Q4 2020 Oncolytics Biotech Inc Earnings Call
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Ladies and gentlemen. This is your operator todays conference is scheduled to begin momentarily until that time your lines will again be placed on music hold thank you for your patience.
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Yeah.
Good morning, and welcome to uncle Index biotech fourth quarter and full year 2020 conference call. All participants are in a listen only mode. There will be a question and answer session. At the end of this call. Please be advised that this call is being recorded at the company's request, but now like to turn the call over to Jon Patton.
<unk> of Investor Relations and communications. Please go ahead.
Thank you operator, good morning, everyone and welcome to you on codecs Biotechs fourth quarter and full year 2020 conference call earlier today on <unk> issued a press release, providing financial results and corporate updates for the fourth quarter and full year 2020. The replay of today's call will be available on the events and presentations section of the on credits.
Site approximately two hours after its completion.
After our remarks company management, we will open the call for Q&A.
A reminder, various remarks made during this call contains certain forward looking statements relating to the company's business prospects in development and commercialization of caliber Europe, including statements regarding the company's focus strategy and objectives of the company's beliefs as to the potential and motive action of pillared reroute anti cancer therapeutics.
I mean aims and anticipated benefits of the company's current or pending clinical trials and other statements related to anticipated developments and the company's business. These statements are based on management's current expectations and beliefs are subject to a number of factors, which involve known and unknown risks delays uncertainties and other factors not under the company's control that may cause.
<unk> actual results performance or achievements of the company to be materially different from the results performance or expectations implied by these forward looking statements maybe force pink statement image unclear expresses an expectation or belief as to future results such expectations or beliefs are expressed in good faith I believe to have a reasonable basis, but there can be.
No assurance at this statement of expectation or belief will be achieved. These factors include results of current or pending clinical trials risks associated with intellectual property protection financial projections actions that regulatory agencies and those other factors detailed in the company's filings with SEDAR Edgar SEC on.
<unk> does not undertake any obligation to update these forward looking statements, except as required by applicable laws now.
Now I will turn the call over to Dr. Matt Coffey, President and Chief Executive Officer of our critics biotech Matt.
Thanks, John.
Thanks to all listening for joining us on the call today to discuss our full year 2020 corporate update.
In addition to John and I'm joined by Andrew Do you go to Dara, a global head of business development, and Kirk look Chief Financial Officer.
We recently wrapped up one of our strongest years, yet at uncle It acts as our team was able to successfully navigate the challenges of the pandemic to achieve key clinical and corporate milestones.
These milestones are validate our unique on quite a virus you mean there.
If you approach it.
Certainly the breast cancer program towards the initiation of a registrational study and generate in multiple opportunities. So it's bad peloria reps potential markets into a variety of highly prevalent indications.
Looking ahead, we believe we are poised for a catalyst rich 2021.
We are beginning the year with a talented team industry, leading collaborators and our robust clinical data set that demonstrates pellerito reps potential to address unmet needs across multiple indications.
Now I'd like to revisit some of these highlights that have brought us to this point.
How these highlights set us up for success in the year to come.
Our primary focus continues to be the advancement of Pellerito Rep are intravenously delivered immuno oncologic virus towards a registrational study on HR positive <unk> negative metastatic breast cancer, a substantial unmet need exists on the syndication as many currently available therapies are unable to produce at meaningful survival advantage for siggi.
Difficult percentage of patients.
To address this need we are conducting our aware one and bracelet one clinical trials as many of you know these trials build upon the results of our prior phase two study of <unk> 13, which showed a near doubling of overall survival with Palo rear up treatment in patients with HR positive <unk> negative metastatic breast cancer.
To support these programs and determine the design of our phase III registration program.
One embrace slipped one achieving aimed to achieve three key objectives.
First the aimed confirmed pellerito reps immuno therapeutic mechanism of action to reinforce the promising survival benefit of R&D to 13.
Second they aim to validate the clinical utility of our novel blood based biomarker measuring T cell carnality to predict patient response to Peloria rep.
Finally, they are designed to evaluate <unk> ability to enhance the efficacy of checkpoint inhibitors to improve best cancer patient outcomes on.
I'll discuss in a moment there is a robust and growing preclinical and clinical data set supporting the synergistic potential of Palo Verde without the checkpoint inhibitor combination therapies.
Over the past year, we've made strong progress on all three of these objectives successfully achieving key milestones despite the pandemic.
Several of these milestones were a result of our continued progression of our aware one window of opportunity study in early stage breast cancer.
As a reminder, the studies being conducted in Spain by Solti and represents the first use of our clinical supply agreement with Roche.
Doubling the number of aware one study centers, we were able to accelerate patient enrollment Halloween screens reopening la spring.
Today, we are thrilled to say that we are fully enrolled studies first two cohorts, which examine the effects of pellet treatment with or without checkpoint inhibitor therapy.
Evaluation of these cohorts is the core objective of aware one as these patients have HR positive <unk> negative breast cancer. The same subtype, we intend to examine and future registration study.
Where what has generated very promising interim data to date, which confirmed pillows immuno therapeutic mechanism of action and highlight how it acts on both the tumor and the patient's immune system to aid in the fight against cancer.
Now on a high level. These data show that pellet generates on adaptive T cell based immune response that can train your immune system to fight cancer and that it remodels normally immuno suppressive tumor microenvironment, thereby making them more on medical to checkpoint inhibitor therapy.
Taking a deeper dive into these interim results I'll discuss our most recent aware one update at the 'twenty 'twenty, San Antonio breast cancer Symposium.
These data showed that Rio increased tumor PDL, one expression in all evaluated patients with expression increasing by an average of 105 four.
This is a powerful result that speaks to calibrate our reps potential just synergistically combine with checkpoint blockade therapy as the approval of a checkpoint inhibitor is contingent on a minimum PDL one expression level in multiple indications.
Data presented at the San Antonio Breast cancer Symposium also showed that 72% of Evaluable patients saw an increase in sell till the study's primary endpoint at a measure of tumor inflammation, that's associated with favorable clinical outcomes.
Notably the maximum increase in cell til an increase of approximately 300 per set was observed in cohort two patients receiving <unk> in combination with checkpoint blockade therapy.
These day to complement our previously reported <unk> results, which are shown on that Palo Verde were up treatment results in a high level of consistent tumor specific viral replication.
An average 14 fold increase in intra tumoral CDA T cells, and the generation of new presumptive antiviral and anti tumor T cell clones that may facilitate a long lasting immune memory effect against cancer.
Together. These findings show that we're on track to achieve the three key objectives I mentioned earlier in the call. An example of how pelo rear up increases intra tumoral CDA positive T cells and the recruitment of memory T cells, which are crucial.
<unk> to remodeling tumor microenvironment that can enable the success of several on Immunotherapies.
Looking forward, we plan to report additional aware one results at ACR in April and final biomarker data from this study in the intended target population in the second half of the year.
These data readouts represent key milestones for the breast cancer program and they will provide additional insights into the immune response generated in patients receiving <unk> in combination with checkpoint inhibitor therapy.
Moving on now to bracelet, one our phase II trial evaluating the safety and efficacy Peloria Rep based combination therapies in HR positive <unk> negative metastatic breast cancer patients.
Like in aware, one the talent and dedication of the Alcoholics team allowed us to open sites and enroll patients in the trial despite the pandemic.
Date, we've activated 18 of 20 sites are on track to achieve full enrollment in the fourth quarter of the year.
While safety run in that's been completed with the data and safety monitoring Board verifying pillows outstanding safety profile. This is in line with what we have observed with polo rear up across all of our clinical studies as we've now treated over 900 patients with intravenous Palo Verde, a rep and have yet to reach a maximum tolerated dose.
We expect to report on additional safety updates on the trial on the second half of the year.
As you May know bracelet, one was designed in collaboration with Pfizer and Merck Serono is being conducted under the auspices of pre cause a world renowned research organization.
Its design is essentially identical to that of IDT 13 study with two exceptions.
The study focuses exclusively on HR positive <unk> negative subset of metastatic breast cancer patients, which is the patient population in which we saw the most pronounced overall survival benefit in 90 213.
Second.
One adds an additional study arm to evaluate <unk> in combination with Pfizer and merck's anti PD lone checkpoint inhibitor Covid and seal.
As mentioned earlier. This design was developed to support the overall survival advantage observed in <unk> 13 by demonstrating <unk> ability to induce robust antitumor immune response and near identical patient population.
Additionally, the study aims to validate T cell carnality utility on the clinical biomarker and evaluate the efficacy of pellet checkpoint inhibitor combination therapy.
Ultimately, we expect a continued progress on Brexit one to complement our aware one dataset.
And drive and drive our lead breast cancer program towards a registration study.
We believe this program has been substantially derisked as we've demonstrated the ability to advance our trials. Despite the pandemic and joining a very strong clinical data set and the process visa.
These accomplishments agile our prior regulatory achievements, which include SaaS tracked designation at a special protocol assessment agreement for this program.
As we continue to move forward in 2020, one I'm confident that our highly talented employees investigators and partners will keep us on track to execute on our stated clinical objectives. This will allow us to adapt peloria rep towards regulatory approval, while simultaneously positioning the company for sustained growth.
Now I'd like to shift gears, a bit and revisit some of the clinical data we've generated beyond early breast cancer program.
Over the past year, we made key stride across our pipeline amassing clinical data in a variety of indications that highlight the broad applicability of Peloria reps immuno therapeutic mechanism of action.
I've discussed a lot of these data on prior calls so rather than go through them all of them in detail I'll briefly touch on the key results and then let Andrew talk a bit about how they are driving our business development strategy.
And our gastrointestinal cancer program, we reported a greater than 90 per cent clinical benefit rate and K Ras mutated colorectal cancer patients in one study and a greater than 80% increase in progression free survival in pancreatic cancer patients with low levels of <unk> six expression in an NCI sponsored randomized study.
Highlighting <unk> potential as a predictive biomarker Palo Verde, a rep response.
These data together with the prior data showed rapid map maturation of dendritic cells increased activation of CDA positive T cells and upregulation of tumor PDL one expression following <unk> treatment in Gi cancers form the basis of our GI cancer program, and our recently announced collaboration with Roche and <unk> and a phase one two.
Goblet study evaluating peloria without the checkpoint inhibitor combination therapy in multiple Gi cancer indications.
Last year. We also showed the benefits of Palo rear up could extend the hematological malignancies reporting fascinating proof of concept data in multiple myeloma.
When evaluating <unk> in combination with a proteasome inhibitor cultism. It we saw the activation of a profound inflammatory response, accompanied by a 50% overall response rate and an 83 per cent clinical benefit rate income schism of refractory patients who are notoriously difficult to treat.
These results indicate the first reported incidence of cytokine release syndrome associated with clinical responses in multiple myeloma.
Duction of a cytokine release syndrome, which can be effectively managed with well established therapies highlights the ability of Pellerito rep visits on a combination treatment to induce robust immune cell activation and tumor lysis multiple myeloma patients.
These data together with our prior results from a trial showing a dramatic increase in PD lone expression with <unk> treatment provides yet. Another example of Palo Verde or upset immuno therapeutic effects.
Lastly, I'd like to discuss some interesting data we've seen in neurological tumors, which come from clinical studies spearheaded by our collaborators.
On our last call I reported the completion of rail glial, an investigator sponsored phase one b trial.
This trial evaluated the combination of Impella with granulocyte macrophage colony stimulating factor alongside standard chemo radiotherapy and adjuvant <unk> for the treatment of newly diagnosed glial glioblastoma multi form or excuse me on.
Since that call we presented results from the trial at a 'twenty 'twenty society of neuro oncology annual meeting.
These results showed that Palo Verde, a rep based combination therapy was well.
I'd say, it was safe and well tolerated and produced compelling signal of efficacy in newly diagnosed GBM patients.
The estimated median progression free survival in all evaluable patients with seven eight months, which is encouraging given the survival rates typically observed in this extremely challenging indication.
Notably <unk>.
<unk> and medium progression free survival correlated with the dose of Palo Verde Rep administered with patients receiving a low dose or high dose of Palo Verde around having estimated median PFS of six one months and 9.4 months respectively.
We will continue to prioritize the execution of clinical milestones in our breast Gi and Hematological cancer programs.
We believe that real glow data highlight an intriguing opportunity for Palo Verde of reps that we will evaluate carefully over the coming months.
Now as I previewed earlier, we're also recently saw some very interesting preclinical data with Palo rear rep and amira in solid tumor model to evaluate the potential synergies between Palo Verde Rep.
Courtesy car T cell therapy.
These data came out of the Mayo clinic from the lab of professor of Immunology, Dr. Richard Vial, a world renowned expert in key opinion leader non enclitic viruses in adoptive T cell therapy, who joined our scientific advisory opinion scientific Advisory board in the fourth quarter of last year.
Through his preclinical studies Dr. Bell has begun to address a critical question about Palo Verde Rep.
And that question is a day.
Immuno therapeutic effects observed in aware, one and other clinical studies position Pellerito rep to Synergistically combine with immuno module Tora agents, such as checkpoint inhibitors or beyond checkpoint inhibitors.
To answer this question Dr. Violent as colleagues evaluated Pellerito Rep car T cell a combination therapy in a solid tumor model.
Now despite the success of Hematological cancers car T therapies have not historically been successful against solid tumors due to immuno suppressive tumor microenvironment that promote T cell exhaustion and exclusion.
This was the scientific rationale for this preclinical study is aware one data have demonstrated <unk> ability to recruit T cell to solid tumors and reverse the immunosuppressive microenvironment.
Results from the study showed that this rationale was well founded as they directly demonstrated Palo Verde rep's ability to synergistically combined with car T cells and enable their success against solid tumors in preclinical model.
Specifically the results show that loading car T cells with Palo rare rep vastly improve their persistence and efficacy in mice in Stark contrast to prior studies showing that the uncle requires V. S. He actually weakened car T cells.
The efficacy of pellet rear up loaded car T cells has been further enhanced by treating mice eight day later with an intravenous peloria rep boost which led to generation of highly persistent car T cells.
In addition to retrench him a growth and ultimately tumor cures.
These synergistic effects appeared to be specific to Colorado Rep. As following car T polo rear up therapy with an intravenous boost to be a V. S. We did not prevent recurrent tumor growth.
Ultimately the successful translation of these results into the clinic would represent a major accomplishment as it would substantially broaden the applicability of car T cells to a variety of highly prevalent and difficult to treat solid tumor indications.
We are now specifically pursuing a partnership strategy to further development of pillar as an enabling technology for car T cells and additional immunotherapies that stand to benefit from its clinically demonstrated ability to recruit immune effect yourselves to solid tumors.
It is our goal to identify partners that will take the lead on this development pathway and assumed the research responsibility and costs associated with it.
Through this strategy, we aim to minimize risk while retaining upside in the form of upfront milestones and royalty payments.
With that I'll now hand, the call off to Andrew to call about how we are leveraging Colorado reps inherited advantages and our robust clinical data sets to drive our BD efforts and the advancement of our pipeline our pipeline programs Andrew.
Thanks, Matt and we said in the past our goal is the secured global clinical commercialization partnership.
Both facilitate palfrey on X approval and maximize its commercial opportunity.
Our efforts to achieve this goal or bolster.
First theres tolerant reps robust clinical dataset.
Second.
Pharma and biotech companies and improving the efficacy of checkpoint inhibitors by pairing them with oncologic viruses. This is demonstrated through several deals done by companies such as Marc BMS and J&J.
And finally, they are empowering their reps inherent advantages over other oncologic viruses.
Now since Matt has already highlighted 0.1 and as part of the call.
Speak briefly about points, two and three starting with the last one.
Almost all other oncologic viruses and development either have at least one and often both of the following two characteristics.
They require special handling procedures due to biosafety level III classification or <unk>.
They require interest and while delivery and therefore, an outreach metastatic disease.
Hello rear up on the other hand is administered systemically on nursing staff requires no special handling procedures and has been clinically demonstrated to selectively replicate in local and metastatic tumors.
These characteristics offer on substantial competitive advantages over other oncologic bars companies as we pursue partnerships with industry leaders.
Yeah.
And our pursuit of these partnerships. We are falling approach that has a track record of success based off those large pharma deals I mentioned earlier, which have typically been preceded by initial collaborations designed to evaluate the feasibility of potential combinations.
In 2020, we successfully executed on this approach fostering collaborations with industry leaders inside of Roche and the phase two Irene.
Phase one two goblet trials.
While these trials targeted triple negative breast cancer, and Gi cancer, respectively.
There are several parallels between the two trials that demonstrate that the broad applicability of colors mechanism of action.
Both triple negative breast and GI cancers, you prove on checkpoint inhibitors is contingent on minimum tumor PDL one expression levels.
<unk> seen in many patients.
PDL, one expression levels and immuno suppressive tumor microenvironment ultimately limit checkpoint inhibitor apps and these indications with only about 20 per cent of triple negative breast cancer, and approximately 20% of Gi cancer patients responding to these therapies.
Despite these low response rates checkpoint inhibitors have been commercially successful in these indications with a checkpoint inhibitor market as a whole I expected to reach $55 billion worldwide by 2025.
Given Palo Europe intravenous route of administration.
And the extensive synergy data Matt mentioned earlier, we believe there is an exciting opportunity for pollo rear up to help checkpoint companies accelerate their growth by increasing the number of patients who are eligible for and respond to checkpoint therapy.
This opportunity ultimately facilitated the collaborative Irene and goblet trials.
As a reminder, Irene is a phase II study evaluating <unk> in combination with insights anti PD, one checkpoint inhibitor red band the Mab in triple negative breast cancer patients on goblet is a phase <unk> study evaluating a combination of Potline roche's anti PDL, one checkpoint inhibitor centric.
In patients with metastatic pancreatic metastatic colorectal and advanced anal cancers.
Notably these trials will also collect collectively evaluate the utility of the T cell poor analogy and <unk> Biomarkers, Matt mentioned earlier.
We look forward to the continued progress of these trials over the next year with the initiation of dosing goblet expected in the first half of the year end.
And an interim safety data update from Irene expected in the fourth quarter.
Together, Yeah, Irina Goblet trials are just the latest examples on how we're successfully executing our business development strategy.
<unk> followed the temper laid out embracement in our ongoing study with BMS evaluating palop vivo combination therapy in multiple myeloma patients.
Looking forward the progression of these clinical studies, particularly those in breast cancer will be our primary focus. However, we also recognize that <unk> is clinically demonstrated ability to up regulate PD lone expression and recruit high concentration T cell solid tumors.
Its business development and partnership potential beyond just checkpoint inhibitor combinations.
As Matt mentioned earlier, we have already seen exciting preclinical data, suggesting that Palo <unk> synergistic benefits can.
It can be extended to additional immuno therapeutic agents and we are pursuing a partnership strategy based on these findings.
As we progressed through 2021 and beyond we are committed to executing this strategy in a way that preserves our primary focus and resources centered on advancing our clinical studies, particularly in breast cancer.
We aim to do this by relying on high quality partners to spearhead Palo <unk> development as an enabling technology for car T cells.
And other immunotherapies that required immune cell infiltration in solid tumors.
This will allow us to achieve an optimal risk benefit balance as we take advantage of <unk> potential to synergistically combine with a variety of additional immuno therapeutic agents. Besides the PDL one checkpoint inhibitor class that is our current development focus.
With that I'll turn the call over to Kirk look our CFO to discuss our financial results for the fourth quarter and full year 2020 Kirk.
Thanks, Andrew and good morning, everyone.
I am pleased to report in 2020 on clinics was able to establish and maintain a strong financial foundation, while advancing the development of Peloria room on.
Our cash and cash equivalents improved to $31 $2 million at the end of 2020 compared to $14 1 million at the end of 2019.
I'm also happy to report today, we've been able to continue building on our financial position, having raised over $20 million from our at the market facility in the first part of 2021.
Importantly, as of today, our cash and cash equivalents are now approximately $50 million and our financial runway now extends well into the second half of 2022.
Our operating expenses for the fourth quarter of 2020 were $4 million remaining relatively consistent with 2019 fourth quarter expenses of $4 $1 billion.
For the full year 2020, our operating expenses were $12 5 million compared to $9 six for the full year 2019.
This change is largely due to increased directors and officers insurance premiums increased investor relations and business development activities and associated professional expenses.
Research and development expenses for the fourth quarter of 2020 were $4 $1 million compared to $2 seven for the same period last year.
For the full year 2020, R&D expenses were $12 9 million compared to $10 8 million for the full year 2019.
In the current quarter and full year 2020. In addition to progressing are aware one and bracelet. One studies. We also began on trial initiation activities related to our government study.
In 2020, we also made changes to our R&D personnel to better support on clinical development program.
Finally, net loss for the fourth quarter of 2020 was $9 3 million compared to $19 4 million in the fourth quarter of 2019.
Equating to a net loss per share of 21 cents for the 2020 period and a net loss of 71 per share for the 2019 period on a consolidated basis.
The net loss for the full year 2020 was $22 5 million compared to $33 1 billion and the full year 2019, equating to a net loss per share of <unk> 56.
For 'twenty for the 2020 period and a net loss of $1 50 per share for 2019 on a consolidated basis.
With that I'll hand, it back to Matt.
Thank you Kurt.
Before we move on to Q&A I just wanted to note how incredibly proud we are of what we've achieved over the last year.
This is truly a testament to an extraordinarily talented and dedicated team of employees and partners.
Thanks to their hard work, we've generated strong clinical data across all of our pipeline.
Together these data illustrate how Palo Verde reps immuno therapeutic effects leave it poised to have wide range on clinical benefits on.
On the strength of these data we continue to steadily progress towards a registration study in our lead HR positive <unk> negative metastatic breast cancer program, while simultaneously executing on additional studies that broadened peloria reps commercial opportunity.
Through this execution in turn fosters our industry partnerships, which deliver additional value to our stakeholders.
Looking ahead, we will continue to be data driven as we advance pellerito reps development.
Be strategic on our approach prioritizing the execution of our stated clinical milestones, while selectively engage on partners to generate value for additional opportunities arrive.
We expect to continue achieving a steady cadence of value, creating milestones throughout 2021 and beyond as we work to generate value for shareholders.
Importantly, improve the lives of our patients.
I'd now like to open the lines to take some questions operator.
Yes.
At this time if anybody has a question. Please press star one on your telephone keypad again that wouldn't be star one on your telephone keypad your free.
Question comes from among C. Lee from Ladenburg. Your line is open.
Hello, Andy.
Hello, how are you on mute.
Oh I just heard of.
Hello, and thank you you're very faint.
He has taken himself out of queue. The next question comes from Patrick <unk>.
<unk> from H C. Wainwright your line is open.
Thanks.
Morning, I have a follow up on my clinic study that showed pelo vastly improved persistence and efficacy of car T cell therapy first I'm. Just wondering if you can frame for us how this data compares to other combination preclinical studies with car T in solid tumors.
Just the first positive preclinical data generated in combination with the Narcoleptic virus.
Well, it's interesting I mean, the concept of using an inflammatory.
Causing agents to promote car T.
Access to the tumor is I think a novel idea I mean, we've seen on.
City of hope published something about six months ago. The difference, though is we're actually seeing chairs with reovirus, which I find fascinating and the second aspect is the.
The the method of carriage what they've done if you look at the evolution of car T work I mean, the first generation car T.
We're pretty primitive they didn't persist very long.
And it eventually generation.
Two they introduce co stimulatory molecules either CD 28.
For one B b.
The third generation, which we're currently and actually has both of those co stimulatory model molecules. So the car T persists much longer.
It just means they have a greater opportunity to do their job. The fourth generation people are actually going to sacrifice one of those co stimulatory molecules to give up that persistence to include genes for things like IL 12 that will recruit additional T cells. The interesting thing is basically what the mail has done has generated at the factory.
Fourth generation car T by adding an inflammatory element to the car T that stably are expressed and held to the car T. So as opposed to generating just a single chemo kind of cytokine.
Having the virus present actually generates a cascade and I think the unique thing here is that you're actually getting the cures in animals and the one thing that really Fascinates me if you read the paper.
Some of these animals at day 14 day 50 started two experienced tumor regrows.
And with the investigators that May have demonstrated is you can go in with specifically reovirus add that to the bloodstream and it re engages the T cells to eliminate the tumor mass and we're comfortable saying that the T cells, because the model that they're using doesn't actually support real virus replication to be 16 model, which in vitro doesn't actually some.
Port replication. So I think this is a massive breakthrough and I think it's really the love child of the aware one study because I think that's the first clear examination of how the virus is engaging the immune system and how its remodel in the tumor microenvironment to become so pro inflammatory and I think what mail is down here has taken the learnings of it.
One and applied it to a specifically new area on car T and I think it's very promising and we've actually had a lot of interest from pharma in this regard on pads.
Patrick as you know car Ts are very hot item right now, but there are challenges are they don't target solid tumors. They can with the virus. They don't persist along but again they can with the virus eventually it would seem that the car Ts run out their populations are depleted by six or eight weeks post treatment, but what's the Mayo clinic that demo.
Australia is that by boosting you can somehow reengage or increase these populations of T cells.
Which is fascinating because again it speaks to the fact that we must have some immature T cells or car Ts that are present on.
That can be re stimulated or re engaged through a boost of the virus and I think you know as a commercial entity. We can you can very well see kits, where the virus is applied to the car T. At the factory and booster shots will be provided for the patients. So if there is recurrence or if there is only a partial response of the patients have I think a serious change.
At improving those outcomes.
Okay.
Just alluded to it but if you could just give us an idea of how.
An idea of how discussions are going around potentially partnering the pellet program in combination with car T. I'm wondering if the level of interest has increased following the recently released preclinical data.
What would the timing for that something like that look like on next steps look like in terms of moving the program forward in combination with car T in solid tumors specifically.
It's interesting actually because if you consider it where par.
Partnership with multiple parties around the phase III breast cancer program, but the phase III breast cancer program is about to start a phase III. So for a corporate partner the barrier to entry is quite higher because they have to be share that the randomized phase two was legit valuable that all the supportive studies aware wanted bracelet or adding to that knowledge.
We're gonna be looking for a larger upfront because it's a phase III assets, but the pharma partner is gonna be immediately incurring costs for that phase III registration study so as opposed to the deals that you see in the preclinical and phase one space, where you get a 10 or $20 million upfront payment and then they forget about you for five years, what you come up with your proof of concept and there's the promise of billions.
Way down the road, we're looking for investment immediately now the car T opportunity I think flips that on its head a little bit.
It's again going back to a new therapeutic area. So it would be a phase one partnership opportunity. So I think it'll be much easier to engage partners.
Because we're not looking for that massive upfront with a co payments on enrollments and our regulatory filings and manufacturing filings on all the marketing that happens during the phase III program. What we're simply looking for is a partnership with upfront milestones and royalties in the phase one environment. So I'll, let Andrew speak to it but we think the <unk>.
Transaction ability of that type of arrangement can happen much more rapidly than what we're doing in the breast cancer space. So Andrew would you like to add to your experiences of the level of interest we're seeing.
Yeah, I think the interest is strong it addresses one of the critical unmet needs of the car T therapeutic space.
<unk>.
As you already alluded too Matt.
A different dynamic and it is a different dynamic because.
Youre trying to decide whether you're going to license this with an eye towards an eventual downstream phase one trial first as opposed to an eventual phase III. So the ask is more modest.
We said we'd looked at a lot of deals we think that we are definitely credible and what we are aspiring to do and we said you know the upfronts are more modest youre not talking about a phase III ready assets.
So we think that there.
There that we're going to have some success here. We're excited about it obviously news at 11 on it because the data only just came out that we're still baking it from a BD perspective, but I.
I'm, especially heartened by what we're seeing so far.
Got it and I'm wondering what your views are on combining capello with bi specifics on particularly those targeting PD 137 on PD L. One or other co stim domains with a checkpoint inhibitor and potential there as well both combinations with solid and liquid tumors.
Those combinations.
I think that opportunity is vast.
On the car T space is Super Sexy right now because the results could have seen in Hematological malignancies are just so so impressive they're taking five year survival rates of 7% and moving into 70, and they're doing it with the patient's own immune system, which I find I think very empowering to the patient the difficulty is the manufacturing of car Ts because their cash.
<unk> they have to come from the individual patient day.
They have to be genetically modified they have to be expanded the patient then has to be depleted and then it goes right back to the patient so collectively the cost and time and expense of car T.
It very much a niche product now.
There are companies that are developing allogeneic car T. So one donor would generate T cells there'd be genetically modified so that they wouldn't be immunologically foreign to multiple parties. So that you could grow it up to more like a cell based therapy, which.
Which will dramatically expand the opportunity for car T like dramatically expand it because it gets past that.
Individualized aspect of it the great things about bio specific as they're showing very much like car T. A fantastic result in heme malignancies, especially b cell malignancy, but they really have been challenged by the solid tumor microenvironment, because their exclusionary to T cells and they are exhausted T cells.
With bio specific antibodies.
What we can do.
What actually are colleagues of ours in the Netherlands have demonstrated you can turn on ineffective model on solid tumors into one where you get very effective treatment and the animals.
I think we have multiple targets that we can pursue and I think we can probably do this across partnerships as well because each company has their own unique epitope that theyre interested in.
In terms of co stimulating their targeting things like PDL. One I think that's just the tip of the iceberg I really believe that this approach.
'cause, it's ability to expand T cells activate T cells and recruit T cells.
We're just beginning to understand how valuable this asset is and how many different areas that can be used against and I think we're fortunate that we have talented.
Scientific Advisory Board members and collaborators that are exploring the use of these agents in areas that I don't think people have even thought about using them 12 months ago.
Yeah, that's really helpful. Thank you very much.
Okay, and if anybody has a question. Please press star one on your telephone keypad your net.
Question comes from Wang seen Lee from Ladenburg. Your line is open.
Hi, Thanks for taking my question and again, sorry for the day issue earlier.
Congratulations on the progress.
Oh, maybe it's pushed study with these car T part so to say.
On the technical question.
Is this going to be manufactured separately for on the car T or E on to pose for you also pre loaded. So can you provide more color on the manufacture produce approach.
Absolutely I mean, that's one of the big things that we've.
We've been looking at I mean.
By the time things actually entered the public domain like a poster publication.
Where I think people aren't aware of the length of time it takes to get the volume up results that are required to get to a publication I mean, it's not measured in days, it's not measured in weeks and some measured in months and years. So we've been thinking about this question from a commercial aspect and actually we've had it with even some of our potential partners. The two oct.
Are you can you can add the virus because basically all of it is you do have an AD free product or collection of blood cells. In this instance car T cells that are kept at four degrees, so that they're viable but in states, where they're not replicating they're not doing anything.
We then simply take a solution a virus in sailing and apply it to those car T cells at four degrees. So that what you eventually get is adherence of the virus towards cell receptor to the outside of the car T cell and we want to do this at a M. A y that engages a sufficient number of virus per cell that it will actually track well to the solid tumor now the options are.
We can do that at the facility.
Which you know where they would do they would they would create the blood product of the car T product. They would terminally differentiated by growth factors and what have you at that point, we could actually apply the virus and what's nice about doing it.
In the factory setting if you will is theres a high level of control because of the GSP environments. So there'll be a lot more sop.
A lot more rigor.
Large greater ability to have testing equipment like HPLC present, too to verify the amount of virus and what have you.
That's a it really is dependent on stability studies, how long the virus persists on the car T and those studies are underway.
The other aspect that we can do is obviously car Ts are made in the factory.
We're then return to the hospital center for infusion into the patients.
Prior to the infusion we can have the pharmacists at the hospital makeup the solution apply it to the virus.
Rocket so that there's proper adherence over the course of an hour and then applied to the patient. So both are available to us on really what's going to dictate the stability study the strong preference from industry partners is to sell the whole thing as a kit. So there would be basically the generation of this force car T that signal to the immune system that retains both co stimulatory.
Molecules plus the timing on T cell receptor.
And then obviously how that quality control that released from the clinic, that's the preference, but it'll really depend on how long that that combination product is stable.
Got it that's helpful. And then you also mentioned the bi specifics and nothing of TC engaged users and because the you why we're issuing to increase T cell infiltration I think go make a mechanistically you seen a D. We the T free engages.
So how you thought about or try to use it. The also engineer your words to express the TCE engages locally inside the tumor to see grades at tusa engages.
So then the majority with you on critical of ours.
That that is exactly I mean, we're somewhat limited by the payload size of Airbus, but it is something that we're exploring right now with our translational research scientists.
Okay got it.
Maybe last question on that.
Well one the final dataset.
There's more color you can do just more new data on the I just recall words or are we when do you see anything new Florida quota won't to.
It is predominantly a new results for cohort, one and two because of the volume of tumor tissue that we got we can do a great deal of research. So historically, we've presented things like TCR sequencing with.
Uh huh.
I mean on histology, so basically very early characterized in which cells are present.
The more advanced things that we could actually do because we have so much tissue isn't out of strength. So we can define whats happening at.
The molecular level, we can actually look at what genes are being expressed what the changes to the key Mackay instead of kind of environment are but we're also doing imaging mass cytometry and that's a very valuable tool for us because it allows us to look at a tumor section.
Look where the viral replication is N C spatial orientation.
Which immune cells are brought to the infection because what we want to see is a massive influx of inflammatory cells that are CDA positive T cells, what we don't want to see.
As tumor infiltrating lymphocytes that are T. Reg and the reason for that is why whereas C. D. H promote on inflammatory and pro inflammatory events on the T. Reg cells largely suppress that now early data that we have from our collaboration with our halos I'm is that the virus will actually accumulate both with the.
<unk> been in favor of the C. D. So we get more inflammatory and anti inflammatory but when we add the checkpoint inhibitor. What we're finding is there is a decrease in T. Reg so with things like imaging mass cytometry, we could actually see which cells are brought in which our assistant or associated sales or there are antigen presenting cells ifs.
<unk> are.
Generating the T cell response that we see because it's going to be both presumptive antiviral and anti tumor.
But we can really start characterizing that response and I think you know using new systems like PDL, one expression or the Ventana PD lone expression we.
We could actually see how many patients are converting from patients that wouldn't normally be eligible for checkpoint blockade and to those who are because you can imagine if we got 2030 40, 50% increases in patients who are eligible for checkpoint blockade and what I'm, saying is agents or indications like Tc or triple negative breast cancer.
Where do you have a threshold PD L. One requirement to get access to that drug if we can improve that by 10 2030, 40% it's.
It's a massive difference to the bottom line for agents like T centric. So it gives us a lot of data and now the focus really is going to be the difference between cohort one and cohort two which is the primary thrust of the aware one study because it really lets us design that phase III program and.
And as we alluded to on the call on earlier, where we're seeing the central changes have largely been in cohort two which adds the teeth centric. So we think in terms of getting a pro inflammatory event.
It looks like the checkpoint inhibitors actually playing an important role.
But through now on a string technology through imaging mass cytometry and Amin on histology will have a much better picture of what the contribution of the checkpoint inhibitor is will also provide additional data on cohorts three or four or five.
But those cohorts are pretty skinny that only like sort of four or five patients each which was by design. It was on exploratory and see whether or not we could get viral replication and I think this is important because we've never seen this level of viral replication in the tumor.
Normally we get a lot of double stranded RNA, which is our pro inflammatory signal on that.
But to see that much viral protein.
Basically suggests you the one we're seeing 80 per cent tumor infection in the tumor we're looking at a time point of three weeks, but I think what people don't recognize once you've gone down that road of replicating the virus the cells aren't viable they've already introduced apoptotic pathways.
So when we see 80% of the tumor being productively attracted what were de facto saying is 80% of the tumor mouth is now not a tumor mass it's viral factory and inevitably those sales will go towards cell death, whether it be a pep talk proptosis or phagocytosis mediated by monocytes.
I think breast cancer, the more data that we get out of it I think the more compelling. It is it explains why we see single agent activity and again I've had people look at the publication of the Golar Moody when we use the virus as a monotherapy, we actually did see objective response in anthracycline refractory refractory breast cancer patients.
And it took six months for it to manifest as an objective response, so really what that tells US is there's that engagement on the immune system that takes time and a patient to manifest and then seen those exquisite overall survival results of $92 13 again points to the fact that breast cancer is unique in its responsiveness to the virus and then what we're seeing on the <unk>.
Once day, just in terms of the amount of viral replication.
Pity of that replication adults engage whether they be in system I think taken together really tell a very compelling story of why breast cancer is such a great indication for us it's such a great lead, but then even behind that through Andrew's activities and the rest of the team's activities we'd have been able to engage groups like Roche will look at other signals we've had in GI where you know the.
NCI demonstrated a near doubling of PFS in patients that express the Chem sales set a low level, which as you know a common feature of a lot of pancreatic cancers, and then we're coming out of Montefiore that demonstrates.
Clinical benefit and the vast majority of patients with K Ras disease on it.
Engagement on the immune system. So I think you know through these collaborations.
We have a unique opportunity to really tell a beautiful story.
Okay.
Thanks, a lot.
At this point I have no further questions in queue I turn the call back over to the percentage for closing remarks.
Well again I appreciate it's early especially for the people on the West Coast.
So thanks, everyone for joining us on the call. We look forward to her continued advancement of Palo Europe, and we'll keep everyone updated along the way thanks, everyone.
Thank you everyone for joining US today. This concludes today's conference you may now disconnect.
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