Q4 2020 Lineage Cell Therapeutics Inc Earnings Call
Ladies and gentlemen.
Welcome to the lineage cell therapeutics fourth quarter and year end 'twenty 'twenty conference call. At this time, all participants are in listen only mode.
An audio webcast of the skull, it's available on the investors section of Linda just website at Www dot lineage cell dotcom.
This call is subject to copyright and is property manage and recordings reproduction or transmission of this call without the expressed written consent of <unk>.
Lineage are strictly prohibited.
As a reminder, today's call is being recorded.
I'd now like to introduce your host for today's conference.
One of the homes director of Investor Relations at lineage Mitchell. Please go ahead.
Thank you Jeff.
Good afternoon, and thank you for joining US a press release reporting our fourth quarter and full year 2020 financial results was issued earlier today March 11th 2021 and can be found on the investors section of our website. Please note that today's conference call and webcast will contain forward looking statements.
Within the meaning of federal Securities laws.
Statements regarding our strategy goals data updates price candidates planned regulatory meetings clinical trials planned manufacturing improvements financing and cash management matters, such statements are subject to significant risks and uncertainties, including those described in our <unk>.
Yes release issued on March 11th 2021, and our most recent form 10-K filing actual results or performance may differ materially from the expectations indicated by our forward looking statements do any of those risks and uncertainties. We caution you not to place undue reliance on any of the forward looking statements which speak.
The only as of today presenting today is Brian Culley, our Chief Executive Officer, Brian will provide some prepared remarks, then take questions from analysts with that I'd like to turn the call over to Brian.
Thank you Walter and good afternoon, everyone. We really appreciate you joining us on the call today.
Before I summarize some recent highlights and our financials. The first just want to remind every one of three ways in which lineage differs among the growing number of cell therapy companies you may hear about.
I, sometimes say that we are pioneering a new branch of medicine, which is one of the many exciting things you've probably heard about the stem cell industry, but lineage isn't a stem cell company, we don't put stem cells and people.
We grow stem cells into great numbers, and then we convert those cells into the specific cell types, which your body uses within the transplant those differentiate itself into your body to restore or improve function, which has been the lost due to injury or disease that.
That means we're more of a cell transplant of company than a stem cell company.
I wanted to begin with the important point today, because they're significant biological differences between using our differentiated sales compared to the undifferentiated stem cells, which some companies in clinics worked with.
That's one example of this I'm often asked how our approach compares to adult stem cells are mesenchymal cells, which are usually harvested from places like bone marrow fat or umbilical cords and the answer is that we aren't like them at all of those are undifferentiated cells, which in some cases might be enriched to secrete certain per.
<unk> survived and certain environmental conditions, but that's not how we approach the diseases, we're working on.
We believe that of retina cells are dying you need to replay of replace some transplant retina cells directly to the eye.
Spinal cord cells are missing you need to transplant replacement sales directly to the spinal cord.
For this reason lineage resembles transplant medicine more than cell therapy, that's an important point to keep in mind when evaluating what we believe are the lower risks and the potential advantages of our approach.
The second thing to keep in mind is that all of our programs are allogeneic or off the shelf therapies.
We never remove sales from a patient manipulate those sales and then inject them back into the patient's body. Those are autologous approaches it in some special settings. Those indeed can be helpful. But they also are unavoidably expensive and difficult to scale, because youre literally making a custom therapy for that one person.
The lineage product candidates are manufactured from a single common cell line, which was established and characterized more than two decades ago.
There are therapies are designed to be pulled off the shelf or in this case from out of the freezer and the THAAD injected into the patient just minutes later.
The economics of an allogeneic therapy compared to an autologous therapy really speak for themselves, but as I like to say unless you're working in a disease with unlimited pricing power. If you were not off the shelf then youre going to be left on the shelf.
The third thing is I want to remind everyone that our platform and with it much of our patent of state relies on something called director of differentiation.
That means that we harnessed natural steps in the developmental pathway in order to manufacture ourselves, we never manipulate or edit the genomes of ourselves as part of the manufacturing process.
The risks of gene editing are still being assessed its clear they do exist, but fortunately that's not something lineage has to worry about.
Our sales are extensively characterized for both form and function and in all cases of single cell line can be expanded to supply the commercial needs of any size market.
These advantages help establish our belief that our platform technology has a lot of potential not only in these conditions, but also may be able to produce additional product candidates beyond dry AMD spinal cord injury in cancer.
Pluripotent cells can become any of the cells, which comprise the human body. So we have of large variety of conditions to which our cell therapy technology could be applied in clinically evaluated and as we continue to generate encouraging data on both the safety and efficacy of our three current cell transplants. We will also look for opportunities too.
First the gate, new applications of our technology and potentially address additional diseases, either on our own or through strategic alliances.
Our belief is that our approach will prove increasingly compelling so that lineage can emerge from the background of cell therapy companies to become an important pioneer and what we might have more accurately called the cell transplant Revolution.
But of course the plan only works if we first established some success with our initial endeavors. So I now will turn to a quick review of last year's accomplishments and set some expectations for you in the year ahead.
I'll begin with operation our product candidate intended to treat dry age related macular degeneration with geographic atrophy.
This disease is caused by the progressive loss of retina cells and is a leading cause of blindness in developed countries.
Approved therapies do exist for wet AMD and they generate billions of dollars in annual revenue, but despite dry AMD being eight or nine times more common than wet AMD. There are no FDA approved therapies for the dry form.
This paucity of treatments may be due to the fact that by the time of patient is experiencing retinal cell counts the <unk>.
Tenths of damage may be beyond what small molecules of antibodies can provide.
Our approach is the transplant brand new retina cells to replace or support the ones that have died off or a dysfunctional.
Doing so we believe we may be able not only to slow the disease process, but also potentially even halt or reverse it.
We also believe that option, which currently is contemplated as a one time treatment performed in about 30 minutes under local anesthesia has a substantial advantage over competitors developing traditional drugs or biologics because those require monthly or semi monthly injections directly into the eye.
In November of last year, we completed enrollment in our phase one two a clinical trial of opera Gin and reported updated results from the study.
At that time, new data were presented on 20 patients, including eight patients in cohort four of the study.
We're especially interested in the cohort four patients because they have better baseline visual and smaller areas of G E.
Which is of profile consistent with the patient profile, we believe will lead to better outcomes from our treatment.
The data we reported showed improvements in visual acuity in the majority of cohort four patients when compared to their untreated eyes, and what the duration of benefit extending to as long as 24 months, which is the longest period for which data was available for those patients.
A trend towards slower <unk> growth also was observed as was previously reported structural improvements in the retina and decreases in droops of density.
And overall offer Gen continues to be well tolerated in all patients treated to date.
Last year. We also made the first known clinical report of retinal tissue restoration.
Assistant to 23 months and with durable improvement in the patient's visual acuity.
This is an unprecedented finding because humans lack the ability to re grow or repair of retinal tissue.
Most of our competitors are attempting to slow the rate of disease progression.
The data from our transplant approach.
Parts of the hypothesis, the opportune may be able to actually reverse try a M D and rescue tissue, especially in an earlier stage patient.
We've taken steps to see if we can replicate this finding in patients which were treated last fall.
Those patients from recently had their three months follow up visits so we will be monitoring them closely because of the timeframe for which we potentially would see this restoration phenomenon is now coming into range.
Our plan is to evaluate these patients per changes before the ARVO conference in May and if at that time, there's something notable to report on retinal restoration, we would plan to do so in connection with that event in order to maximize awareness and the valuation of any findings.
We also intend to provide another interim data update around ARVO, which we expect will be informative because although it's wonderful to see benefits as early as two or three months in we really want to have four to six months of data before we consider of patients to be Brent benefiting from our treatment.
This means you can look forward to two separate and near term updates from lineage Honey operating clinical study. The first one toward the end of this month and then the second one in May or June.
Thereafter in the third quarter of this year, we plan to speak with the FDA about next steps for development. So overall, there will be a lot to watch for with respect to the opportune program.
Moving next to OTC, one hour oligodendrocyte transplant program to treat cervical spinal cord injury.
You may have seen mentioned of this program in the Wall Street Journal today, and I'm expecting this program will receive additional publicity as we continue to make progress with it.
Oh P. C. One is a onetime surgical implantation of specialized cells.
This directly into the area of injury spinal cord.
Acute spinal cord injury patients suffer from paralysis, and the loss of motor function and the lifetime cost of caring for an acute spinal cord injury patient has been estimated to run as high as $5 million.
But just like dry AMD. There currently are no FDA approved treatments for spinal cord injury.
Over the past year the <unk>.
<unk> teams successfully deployed a new manufacturing process, which led to significant improvements in the production and quality of OTC want including to areas like scale purity reproducibility and the other attributes which enhance the commercial viability of this product candidate.
Our team also developed a new thought and inject formulation of O. P. C. One enabling its use at a much larger number of spinal cord treatment centers, which will help accelerate enrollment in the next clinical trial.
Along the way, we were able to eliminate the dose preparation steps, reducing overall logistics of preparation at of qualified cell prep lab from several hours to just a few minutes in the O R and in doing so reduce the logistics costs by approximately 90%.
With these manufacturing improvements in place, we next announced an exclusive option and license agreement with near gained technologies of medical device company, which gives us access to a novel and convenient delivery system.
The newer gain parenchymal spinal delivery or P. S. T system is expected to reduce the significant technical hurdle to conducting of larger scale clinical trial because it has been designed to allow for the administration of cells to the spinal cord without stopping the patients respiration.
We plan to collaborate with near game and the affiliate Neurosurgeons at UC, San Diego on the preclinical and clinical testing of this novel system.
The near gained P. S. D is expected to be a much better option than the content of excuse me than the complicated gantry, which was utilized in the first clinical trial and it will allow us to incorporate our new cell and inject formulation described before as enabling faster patient enrollment by access to a large number of clinical trial sites.
Most importantly, since the PSC system can eliminate the need for a patient's respirator to be turned off during the procedure.
This should facilitate a measured and targeted transplantation of cells to the affected area, which may reduce procedural risk and improve patient outcomes.
Our plans to evaluate the near gain P. S D to safely and effectively deliver OTC one sells to the spinal cord throughout this year.
These manufacturing and delivery steps have helped us to lay the groundwork to prepare O. P. C. One four of later stage clinical trial and building upon the positive data from the previous phase one to a clinical trial.
Looking ahead, we plan to request an arm at meeting with the FDA during the second quarter of this year at which we will discuss our plans to evaluate the new delivery device.
We also intend to request to meet with the FDA in the fourth quarter of this year to discuss improvements we've made to the O P. C. One manufacturing process as well as our clinical development plans moving forward.
Once these meetings are complete and assuming GMP manufacturing has been successfully completed as well we expect to be in a position to initiate a large scale comparative clinical trial next year.
We believe the next study both of the C. One can be positioned as a registrational study and we will seek to gain agreement with the FDA on this path.
Next I'll move to back to our off the shelf dendritic cell cancer vaccine.
Dendritic cells of the most potent antigen presenting cells in the body and we harness their activity to deliver hand picked antigens and approach, which is reemerging as attractive therapeutic modality based on the consistent safety profile and increase the knowledge of how to deploy dendritic cells in a clinical setting.
Back to is comprised of mature dendritic cells, which we manufacture from proprietary establish cell banks and load with a tumor specific target or antigen to instruct enhance and to deploy the body's immune system about which sells it should attack and eliminate.
Last year, we exercised our option with cancer research UK to bring the Vac immuno oncology platform in house and thereafter, we reported encouraging preliminary phase one clinical results in non small cell lung cancer patients.
Specifically back to demonstrated potent induction of immune responses in all four patients tested to date <unk>.
Providing us with mechanistic validation and reinforcing data obtained in autologous back one clinical trials conducted by a serious of Duke University.
Antigen reactive pentamer staining induced by back to and further supported by early spot data suggested that that too is highly potent inducing significantly higher levels of antigen specific T cells compared with the levels of invoked by alternative approaches such as the DNA and RNA based vaccines.
Our partner Cancer Research U K is responsible for this study and enrollment of the last few patients has unfortunately been impacted by COVID-19 restrictions across the U K. However, I'm pleased to share today that the.
The seventh patient in the study was recently and successfully enrolled the CR UK anticipates that the final patient will be enrolled in the coming months.
Following completion of enrollment we anticipate additional data from the study will be available around the fourth quarter of this year.
We believe the best path ahead for back to maybe to evaluate it in combination with therapies considered biologically synergistic with the dendritic cell vaccines, such as chemotherapy or the immune cell protected properties offered by checkpoint inhibitors.
The past could also involve the potential partners that is already commercialized such of synergistic therapy, but first we have a number of improvements and modernizations, we'd like to make on the manufacturing side, which will help prepare vac for further trials and provide competitive advantages for any future programs. We may design.
Our manufacturing team was recently directed to begin work on production enhancements, which we believe will increase the commercial appeal and utility of the Vac platform just like we did to create value and competitive carriers with op Virgin and O P. C. One.
As part of this manufacturing enhancement, we also aim to enhance the flexibility of the vac platform because you could theoretically insert any antigenic trigger into the dendritic cells.
That means that the vac platform is capable of producing nearly of limitless number of product candidates each one being distinguished by the specific antigen, which the dendritic cells are carrying to the patient's immune system.
This approach opens up a large number of potential corporate partnerships by allowing us to use our dendritic cells as carriers for other companies antigens, while simultaneously retaining the option to advance our own carefully selected antigens.
And improve back of platform could permit us in the coming years to generate a deep pipeline of unique product candidates each targeting a different type of cancer and we feel this product platform nature of <unk> will enable us to become a more prominent player in the immuno oncology field, especially as we validate and mature of the production process scale and other attributes.
Of the back of platform.
Overall, I believe we have made rapid and valuable progress with all three of our programs increasingly converting what began as interesting science projects into rigorous clinical data packages for product candidates with attractive commercial profiles.
As we further advance these programs and prepare them to enter later stage clinical trials. We believe lineage is on the right path to create significant value for patients and shareholders.
And in addition to the product development strategy I. Just described we also have conducted a series of business and financial transactions, which are designed to help build value over the longer term.
As one example, we incubated and funded the early product development of anchor site, which today is a revenue revenue generating cancer diagnostic company with the market cap of over $300 million.
Over time, we have been able to convert our ownership position in companies like August site in another public company, we spun out Ajax.
And convert those ownership positions into cash to fund our clinical programs without the need for traditional financings.
With our broad technology platform when they find additional opportunities to do this in the future.
More recently, we announced sales from our ATM program and.
When combined with sales of marketable securities. We own. This has provided us as of March 5th with approximately $57 million of cash and cash equivalents.
That capital is expected to fund our operations well into 2023, which will allow us to deliver multiple significant milestones and provide us the flexibility with respect to our partnership discussions.
I'll highlight next our balance sheet accounts and the statement of operations for the fourth quarter of 2020 and full year 2020.
A more detailed view of our comparative spending for these periods can be found within our earnings announcement filed earlier today.
We ended 2020 with $32 $6 million of cash and cash equivalents.
During 2020, we funded our operations, primarily by receiving $24 $6 million from Juvenescence and by selling a portion of our positions and orchestrate Ajax and how the seat by of holdings, the ladder of which collectively provided us with an additional $13 $1 million.
We also raised more than $5 million in gross proceeds in 2020 from sales of R. A T M.
Between January 1st 2021 through March 5th of 2020. One we continued to opportunistically utilize our ATM, adding nearly $20 million of additional gross proceeds as well as $10 1 million in additional gross proceeds from sales of leukocyte shares.
As of March 5th 2021, we continue to hold approximately one 1 million shares of hunk of site stock.
Valued at $4 $2 million on that date.
And just over 169000 shares of how the seed stock valued at $330000 on that date.
Consistent with our prior cash management strategies, we were able to make timely decisions about when to conduct sales of our marketable securities or the ATM in order to help fund our business.
Next I'll turn to the statement of operations for the fourth quarter of 2020.
Total revenues for the fourth quarter of 2020 or $400000 of $900000 decrease from the same period in 2019.
This was primarily due to the absence of the $600000 upfront payment from a new license agreement in 2019 as well as the completion of the NIH grant activities in 2020.
Operating expenses are comprised of both research and development expenses and general administrative expenses.
Total operating expenses for the fourth quarter of 2020 were approximately $6 $1 million.
A decrease of $1 $9 million as compared to the same period in 2019.
The decrease was comprised of of $900000 decrease in R&D expenses and of $1.0 million decrease in G&A expenses.
Our loss from operations for the fourth quarter of 2020 was $5 $9 million, a reduction of $1.0 million as compared to the same period in 2019.
Our net income attributable to lineage for the fourth quarter of 2020 was $2.0 million of one cent per share as compared to $4 $5 million net loss or three cents per share for the same period in 2019.
The position of net income was driven by unrealized gains on our marketable securities as well as due the foreign currency exchange rate fluctuations, which are largely impacted by the remeasurement of U S. Dollar denominated notes payable by cell care Neurosciences two lineage.
I'll now give a brief recap of the full year 2020.
Total revenues for 2020, we're $1.8 million of decrease of $1 $7 million as compared to 2019 the day.
Kris was primarily due to decreases of $1.0 million in grant revenue.
$400000 in royalties from product sales and license fees and $300000 in the sale of research products and services due to the cessation of such sales.
Total operating expenses for 2020 were $27 $9 million, a decrease of $14 $1 million compared to the same period in 2019.
The decrease was comprised of of $5 $6 million decrease in R&D expenses, and an $8 $5 million decrease in G&A expenses.
Part of our goal from the Asterias merger was to implement significant cost reductions and achieve synergies from putting the two companies together.
And we obviously were pleased to see this plan pay off in terms of significant expense reductions year over year.
Our loss from operations for 2020 was $26 $4 million of reduction of $12 $4 million as compared to 2019.
And our net loss attributable to lineage for 2020 was $26 million or <unk> 14 per share as compared to $11 $7 million or eight cents per share in 2019.
The variance in our net loss numbers year over year are significantly impacted by changes in the value of our marketable securities and equity investments for the applicable periods.
All of these fluctuations are important we tend to utilize loss from operations is a more relevant measure of performance in regards to moving our clinical programs forward.
Actively managing our expenses.
Overall, our fourth quarter cash activity was in line with our expectations and we were able to maintain our 2020 quarterly burn of approximately $5 million due to our sustained cost reduction efforts throughout the last year.
We also expect our first quarter burn for 2021 of them to be in a similar range. Excluding the three following additional expense items.
Our second installment payment of roughly $700000 to cancer Research U K for the early exercise of the act too.
A $500000 payments of gyroscope for an extension of the period during which we have an exclusive right to negotiate the definitive agreement.
And the payout of our annual bonus compensation.
These expenditures will be offset by the 2021 fundraising activities I mentioned earlier when discussing our balance sheet highlights.
So to wrap up the financial section like I say I'm very happy with the progress we have made in 2020, because heading into 2021 were equipped with a healthy balance sheet, which helps us fund our operations well into 2023 and drive our clinical programs forward.
Yes.
So to conclude.
<unk> and others in the field of allogeneic cell therapy are helping to demonstrate the viability of commercial potential of using allogeneic cell transplants to treat or cure serious diseases or conditions that represent major unmet medical needs in large market opportunities and has the tools and methods used to many of.
Facture Intest these therapies and patients are reaching maturity.
Public policy and Investor support for cell therapy has moved in a positive direction.
As we prepare to advance our product candidates into later stage trials, we're working to position lineage. The benefit from this convergence of positive factors and help to accelerate the development and commercialization of this novel branch of Medicine.
Specifically.
Of the events and milestones that our shareholders can look forward to include a day.
And the thing operating data from the ongoing phase one two a clinical study as I said toward the end of this month and again in the second quarter of 2021.
Planning to meet with FDA to discuss further clinical development of the opera Gen program, which is anticipated in the third quarter of 2021.
Completing patient enrollment in the ongoing phase one study of Vac too which is anticipated in the.
2021.
Evaluating the near gain parenchymal spinal delivery system, which has already begun and will continue throughout 2021.
Completing the OTC, one manufacturing to support our late stage clinical trial.
Introducing manufacturing enhancements to the <unk> two program, which is already underway and will continue throughout this year.
Reporting results from the ongoing phase one clinical study of <unk> for the treatment of non small cell lung cancer, which is anticipated around the fourth quarter of 2021.
And evaluating partnership opportunities and the expansion of existing collaborations for op Virgin OTC, one and back to.
At lineage, we have an opportunity to make a profound impact on millions of people and the patient serves our inspiration every day.
I appreciate all of you joining us this afternoon and we appreciate our shareholders' support as we position lineage to become a leader in cell therapy and cell transplant medicine.
And with that operator, I am ready to respond to any analyst questions, which we may have.
Yeah.
Understood at this time I would like to inform everyone in order to ask the question Press Star then the number one on your telephone keypad.
Again that star one on your telephone keypad.
Your first question comes from the line of Joe Bank Guinness from H C. Wainwright. Your line is open.
Hi, Brian and you want of thanks for taking the question hope the two of your of doing well, Brian I've three questions. The first one might be a simple, yes, or no, but I just want to make sure regarding your prepared comments on value to you also talked about Manny.
Manufacturing improvements of law around that as well, but is it safe to assume and I don't want to put words in your mouth that any manufacturing improvements would really impact the entire vac platform. As you said you could have almost the limitless amount of potential assets.
Yeah. Thanks for the question Joe I think our expectation is the answer is a simple yes the.
The dendritic cells are carriers, you can think of them as just being just just the messengers. The the important part is in the specific part is the message, which they carry so if we are able to improve things like scale per.
Alrighty.
The production.
The efficiency.
Of of introducing the antigen into the cells all of those should be applicable to all of the programs, which we might imagine with of our own or partnered so it is it that's that's where we see a lot of value in that program is that we can conduct the series of steps that are going to be applicable to every.
Thing that we do in oncology rather than having to go through all of those steps for each and every program.
So I think the answer is yes, we don't have a reason to think that we would have to do that and make each.
The production or each cell line unique we think that we can capitalize on the commonality and then the only variable becomes the antigen and so what would need to sort out is how does that how does that look to the regulators certainly with autologous approaches there appears to be a lot of flexibility considering that you've got.
The different product every single time, so we would hope to capitalize on some of those economies of scale in our production system.
That's helpful. Thanks, and I realize the way you ask the question might come across as if it was the congressional hearing was yes or no will suffice.
Sorry about that.
So my next question is just switch switching to your finances, you've been very active lately obviously.
With different.
Different raises selling some of your own cost side and et cetera, and you also just filed the new F. Three shelf filing. So obviously, the fact that you're well funded well into 2023 is a good thing to project to investors in my belief, but I guess, maybe can you comment on sort of the big picture of your overall financing strategy.
Based on your recent moves and maybe looking towards the future.
Yeah sure I'm happy to Joe and you probably know I'm I'm, largely and capable of providing just the yes or no answer.
So we did provide a lot of detail in the press release recently, but I realize that most of that content is it's focused on the the actual transactions and doesn't really speak to our strategy and the success that I think we've had with them.
I would say there are three big takeaways from from recent financing news and events. The first and foremost is that we now have more than two years runway and when you look at what we have done in the past two years you can imagine there are a lot of milestones. We expect this capital will help us reach in the next two years, including having two separate probe.
Grams in late stage clinical trials.
The second point is the rather than doing a traditional financing with the the higher fees than the discounted pricing that's off of associated with that option. We were able to take advantage of our rising share price and higher trading volume to raise of fairly meaningful amount of money in and that can create leverage which we can use.
Two opposed talk of financing overhangs or of getting pushed around in partnership negotiations and the <unk>.
Third I'd say is that.
A large amount of the capital that we have raised has come from selling equity in public companies. We originally created like all of a site in Ajax and we'd been able to create value from non core assets that way and use that the fund.
So it.
It might be forgotten, but I think it's worth mentioning that we haven't had to do a traditional financing and more than three years and I don't know how many biotech companies can say that but I imagine it's a small number.
With our large patent portfolio, we may have additional opportunities to spin out new regenerative medicine businesses. So from time to time, you're going to see things like the registration statement, which we filed today because it gives us the flexibility to raise capital and management thinks it's prudent housekeeping to have the ability to access the capital markets.
Quickly if and when it makes sense for us to do so.
But that will invest the money in the right way and I think overall, we take of creative and diversified approach to funding the business and try to do so in the minimally dilutive way, which obviously helps to protect share price.
And create value for shareholders.
That's really helpful. And then my last question is.
Around op of Gen, obviously, well not obviously, but since it's your lead asset in the upcoming data. So you gave a nice teaser I think about the upcoming ARVO data, but I was hoping to get more color not only around that but about what kind of expectations. We might have for the data update by the end of this month with <unk>.
Ultimately I think you said, we might be starting to get to the point with some of these patients of about 10 of us getting to getting to the time point, where we might see additional regeneration. So I guess that that's like a the highest the anticipation factor, which we might be getting too, but what kind of expectations. We have around data. This month end.
In may.
Yeah, I'm not surprised for that question so.
I guess of two part answer one is that we have for some time now said that we plan to provide a three month update so we enrolled the bunch of patients in the fall and that's going to nearly double the number of cohort four patient data that we have through three months. So.
People are going to want to be looking for continued trends.
With these additional patients of three months as early but if we see any patient starting off well I think that's a good sign.
We also will report on.
Not one but two patients that's new.
I don't want to I don't know.
I'll give away everything, but not one of the two patients that had a modified immunosuppression regimen.
We'll have updates on the orbit device overall safety, but restoration I understand is what is what everyone is really keen to hear something about.
Youre correct that we first saw of restoration.
The late it was at a nine month visit but we don't know when it became detectable only that it was after three months. So we didn't see it at three months and we didn't see it at nine months. So the reason that there's such a big window there.
Is it in our protocol, we don't do every form of imaging at every employment of too.
Too many visits can be onerous for the patients the sites and frankly the G E doesn't change that much month to month, and then no unexpected that retinal restoration was going to occur. So there was no reason to put a whole bunch of atypical assessments in place. So what that means is it any new evidence of restoration could be.
Come visible at month four months six months eight, but we wouldn't necessarily see it as soon as it's evident that we have to wait until it gets picked up in one of these routine imaging visits however.
We do know that the timeframe was between three and nine months and that's the same timeframe. We're now in with the additional five patients who were treated in a similar way to the prior patient so we'd have to wait and see and if we do see more restoration evidence. We certainly will reported shortly after it's validated by third parties. So we're.
Entering the the zone of highest interest right now.
That's really encouraging looking forward to it and thanks for all of the color Brian.
You bet. Thank you would go for the questions.
Your next question comes from the line of Jason Mccarthy from Maxim Group. Your line is open.
Hi, Brian Thanks for thanks for taking the questions a couple of questions first on the O P C.
One program, we've seen positive data signals of efficacy thus.
Thus far you had mentioned that the.
Potentially moving towards a phase two which could be of Registrational trial in 2022, what do you think the size of that trial of this and the parameters around that trial could look like.
And I'm, asking because we're watching abbvie with allowing the mab right. There in the phase 250, some odd patient trial not sure if that's for.
Registration or not but they did get fast track and orphan.
I could see that data while you guys are working up towards your phase III quote unquote registration trial can you give us a little bit more color on how you think about that.
Yes, certainly Jason it's a it's a very nice question because there is no precedent right. We don't have anything approved with cell therapy or the accident.
The growing molecules. So it's an unknown. However, there are some I would say reasonable boundary condition. So one rule of thumb is the FDA likes to see at least 100 exposures to of therapy in order to get a good sense of of safety in particular, but we are.
Also do you have examples of various treatments, especially in orphan indications where the.
A smaller number of patients can provide the basis for an approval.
So I don't I don't know the answer because we haven't been able to go to the agency and have that are have that discussion, but I think that it is probably capped at 100 and I think it's going to be driven in part by your X one of his expectations as to the clinical benefit.
The things that we might.
Think about doing.
In terms of.
The the balance across the arms and how we build the statistical plan.
And which assessments that we use so different assessments can of course give you different kinds of statistical power, if you're looking at the responders analysis.
Looking out of a certain event compared to if you're looking at the continuous variable you might have more statistical power because you're looking at the area under the curve. So it's really difficult for me to say, it's likely to be X number of patients, but what I can say is that I think of hundred is probably of reasonable.
The sealing the one might expect but the the details of that really the you know that.
That's going to be known to us.
Later, then and today, we can just projected for now.
And then on on the cell therapy side, just in General you had mentioned in your opening remarks about our very specifically about what lineage does with differentiate itself that integrate and go in the actually correct of the tissue.
There versus something like M. A c's and you know we've been seeing the tremendous shift and the cell therapy space.
You could look at groups like that and they're in vertex actually just moved into of type one diabetes study yet today or yesterday.
How important is it.
That bigger players are now moving into a space that lineage.
Is it already and then seemingly with the most.
Advanced clinically.
Assets relative to everybody else.
In the space, even the bigger players how does that book.
Good for lineage going forward.
I love it.
There's a little bit of the curse of the front runner here.
You know when your when you were a little bit of head of every one.
People, who are looking for parallels or comparables. They simply don't have as much data or evidence of reference points to evaluate you.
So on one hand, you say Oh, there's a paucity of competition, that's great but on the other hand, how do you value of company.
Like ours, because there aren't a lot of examples.
So I would say that I am delighted to see companies like.
Blue rock and semi and Sun are being recognized and rewarded with high valuations because I think now we have greater reference points.
And the fact that those companies and maybe some others that we could add to the list art operating in our specific space means that we get all of the benefits of technological corollary without the penalty of direct commercial competition. So I think it's.
It's a good thing for lineage M and I think that it is ultimately going to be good for the space because it's going to draw more attention and recognition that there are places in settings in diseases for which cell therapy is probably a better choice than the.
Traditional small molecules and the antibodies.
The great answer we Couldnt agree more thanks, Brian.
Thank you Dr Mccarthy.
Your next question comes from the line of key Mckay from chart done your line is open.
Thanks, Brian.
Wanted to talk about the new delivery device for spinal cord injury.
First of all in terms of its ability to allow the practitioner to lay down.
Both.
Geographically.
With more accuracy and the.
Mount of sales can you talk about those capabilities.
Oh, yeah the.
Yes, no and the no part is that we haven't tried it in the human yet so we don't know but from a design consideration.
There are a number of advantages to the new device. So the assembly itself is smaller and it uses fewer components.
Can provide single hand operation for the X Y Z positioning. So if you think of the three axes the.
The needle GAAP, which is a really integral component here.
Has greater accuracy and the connections between the component parts.
There are fewer of them they are a little tighter so you've got less let's say wiggle a to the device now really the big advantage here is being able to administer sells more slowly but one of the things that is often underappreciated with cell therapy is it's not just the cells.
The delivery of the placement is nearly as important as the active agent so having the having a tool that we think can do a better job of placing the cells into the area injury will be beneficial, but the sales do have the ability to migrate a little bit so so.
It's not a it's not like landing of Rover on Mars and you've got to have it on the bottom of the crater where it's really flat you do have a little bit of flexibility but.
But we think that the improvement here reflects the normal evolution of of new technology and that ultimately clinical outcomes will be improved as you get better at not only the.
The quality of the cells that you're putting in but also how and where you place them I think we're seeing that with opportune and I think we're going to see that with LPC one.
And then just in terms of I guess.
The ability or how quickly the practitioner can be fast outlook of device or are you able to at least start on cadavers.
What does that experience like in terms of how quickly the practitioner can get up to speed.
And feel comfortable.
Using the other months.
There's a high degree of familiarity.
With the device.
Got your X Y Z manipulator and you know the the differences, sometimes just come down to how big is the knob, but directionally the the positioning of the syringe and the the Microdrive Assembly, which holds the syringe.
He is very familiar ultimately what you're talking about is your angle of insert and you're down those of the two most significant components. So I think the learning curve for this will be relatively low but that is one of the things that we are going to be investigating there's probably a good a good case to be made to do.
<unk> extensive first animal and then cadaver testing to demonstrate and get specific answers to your question and we will be doing exactly that in cooperation not only with near gain but also the neurosurgeon team at UCSD, which help to design and develop this new PD.
My system.
So just the just the final question the wrap that up.
Any sense of what the FDA is going to.
Want to know understand about these types of issues before they let you go forward in humans.
Nothing specific it's it's different than what we have with for example of the opera Gen program because there we know that the device has already been five 10-K clear. So we don't have that same status.
So when we think about approaching F. D. A one of the things that we are going to want to do in in meeting packages is to provide the sort of comfort and experiential data.
Say the this is a good tool in that it can be well adapted we don't yet know exactly what the testing expectations, our criteria you're going to be which is why we're planning the next quarter, which really isn't too far away now to requesting or amount of meeting to have a conversation.
About the device and to see what kind of learnings that we need to provide to support its use and part of that is almost certainly going to include some of the expert testimony the.
That the device can be readily adapted to this patient population in the for the delivery of our cells that it would be beneficial to be using something like this as opposed to the original scaffolding equipment, which potentially could lead to errors, because it's a little bit more complicated.
Okay. Thanks.
You bet you bet. Thank you kick.
That was the last question, ladies and gentlemen. This concludes today's conference call. Thank you for your participation you may now disconnect.
Yeah.
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