Q1 2022 Oncolytics Biotech Inc Earnings Call
[music].
Good afternoon, and welcome to you all go at X biotech first quarter 2022 conference call.
Participants are now in a listen only mode.
A question and answer session at the end of this call.
Be advised that this call is being recorded at the company's request.
I'd now like to turn the conference call over to Mr. John Patten Director of Investor Relations and Communications. Please go ahead.
Thank you operator, and good afternoon to all listening earlier today <unk> issued a press release, providing recent operational highlights and financial results for the first quarter of 2022.
A replay of today's call will be available on the events and presentations section of the website approximately two hours. After its completion after remarks from company management, we will open the call for Q&A.
As a reminder, various remarks made during this call contains certain forward looking statements relating to the company's business prospects and the development and commercialization of <unk>, including statements regarding the Companys focus strategy and objectives companies. Please.
And motive action of calendar year at the cancer therapeutic design aims and anticipated benefits of the company's current pending clinical trials.
So it's purely timing of the release that additional data.
These plans and expectations regarding a potential registrational study the company's business development plans and strategies and other statements related to anticipated developments and the company's business. These statements are based on management's current expectations and beliefs and are subject to a number of factors, which involve known and unknown risks and uncertainties.
Uncertainties and other factors not under the company's control that may cause actual results performance or achievements of the company to be materially different from the results performance or expectations implied by these forward looking statements in.
And any forward looking statement in which analytics expresses an expectation or belief as to future results such expectations or beliefs are expressed in good faith.
<unk> have a reasonable basis, but there can be no assurance that these statements of expectation or belief will be achieved.
These factors include results of current and pending clinical trials risks associated with intellectual property protection financial projections actions by regulatory agencies and Theres. Other factors detailed in the company's filings with SEDAR and the SEC.
<unk> does not undertake any obligation to update these forward looking statements, except as required by applicable laws.
I will now pass the call off.
President and Chief Executive Officer, Dr. Matt Coffey. Please go ahead Matt.
Okay. Thank you John and good afternoon, everyone.
It's my pleasure to be speaking with you all today about our recent accomplishments and outlook for the next several months.
Now in addition to John and myself will also be hearing from Dr. Thomas <unk>, Our Chief Medical Officer, Andrew do you got to do a global head of business development, and Kirk look Chief Financial Officer.
2022 has been a highly productive aircraft codex would have reported a total of seven clinical updates on pellet railroad pillar as I'll refer to it from five different clinical trials.
Each of these updates has added to our robust clinical data set demonstrating pellets anticancer activity.
A logical mechanism of action and favorable safety profile.
Alongside these clinical achievements, we published compelling preclinical data in Q high impact peer reviewed journals bolstering our efforts to expand <unk> commercial potential through collaborations and partnerships.
Most importantly, we also continue to expect bracelet, one a randomized phase III trial in HR positive <unk> negative breast cancer to report topline data by year's end.
We expect this readout to be our most important milestone this year as a successful outcome would strengthen our business development prospects and move us forward into a registrational study.
Taking a broader view of this recent progress we can see the advantages of our corporate strategy.
This strategy has us internally focused on bringing our lead breast cancer program into a registrational study leveraging partnerships and collaborations to generate additional value to pellets development in other indications and geographies.
We believe this strategy nicely aligns with Colorado reps final logical profile.
It's clinically demonstrated ability to stimulate anti cancer immunity, adweek and tumor defense mechanisms positions. It as an attractive immuno oncology product in its own right as well as the ideal combination partner for a wide array of therapeutic classes.
This hypothesis has been repeatedly supported by clinical and preclinical data showing pellet synergy with anti cancer therapies, such as checkpoint inhibitors and car T cells.
By successfully executing our strategy, we have been able to maintain a strong cash position and report positive clinical updates and breast.
Pancreatic colorectal neurological and Hematological cancers since the start of the year, all while keeping our lead program on schedule and advancing towards what we believe will be the crucial inflection point for the company.
Long term, we plan to continue executing this strategy by building upon existing partnerships with lead academic institutions and companies such as Pfizer Roche Merck Serono insight BMS and Abbvie, nor tie with the goal of building towards the late stage pipeline that provides shots on goal in multiple indications.
This will allow us to preserve our primary focus resources and upside in breast cancer, while minimizing shareholder dilution and the risk of binary events in late stage clinical trials.
With that high level overview completed I'll recommend that anyone interested in reading more about our Q, what a couch and take a look at the most recent letter to shareholders posted on our website.
Now I will hand, it off to Tom to discuss our recent accomplishments and more depth. Please go ahead Tom.
Thanks, Matt I'll.
I'll begin by discussing some very interesting biomarker data from our aware one trial that were just announced yesterday in a poster at the ESMO breast cancer meeting and will then provide some context on how they support our lead programs advancement to a registrational study.
These data are from aware, one first two cohorts, which enrolled patients with early stage HR positive <unk> negative breast cancer subtype, we plan to examine and future Registrational study.
Patients in these cohorts were treated with pellet Ria rep, and letrozole with or without the checkpoint inhibitor <unk>.
Tumor samples were collected from patients both pre and post treatment.
Gene and protein expression assay is run on these samples demonstrated pellet Ria reps immunologic mechanism of action and its synergy with checkpoint inhibitors, notably they provided strong evidence of <unk> ability to deliver durable clinical benefits to HR positive <unk> negative breast cancer patients.
This evidence came from two well established prognostic assessment based on Pam 50 gene panel analysis.
The first of these was the risk of recurrence score, which uses tumor gene expression profiling to assess the likelihood of a patient relapses. After an initial clinical response to therapy.
The results showed that all evaluable patients had a risk of recurrent score classified as low after treatment, while only 55% of patients had a low score prior to receiving the Palo <unk> based therapy.
The second prognostic metrics featured in the ESMO breast cancer poster uses gene expression profiles to classified tumors into distinct molecular subtypes.
Testing of pre and post treatment samples demonstrated that most tumors converted from the aggressive aluminum b subtype.
<unk> subtype, which is associated with improved clinical outcomes and.
In fact, all tumors from Evaluable patients, who received <unk> in combination with the teaser Alicia Mad Reclassify. This luminal eight by 21 days following treatment.
Collectively we believe these are very exciting results.
So that <unk> drives changes in the tumor that leave patients more likely to benefit from therapy and less likely to see their cancer return following an initial positive clinical outcome.
Also included in the ESMO poster, where data is showing statistically significant post treatment increases in markers of tumor cell death, and T cell activation, which further defined the molecular mechanisms by which <unk> delivers the exciting prognostic results I, just mentioned as well as the clinical benefits.
Observed in earlier breast cancer studies.
When viewed alongside the previously reported results from the very successful aware one study. These latest data add to a clear and compelling picture of pillar <unk> multifaceted mechanism of action that explain its ability to offer clinical benefit in multiple indications and in combination with a wide variety of <unk>.
Pudic partners.
As you May recall, the previously reported results included pellet <unk> ability to remodel the tumor microenvironment by up regulate PD lone expression.
And its ability to promote the generation expansion and tumor infiltration of anti cancer CDA positive T cells.
These effects were enhanced with checkpoint inhibition was added to the therapeutic regimen.
The prior data also identified changes and peripheral blood T cell populations that may serve as potential biomarkers to identify patients most likely to respond to <unk> treatment.
Each of the immunologic effects observed in aware one serves to prime the immune system in its fight against cancer and improve the long term survival of patients as evidenced by the prognostic classifications, which were improved following treatment as described in the ESMO poster.
I'd like to take a moment to emphasize the importance of the <unk> III findings as they provide clear clinical evidence of <unk> ability to improve survival.
The study that enrolled nearly 60 HR positive <unk> negative breast cancer patients.
This largely on the strength of these results we received fast track designation and the special protocol assessment from the FDA, which suggests the agency views <unk> III.
One of the two well controlled pivotal trials that are typically required to support a regulatory approval.
As part of our strategic planning to advance <unk> to a Registrational study we began discussing the <unk> result, with potential Biopharma partners.
These discussions were ultimately the impetus behind our decision to collaborate with Roche Pfizer and Merck Serono to supplement the IMD two and three results through the aware one and bracelet one trials.
By conducting these trials in collaboration with industry leaders.
We've been able to work together on navigating the best path to a future Registrational study and strengthen our business development outlook.
As we have consistently stated on past earnings calls aware, one and bracelet one were designed to support and expand upon the <unk> two and three results by exploring <unk> mechanism of action and evaluating its potential synergy with checkpoint blockade and.
In addition, the trial's seek to identify a biomarker that can predict patient response to <unk> therapy.
Thanks to the aware one results, we can confidently say that the strategy, we laid out after <unk> III as thus far been a success.
With these results in hand.
Next potential catalyst for our breast cancer program is bracelet ones anticipated topline data readout in Q4.
With randomized cohorts evaluating paclitaxel monotherapy, Paclitaxel, plus <unk> and Paclitaxel plus <unk> in combination with a checkpoint inhibitor.
Programs.
Lastly, I'd like to discuss a peer reviewed paper recently published in science translational medicine.
That evaluated pillory, Europe's ability to enhance the efficacy of car T cells and enable their success and solid tumors.
Car T cells are produced by removing natural T cells from a patient and genetically engineering them to include a receptor that is specific for an antigen expressed on cancer cells.
Mr. Rex cars T cells to the site of the cancer, where they mediate tumor cell death.
Or initial development <unk> sales have been a transformative therapy and have been shown to generate long term cures in patients with leukemia lymphoma, and other blood base cancers.
Unfortunately, the benefits of car T cells have thus far been limited to the comparatively small subset of cancer patients with hematologic malignancies.
And their inability to effectively treat solid tumors remains a long standing problem.
This is largely due to three challenges first.
A suppressive micro environment of solid tumors.
Restricts car T cell infiltration into tumors and diminishes their effectiveness.
Second car T cells have limited perseverance, which hampers their anti cancer activity and lastly, heterogenous nature of solid tumors leads.
Leads to antigen escape, which allows tumors to invade killing.
By leaving car T cells with nothing to target.
The results published in Science translational Medicine showed that the addition of pellet rear up overcomes each of these challenges as it reverses immuno suppressive tumor micro environments.
Increases carty sell perseverance.
And prevents antigen escaped by creating dual specific car T cells that take advantage of <unk> ability to replicate within the tumor.
These stool specific cells are directed against the tumor both by their engineered receptor targeting at specified tumor antigen.
And by a separate receptor that targets <unk> replicating within the tumor.
By overcoming each of these challenges Hello, rear up was able to drastically improve the persistence and efficacy of car T cells in your in models of skin and brain cancer.
When compared to treatment with either <unk> or car T cells alone.
<unk> loaded with telling me around.
Led to statistically significant survival benefits.
When <unk> loaded Carty sales were followed by an intravenous pellerin boost.
We saw a further enhancement and efficacy with tumor cures observed in more than 80% of treated mice and each model.
If these findings are translated to the clinic, they could have a profound therapeutic impact and alter treatment paradigms across many indications occur.
According to the U S National Cancer Institute, approximately 90% of cancer cases diagnosed in 2021 were solid tumors.
While these patients are currently unable to benefit from car T therapy. The preclinical data featured in science translational medicine.
<unk> is the key to unlocking the potential of this revolutionary treatment modality for these patients.
We believe this provides an excellent opportunity for business development, which are now let Andrew discuss Andrew.
Andrew.
Thank you Tom and good afternoon, everyone.
From a BT perspective, we're very excited by the preclinical results presented in science translational medicine.
Despite only being approved subset of cancer patients with hematologic malignancies khaki.
Archie therapy generated more than $1 billion in sales last year.
Hello, <unk> potential to enable hartke success and solid tumors. Therefore represents an opportunity to greatly expand what is an already large market.
Preceded this opportunity we plan on using our preclinical data to engage with partners, who are interested in licensing <unk> and leading us development as an enabling technology for car key therapies have.
Partner assume the cost of development responsibilities here.
Allow us to participate in the upside of this lucrative Archie commercial opportunity with minimal risk.
And a continued focus on our current clinical programs and breast and other cancers.
I'd like to mention the ongoing bridging clinical trial being conducted by our partner Adeline Archive, who is working to develop and commercialized Paula rear up in China and other Asian territories.
This drought evaluates pylori are rap Paclitaxel combination therapy, and Chinese breast cancer patients.
Trial recently advanced into its third and final does escalation cohort.
After data from the first your cohorts showed the study combination was all tolerated and did not lead to any new safety signals.
As a reminder, the trial second cohort evaluated dosing regimen equivalent to what was administered to 90 213, while.
While the third cohorts regiment is equivalent to the <unk> paclitaxel cohort being evaluated brace at one.
The breaking trial aims to accelerate add lights development of calories by allowing them to incorporate data from 90, 213 and bracelet one to inform plans for phase III study designs for registration rapidly growing pharmaceutical markets.
Alone recorded 416000 cases of breast cancer in 2020, and our partnership with add light provides a valuable opportunity to expand pillow reps commercial prospects.
Two important international regions.
The last 80 updates I'll discuss today come from Goblet R. <unk> gastrointestinal cancer trial banked conducting collaboration with brush.
This trial is evaluating Colorado wrapped in combination with PDL, one inhibitor such as a laser map in patients with advanced or metastatic pancreatic.
Excellent annual cancers.
The trial has seen rapid progress since the first patients dose last November .
Each of its two safety runs have been successfully completed with no safety concerns noted during independent reviews by the trials data safety monitoring board or <unk>.
Following these positive the SMB reviews and authorization from Germany's regulatory body.
All of the trials for cohorts are not clear for full enrollment.
With each of the safety updates I, just mentioned and the data from the presentations at ACR. We have added to an impressive database demonstrating <unk> ability to provide with a myriad of leading anticancer agents without causing unacceptable toxicities.
This has been shown across many indications which supports the case, we're <unk>, we developed as an immunotherapy backbone that can enhance the efficacy of other agents.
Hello, rear up safety database at dusk proven to be a strong selling point in our conversations with a potential biopharma partners.
Interested in harnessing its immunologic effects.
Maximize the commercial impact of their drives a therapeutic candidates.
Next I would like to talk about how we envision our beady efforts progressing are.
Particular, as we head towards bracelet once anticipated top line data readouts.
As data mature to embrace it won and factoring in the data we've already generates lion Q1, three and they were one will be able to better leverage the full suite of immunotherapeutic effects of Hello, rear up and find the most advantageous strategy for partnerships.
With that in mind, we plan to be methodical in our efforts to seek a global clinical commercialization partnership as we move towards registration.
Given the number of relationships are established with leading Biopharma companies <unk>.
Including several have already expressed interest and embrace that one study.
We hope to generate competitive tension between potential partners to ensure we reached the best deal possible for our shareholders.
Beyond breast cancer, we plan to continue utilizing partnerships with academic and industry leaders advanced <unk> based combination therapies as.
As Matt mentioned, we believe the strategy of lines Wow with <unk> Arbuckle logic profile.
Data from aware, one and other clinical studies have demonstrated <unk> as both an active immunotherapy and of our style backbone therapy with your body to activate anticancer immunity and remodel tumor microenvironment.
As a backbone therapy, Hello railroad can increase the efficacy and addressable patient populations of a variety of therapeutic modalities.
We have already begun to prove out this strategy with checkpoint inhibitors, which comprise a multibillion dollar market. Despite as soon as one in five patients adequately responding to these therapies.
As discussed earlier, we are now working to solve this problem breast and Gi cancers with our bracelet one in goblet studies.
She efficiently replicate this approach across other indications and drug classes. We aim to have partners, who will share the responsibility for these development efforts.
This will allow us to maximize our opportunities for value creation without deviating from our core focus on cancer and.
And with that I will now let Kirk proceed with a discussion of our financial results Kirk.
Thank you Andrew.
I'm happy to report that Oncolytics continues to be in a strong financial position with cash and cash equivalents of $39.5 million as of March 31, 2022, compared to $41.3 million as of December 31, 2021.
Based on our current projections are existing financial resources leave us well capitalised into 2023.
This is expected to provide runway through multiple clinical data readouts, including the upcoming announcement of bracelet ones topline results.
Our operating expenses for the first quarter of 2022, where $2.6 million compared to three one in the first quarter of 2021.
This change was mainly due to lower investor relations activities and associated expenses.
Now research and development expenses for the first quarter of 2022 or $3.7 million compared to two eight for the same period last year.
This increase was due to the progression of the Goblets study.
The the completion of a product Phil.
Higher manufacturing related process development activities.
And a higher compensation expense in support of our expanded clinical program.
The net loss for the first quarter of 2022 with $6 $8 million compared to $6 $4 million for the first quarter of 2021.
According to a net loss of 12 cents per share.
First quarter of 2022, and 13 cents per share for the first quarter of 2021.
With that I will now pass the call back to Matt for some concluding remarks, Matt.
Thanks, Kirk let me conclude by expressing my enthusiasm for icy Oncolytics headed.
Thanks to thoughtfully designed clinical studies highlighted by IMD 213, and it's supportive studies, we have established Pella is a private estate immunotherapeutic agents and demonstrated its ability to deliver a statistically significant and clinically meaningful survival benefit to breast cancer patients and a well controlled randomized clinical trial.
We have thoroughly characterize immunological effects, including its ability to awaken mandate and adaptive antitumor immunity and re model tumor microaire environments by promoting the infiltration of cancer fighting immune cells Upregulated PDL one expression.
We also showed that we can enhance these effects will check point blockade.
This is clearly differentiated pellet from competing agents it is all.
So strongly take the interests of thought leaders across industry and academia allowed us to establish valuable relationships.
We are leveraging these relationships to adapt a diverse pipeline and expect to achieve multiple clinical milestones by the end of the year. Please include anticipated updates from the goblet study at the upcoming ethanol World Congress on Gastro intestinal cats are meeting as well as bracelet wanted to anticipate the top line data right out in Q4.
With bracelet ones.
Coming right out we're aiming to propel our lead program into a registration I'll study, while providing the necessary proof of concept for our broader clinical development strategy.
A positive outcome and bracelet, one will establish the rule of Perl out as an emerging immunotherapy and will likely bode well for a program like goblet, which is yet. Another example of a collaboration with an industry leader.
We would also on bold in our efforts to expand Pell us therapeutic impact through partnerships to develop that as a backbone a combination therapies and additional applications.
As we adapt tell US development, we will continue to dedicate our primary focus on resources to our breast cancer program, along with GI cats us through the call but study.
We believe this capital efficient approach represents the best strategy to maximize shareholder value as we work to bring pallor to cancer patients in urgent need of novel therapies.
Finally.
I would like to briefly thank all those responsible for bringing alcoholics to where it is today starting with our shareholders.
We greatly value your support which is what makes our fight against cancer possible.
I also need to extend my gratitude to our employees partners and collaborators Cove enabled an impressive collection of data highlighting pillows wide ranging therapeutic benefits.
Lastly, and most importantly, I want to thank the patients who participated in a clinical trials and their families.
The desire to improve the lives of patients that serves as the driving force behind all the work we're doing as a company.
With that I'll ask the operator to open it up for questions.
Thank you ladies and gentlemen, we will now begin the question and answer session. If you have a question press star.
Followed by one on your Touchtone phone.
Three ton prompt acknowledging your request and your questions will be pulled in the order. They are received should you wish to decline from the polling process. Please press star followed by two.
You are using a speakerphone. Please lift your handset before pressing any key your first question comes from John Newman with Canaccord. Please go ahead.
Hi, guys.
Thanks, very much for taking my question.
I just wondered if you could talk a bit about future plans for Apollo era.
Conjunction with hearty.
We've recently published.
Some interesting information.
Regarding loading.
<unk> with <unk>.
[laughter].
I'm wondering if.
You could discuss potential future.
Future clinical plan Sir thanks.
[noise], Hey, John how are Ya.
Oh, thank you.
So what what what transpired since this has become public Andrew has been able to negotiate a number of mta's.
And a number of companies are looking to see whether their contracts.
Behave as well and.
Pre clinical environment as professor Biles work did at mail.
As you know various companies have various cartoons targeting various moiety. So.
What they want to be able to do is basically emulate the work that Dr. Bile had done and then I think we could be looking at getting into a number of clinical studies very very very quickly Andrew do you want to talk a little bit about the commercial strategy around the car Tia and how we see a way forward with this.
Yeah, obviously, something we don't want to develop organically, we're focusing on brats first and last and foremost right now so and the reason for that part is if you read the paper essentially have a prime and a boost dose of <unk>. So I'd only celts each khaki treatment would only sell 2000, <unk>, which is negligence.
But it would sell car keys that goal on the order of 400 to $500000 a year. So we see the value for us financially Bang and getting.
A piece of the actual sale of that car key that would not be solved.
Not for the ability to treat that solid tumor that palo rear up conveys so the way we see it as we would want to get a reasonable upfront I won't go into what those numbers are but it has to be something we feel comfortable with.
Some development milestone payments and then when the product is approved a certain percentage of each sale of a khaki treatment.
Okay, great. Thank you.
Ladies and gentlemen, as a reminder, if you do have any questions. Please press star one.
Your next question comes from Patrick Cicciaro with HD Wainwright. Please go ahead.
Alright.
Good afternoon. This is Jason on for Patrick and I guess My first question is also just around the car to the client building off the previous question and.
What I'm wondering is are there any plans in terms of moving into higher or larger organism, four preclinical and kind of like producing for hi, Andy enabling studies.
That is ultimately to go what we'd like to do is is work with these various partners.
And their preclinical model. It's interesting we've discussed how we could potentially move this forward with some other partners, including the collaborators at mail.
So many of these cartoons are well understood now in the clinic, especially the he malignancy wines then because.
The the <unk> profile around Palo Alto, well known we're not sure if we would actually need to do higher organisms say Simon August monkeys, or <unk> or what have you. What we may be able to do with what we've done with.
The initial work done in checkpoint blockade, where we would just run a safety run in three to six patients or a three by three design. So we might be able to go.
Any additional animal testing required to get into the clinic and that's generally the thinking will have that conversation our partners will have that conversation with the agency but.
But our current thinking as it would not be necessary.
Okay, Great. Yeah, that's really helpful to know and then just one more question if I may so I know.
There wasn't any update today in terms of the real glial program and especially with the positive results are you guys are presented it sort of long terms and add ACR early last month.
So can you kind of give us an update of like what is the next plan or like what it's like the next update for this and that's all for me for today. Thank you.
It's interesting the emerging data that we're getting especially aware and we anticipate if the science holds we should expect similar outcomes with bracelet in goblet.
There wasn't a lot of interest around the GBM work the virus did seem to provide a survival advantage of the high dose.
As well as the Pff's advantage of the high dose.
Where are we think this is likely to go is.
With the addition of checkpoint blockade.
We actually have a number of animal models and publications in this space demonstrating that the virus can be very effective in the GBM space and of course, our more recent work with party.
Isn't on our critical path, though in terms of what we would like to do in the clinic that really the goal is to get the result that a bracelet and start that phase III program and breath in the context of a partner we also believe that.
<unk> could potentially lead to a second route to a registration study.
Allowing us to avoid any binary events in that phase resetting my running two different programs. What we think is a very attractive though is if we do partner with a company that has checkpoint blockade in.
In terms of their development path and lifecycle management I think we've demonstrated very effectively uhm that the virus can be used synergistically in GBM and I think the next logical step would really be exploring that in the context of either party checkpoint blockade I didn't getting that on a regulatory path.
Alright, great. Thank you so much.
There are no further questions at this time. Please proceed.
Again I just wanted to thank everyone for taking the time to listen to our quarterly updates and I'd like to thank everyone. Further questions have a lovely day.
Ladies and gentlemen, this concludes our conference call for today, we thank you for participating and ask that you. Please disconnect your lines have a great day.