Q1 2021 Lineage Cell Therapeutics Inc Earnings Call
[music].
Welcome to the lineage cell therapeutics first quarter 2021 conference call at this time all participants are in a listen only mode on the audio webcast of this call is available on the investors section of the niche website of triple double your dot lineage cell dot com.
The call is subject to copyright and is the property of vignettes and recordings reproduction or transmission of this call without the expressed REIT and been signed of leading edge or the strictly prohibited.
A reminder, today's call is being recorded I would now like to introduce your host for today's conference you'll want to hone the director of Investor Relations at lineage <unk>. Please go ahead.
Thank you Mary.
Afternoon, and thank you for joining us of prep.
The release reporting our first quarter 2021 financial results was issued earlier today may 13th 2021 and can be found on the investors section of our website. Please note that today's discussion will contain forward looking statements within the meaning of federal securities laws, including.
<unk> regarding our strategy goals product candidates.
The nickel trial data announcements and updates anticipated regulatory meetings and interactions planned manufacturing improvement financing cash management and runway anticipated collaboration opportunities and benefits and commercial potential and.
Statements made during this discussion that are not statements of historical fact should be considered forward looking statements, which are subject to significant risks and uncertainties actual results or performance may differ materially from the expectations indicated by our forward looking statements due to known and unknown risks and uncertainty.
We caution you not to place undue reliance on any of the forward looking statements, which speak only as of today and are qualified by the cautionary statements and risk factors in our filings with the SEC, including in our quarterly report on form 10-Q filed today may 13th and our annual report.
And on form 10-K for the year end of December 31, 2020, presenting today is Brian Culley, Our Chief Executive Officer, Brian will provide some prepared remarks, and then take questions from analysts with that I'd like to turn the call over to Brian.
Alright, Thank you would want on and good afternoon, everyone and we always appreciate you joining us on these calls.
And it has been and an extremely productive start for the year for US we continued to deliver positive clinical results with our lead program offer Jim and.
And we entered into two strategic partnerships, which expand and support our clinical pipeline programs.
The one and that.
We also strengthened the overall came through the appointment of two individuals to our board of directors, both of whom possess significant medical and health care experience.
As a reminder, lineage is pioneering of new branch of medicine based on the transplant of wholesales and simultaneously positioning ourselves as an important the leader in this rapidly growing field.
Our approach is to manufacture differentiated cell types and transplant them into the body to restore or improve function, which has been the lost due to injury or disease.
Simply put.
We believe that if retina cells are dying you need to transplant and the sales directly to the eye if.
Spinal cord cells are damaged or missing you need to provide replacement spinal cord cells directly to the area of injury.
All of our cell therapy programs are allogeneic, which means the cells are manufactured from a single common cell line and instead of being removed from our patient manipulated and re implanted which is called the autologous therapy.
Allogeneic approaches offer significant advantages over autologous therapies in terms of manufacturing and handling costs.
And each case the cell line, we use for our therapies was established and characterized more than 20 years ago.
The cell lines, our pluripotent, meaning they can be directed to become any of the 200 plus cell types, which comprised of the human body and they provided of one time source of starting material for all of our clinical and commercial needs.
As the solution for the complexity of handling and preparing wholesales for patients with.
We designed thaw and inject formulations for what people often called off the shelf so that our products can be injected into the patient just minutes after being sought.
Instead of going through the lengthy and complicated and costly dose preparation steps.
We believe the economic advantages of allogeneic therapies cannot be matched by autologous options and which of single unique therapy is developed for each patient or customer.
Importantly.
Our approach avoids the risks of genetic manipulation, which has always been and area of significant potential risks and as many of you will have noticed recently those risks and have recently impacted the field of ophthalmology.
Instead of manipulating the genome and potentially causing changes we cannot control we.
We rely on something called directed differentiation.
With direct of differentiation, we harnessed the natural steps and the developmental biological pathway in order to manufacture our final cell types.
We expose ourselves to various compounds under tightly regulated conditions in order to turn them into only the cell types, which we desire to make.
We never modify the genome as part of our manufacturing process, because it simply isn't necessary.
Our sales have the attributes needed to perform the job of the sales they are replacing.
As part of our quality control procedures. Our sales are extensively characterized for both form and function.
And because we have established large master and working cell banks and of developed protocols over the years to improve our production scale.
Single cell line can be expanded from our in house process, the potentially supply the needs of any size commercial market.
These advantages help establish our belief that our technology platform has potential not only in the conditions. We currently are pursuing but also may produce additional product candidates beyond dry AMD spinal cord injury and cancer.
As we continue to generate encouraging data on both the safety and efficacy of our three current cell transplants.
We will consider opportunities to investigate new applications of our technology and potentially address additional diseases, either on our own or through strategic alliances.
I'll now turn to a quick review of our recent accomplishments and set some expectations for the remainder of the year.
I'll begin with our lead product candidate and intended to treat dry AMD with geographic atrophy of disease with no FDA approved treatments.
Dry AMD is caused by the progressive loss of retina cells is a leading cause of blindness and developed countries.
Our approach to treating this disease is to transplant brand, new retina cells to replace or support the ones that have died off or are dysfunctional.
Replacing the entire cell avoids risks and limitations inherent and approaches that target just a specific pathway, which may prove to be the wrong pathway or approaches, which target a certain mutation, which only addresses a subset of patients.
We believe our approach may be able not only to slow the disease process, but also even halt or reverse it.
We also believe that offer Jim which currently is contemplated as a one time treatment performed and about 30 minutes under local anesthesia.
Has the substantial advantage in terms of compliance and convenience over competitors that are developing traditional drugs or biologics, which typically required monthly or semi monthly injections.
Since the beginning of the year, we have provided two interim data updates from our phase <unk> clinical study of opportunity and we intend to continue providing these interim updates.
This is an open label study and it's our view that providing investors with frequent updates not only helps them appreciate our enthusiasm for the data was collected but also provides clarity and transparency on how the patients are doing throughout the observation periods.
We do this because the patients were treated on different dates. So we are tracking 24 separate time lines ranging from just a few months for over five years and the different visual assessments. We performed on patients can be more or less informative depending on where they are collected along those timelines.
For example, we think changes in the best corrected visual acuity or BC. The egg are most informative during months three through six while effects on GE growth are more likely to become detectable during the second six months post treatment.
Consistent with this view, we believe our data set has improved with each update as the amount and duration of evidence that we've provided has grown.
And our most recent update coincident with the 2021 ARVO conference Dr. Christopher Riemann from the Cincinnati Eye Institute presented data on all 24 patients enrolled and the study with a minimum of four five months of follow up.
We were pleased that this most recent update continues to suggest to us the treatment with origin can generate clinically meaningful responses in patients with dry AMD with G E.
We also continue to believe that earlier intervention and less severely affected patients will increase the likelihood of detecting a clinically beneficial effect. This is why we have emphasized the data from the final 12 patients in cohort for who had better baseline visual acuity compared to the first 12 patient.
And cohorts one through three who were all legally blind at baseline.
While the data are still being collected is notable that 83% of cohort for patients treated eyes were at or above baseline visual acuity at their last assessment of at least for and a half months, while at the same high percentage of the patients untreated eyes were below pretreatment baseline values at the same time points.
Additionally, we shared for the first time at our last update the cohort for patients with data available from a validated quality of life questionnaire reported improvements and a majority of the vision parameters, which were collected.
The magnitude of these qol improvements was also higher overall in cohort for then in cohorts one through three which is consistent with the larger clinical benefit we have observed among those cohort for patients.
Previously reported structural improvements continue to be present, and the overall oxygen continued to be well tolerated with no unexpected adverse or serious adverse events.
We also now have engrafting data for <unk> extending to more than five years further supporting the potential for <unk> to become a one time treatment.
And additional exploratory objective and the study was the evaluation of the orbit Sds and third party device designed to deliver therapeutic material to the sub retinal space.
We entered into an option agreement with the device manufacturer. So that we can make and independent determination of the safety performance and ease of use of the device and its potential as an alternative way of delivering opportunity compared to the traditional method of accessing the sub retinal space by of Par's part of the vitrectomy or PPV.
We made significant investments in this effort and even enrolled additional patients to help guide our decision, but based on the totality of clinical data that we've collected to date and other important considerations. We have elected to continue delivering on via the standard method of PPV.
One of the many factors, which informed the decision was the importance of delivering operating and sales close to or within the area of G E.
We determined that PPV provides greater flexibility and performance and this key parameter.
In parallel with the orbit cohort, we continued to treat patients via PPV and evaluate their clinical outcomes.
Quickly we have identified a number of methods by which we may be able to improve the use of PPD to deliver on for Jim further diminishing the need for a third party device.
I'm encouraged by these new opportunities to further improve the procedure and I hope to be in a position to share some of those details as they mature.
In connection with this decision we elected not to enter into a definitive agreement with the device manufacturer and allowed the option period to lapse.
I should also point out that there are some additional financial benefits to our decision to continue with PPV, which include not having to share of the economic upside of the origin program with another party and not having the added regulatory logistical and procedural expenses and the complexities that would come with having a separate device and.
Training program to support of special surgical procedure.
Overall, we will always remain open to different ways or ideas for how we might improve our treatment.
Looking ahead for the option program, we continue to monitor all patients on the study.
And since the ARVO data cutoff preceded the actual ARVO update by more than a month of the house.
We plan to provide another update next month, and which we will have at least six months of follow up and all the patients.
In addition to longer follow up of the promising <unk> data. This time period is important because we will be looking for indications of retinal restoration and reductions in the size and growth of the areas of GAA as I explained a moment ago.
The six month data are also important because that is the minimum amount of safety data. We would want to have collected before we engage with the FDA to discuss the next steps and our development plan for origin.
While we wait for our next data update next month and just wanted to take a moment to address something important which I believe could be a bit misunderstood.
And sometimes it's been asked whether I would expect to see a greater separation of the curves by month for the.
Especially in light of the large increases we've seen and visual acuity and some patients.
First of all remind everyone that the area of atrophy grows very slowly and changes are difficult to detect and a short timeframe like three or four months and that is why we are keen to see how the upcoming six to nine months measurements look.
But I also want to remind everyone that our G. A grass used the patients' untreated eye as a comparison the.
The untreated eye is always the eye with better vision at baseline. So it is not a balanced comparison at baseline and may even worked against us because we are comparing our treated eye results with a more disease die in every case.
But even more than those two points, it's important to understand that off Virginia RPE cells do not contain the same levels of lip of few some sound and the patients' existing RPE.
So our sales are not easily seen using fundus on of fluorescence or Fas Fas.
<unk> is a common imaging tool used to collect GAA data, but SaaS is and capable of detecting the existence of or potential benefits from structural retinal restoration.
In order to see restoration, you need to use high resolution <unk> imaging in conjunction with other precise imaging techniques. So in effect, we don't believe our GH graphs and tables are fully reflecting the <unk> potential restoration and benefits.
And I know this is a fairly technical point and I felt it was important to note that sometimes the standard techniques are not optimized for newer technologies like ours, and sometimes you need to update not only the way you treat the condition.
But also how you're monitoring changes and a patient.
Fortunately OTT imaging is also a fairly common to all the clinical sites and was always part of our per protocol assessments. So we have access to this powerful method of collecting anatomical data on patient redness.
And most importantly, we have OCD images for all of the cohort for patients treated last fall.
And we're now evaluating those images using this more precise methodology and multiple independent experts and ocular imaging technology are assisting in our review of the data.
Overall as we continue to learn about the potential for <unk> to drive outcomes and dry AMD and we will continue to be open to new and improved ways to handle it deliberate or measure it as we learn and optimize the solutions. We also will continue to share updates with you on an ongoing basis.
Moving next to OTC, one hour oligodendrocyte transplant program to treat cervical spinal cord injury.
<unk> is an investigation of onetime surgical implantation of specialized cells directly into the area of injury and of spinal cord.
Acute spinal cord injury patients suffered from paralysis and loss of motor function and the lifetime cost of caring for and acute spinal cord injury patients has been estimated to be as high as $5 million, but just like dry AMD with <unk> there.
And there currently are no FDA approved treatments for spinal cord injury.
Over the past year, our team successfully developed a new manufacturing process, leading to significant improvements and the production and quality of OTC. One and then other attributes which are expected to enhance the commercial viability of of product.
We also developed and you thaw and inject formulation of <unk>, enabling investigational use at a much larger number of spinal cord treatment centers, which will help to accelerate enrollment and the next clinical trial.
This new formulation.
Will allow us to eliminate the dose preparation steps, reducing overall logistics of preparation from several hours in the lab to just a few minutes and the LR and.
And our logistics costs by approximately 90%.
This new process has recently been relocated into our in house GMP suite, where we are working through the steps to increase our production scale prior to manufacturing material to support upcoming trials.
In February we announced an exclusive option and license agreement with <unk> technologies and medical device company, which gives us access to a novel system that we believe will enhance delivery of <unk> to the spinal cord.
The newer gained parenchymal spinal delivery or PSD system is expected to reduce a significant technical hurdle to conducting a larger scale clinical trial because it has been designed to allow for the administration of sales for the spinal cord without stopping the patients respiration.
Our plan is to evaluate the near gain PSD to safely and effectively deliver OTC, one to the spinal cord and both preclinical and clinical settings.
All of this groundwork is helping us to prepare <unk> for a later stage clinical trial.
Building upon the positive data from the previous phase <unk> clinical trial.
We currently are preparing for and FDA interaction and June to assess our plans to evaluate the and your gain PSD system for OTC wanted and we look forward to providing an update following that interaction.
Looking ahead, we also intend to interact with the FDA around the end of this year to discuss the improvements we've made to the LPC on manufacturing process as well as our clinical development plans moving forward.
Following these planned meetings and interactions and assuming FDA agreement on our clinical trial design, we would expect to be and are positioned to initiate a large scale comparative clinical trial sometime next year.
We believe the next study of OTC, one can be positioned as a registrational study, but we need to reach alignment with FDA on this path before we can commit to it and our plan.
Our current efforts are focused on putting us in a position to have that discussion with the FDA and generate and the data to support that path.
Now I'll move to back to our investigational off the shelf dendritic cell cancer vaccine.
And the drink sales and most potent antigen presenting cells and the body and we harness their activity to deliver hand picked antigens and approach, which is re emerging as an attractive therapeutic modality based on the consistent safety profile and the increased knowledge of how to deploy dendritic cells in the clinical setting.
The <unk> two is comprised of mature dendritic cells, which we manufacture from proprietary establish cell banks and load with a tumor specific targets or antigens to instruct enhance and deploy the body's immune system about which sells it should attack and eliminate.
Last year, we exercised our option with cancer research UK or see our U K to bring the vac immuno oncology platform in house.
And thereafter, we reported encouraging preliminary phase one clinical results and non small cell lung cancer patients specifically.
Specifically back to demonstrated potent induction of immune responses, providing us with mechanistic validation and reinforcing data obtained in the autologous tack one clinical trials conducted previously.
Our partner CR UK is responsible for the study and.
While enrollment has been impacted by COVID-19 restrictions 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 would be available around the fourth quarter of this year.
Currently our focus is on making improvements and modernization to the manufacturing process for <unk>, which will help prepare of back to for further trials and provide competitive advantages for any future back programs. We may design.
Our manufacturing team was directed to begin work on production enhancements, which will increase the commercial appeal and utility of the bank platform.
Just like the successful improvements that we did and made with <unk> and <unk>.
As part of this manufacturing enhancement, we also aim to enhance the flexibility of the vac platform, because you theoretically could and sort of any antigenic trigger into the dendritic cells and we believe the vac platform is capable of producing nearly of limitless number of product candidates. Each one distinguished by the specific antigen.
Which the dendritic cells are carrying to the 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.
And simultaneously retaining the option to advance our own selected antigens and.
And as an example of implementing that strategy I just outlined and.
In April we announced our first collaboration for our <unk> platform.
Our agreement with Gimme Gnomic will generate a novel product candidate derived from our back allogeneic cancer immunotherapy platform and is targeting a proprietary tumor associated antigen construct provided by immuno <unk> for the treatment of Glioblastoma multi form.
Lineage, and immuno and Mick will collaborate and the manufacturing and clinical development of this novel <unk> product candidate.
Following the full development and delivery of GMP back product material Immunomedic assumes full and independent clinical and commercial responsibility and further advancement of the program.
In connection with this alliance lineage of entitled to payments of $2 million, which we anticipate receiving and the first year of the agreement and up to $67 million and developmental and commercial milestones across multiple indications and territories. We also will be eligible to receive royalties up to 10% on net sales of future products.
This collaboration represents the first of many partnerships, we hope to enter into with our <unk> platform and.
And we believe it helps to further validate that as a promising new therapeutic vaccine platform.
Our plan is to leverage our technology to generate additional factory of cell therapies.
And collaboration with partners as well as on our own and capitalizing on lineage is manufacturing and transplant success.
These alliances can diversify our oncology pipeline and provide new opportunities for success without the financial burden of independence development.
Now moving to the corporate side, we recently added two new members to our board of directors.
Dr <unk> and Dr. <unk> <unk>.
Both of these women have had leadership for strategic responsibility for pharmaceutical product development and bring extensive experience and clinical research and medical affairs.
These appointments reflect a commitment to ensuring that our board can provide a broad range of the expertise and perspectives as we work to position ourselves as the leader and the field of cell therapy and regenerative medicine.
Overall I believe we have made rapid and valuable progress during the first few months of this year advancing all three of our clinical programs and further strengthening the company's capabilities.
Moving next for financials, our current cash and marketable securities position is expected to fund our operations well into 2023.
Our operational runway of course could change if regulatory feedback or corporate decisions take us in different directions, but I believe we are and a very good position currently because our base case operational plan includes a lot of planning and preparation activities.
With respect to our ATM program on March 5th 2021, we completed ATM sales totaling $25 million and gross proceeds which was the full amount allowed under the prospectus filed in may of 2020 for that program.
That same week, we filed a prospectus supplement for an additional $25 million under the ATM program. However, I would like to confirm that no sales of lineage stock have been conducted under that new prospective supplement dated March five 2021.
I also want to mention that earlier. This morning, we received notice informing us about the forgiveness of our $523000 PPP loan so elimination of that debt will be reflected in our Q2 financial statements.
I can move now into our balance sheet accounts and statement of operations for the first quarter of 2021, a more detailed view of our comparative spend for these periods can be found within our earnings announcement filed earlier today.
As of March 31, 2021, we had approximately $62 4 million and cash cash equivalents in marketable securities, which includes our remaining ownership of approximately $1 1 million shares of <unk> common stock and just over 169000 shares of common stock and how to seat by of holdings the LTV.
During the first quarter of 2021.
We added to our cash position with net proceeds of $19 3 million received from sales of our common shares under our ATM program and net proceeds of $10 $1 million received from selling a portion of our marketable securities.
As I referenced earlier, we have not issued or sold any shares under the ATM offering commenced on March 5th 2021.
I'll turn next to the statement of operations for the first quarter of 2021.
Total revenues for the first quarter of 2021 of approximately $400000 and $100000 decrease from the same period and 2020.
That decrease was primarily related to a $200000 decrease and grant income, which was primarily driven by the completion of NIH grant activities and a prior year and offset by a $100000 increase and royalty related revenues.
Operating expenses are comprised of both research and development expenses and G&A expenses total operating expenses for the first quarter of 2021 were approximately $7 3 million a decrease of approximately $600000 as compared to the same period in 2020 the.
The decrease was primarily related to a reduction and G&A expenses.
Our loss from operations for the first quarter of 2021 was approximately $7 million a reduction of $400000 as compared to the same period in 2020.
The net loss attributable to lineage for the first quarter of 2021 was $1 4 million or <unk> per share as compared to $8 4 million net loss of <unk> <unk> per share for the same period and 2020.
It's important to remind investors that the variance between our loss from operations and our overall net loss is impacted by the changes.
And the value of our investments and the Orca site and how the seat.
Well as foreign currency exchange rate fluctuations related to lineage is international subsidiaries.
While these fluctuations are important.
We tend to utilize loss from operations is a more relevant measure of performance with regard to moving our clinical programs forward.
Overall, our first quarter cash activity was in line with our expectations.
We anticipated the first quarter would have our highest cash expenditures for the year due to our second installment payment of roughly $700000 to see our U K for the early exercise of our option to bring the vac immuno oncology platform and development of back to in house and the $500000 payment to gyroscope for an extension of the option period.
For the remainder of 2021.
We anticipate our quarterly cash burn rate to be approximately $5 5 million.
To wrap up the financial section I will say that I continue to be pleased with the paths. We are on to maintain our financial stability, while strategically driving our multiple clinical programs forward to position us to maximize shareholder value.
So to conclude.
Lineage and others and the field of allogeneic cell therapy are helping to demonstrate the viability and commercial potential of allogeneic cell transplants to treat or cure serious diseases or conditions, which represent major unmet medical needs and large market opportunities.
And as the tools and methods used to manufacture and test these therapies and patients are reaching maturity.
On the policy and Investor support for cell therapy has moved and a positive direction.
And we advanced our product candidates towards later stage clinical trials, we're working to position lineage and to benefit from this convergence of positive factors and help accelerate the development and commercialization of this novel branch of Medicine.
Looking forward for the remainder of 2021, a number of key events or milestones, which we have in mind include operation and interim data, which as I said is expected next month.
And our map interaction with FDA to assess the near gain PST, which is already scheduled for June 2021.
We have a plan to meet with FDA to discuss further clinical development of opportunity, which is currently anticipated in the third quarter of 2021.
We anticipate completion of patient enrollment and the vac to study around the middle of this year.
We're expecting completion of the improved manufacturing process and comparability testing to support of late stage clinical trial of <unk> one to be ongoing throughout this year.
We have and FDA interaction anticipated, which is to discuss manufacturing improvements for OTC, one we'd expect that will happen around the end of the year.
And we look to report results from the ongoing back to study, which we would expect to be around year end and we will be continuing to evaluate opportunities for new <unk> product candidates and new back of alliances based on internally identified or partnered tumor antigens.
At lineage and we're proud to have the opportunity to make a profound impact on millions of people and.
And benefiting from the technology platform, which we enjoy and the patients continue to inspire us every day.
I appreciate all of you joining us this afternoon, and we particularly appreciate our shareholders' support as we continue to position the lineage and to be a leader and cell therapy and cell transplant medicine.
And with that operator, I am ready to respond to any analyst questions. We may have.
Thank you Anthony reminder, if you wish to ask the question. Please press star followed by one on your thoughts on telephone if for your question has been answered or you wish them and tell your question by the pound key.
Your first question comes from the line of Christian <unk> from Bank of Barclays. Your line is now open.
Hi, good afternoon, everybody. Thanks, so much for taking the questions. The first one I had was in regards to the patient who had the retinal tissue restoration now at about three years out I'm wondering what where you might look to understand the particular effects or characteristics around the patient and then.
Can you discuss the importance of evaluating the long term trend that you've observed relative to other approaches in the space.
Hi, Kristen sure I'd be happy to address each of those.
What we find what we think is most notable.
The retinal restoration patient.
Beyond the initial observation of retinal restoration and the truly fantastic durability of that observation.
Is that their procedure was unlike the patients which preceded them and.
And by that I mean, specifically they've had a fairly thorough or complete coverage of <unk> cells right across the area of <unk> and that has never happened before.
We then one of our advisers was going through those OTT images, which I mentioned before because again you don't see restoration by using just Fas and.
And he observed in the nine month images these benefits that have been the thorough.
<unk> thoroughly discussed by US previously so as we gain confidence and that observation and we had embedded by additional imaging experts and the experts and.
On the ophthalmology generally.
We then advised or asked our investigators if they would work to try to get more aggressive delivery of a more complete delivery of our gen across the area of <unk> and so that was different because and the early patients we tended to stay fairly far away from the area of atrophy.
Because we wanted to be careful that we didn't.
We're up the patients preferred route and the Lucas we want to make sure that we didn't cause any harm or.
Or disrupt their baseline vision.
But I think what we discovered with that particular patient is that it may not be the case that opportunities effects can work at their best at a distance and they've made the sales may need to be truly replacing right. There in the area of the debt sales or.
And the diseased cells or the the sales that are not functioning fully and.
So the patients, which followed that extraordinary finding they are now passed for and a half months and so they are getting into the same timeframe, where we think this observation of restoration can occur and all of them. We ask the investors the investigators to try to get more complete cover.
<unk> and in some cases, they were successful and in some cases they were unsuccessful. So we have a mixture, which is kind of and interesting test where we will be looking in particular for restoration and patients that had more complete coverage of.
Of the <unk> sales across the area of <unk> and.
And we will be able to compare those with patients that did not have as complete coverage across the area of G. E. So we do think the placement of cells is very important in terms of obtaining the best outcomes.
With respect to your other question the importance of trends.
Reaching into my my my background or originally as a scientist is the bench scientist as you would work of problem. It.
It was always very interesting if.
You Couldnt get too excited about a single observation, but as more and more observations, especially using different methodologies as each of them sort of piled on and were directionally correct or directionally facing the right way.
Even if any one of them was not statistically significant you can start to build a lot more confidence. So for example, if youre seeing BC VA benefits and <unk> benefits.
And youre seeing quality of life benefits and Youre seeing low light reading speed benefit if everything is sort of directionally going your way. It is much easier to be confident that you are having an effect even within a single assessments such as the CVA you cannot choose just the single time 0.3 months six months nine months and say.
Uh huh.
25 letter gain you really need to look at the area under the curve and say, okay. Maybe that patient was many letters at month six how were they at month nine and three and 12 and I think by looking not only with in each assessment, but across multiple assessments you get a much more fulsome picture and I think thats what were enjoying.
And that is why I referenced that I feel like every time, we put out an interim update it is a more of it as a picture of our data, which can provide greater confidence and conviction that delivering the offers himself to these patients is driving of a benefit in them and supportive of further development.
Great. Thank you, Brian and then I know there are no approved therapy for dry AMD, but perhaps from what's been observed and the field of wet AMD based on the discussions you've had with physicians and Kols, how do you imagine both of the day and their patients.
Rank or evaluate the importance of these different endpoints that you're observing and the trial as well as items like safety and convenience.
The other several important parameters ultimately the patients care, most about seeing better because avoiding falling down of flight of stairs and dim light or being able to use your cell phone and watch your grandchild at.
And their piano recital those quality of life issues are.
There's nothing more important than those.
But the burden of proof is sometimes more easily achieved with other methods. So for example, anatomical methods of improvement in the anatomy and the structure of the retina, so the patience and the regulatory.
Guardians of these markets are not always perfectly aligned in.
And our case I'm encouraged because I think that we are able we're going to be able to demonstrate that we can provide both of those.
But I do think that there is and there is in perfect alignment of the overall objective of of safe and effective therapies is really going to be fda's judgment, but the individual patients. They are going to have their own criteria in terms of their risk tolerance, where are they in the disease how important is it.
Or are they getting long one and I are both eyes there.
For many factors there.
But I think the something that's notable about the cell transplant approaches generally and of course offers and specifically as I believe that ultimately we're going to be able to deliver both I believe we're going to be able to demonstrate anatomical improvements to the retina, which give us a good basis for our regulatory evaluation and I think we're also going to be able to them.
Concerning some degree of visual acuity improvements. So it's a complicated situation because there is no regulatory precedent as you know and so there is no clear path, but I do want to mention that we will remain open.
And just because.
The sponsor decides to pursue of certain endpoint does not set that as the bar for every other sponsor ultimately you need to align your therapy and your therapies attributes and benefits with some sort of primary efficacy endpoint and so there's a long history not just in ophthalmology, but more generally.
For ethical pharmaceuticals of trying to figure out what's the right way to measure the benefit that you're conferring and be able to do that and the context of the clinical trial, which is affordable and enroll the bowl.
And convincing.
So that's a very long answer, but I do think debt.
Hope that I touched on all the points that you made there.
Great. Thanks, Brian and looking forward to the data next month.
Christopher.
Next question comes from Joe <unk> from H C. Wainwright. Your line is now open.
Hey, Brian Hey, you want and good afternoon, and thanks for taking the question.
Brian I'm on a go to some of your prepared comments and then also of some of your commentary about the rep.
Restoration of patients. So first let me go to your comments.
Comments prepared comments about your decision to.
Not exercise your option for gyroscope, and then link that to a direct question about the restoration patient do you feel then now that the PPP I'm sorry.
And not the PPP loan the PPV delivery is.
And maybe more appropriate to deliver more.
Currently the cells to cover the area of G H.
Okay.
Yes, Joe. Thank you for the question I think I think the short answer is yes, I think that we and we've had.
A couple of years of of.
Of data to review and we've learned a lot of things with this new technology and I think that we feel that having the the.
The flexibility or.
And better placement flexibility is really important because it is ultimately going to be tied to the clinical outcome. So I think I think the answer to that question is yes.
Got it and then.
And sort of going forward with that restoration patient, how and how are you going to be able to share some let's call. It delivery data for the current patients to describe how and where the sales were delivered because like you said early on you were avoiding the area of GAA and.
Have each patients subsequently been getting closer with regard to their delivery and the areas of the <unk> that you could be able to see restoration.
Time progresses, I guess, it really comes down to what can you share at some point with regard to where the delivery occurred versus where the <unk> was.
Yes.
It's a nice question because the company historically has been extremely transparent with its whether its data.
We have provided patient level data at essentially every single endpoint with all of our exploratory assessments.
So it will be no problem for us to provide not only the clinical outcomes, but to match those up with some sort of scale or score of plus minus type of.
Analysis on placement of cells.
And that's that's the case not only for restoration, but but more generally for how the patients are performing so even if what we see is that patients with the best be CVA and is also had the better placement of cells that's incredibly.
Validating of the direction that we're going in and of firms for us that cell transplant and cell replacement is really driving this and it's not so much trophic effect or.
Again sales operating at a distance, which frankly has been our philosophy throughout this and it's across all of our applications, that's not to say that.
And maybe some factors and biological factors that are coming from our cell lines that are beneficial and contributing to clinical outcomes.
Just don't think that they are sufficient for optimal outcomes. So obviously the homerun here is being able to show restoration and the more restoration of the better.
Restoration only happens with great placement, that's fine that's the direction, we're going and anyway. If we do not show restoration and if we can still show clinical benefits that can lead to an approved product and we're showing those that are happening with.
Superior placement or more exquisite placement and I think all of those are Vic.
Victory or winning scenarios and and I should add or I can add debt one of the other things that we've learned is around patient selection. So I think we're seeing some signals as to which kinds of patients might be more likely to quote unquote respond to our therapy and we're starting to refine.
And our thinking there it used to be just earlier is better and although I agree. The earlier is still better we're starting to even be able to think about well, maybe we could score the brooks membrane health and some way and sort of how the selection criteria for patients and so forth. These are still very much of a work in progress because again this is a new.
Technology and so we are learning while doing but I also think thats incredibly encouraging because we have a lot of areas, where we can get better because we have of new technology. So I hope that is it.
The responsive to your question.
No. It certainly is the thank you and actually your statement of New technology is of Great segue for my next question and I wanted to ask about the regulatory topic and the split it into two parts. So first since we're on a per Jen as youre going to go into the FDA meeting and talk about a potential Registrational study.
Are you willing to disclose right now about what your wishlist looks like since it is of new technology, what would you like a registrational study to look like and hope that the FDA agrees to maybe with some tweaking or what have you and then the second part of that is with regard to your OTC one upcoming regulatory.
The interactions and if I heard you correctly on your prepared comments you said that this potential Registrational study would be of comparator study and I just wanted to verify would be.
Compared to what.
So it's such a fun question that Youre asking there.
Think that the the.
On the regulatory directions kind of fall across two parameters. There is theres visual acuity and all of this different variations reading letters on the Nice chart reading speed low light reading, so theres visual acuity and we're seeing benefits and visual acuity. So that's on the table than theirs.
<unk> G a growth of <unk> area some of sort of.
G a change and I want to keep it kind of broad because we need to keep open debt. It's not just the circumference of the circle that we're looking at one of the things that we think that we can bring our changes to the the depth for the health of the retina and you can think of the retinal I guess I get the.
Eight layer birthday cake and you know if you.
If you've got all of these layers that of switch together and they're dysfunctional.
And fleet those I'm using really core terminology, but you know the the little Kid is going to be a lot happier with the cake, that's inflated rather and one that's collapsed and that doesn't always as I described doesn't always translate easily in the aerial views the.
A lot of us used to look at G. H.
So theres a theres a G. A component here, but you asked me a different question you said, what's my what's my ideal my ideal is very easy my ideal is I want to collect I'm gonna have evidence of retinal restoration and then I would like to use high res OTT to be able to demonstrate the.
And there are anatomical changes to the retina, which never occur naturally and I think that that would be so incredibly powerful and it would be a really great win if we are able to have a study like that but.
There are a lot of requirements there we need to see it we need to be convinced of it we need to figure out ways to measure it but you asked me for my wish and so that's my answer.
Great and then the LPC one comparator wish.
Oh obesity on comparator, yet the office I mean, I don't [laughter].
I don't know.
The the challenge with with <unk> and how do you do a sham control.
With a surgical procedure my opinion and I think the opinion of shared by most.
Surgeons here is that and it is not ethical to make and incision and then do a sham procedure for.
For spinal cord injury patients now of statistician is going to have a different view because theyre holding on to the elephant trunk or sort of the tail.
But I think that there are ways of doing partial blind studies right, maybe the maybe the family knows if there's the decision under the bandage, but maybe the person who's doing the assessment.
Who's collecting the data on mobility or sensation, maybe they are blinded. So there are sort of hybrid ways or pseudo blindings that are probably capable.
We are obviously in the early days of of sorting out what we think would be the most.
The compelling and powerful way of doing that.
But I do hope to avoid having to enroll a large number of of <unk>.
Semi matched patients and essentially doubling the size of the study but.
Ultimately, we need to go to FDA with a compelling case and a compelling story about why that is the right way to go and it's similar with dry AMD and I think the best comparator in the case of dry AMD is actually a matched patient population that you observe what happens to their gea and real time and I was just complaining a little bit earlier.
Debt, where we're matching our data against the contralateral eye that we always know starts out better and it seems a little unfair, but it's what we have it's the only comparison, which we can make.
But what if we have a population of control population of patients who come in at baseline, but the same size of of atrophy and they have similar stage of disease, but they are untreated and we'll just monitor what happens that for me would be of much better comparison as the changes that.
Occur with opportune compared to this contra lateral eye and I think that's the case for both <unk> and for the CVA.
Got it thank you very much Brian.
Thank you Joe.
Next question comes from the line of Robert <unk> from Noble Capital. Your line is now open.
Hi, I had a question about the presentation of the operation and data and the additional interim.
The analysis, that's going to be presented.
Just wondering whether it was going to be presented in the press release, the root of scientific conference and then when would the full dataset.
Presented.
Hi, Rob Thank you for the question.
A final decision hasn't been made but we do not currently have.
A major medical conference planned for the next update so what I believe would be most likely is that we would provide a press release, which in our case typically would link out two of slide deck that we would make available. So that you would be able to see more of the totality of the evidence over time so.
We're too early for me to say exactly what we will do but looking rearward. We that debt is one way that we've been able to provide more information than you can really pack into just the press release with some some top line data.
Okay and just in the few minutes that remain just quickly.
Can you just summarize what the timeframe for the <unk> program and.
And the milestones might be after the.
The end of the year and assuming everything goes well.
Yeah, Rob. Thank you the the two major activities on OTC one of.
Our our map meetings so weird.
We have to.
Talk with FDA about this new near gain PSD and so we have and our mat interaction, which is scheduled for next month. So that's that's not very far away.
And then we want to around the end of the year talk about the manufacturing improvements, which I described previously or in other calls.
Just wanted to make sure that we've got good alignment with the agency the.
The process that we have developed which has much greater purity and and control and scale, we want to make sure of that the agency is comfortable with that process, creating sales and those sales going into patients. So those are a couple of things that you can look forward to.
And then we always keep an open line of communication going with the California stem cell agency or serve.
On that.
That's just that's always sort of a side thing that could be part of our.
Part of our news flow as we go forward, but theres nothing nothing specific or imminent on that topic today.
Okay, great. Thank you very much.
Thank you Rob.
Next question comes from the line of Keith Mckey from Paragon and your line is now all of them.
Hi, yes. Thank you.
And Brian I wanted to talk to you about the decision about the orbit device.
And we appreciate.
We shape the yoga you guys are finding debt.
Better coverage of the geographic.
Each of the area is advantageous so if we think about then the trade offs of why the orbit device was of course.
To be beneficial in terms of the.
And I'm happy to have the retinol and membrane formation.
Are you comfortable debt utilizing PPV is something that you're on.
Surgeons can can do the procedure.
And minimize the trade off of the.
The injury versus the better coverage.
Yeah, Hi, Kate that has definitely and astute question. So.
With respect to retinal surgeon experience PPV is widely used all of retinal surgeons have extensive experience with it I was told by one in particular that is a requirement and you want to graduate from retinal surgery and school you need to be able to perform of PPV.
So we've continued to use PPV, while evaluating the orbit device in parallel we didn't have very much data two years ago. When we entered into the evaluation agreement.
And since that time, there have been 12 more patients, which had been treated about half of PPV and half orbit.
And we've seen some some interesting things as referenced and Dr. Raymond ARVO presentations, the PPV procedure always only needed a single device to successfully deliver the sales it.
And it had a high rate of success doing so we didn't have ourselves time out while using PPV.
There was a single case of CMV, which arose and of PPV patient, but that occurred two years post treatment and we don't think that was and any way associated with ourselves of the procedure, but the primary reason that we even explored alternatives of couple of years ago is that PPV is associated with the high rate of <unk>.
Retinal membrane formation, but not only are the majority of the Erm's and our study clinically insignificant, but we also demonstrated that of severe E. R M, which needed to be removed could still result, and an improvement in visual acuity. After its removal. So we think the totality of the data at the.
Time and supports the continued use of PPV and to deliver offer Jim as I said, we would continue to be committed to exploring ways that we can improve our therapy, there may be alternate or improved sub retinal delivery solutions out there.
But we did allow that option agreement with the manufacturer to expire and may in accordance with its terms and we're already and the process of exploring two areas of potential improvements to the PPV procedure, which might further improve outcomes. So we think that PPV using PPV to deliver opera, Jim is going to ultimately.
The of better choice for patients and for surgeons as well as for lineage.
Great. Thank you for that answer.
Thanks, Jeff.
There are no further question at this time Gaiam for easy you May proceed. Thank you.
And I. Thank you everyone I really appreciate you Mary and I appreciate everyone's participation, we will keep working hard for you and we'll look forward to our.
Upcoming events and milestones and our continued communication with all of our shareholders. Thanks and have a great afternoon.
This concludes today's conference call. Thank you all for your participation you may now disconnect.
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