Q1 2022 Caladrius Biosciences Inc Earnings Call

May 5, 2022

His thoughts and a business update conference call. Currently all participants are in a listen only mode. Following management's prepared remarks, we will hold a Q&A session.

That's a question at this time, please press star followed by one on your question on the telephone.

If anyone has difficulty hearing the conference call. Please press star zero for operator assistance.

Reminder, this call is being recorded today Thursday may five 2022.

I'll turn the call over to John Mosquito, Vice President of Investor Relations and corporate Communications I'd collect you. Yes. Please go ahead.

Thank you operator, and good afternoon, everyone. Welcome to <unk> first quarter 2022 conference call to discuss our financial results and provide a business update.

Joining me today from our management team are.

Dr. David Mazzo, President and Chief Executive Officer, Dr. Christian bulk executive Vice President of research and development and Chief Medical Officer, and James <unk>, Vice President of Finance and Treasury.

Shortly before this call we issued a press release announcing our first quarter 2022 financial results, which is available under the investors and news section of the company's website.

Along with the webcast replay of this call. If you have not received this news release and you'd like to be added to the company's email distribution list. Please email me at.

<unk> <unk> at <unk> Dot com.

Before we begin I will remind you that comments made by management. During this conference call will contain forward looking statements that involve risks and uncertainties regarding the operations and future results of collaterals I encourage you to review the company's filings with the Securities and Exchange Commission, including without limitation its forms 10-Q.

8-K, and 10-K, which identify specific factors.

May cause actual results or events to differ materially from those described in the forward looking statements. Furthermore, the content of this conference call remains time sensitive.

Contains time sensitive information that is accurate only as of the date of this broadcast Thursday may five 2022.

<unk> Biosciences undertakes no obligation to revise or update any statements to reflect events or circumstances. After the date of this conference call with that I will now turn the call over to Dr. Mazzo Dave.

Thank you John and good afternoon, everyone. Thank you once again for taking the time to join US today as we provide an overview of recent business highlights and discuss our first quarter 2022 financial results joining.

During the first quarter, we continued to advance our CD 34 positive cell therapy development pipeline with the initiation of the proof of concept study for <unk> 201, and diabetic kidney disease. However, our most important achievement coming just after the quarter concluded was the culmination of our efforts to diversify and expand.

Our development portfolio, which resulted in the recently announced signing of a merger agreement with <unk> Therapeutics. This transaction will be transformational for collagenase, creating upon closing a financially sound NASDAQ listed company with a diverse product development pipeline strong existing partnerships and potential for future.

<unk> attractive partnerships. The merged company will operate under the name of Lasantha Therapeutics Lossada for short and will focus on exploiting the full potential of sense Sundar platform technology products and a range.

Solid tumor oncology indications.

One the lead product candidate from the <unk> platform has the potential to be combined with myriad chemo and immunotherapies like agents and could become an integral part of a revised standard of care therapy for many difficult to treat cancers.

The combination of <unk> and will allow the collages team to leverage its broad development expertise and experience specifically in oncology with the goal of rapidly progressing with <unk> product development candidates toward global registrations as a result.

<unk> anticipates, achieving multiple potential value, creating milestones over the next 24 months simultaneously with the signing of the merger agreement last week <unk> also entered into collaboration and investment agreements with <unk>, whereby we made a $10 million investment in sand and created a development collaboration.

Structure, including a joint steering committee from which we will be providing human resources over the course of the next several months leading up to the closing in order to maintain the momentum associated with the development of the exciting products in the pipeline we.

As I hope you can hear in my voice, we couldnt be more excited and motivated about the prospects that this merger will bring for patients and shareholders.

Now I will turn the call over to James <unk>, Our Vice President of Finance and Treasury to review and provide commentary on our first quarter 2022 financial results James.

Thanks, Dave I am pleased to join you today to present, a summary of our first quarter 2022 financial results.

Starting with operating expenses.

Research and development expenses for the three months ended March 31, 2022 were $3 3 million compared to $5 1 million for the three months ended March 31 2021.

Research and development activity in the current year period focused on the advancement of our ischemic repair platform and related too.

Expenses associated with efforts to continue execution and acceleration of enrollment of the freedom trial and.

Expenses associated with the planning preparation and initiation of the phase <unk> proof of concept trial for <unk> 201, as a treatment for diabetic kidney disease and.

Ongoing expenses for <unk> in critical limb ischemia and burgers disease in Japan associated with study closeout activities and preparation for the pre consultation meetings with at the MDA.

General and administrative expenses, which focus on general corporate related activities were $3 3 million for the three months ended March 31, 2022 compared to $3 million for the three months ended March 31, 2021, representing an increase of 11%.

This increase was primarily due to an increase in fees associated with the review of potential strategic transactions.

Overall net losses were $4 2 million and $8 1 million for the three months ended March 31, 2022, and March 31 2021, respectively.

Turning now to our balance sheet and cash flow.

As of March 31, 2022, the company had cash cash equivalents and marketable securities of approximately $88 $5 million, which.

<unk> us well relative to the projected capital obligations for our existing development programs as well as our cash and investments balance target at the time of closing of the merger with <unk>.

That completes the financial overview.

With that I will now turn the call over to our Chief Medical Officer, Dr. Christopher Buck for the review of our clinical development pipeline Chris.

Kristin.

Thank you James and good afternoon, everyone.

<unk> is currently developing a set of autologous cellular therapies designed to treat or reverse disease.

Based on human clinical trial data generated to date, our therapies have shown strong signs of efficacy and durability with an excellent safety profile.

Unlike many allogeneic therapies.

Importantly, we believe that curative cell therapy products when applied to the right indication and at the right price can.

Can restore human health and potentially improve quality of life with a single administration as compared to a treatment that requires frequent re administration.

With that said, we have long recognized that the medical promise that we see does not correlate with the value ascribed to our pipeline as indicated in our share price.

This dichotomy was the basis for our quest to identify and secure additional development candidates.

With the strongest affinity ascribed to products that we believe hold great medical potential.

Current indications of high unmet medical need and where they can be positioned advantageously.

It can be materially advanced in their development with mostly our existing capital and represent therapeutic areas that have been historically attractive to investors.

Our merger with <unk> allows us to take all our requirement boxes and I am personally thrilled to become involved in the development of the <unk> product pipeline.

With that as a general introduction I will now expand on each of the collateral clinical programs in numerical order.

Kicking off with C. L. B S 12, Nedra in Japan, our product candidate for the treatment of critical limb ischemia and burgers disease.

<unk> was awarded a sakigake designation from the Japanese regulatory authorities for the treatment of critical limb ischemia and burgers disease, which is an orphan sized subset of critical limb ischemia.

Kentucky designation is akin to the regenerative medicine advanced therapy designation Werent armet designation in the United States.

Second coffee designation affords the recipient prioritized regulatory consultation a dedicated review system to support the development and review process.

<unk> the option of a rolling registration submission.

As well as a reduced review time of six months.

The registration.

It's filed.

Additionally, under Japan's regenerative medicine legislation products, such as who are eligible for conditional approval and possibly full approval in Japan.

Based on the assessment of the data from the trial or trials designed intellect direct collaboration with the Japanese pharmaceutical and medical devices agency known as P. M D. A.

Note that conditional approval of a regenerative medicine product only requires the demonstration of a trend towards therapeutic effect together with acceptable safety.

Further the sakigake designation is a highly sought regulatory classification in Japan.

And we hope that this.

Coupled with positively trending data from our trial.

<unk>, an attractive product for parking partnering to a Japanese pharmaceutical company.

The Companys study of <unk> in Japan for the treatment of critical limb ischemia and burgers disease has shown positive results to date.

The initial responses observed in the subjects, who have reached an endpoint in this study are consistent with our expectations of therapeutic effect and safety based.

Based on previously published clinical trials in Japan, and the United States.

As discussed in prior quarters, we have suspended our enrollment efforts to minimize the operational.

And financial burden that we have incurred and continue to incur due to enrollment delays and the lack of visibility on the time to completion.

The company has turned its focus to securing a partner in Japan to complete the study by enrolling the four remaining no option critical limb ischemia subjects, if deemed necessary <unk> to explore the possibility of submitting.

Existing data to the Japanese regulatory authorities.

And in upcoming clinical pre consultation meeting with the PMT a.

Topline results from this study will be presented and discussed and.

And we expect that they will provide important perspective to be considered in preparation for the formal consultation meetings, which precede the Japanese new drug application.

Turning now to XOMA were <unk> 16 for the treatment of <unk>.

Coronary microvascular dysfunction or CMT.

CMT is a disease that continues to be under diagnosed and potentially afflicts millions annually, a vast majority of whom are female with no current treatment options.

In May of 2020, Collagenase announced the full data results from the phase Iia escape CMT trial, showing a highly statistically significant improvement in coronary flow reserve.

Correlating with symptom relief for patients with CMT after a single intra coronary injection I think sooner.

Subsequently the company initiated and is currently treating patients in a rigorous phase two b clinical trial known as the freedom trial, which to our knowledge is the first controlled regenerative medicine trial and CMT in the United States.

The Frito trial is a double blind randomized placebo controlled trial designed to corroborate the results of the escape CMT trial, while assessing the efficacy and safety of delivering autologous CD 34 positive cells, our zona products, the subjects with CMT and without constructive.

Coronary artery disease.

Initially investigator and potential subject response to the freedom trial was favorable in early.

And the trial proceeded as planned with the first patient treated in January of 2021.

However, since the inception of the trial the impact of the COVID-19 pandemic in the United States, coupled with supply chain issues associated with the catheters used for the diagnosis of CMT and or administration of a zona.

Have made and continue to make enrollment much slower than originally predicted and challenging to accelerate.

Collagenase is taking steps to accelerate enrollment by expanding the number of participating investigational sites as well.

Well as modifying the study protocol to make study inclusion criteria more flexible.

We are continually monitoring study progress and we will consider additional future protocol.

Or execution, all changes as appropriate.

Lastly, our most recently proposed development program C. L. B S 201 for the treatment of diabetic kidney disease, where D. K D.

The company initiated a phase one open label proof of concept trial evaluating C. L. B S 201, a CD 34 positive regenerative cell therapy investigational product for intra renal artery administration in patients with diabetic kidney disease.

The development program focuses on patients that exhibit rapidly progressing stage three be slashed for disease.

The scientific rationale for the program is based on the association of Progressive kidney disease with attrition of the micro circulation of the kidney.

Preclinical studies in kidney disease and injury models have demonstrated that protection, where replenishment of the micro circulation results and improved kidney function.

Our proof of concept protocol provides for a staggered.

Sequentially dose cohort of six patients or.

We're seeing by an independent data safety monitoring board.

With the objective of determining the tolerance of intra renal cell therapy injection and diabetic kidney disease patients as well as the ability of C. L. P. S 201 to regenerate kidney function.

A key readout of the data will occur at the six month follow up visit for all patients and as previously announced the first patient was treated in this study of C. L. B S 201 in April of 2022, leading to top line data from all subjects expected by the first quarter of 2000.

23.

With that I will now turn the call back to Dr. Mazzo Dave.

Thanks Kristen.

We move onto Q&A I'd like to revisit our announcement and conference call of last week specific to our merger with <unk> therapeutics and the creation of <unk> Therapeutics, a new diversified therapeutics company that we believe will be well positioned for future growth and the generation of great value for patients as well as for shareholders I believe it's worthwhile to take a.

A moment to put this transaction into perspective.

In the current financial environment of high inflation disappointing earnings by Tech companies tightening availability of capital and socio political chaos.

According to Barron's the S&P 500 had its worst start to the year since 1939. Additionally, the XP and widely accepted measure of the biotech market's performance has mirrored that fourth performance and is down approximately 35% year to date and the aggregate enterprise value of the world's biotech.

<unk> is down approximately 70% since it peaked in February of 2021.

<unk> and follow on offerings are also down almost 100% on a year over year volume basis type transactions are exceedingly difficult if not impossible to consummate at this time and as of last week. There were 190 for life science companies with a negative enterprise value.

Meaning that they were trading with a market value of less than their cash holdings.

Finally, those microcap issuers that have been able to raise capital in the quarter are mostly doing so under the most painful or financial terms with warrant coverage on deals often exceeding 100% and many deals carrying 200% warrant coverage without a doubt these are challenging times and we believe that the company.

That will survive and ultimately thrive.

Those that control their own destiny by being proactive in addressing the headwinds that they face.

This was the spirit that collateral since been seeking to diversify and Derisk our development pipeline outside of cardiovascular autologous cell therapy, our merger with Sen Therapeutics will accomplish this goal we are truly excited about the prospects for success and defend our platform technology and difficult to treat cancers and look forward to work.

With our <unk> colleagues to rapidly advanced treatments based on this platform to the market to benefit cancer patients and our shareholders and with that operator.

Ready to take questions.

Thank you I'm, sorry, I might have to ask a question. Please press star followed by one on you touched on phone. Please ask only one question at a time and then be prepared to return to the queue for any additional questions.

Your first question comes from the line of Kumar Shah from Brooklyn cap. It Alex Your line is open.

Thanks for taking my questions.

We're waiting to update.

So with regard to ornate.

The pre consolidation meeting looks like that's going to happen very soon.

And my question was with regard to the <unk> guidance.

Will that be based on the interactions you will be having a pre consultation meeting.

Hello Kumar Thanks for joining the call and for the questions appreciate it and Youre actually right first the pre consultation meeting is expected to occur in the next several months, it's obviously dependent upon the scheduling as controlled by the <unk> and the pre consultation meeting is.

Part of the process Thats associated with the sakigake designation in which the regulatory authorities can get a preliminary look at data and provide us with direct guidance on how to presented amend it.

And potentially re fashion it such that the official consultation meeting when it occurs could proceed more smoothly and with a higher probability of a positive result, so so yes, we should come out of that meeting with clear guidance on how to proceed into the next.

Steps of the process, which would include ultimately consultation meetings with the T. M. D. H, but also some additional pre consultation meetings on the other parts of the Japanese new drug application, including the preclinical sections as well as the CMC sections.

Okay.

So finding a partner in Japan, what can you share with regard to that.

Well I can repeat what I've said.

Multiple times strengthening over the last year, we have had and have.

More than a half dozen companies, who remain in diligence and have expressed serious interest in the product assuming that.

Their decisions will be finalized once we get further guidance from the <unk>. So I expect that after the guidance from the pre consultation and then potentially as we move into the consultation phase.

As the regulatory authorities Express continued support for the program I think the chances of closing a transaction with the Japanese pharmaceutical company for <unk> increase overtime.

And in terms of C. L B, a stool one in BK D.

What's happening in this cleaning fine Dave.

Is the expectation that.

Wanted to a practice slide with the first two dose.

You will have the second patient ready to be dosed.

And.

Right.

Yes.

The protocol is designed with <unk> in all patients the first one.

Which has already been treated.

<unk>.

And actually.

Has the DMC has met for that patient and actually has approved us moving on to the to the next patient.

Patients will be receiving bilateral injections and in fact, the second patient was dosed today.

And now we will wait two weeks after that patient for the DMC review and if that patient does.

It does well and the DMC satisfied then we will move on to patients four through six but there will not be required.

Observation period of two weeks between each of them. So the remaining four patients will be dosed as quickly as they can be identified cash screening and go through the process of having manufacturing schedules.

Okay, great. Thanks, so much.

Thanks, so much.

Thank you. Our next question comes from the line of Atlanta, Wella brand Chatty from H C. Wainwright. Your line is open.

Good afternoon, everyone and thank you for taking the question.

One question around any of that for me as well.

So you just mentioned this package that.

But I was wondering.

You are going to be disclosing the topline data with the P. M D.

Wondering what is that.

Z for the <unk> to the public or are you waiting to disclose the data with <unk> in Libya.

What day guidance fees in past you kind of evaluate whether you can disclose this data.

Yes, Hi, Manuel it's nice to have you on the call as well. Thank you for the question.

I think you've answered your own question to some extent. This is an open label trials. So we have been providing I would say Tom.

Top line descriptive data all along not patient by patient data and we've announced that.

Trial is demonstrating the requisite trend toward.

Efficacy and the safety profile that we think satisfies the requirements for conditional approval for regenerative medicine product, but we've been very careful about reduce releasing the completed datasets to the public until we have a conversation with the Japanese regulatory authorities.

We don't want them to feel that our release of the information to the public as in any way intended to force their hand, one way or the other so it's a judgment call, but we will only release the full analysis. After we've spoken with the regulatory authorities and have their agreement that Duke.

So would not jeopardize the review of the product for registration.

Understood.

With regard to Donna you just mentioned about the enrollment activities that I just wanted to have a sense of.

While the U S.

We're seeing the effects of practical adjustment have you been able to add more sites at this point.

For the trial.

So when we I think it was at our last conference call. In fact, when we said we were going to be working to add additional sites. We have in fact added.

Some sites. This is this is a program that has been fraught with.

With obstacles, it's really frustrating for us and for the the sites and for the patients that want to participate and we've alluded to this in our press release as well as in our comments today. So initially we had the issue with with Covid and and <unk>.

Lack of available personnel and openings at sites.

And then the difficulty of patients to move around and the ability of patients to test the screening and have a negative COVID-19 test and then just as we started to add more sites and have made some arrangements. We found that the catheters that at least one of the major catheters from Philips that was used in the.

Coronary flow by Doppler technique.

Was discontinued and so we have to amend the protocol to allow for other means of measuring and diagnosing CMT and more recently, we've had at least one it may even be two of the catheters that are qualified to use for administration of the product.

Suffer supply chain issues and can't be found and so we're having to struggle with either re qualifying additional catheters. If we can actually find them and have adequate supply chain or scramble to move products.

Catheters from one site to another which is not always within our purview. So it's been a difficult time and.

And.

To answer your question directly we have added two sites.

But the addition of sites alone isn't going to solve our problems right now.

Got it thank you very much.

Thank you Emmanuel.

Thank you and your next question comes from the line of Pete Enderlin from MAZ Partners. Your line is open.

Hi, Thanks for taking the questions.

When will the proxy statements filed with the SEC for the deal.

Yeah.

It'd be nice to have you on the call again.

Our goal is to have the proxy statement filed.

Sometime by the end of May early June the rate limiting step in that is completion of some of the <unk>.

Financial audits and also the <unk>.

The management discussion and analysis in the compensation discussion and analysis that has to be contributed by <unk>. So.

They are on the critical path for forgetting those things to us in the current timeline.

Targets at the end of this month or early June for the first quarter filed a little more color on that.

<unk> stockholders or I mean, how many of them are there.

Is there some way to characterize them generally.

I can say that.

Yes.

So I'm not at Liberty to give specifics because they're a private company and so that's not might not.

Not my prerogative to give the information that I've received under confidentiality, but I can say that they are like many private companies that are a closely held private company there are less than 10.

Major shareholders with.

A half dozen or so holding the majority of the shares and that's divided among some founder shares some high net worth individuals and some health care funds.

And what's the.

Method for determining the exact ratio ownership I don't mean.

How it will turn out but what are the parameters that will go into that.

Yeah.

Well the parameters.

Will be described in detail in the S. Four in the proxy and they're the first of all they are based upon the valuations assigned to each company based upon the potential seen from a market perspective.

Whitley discounted for stage of development, they're looking at other assets that the company have including existing deals milestone set our expected cash on hand.

<unk> competitive positioning in the marketplace as well as any liabilities that would be there that might detract from from that and then once those calculations are done with all of those factors included it becomes simple math, it's just a ratio of outstanding shares.

Collagenase versus outstanding shares of <unk>.

Appropriately valued based upon that.

Final value of each company, but you can assume that it's going to be.

Essentially a merger of equals from evaluation perspective.

Are you using any investment bankers to do that.

Well, yes, there we had on our side.

Back Bay Life Science advisors.

Which was part of the.

The process and the evaluation process and they will also be providing the fairness opinion, which is required for a public company and on the send side. There is evercore, which is a similar boutique.

Investment Bank M&A.

M&A advisor, which is working with sand and they've collaborated with our attorneys as well as the legal advisors for <unk> to come up with an acceptable set of definitions the factors that go into the.

The calculation of the valuation ratio the math the formula if you will as well as any adjustment factors that would be considered at the time of closing.

Thanks.

You just give a little better sense of the broad applicability of the send our technology.

Just.

So that it could be used.

Conjunction with a lot of different cat.

Cancer therapies, immunotherapies and other kinds of chemotherapy.

How broadly could it be applied.

Well I think you've kind of answered your own question to some extent Pete.

Our expectation is that it will be applicable extremely broadly I mean, one of the things. That's so exciting about this technology is that it gives us it gives us the opportunity so think of things.

Send one as is.

The facilitator.

Two existing standards of care in really difficult solid to treat tumors and if you talk about pancreatic cancer <unk> cellular cancer gastric cancer colorectal cancer, a variety of breast cancers head and neck cancer. Some brain cancers. The list is quite long. These are cancers, where the current state of the art.

Current standard of care.

<unk>.

Relatively low response rates and the prognosis for patients.

It's pretty dire there.

Lifespan after diagnosis is relatively short.

Can improve that.

All of these different cancers with these standards of care.

Then you have the potential here for a really lucrative product and send one promises to be able to do that because as I said it facilitates the delivery of all of these different chemotherapeutic immuno therapeutics <unk> therapeutics.

Cellular therapeutics and facilitates that by opening up a.

Our conduit of Trans transport pathway, which is naturally existing himself, which typically.

Typically is used for nutrient transport, but we basically hijack that to open it up to allow other products to be moved and directed.

And done in a precision way directly to the tumor cells themselves and so we're looking to see this technology applied across a variety of cancers and in combination with a variety of different cancer.

Therapeutics and modalities of cancer treatment.

Would you say that that technology has a high level of.

Protection at this point.

Oh, yes, absolutely.

Okay and then.

Kristen said something.

Comments about.

Effective treatments at the right price and if I can make a little bit of an editorial comment.

The strategic partners.

Patient advocacy groups were not exactly beating down the door to get to your CD 34.

Programs so.

To what extent do you think that's a function of the pricing.

<unk> pricing for those those.

<unk>.

Could there be.

Difficult effort to substantially cut the price and thereby open up much wider potential markets.

So.

<unk>.

Go ahead, no no actually.

I don't disagree and to some extent the.

A colleague of cell therapies in general not just ours, but in general.

Suffer from the pre supposition that they're extremely expensive and extremely difficult from a logistic perspective too to distribute and administer.

It's not a fair assessment across the board, but it is something that <unk>.

Many people assume out of the box now in the case of our CD 34.

Autologous cell therapies, we've said many times that our process is simpler.

Faster.

And more economical than one might expect for other types of autologous cell therapies.

Compared the preparation of <unk> or.

<unk>.

In terms of cost and time to the preparation of some of the autologous immuno cellular therapies.

We're an order of magnitude less expensive.

And.

What's going to be I think.

The key to the success of these products is the demonstration to the satisfaction of the ultimate payers.

The cost to benefit ratio, which not only includes the therapeutic benefits, but the duration of benefit.

It's something that supersedes the cost to benefit ratio of existing therapies and that only comes from getting to the later stage trials, which ended up themselves are costly to to execute but.

But it's all going to be decided naturally as these products evolve into later stage clinical development and I think part of the reason that we.

We haven't seen.

Certain.

Partnerships occur yet is simply because we're waiting for definitive control the data that will give those potential partners the confidence that moving forward with a technology such as this would make sense for them commercially.

Yes. Thanks, that's very interesting thank you very much.

Thanks Pete.

Once again that Dolby star one for our questions.

I think this concludes our question and answer portion of the presentation and now I'll turn the call back to Dr. Mazzo for closing remarks, Sir.

Thank you Grace and again, thank you all for participating on today's call. We look forward to speaking to you again during our next quarterly conference call and to continuing to provide updates on our achievements and our progress, especially as it relates to the merger with <unk> Therapeutics, we remain grateful for your continued interest in and support.

The collages Biosciences, we wish you well and <unk>.

Have a pleasant evening, thank you very much.

Thank you so much presenters ladies and gentlemen. This concludes today's conference. Thank you all for joining you may now disconnect.

Okay.

Thank you.

[music].

Yeah.

[music].

Welcome to the Collegium Spy Sciences first part, it's finding financing for natural resource and a business update conference call. Currently all participants are in a listen only mode. Following management's prepared remarks, we will hold a Q&A session.

So that's a question at the time. Please press star followed by one Oh, Yes, that's don't telephone.

And finally, one has difficulty hearing the conference call. Please press star zero for operator assistance.

This call is being recorded today Thursday may five 2022, I will now turn the call over to John Mosquito, Vice President of Investor Relations and corporate communications at collector. Yes. Please go ahead.

Thank you operator, and good afternoon, everyone. Welcome to <unk> first quarter 2022 conference call to discuss our financial results and provide a business update joining me today from our management team.

Dr. David Mazzo, President and Chief Executive Officer, Dr. Christian <unk> Executive Vice President of research and development and Chief Medical Officer, and James <unk>, Vice President of Finance and Treasury.

Shortly before this call we issued a press release announcing our first quarter 2022 financial results, which is available under the investors and news section of the company's website.

Along with the webcast replay of this call. If you have not received this news release and you'd like to be added to the company's email distribution list. Please E Mail me.

Gerry do you do at collateral Dot com.

Carriage you to review the company's filings with the Securities and Exchange Commission, including without limitation its forms 10-Q.

8-K, and 10-K, which identify specific factors that may.

They cause actual results or events to differ materially from those described in the forward looking statements. Furthermore, the content of this conference call remains time sensitive.

Contains time sensitive information that is accurate only as of the date of this broadcast Thursday may five 2022.

During the first quarter, we continued to advance our CD 34 positive cell therapy development pipelines with the initiation of the proof of concept study for <unk> 201, and diabetic kidney disease. However, our most important achievement coming just after the quarter concluded was the culmination of our efforts to diversify and expand.

Your attractive partnerships.

The merged company will operate under the name of Lasantha Therapeutics Lossada for short and will focus on exploiting the full potential of sense Sundar platform technology products and a range.

Solid tumor oncology indications.

One the lead product candidate from this and our platform.

Has the potential to be combined with myriad chemo and immuno therapeutic agents and could become an integral part of a revised standard of care therapy for many difficult to treat cancers.

As a result.

We will be working diligently with <unk> and with you our shareholders to finalize the transaction and look forward to announcing the closing by our target of the end of the third quarter of this year as I Hope you can hear in my voice, we couldnt be more excited and motivated about the prospects that this merger will bring for patients and shareholders I now will turn the call over.

James <unk>, our vice President of Finance and Treasury to review and provide commentary on our first quarter 2022 financial results James.

Thanks, Dave I am pleased to join you today to present, a summary of our first quarter 2022 financial results.

Starting with operating expenses.

Research and development expenses for the three months ended March 31, 2022 were $3 3 million compared to $5 1 million for the three months ended March 31 2021.

Research and development activity in the current year period focused on the advancement of our ischemic repair platform and related too.

Expenses associated with efforts to continue execution and acceleration of enrollment of the freedom trial and.

Expenses associated with the planning preparation and initiation of the phase <unk> proof of concept trial for <unk> 201, as a treatment for diabetic kidney disease and.

Ongoing expenses for <unk> in critical limb ischemia and burgers disease in Japan associated with study closeout activities and preparation for the pre consultation meetings with at the MDA.

This increase was primarily due to an increase in fees associated with the review of potential strategic transactions.

Overall net losses were $4 2 million and $8 1 million for the three months ended March 31, 2022, and March 31 2021, respectively.

Turning now to our balance sheet and cash flow.

As of March 31, 2022, the company had cash cash equivalents and marketable securities of approximately $88 $5 million, which positions us well relative to the projected capital obligations for our existing development programs as well as our cash and investments balance.

At the time of closing of the merger with <unk>.

That completes the financial overview.

With that I will now turn the call over to our Chief Medical Officer, Dr. Christopher Buck for the review of our clinical development pipeline.

<unk>.

Thank you James and good afternoon, everyone.

<unk> is currently developing a set of autologous cellular therapies designed to treat or reverse disease.

Based on human clinical trial data generated to date, our therapies have shown strong signs of efficacy and durability with an excellent safety profile. Unlike many allogeneic therapies.

Importantly, we believe that curative cell therapy products when applied to the right indication and at the right price.

Can restore human health and potentially improve quality of life with a single administration as compared to a treatment that requires frequent re administration.

With that said, we have long recognized that the medical promise that we see does not correlate with the value ascribed to our pipeline as indicated in our share price.

This dichotomy was the basis for our quest to identify and secure additional development candidates.

With the strongest affinity ascribed to products that we believe hold great medical potential.

Current indications of high unmet medical need and where they can be positioned advantageously can be materially advanced in their development with mostly our existing capital and represent therapeutic areas that had been historically attractive to investors.

Our merger with <unk> allows us to kick all our requirement boxes and I'm personally thrilled to become involved in the development of descent product pipeline.

With that as a general introduction I will now expand on each of the collateral clinical programs in numerical order.

Kicking off with C. L. B S 12, Nedra in Japan, our product candidate for the treatment of critical limb ischemia and burgers disease.

Kentucky designation is akin to the regenerative medicine advanced therapy designation Werent armet designation in the United States.

Socket Gawky designation affords the recipient prioritized regulatory consultation a dedicated review system to support the development and review process.

<unk> the option of a rolling registration submission.

As well as a reduced review time of six months.

The registration once filed.

Additionally, under Japan's regenerative medicine legislation products, such as who are eligible for conditional approval and possibly full approval in Japan.

Based on the assessment of the data from the trial.

Our trials designed intellect direct collaboration with the Japanese pharmaceutical and medical devices agency known as P. M D. A.

Note that conditional approval of a regenerative medicine product.

Only requires the demonstration of a trend towards therapeutic effect together with acceptable safety.

Further the sakigake designation is a highly sought regulatory classification in Japan.

And we hope that this.

Coupled with positively trending data from our trial will make <unk>, an attractive product for parking partnering to a Japanese pharmaceutical company.

The company's study of <unk> in Japan for the treatment of critical limb ischemia and burgers disease has shown positive results to date.

The initial responses observed in the subjects, who have reached an endpoint in this study are consistent with our expectations of therapeutic effect and safety based.

Based on previously published clinical trials in Japan, and the United States.

As discussed in prior quarters, we have suspended our enrollment efforts to minimize the operational.

And financial burden that we have incurred and continued to incur due to enrollment delays and the lack of visibility on the time to completion.

Existing data to the Japanese regulatory authorities.

And in upcoming clinical pre consultation meeting with the PMT a.

Topline results from this study will be presented and discussed and.

And we expect that they will provide important perspective to be considered in preparation for the formal consultation meetings, which precede the Japanese new drug application.

Turning now to XOMA were <unk> 16 for the treatment of <unk>.

Coronary microvascular dysfunction or CMT.

CMT is a disease that continues to be under diagnosed and potentially afflicts millions annually, a vast majority of whom are female with no current treatment options.

In May of 2020, Collagenase announced the full data results from the phase Iia escape CMT trial, showing a highly statistically significant improvement in coronary flow reserve.

Correlating with symptom relief for patients with CMT after a single intra coronary injection I think zona.

The Frito trial is a double blind randomized placebo controlled trial designed to corroborate the results of the escape CMT trial, while assessing the efficacy and safety of delivering autologous CD 34 positive cells, our XOMA product the subjects with CMT and without constructive.

Coronary artery disease.

Initially investigator and potential subject response to the freedom trial was favorable and early enrollment in the trial proceeded as planned with the first patient treated in January of 2021.

Have made and continue to make enrollment much slower than originally predicted and challenging to accelerate.

Collagenase is taken steps to accelerate enrollment by expanding the number of participating investigational sites as well as modifying the study protocol to make study inclusion criteria more flexible.

We are continually monitoring study progress and we will consider additional future protocol and or execution all changes as appropriate.

Lastly, our most recently proposed development program C. L. B S 201 for the treatment of diabetic kidney disease or D. K D.

The company initiated a phase one open label proof of concept trial evaluating C. L. B S 201.

CD 34 positive regenerative cell therapy investigational products for intra renal artery administration in patients with diabetic kidney disease.

Development program focuses on patients that exhibit rapidly progressing stage three be slashed for disease.

The scientific rationale for the program is based on the association of Progressive kidney disease with attrition of the micro circulation of the kidney.

Preclinical studies in kidney disease and injury models have demonstrated that protection or replenishment of the micro circulation results and improved kidney function.

Our proof of concept protocol provides for a staggered.

Sequentially dose cohort of six patients.

We're seeing by an independent data safety monitoring board.

With the objective of determining the tolerance of intra renal cell therapy injection and diabetic kidney disease patients as well as the ability of C. L. P. S 201 to regenerate kidney function.

A key readout of the data will occur at the six month follow up visit for all patients and as previously announced the first patient was treated in this study of C. L. D. S 201 in April of 2022, leading to top line data from all subjects expected by the first quarter of 2000.

23.

With that I will now turn the call back to Dr. Mazzo Dave.

Thanks, Kristen before.

Before we move onto Q&A I'd like to revisit our announcement and conference call of last week specific to our merger with <unk> therapeutics and the creation of Lasalle Therapeutics, a new diversified therapeutics company that we believe will be well positioned for future growth and the generation of great value for patients as well as for shareholders I believe it worthwhile.

To take a moment to put this transaction into perspective.

The current financial environment of high inflation disappointing earnings by Tech companies tightening availability of capital and socio political chaos.

According to Barron's the S&P 500 had its worst start to the year since $19 39. Additionally, the Spi and widely accepted measure of the biotech market's performance has mirrored that fourth performance and is down approximately 35% year to date and the aggregate enterprise value of the world's biotech sector.

<unk> was down approximately 70% since it peaked in February of 2021.

IPO and follow on offerings are also down almost 100% on a year over year volume basis pipe transactions are exceedingly difficult if not impossible to consummate at this time and as of last week. There were 190 for life science companies with a negative enterprise value meaning.

That they were trading with a market value of less than their cash holdings.

Finally, those micro cap issuers that have been able to raise capital in the quarter are mostly doing so under the most painful or financial terms with warrant coverage on deals often exceeding 100% and many deals carrying 200% warrant coverage without a doubt these are challenging times and we believe that the companies.

That will survive and ultimately thrive are those that control their own destiny by being proactive in addressing the headwinds that they face.

Is this spirit that collateral since been seeking to diversify and Derisk our development pipeline outside of cardiovascular autologous cell therapy, our merger with Sen Therapeutics will accomplish this goal we are truly excited about the prospects for success and to send our platform technology and difficult to treat cancers and look forward to working.

With our <unk> colleagues to rapidly advance treatments based on this platform to the market to benefit cancer patients and our shareholders and with that operator, we're ready to take questions.

Thank you I'm, sorry, I might have to ask a question. Please press star followed by one on your Touchtone phone. Please ask only one question per listener.

And then be prepared curious reenter the queue for any additional questions.

Your first question comes from the line of Kumar Shah from Brooklyn cap. It Alex Your line is open.

Thanks for taking my questions.

We're waiting the update.

So with regard to ornate.

The pre consolidation meeting looks like that's going to happen very soon.

And my question was with regard to the B M B a guidance.

Will that be based on the interactions you will be having this pre consultation meeting.

Hello Kumar Thanks for joining the call and for the questions I appreciate it and Youre absolutely right first the pre consultation meeting is expected to occur in the next several months. It's obviously dependent upon the scheduling is controlled by the <unk> and the pre consultation meetings is.

Steps of the process, which would include ultimately consultation meetings with the <unk>, but also some additional pre consultation meetings on the other parts of the Japanese new drug application, including the preclinical sections as well as the CMC sections.

Okay.

Films are finding a partner in Japan, what can you share with regard to that.

Well I can repeat what I've said.

Multiple times shrinking over the last year, we have had and have.

More than a half dozen companies, who remain intelligence and have expressed serious interest in the product assuming that.

As the regulatory authorities Express continued support for the program I think the chances of closing the transaction with the Japanese pharmaceutical company for how Natura increase overtime.

And then Dom South Seattle School, one in BK D.

What's happening in the cleaning fine Dave.

If the expectation that one fewer practice acquired with the first two dose.

You will have the second patient ready to be dosed.

And exactly right.

Yes.

The protocol is designed with two Sentinel patients the first one.

Which has already been treated.

And.

And actually.

Has the DMC has met for that patient and actually has approved us moving on to the to the next patient the second patient will be receiving bilateral injections and in fact, the second patient was dosed today.

And now we will wait two weeks after that patient for the DMC review and if that patient.

It does well and the DMC satisfied then we will move on to patients four through six but there will not be required.

Okay, great. Thanks, so much.

Thanks, so much.

Thank you and your next question comes from the line of M. I know a lot of Brent <unk> from H C. Wainwright. Your line is open.

Good afternoon, everyone and thank you for taking the question.

One question around any of that for EMEA as well.

So you just mentioned that.

But I was wondering.

We're gonna be disclosing the topline data with the P. M. D. A I was wondering what is that.

<unk> for the <unk> to the <unk> or are you waiting to disclose the data we get the NDA in Libya.

What day their guidance fees in past you can evaluate whether you can disclose this data.

Yes, Hi, Matt Manuel it's nice to have you on the call as well. Thank you for the question.

I think you've answered your own question to some extent. This is an open label trials. So we have been providing I would say Tom.

Topline descriptive data all along not patient by patient data and we've announced that.

Trial is demonstrating the requisite trend toward.

Efficacy and the safety profile that we think satisfies the requirements for conditional approval for regenerative medicine product, but we've been very careful about releasing releasing the completed datasets to the public until we have a conversation with the Japanese regulatory authorities.

So would not jeopardize the review of the product for registration.

Understood.

With regard to Donna you just mentioned about the enrollment activity.

Just wanted to have a sense of.

While there are U S.

Seeing the effects of practical adjustment have you been able to add more sites at this point.

For the trial.

So when we I think it was at our last conference call. In fact, when we said we were going to be working to add additional sites. We have in fact added.

Some sites. This is this is a program that has been.

Been fraught with.

<unk> and <unk>.

Lack of available personnel and openings at sites.

And then the difficulty of patients to move around and the ability of patients to the test screening and have a negative COVID-19 test and then just as we started to add more sites and have made some arrangements. We found that the catheters at least one of the major catheters from Philips that was used in the.

Coronary flow by Doppler technique.

It was discontinued and so we have to amend the protocol to allow for other means of measuring and diagnosing <unk> and more recently.

Had at least one it may even be two of the catheters that are qualified to use for administration of the product.

Suffer supply chain issues and can't be found and so we're having to struggle with either re qualifying additional catheters. If we can actually find them and have the adequate supply chain or scramble to move products.

It is from one site to another which is not always within our purview. So it's been a difficult time and.

And.

To answer your question directly we have added two sites.

But the addition of sites alone isn't going to solve our problems right now.

Got it thank you very much.

Thank you Emmanuel.

Thank you and your next question comes from the line of Pete Enderlin from MAZ Partners. Your line is open.

Hi, Thanks for taking the questions.

When will the proxy statement be filed with the SEC for the deal.

Nice to have you on the call again.

Our goal is to have the proxy statements filed sometime by the end of May early June the rate limiting step in that is completion of some of the.

Financial audits and also the the management discussion and analysis in the compensation discussion and analysis that has to be contributed by <unk>.

No.

They're there on the critical path for forgetting those things to us in the current timeline.

Targets at the end of this month or early June for the that's for this.

A little more color on that.

Who the <unk> stockholders or I mean, how many of them are there.

Is there some way to characterize them generally.

I can say that.

So I'm not at Liberty to give specifics because they're a private company and so thats not Mike.

Our major shareholders with.

Half dozen or so holding the majority of the shares.

And that's divided among some founder shares some high net worth individuals and some health care funds.

And what's the.

Method for determining the exact ratio ownership I don't mean.

It will turn out but what are the parameters that will go into that.

Well the parameters.

<unk> will be described in detail in the S. Four in the proxy and they're the first of all there based upon the valuations assigned to each company based upon the potential seen from a market perspective appropriately discounted for stage of development, they're looking at other asked.

First with the company have including existing deals milestone set or expected cash on hand.

Collagenase versus outstanding shares of <unk>.

Appropriately valued based upon that.

The final value of each company, but you can assume that it's going to be you know.

Essentially a merger of equals from a valuation perspective.

Are you using any investment bankers to do that.

Well, yes.

We had on our side.

Back Bay Life Science advisors, which was part of the.

The process and evaluation process and they will also be providing the fairness opinion, which is required for a public company and on the send side. There is evercore, which is a similar boutique.

Investment Bank.

M&A advisor, which is working with sand and they've collaborated with our attorneys as well as the legal advisors <unk> to come up with an acceptable set of definitions the factors that go into the.

The calculation of the valuation ratio the math the formula if you will as well as any adjustment factors that would be considered at the time of closing.

Thanks.

Just give a little better sense of the broad applicability of the send our technology.

Just that it's something that it could be used.

Injunction with a lot of different.

Cancer therapies, immunotherapies and other kinds of Chemotherapies and stuff, but how broadly could it be applied.

Well I think you've kind of answered your own question to some extent Pete but our expectation is that it will be applicable extremely broadly I mean, one of the things. That's so exciting about this technology is that it gives us it gives us the opportunity so think of think of ups.

Send one as as the facilitator.

Two existing standards of care in really difficult solid to treat tumors and if you could talk about pancreatic cancer <unk> cellular cancer gastric cancer colorectal cancer, a variety of breast cancers head and neck cancer. Some brain cancers. The list is quite long. These are cancers, where the current state of the art.

The current standard of care.

As you know.

Relatively low response rates and the prognosis for patients is pretty dire there.

Lifespan. After diagnosis is relatively short if you can improve that.

All of these different cancers with these standards of care.

Then you have.

Essentially here for a really lucrative products and send one promises to be able to do that because as I said it facilitates the.

The delivery of all of these different chemotherapeutic immuno therapeutics.

RNA therapeutics potentially cellular therapeutics and facilitates that by opening up a.

Our conduit of Trans transport pathway, which is naturally existing himself, which.

<unk> is used for nutrient transport, but we basically hijack that to open it up to allow other products to be moved and directed.

Therapeutics and modalities of cancer treatment.

And would you say that that technology has a high level of IP protection at this point.

Oh, yes, absolutely.

Okay and then.

Kristen said something.

Comments about.

Effective treatments at the right price.

I can make a little bit of an editorial comment.

The strategic partners.

Patient advocacy groups.

Not exactly beating down the door to get to your CD 34.

Programs so to.

To what extent do you think that's a function of the pricing potential pricing of those those products.

Could there be a cigna.

Significant effort is to substantially cut the price and thereby open up much wider potential markets.

So the autologous.

Go ahead, no no actually.

I don't disagree and to some extent.

<unk>.

<unk> cell therapies in general not just ours, but in general suffered suffer from the pre supposition that they're extremely expensive and extremely difficult from a logistics perspective too to distribute and administer that's not a fair assessment across the board, but it is.

Something that.

Many people assume out of the box now in the case of our CD 34.

Autologous cell therapies, we said many times that our process is simpler.

SaaS there.

And more economical than one might expect for other types of autologous cell therapies.

If you compared the preparation of <unk> or.

<unk>.

In terms of cost and time to the preparation of some of the autologous immuno cellular therapies.

We're an order of magnitude less expensive.

And.

What's going to be I think.

The key to the success of these products is the demonstration to the satisfaction of the ultimate payers.

The cost to benefit ratio, which not only includes the therapeutic benefits, but the duration of benefit.

It's something that supersedes the cost to benefit ratio of existing therapies and that only comes from getting to the later stage trials, which ended up themselves are costly to to execute but.

But it's all going to be decided naturally as these products evolve into later stage clinical development and I think part of the reason that we.

We haven't seen.

Certain.

Hartner shifts occur yet is simply because we're waiting for definitive controlled data that will give those potential partners the confidence that moving forward with a technology such as this would make sense for them commercially.

Thanks, that's very interesting thank you very much.

Thanks Pete.

Once again that will be star one for a question.

I think this concludes our question and answer portion of the presentation and now I'll turn the call back to Dr. Mazzo for closing remarks, Sir.

Progress, especially as it relates to the merger with <unk> Therapeutics, we remain grateful for your continued interest in and support of collages Biosciences, We wish you well and <unk>.

Have a pleasant evening, thank you very much.

Thank you so much presenters ladies and gentlemen. This concludes today's conference. Thank you all for joining you may now disconnect.

Q1 2022 Caladrius Biosciences Inc Earnings Call

Request a DemoDemo

LSTA

Lisata Therapeutics

Earnings