We have more than enough money.
But for those dates we have it's approximately November 20, Threerd and then 45 days thereafter for the expiration of the remaining 20, but thats going to be sort of a.
Oh wait and see because I just don't think at this juncture its money that we need given that we have the funding in place we're.
We're moving we're moving at a good pace with jubilant, we have our plans in place for moving.
Moving forward on cardiovascular and some of the other projects we're working on.
So im not going to needlessly look to fund I mean, I'm very happy with it.
Some of the auditors on how the Q is going to look in terms of financial disclosure and given what my budget is over the next two years.
We have enough money in the bank allocated to get us from here until approval, so I'm not going to.
I wouldn't I wouldn't 100% rollout using it because it really depends on what happens, but I would say that it would be high.
Highly unlikely.
That we would use that that second tranche, but the 5 million is coming in and it should be in within the next week or two.
All right that's it for me I'm. Good thanks excellent. Thank you Jacob.
Next question.
Question from Mike Kelly with video. Please go ahead your line is open.
Yes. This is Mike recount independent investor.
Question.
A couple questions here to financial.
Appreciate you, taking the call Jeff and Mike.
And Joel.
First question is what you were just talking to the prior caller Jacob about so when you were on the call.
Well and you said there was a $20 million.
Coming in is that the 5 million plus the 15 yep yeah.
Yes, it is and I think on.
On one hand, that's also.
You know as an aside helped move going forward faster because they understand that.
It would be great I do firmly believe we're going to get the deal done I think that that's going to happen, but remember we now have a lot of financial freedom. This is something that we have not had in many many years and I know a lot of the people on the phone call have been with us for many years and they understand that you know I was looking.
Back at a lot of that a lot of the decisions. We always made were well do we want to do we want to have you know a middle core bread or something like that now. We finally have an opportunity to complete the trial to work on a bunch of other projects in a very focused and directed manner. So we get things to to completion and not.
Just scattershot investments here, there and everywhere.
But we also have the benefit of moving forward with a great partner.
So I'm talking about the five that is guaranteed and the 15 that is guaranteed onto the series D preferred and then we have the other option, which is for an additional 29, but as I said with the five in the 15, we're we're more than covered to take.
Take care of all of our financial need to after the next couple of years.
So as the 700 that came in after.
The third quarter was that from jubilant, then or was that from somebody else. We don't know the 700. It was from the series D.
So they've already started funding yes.
Yes, they have yes, so they funded.
Well you know you'll see.
See the Q tomorrow, but they've they've already started funding S.
You'll see that if you look at acute tomorrow. The important thing to look down is on the balance sheet looking to the equity section, you'll see the equity receivable as well as the series D. Outstanding. So if you put those two together you will see what the financing you know.
What we have planned over the next nine months coming in on.
Our anti basis so it's.
Nice to have Uh huh.
Nice positive receivable on the balance sheet for once.
Well, that's great to hear I'm glad to see it start funding the rest of several more questions, but they are more on the scientific side, but.
First one is on the <unk> you have to be a window you you've said that before.
Or there was a 60 day window from the time you request a meeting with the FDA. So you have that meeting at a minimum.
Have you made that request yet with the FDA for the P. three review.
Hey, Mike It's Mike how are you.
Hi, Mike I appreciate it Mr Rosen.
Yeah. Thanks for the question, we have not made that request yet so what we've been doing like I said is.
While we've been doing the due diligence with jubilant we've.
It's allowed us to.
Accumulate more of this data that I, just went over and to have the.
First half of the subjects actually a little bit more in arms three.
Completed through their six month follow up and so if you ask me and you're asking me I think that actually puts us in a better position then that if we had asked for the FDA meeting before because this gives us.
The data that would actually be or how we would design and are seeking to thinking of designing the phase three fall.
Following up these subjects all the way to six months.
Because that's what is done clinically you look at the patience and see if the drug is working after three and six months. This was US. This has given us the time to get data, where we have imaging.
All of these time points, but most importantly, as I just went over the baseline.
A line in the five week and then we can compare those to the 12 and of the 24 week clinical outcome. So it gives us a stronger story to tell I mean, there is some risk there maybe maybe things got worse as we followed them for 24 weeks of versus 12, you remember the 12 week data we're very powerful.
But it turns out the 24 week data are equally powerful and I think thats very important and what this does is reinforce our our hypotheses and what were thinking in terms of what till Manocept can bring to the table. So I think it's put us in a better position frankly, but we haven't asked it yet the plan is to to ask for that meeting.
Meeting in the next though.
Before the end of the year for sure is the plan and we're putting all these data together in what is known as a briefing book that also has all sorts of other.
Explanations and distributors of the prior trials so that the FDA can have everything in front of their fingertips.
As they make their give us their feedback on our trial design as well as our our proposed.
Endpoints and objectives and milestones so again, a long answer to your short question, we haven't asked for it yet, but we're going to ask for it before too long so.
So Mike that point to sometime late in.
First quarter of 2021 before starting the Pvthree.
Yes, most likely I.
I mean things could happen sooner right. So thats. The typical response time that I've said.
It's unlikely it will be sooner given things that are going on in the world I mean, the response time given that the cobot scenario.
Once we asked for it we'll have feedback from them and in 60 days.
And then we're in a good position to go now again, we should you should note that we're not going to the FDA for a formal approval process to start the phase three but we just want to make sure that there that they agree.
With what we're proposing so that will increase our likelihood of success.
If we meet these milestones that they've agreed upon and then we deliver those data at the end of the phase three.
Since they've been involved in the decision making.
It's much more likely that we're going to be an agreement that the data supports the.
Indicate.
Patients were going for so it's not a requirement to do at this stage. We think it's a it's a smart way of doing it.
To make sure that the phase three has the most likelihood of being accepted as a registrational study assuming it meets our our targets.
So you just made a variance.
Important clarification, there may not have been understood you do not need.
Ill start the P. Three but all of this effort you're going to end this continual refinement of data in the <unk>.
Understanding of data will make the P. Three more effective so are you, saying you could start the P. Three any times, but.
You are choosing to better refine the data before you start and go to them.
Yes, yes, we could started at risk sooner than that but.
As Jeff has outlined and due to his efforts were in a position where we don't we can make it to the end of the road and do it in the in the in the best.
Fashion possible right on the smartest way, where we have the resources now to do it and set us up set ourselves up to the best chance of success I think I really want to build on what Dr. Russell just said because I think it's important that you know that you know the briefing books are being worked on now and that's something that it can be submitted the preponderance.
As evidence that we're now bringing having be 16 patients at week 24 really is what I would say like the crucial linchpin for getting the FDA is by and yes, we don't need to go to them again, we could launch at any point in time, but we have the flexibility we have the runway to do.
And now that we can provide to them a package that includes this really key week 24 data. We made it isn't decision internally. It was obviously a risk because maybe we didn't have such a positive we 24, but thankfully we have the data who is very very good and I'm really really happy with it I think.
You would have been better and now we can use that as part of our package to the FDA. If you remember the last time, we submitted to the FDA, we actually caught off guard because they responded so quickly.
We submitted it was the middle of the summer numbers like Okay. We're gonna summit, we can take off a few weeks relax and then have the meeting and then we heard that could fit into.
The peaks and next thing you know everybody had to cancel their summer vacations and we're working on it so I'm really happy with the fact that we are going to be presenting such a robust data package to them and I think that it will really lead us to have a nice springboard into the launch of the phase three.
Well you know this is excellent information that both of you just passed I don't think.
General population understood that I think the general understanding was that you still have to get approval for the phase three but you're actually trying to make the phase three a better a better or more well understood and accepted.
Trial.
You're not waiting because you can't get approval. So that's a really important piece of information that I guess.
Thanks, Mike Leigh OLED, you highlighted that I'm, sorry over talk you, but I think we've noticed that in our conversations in readings and so I wanted to make that clear and I know, Jeff did as well. So thanks for also emphasizing that point.
That's excellent yes on your remaining participants in the arm three.
[noise] based on what it's taken to get these done are you seeing those being done by the first quarter of next year also.
Oh, yeah. So we've got but they will have their imaging events in their last clinical assessments I think there's only one one subject to is lagging because that it took them a while or maybe maybe a couple that are like.
Lagging because it took them a while to get their anti TNF, but in terms of the analysis, where we're doing it in a rolling fashion. So.
With those lagging one or two aside we'll have all the data analyzed at some level in the first quarter.
Hi, this is or maybe don't and maybe I should tell the folks out there you know that.
But for me.
Don and analyzed with statistical input and analysis and the tables figures of the legends that need to be done and a final clinical study report on that takes some months after but the way.
We're we're looking and analyzing the data internally in a rolling fashion. So we're going to know a lot about those.
Yes.
In the first quarter so.
So even before the phase three starts we're going to have more information even that I've discussed today and more.
Detailed analysis will have been done on those cases as well so that.
That will help us I don't foresee a changing the design as.
As John mentioned and as I've tried to relate today things are going along according to hypotheses exceedingly well and so I think this is all supportive for our even our current design of the phase three and now. We're we're also using these data to help us in the sample size estimation, we already have estimations.
Of that but were able to use these data to help us refine that even more so we can really hit the ground running with a very targeted phase three not not larger than it needs to be and not too small so that we can achieve success and the other thing to build on that you know this arm three.
Has really shown to me I don't know about our clinical guys were obviously very experienced and all that but you know.
More of the the outsider I would say, but the arm three has really shown to me why there's such a need for this product. The fact that it takes some of these patients forever, who arent on great health care plans to get there.
Anti TNF it because you know what they know that once they get it it's a six month authorization and there's you know they don't they get there they get their medicine and maybe works maybe it doesn't the fact that we're going to have something that can tell you at week, five whether or not it works he's going to invite the insurance companies to be more apt to say you know what.
We'll take that chance because instead of authorizing for six months and paying for six month of a drug we're going to take for five weeks of drug and which is essentially you know two or three injections and we'll know when they are not going to work. So it's sort of money well spent you know how the insurance company. They view all of US is as positives and negatives, where we're just dollars incensed to them.
I think the patient care doesn't really care, but thank god, there companies like us who do care about the patients and are putting forward a product that will allow these insurance companies to make the decisions in a timely manner, because they know that their commitments not going to go beyond that five week, because we're going to be accurately able to predict it and at five weeks.
We predict it's working the insurance companies more than willing to pay for it we've had issues with patients who just can't get the drug insurance companies more and more are tightening their belts and they don't want to have to pay and this is why our diagnostic is so greatly needed. Because this is something that's going to open up patients who need the drug and be able to get access to it faster.
And that's why we have several patients that will go past this quarter because he just couldn't get the truck I mean, that's it it's the lunacy. This whole thing that somebody who really needs it isn't going to get it because there as well. So we know whats working two nanos working do I want to have to pay for six months of the drug insurance companies don't enough for them. It's all about the dollars and cents and we're going to make that.
Decision, so much easier for them and that's something that has really given us a moment, a pause and really.
Encouraged us to how good.
Good of a product this will be and how successful will be long term.
Well you might just led into something and this was from your K oil with RAF you did a really good job in explaining from his viewpoint.
I was going on it within the <unk> in the medical community, but one thing you brought up that was really important was.
Some of this after it gets approved which we're all hoping for a positive outcome and will.
The people who make the entity is anti TNS.
Excuse me.
Try to do anything negative to it and what he said was basically there's 30 other types of drugs out there just chomping at the bit to get onto the market. So the big companies that are making me anti TNS may not be receptive to this but there's plenty of others as well so he so I took away.
From that mitigated the risk a lot of non acceptance is that a fair assessment from the K will.
Yes, there's another point great point. This is Mike Rosell I agree you did a great job Jonathan Graff. He's now we've had a number of discussions with them and they've all been really informative and in fact, he was one of the care wells or how.
Lets design the the currently running trial as well as the phase three and so he has been instrumental his insight has been instrumental all along the way and he's a he's an influencer in the field of Rheumatology and in addition to what you said there Mike I want to emphasize that somebody jet has said multiple times.
We think.
Is holding true at least in our limited data so far so when I mentioned to you the positive predictive value is 100% for imaging read out for predicting.
Clinical outcome at 12, and 24 weeks I don't know that that number's going to hold but what that means is in subjects, where we see an a beneficial effect.
Second our till Manocept imaging read out.
All of those subjects, where we said you're getting better by till Manocept every one of them got better clinically so that's something where in a payer or a company that's making an anti TNF Alpha I think we'll see that information is valuable because that would then be usable to re and.
Enforce that are anti TNF alpha treatment is working so they can keep.
The patient will then need to say on it the doctor will advocate that the patients stay on it because they have something in hand that says objective really is working and is Jed is using that as an example of himself over time you know the payers are going.
Into want some concrete information to say this drug we're paying $5000 a month for is working right. So this will be something we can give that says indeed, it is working and.
And we've seen it first hand with patients who looks like they are great for the trial and I'm always getting on and Bonnie about that he has been working hard.
But off on that thing for years, and I always yell at or whatever that patient when it couldn't get their drug you know we have patients that screen and look great and they can't get the drug because the insurance company just doesn't want to pay and this is I mean and yes, Mike made the point is maybe I'm a bit selfish because this will help me long term with micron disease, and my and my situation getting my Auntie.
You know what is going to help so many people and it's something that we're really really excited about.
Well you guys have done a great job here I got one more teased your question for the N. you said several times that you've been doing some preclinical studies on therapeutics.
Can we can you leave us with a teaser if some of those have been looking at here.
Heaters or CV therapeutics, what can you tease this a little bit what some of those preclinical with too.
You are working on effort.
Sure. So the main one is the main domain is oncology so cancer, yes, we've looked at.
A number.
And so.
Tumor models and I think this part has been publicly discussed in general the theory is that and the evidence to support us in general that are.
Therapeutic hot in concert with existing immuno therapies to NAV and then.
Added synergistic effect and we're seeing that in our preclinical models and we have some compelling data demonstrating that that we've been talking about and are likely to write up for an abstract in a publication before too long. These are these are we think very strong data that show that we can impact the Mac.
Then procedures associated with tumors in such a way that not only have a clinical benefit themselves, but also can kind of release the body's immune system as encouraged by other immunotherapies and increase the effect of those immuno therapies. So we think this is a.
A very powerful story potentially in the cancer space I'll leave it at that.
Okay, well I appreciate you sharing a little bit I'm very I'm, a long term shareholder I'm very encouraged by what you guys are doing and what you've done and I appreciate it and applaud you and say thanks.
Excellent Thank you Mike and.
I think I think that was it for the questions and so I know it's already late so I just want to thank everybody once again for calling in and I look forward to speaking with you guys. All again in the <unk>. The near term are going to be trying to set up some more of these virtual fireside chat as well as appearances if some of these other virtual a investor conference.
And so that way, we can get out in front of investors as much as possible. So everybody have a great day. Thank you so much for tuning in.
That concludes the call for today, we thank you for your participation and I say please disconnect your line.
[noise].