Q1 2022 Synthetic Biologics Inc Earnings Call
Greetings and welcome to synthetic biologics first quarter 2022 earnings conference call.
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Please go ahead Sir.
Yeah.
Thank you operator, and good morning, everyone welcome to synthetic biologics 2022 first quarter Investor Conference call.
Leading the call today will be Steven Shallcross, Chief executives and Chief financial officer of synthetic biologics.
Doctor Vince wait your head of corporate and product development of synthetic biologics Doctor Menel kits Ghio General director of synthetic Biologics European subsidiary and Doctor Frank Tafaro, Chief Operating Officer Officer are also on the call and will be available to answer questions. During the Q&A session.
Synthetic biologics issued a press release this morning, which provided operational highlights and included the financial results for the first quarter ending March 31 2022.
The press release can be found in the investors section of the company website at Www Dot synthetic biologics dotcom together with the quarterly report on Form 10-Q for the quarter ended March 31st 2022, which we plan to file today with the Securities and Exchange Commission or S. E T.
In addition to the phone line. This call is being streamed live via webcast, which will be archived on the company website www dot synthetic biologics dot com for 90 days.
During this call certain forward looking statements regarding synthetic biologics N V C N biosciences current expectations and projections about future events will be made.
Generally the forward looking statements can be identified by terminology such as May should expects anticipates intends plans believes estimates and similar expressions. These statements are based upon current beliefs expectations and assumptions and are subject to a number of risks and uncertainties.
Including those set forth in synthetic biologics filings with the FCC, many of which are difficult to predict.
No forward looking statements can be guaranteed and actual results may differ materially from such statements. The information on this call is provided only as of the date of this call and synthetic biologics undertakes no obligation to update any forward looking statements contained on this conference call on account of new information future events.
Or otherwise, except as required by law with that I'd like to turn the call over to Steve Steve.
Thanks Dean.
Good morning, everyone and thank you for joining our 2022 first quarter Investor Conference call.
The onset of 2022 was marked by the successfully completed acquisition of V. C. N Biosciences, a privately held clinical stage biotech company focused on developing a new uncle lytic adenovirus or Ob platform.
The acquisition transformed synthetic biologics pipeline with the addition of V. C N lead clinical stage drug candidates B C. N O one as well as preclinical stage V. C. N 11, both of which are next generation Arkalyk Adenoviruses designed to break down the tumor stroma.
Through the expression of Colorado days.
This differentiating mechanism of action is intended to improve the ni tumor effect of both the oncologic virus and co administered chemotherapies and immuno oncology products.
Importantly, degrading the stroma can expose tumor antigens, turning cold tumors hot and enabling a sustained anti tumor response by leveraging the patient's own immune system.
As part of this acquisition and to support our extension into oncology. We're pleased to welcome Dr. Frank The Ferro as Chief operating officer and Dr. Mendell, because colo one of the founders of V. C. N is general director of Europe , both bring extensive expertise in arkalyk adenoviruses and are uniquely suited to <unk>.
Support our transformative clinical development strategy.
Additionally, we recently formed a scientific advisory board of key opinion leaders to advance our oncology pipeline.
These distinguished leaders have made groundbreaking scientific advances in their respective fields of oncology immunology gene therapy, ophthalmology and tumor virology and we look forward to their counsel as we advance our <unk> development program to address devastating cancers with high unmet need.
<unk>.
This is an important phase of synthetic biologics evolution and with our strengthened leadership team recently formed scientific Advisory Board and expanded differentiated pipeline. We believe we are well positioned to deliver a nearing pivotal milestones.
I would now like to provide an overview of our pipeline and walk you through key updates.
Our lead in college product P. C. N O. One is the next generation Ob designed for intravenous intra tumoral <unk> delivery.
We see no one has been administered to 70 to cancer patients in four phase one clinical studies to date with a focus on pancreatic ductal adenocarcinoma also known as <unk> and retinoblastoma.
As a reminder, V C N O. One was granted orphan drug designation in 2011 by the European Medicines agency for the treatment of <unk> and was granted orphan drug designation by the FDA in February this year for the treatment of retinal blastoma.
If V C. N O. One is approved by the FDA orphan drug designation provides critical marketing exclusivity and we plan to take full advantage of the development benefits to which we are eligible under the orphan drug act, including tax credits reduced user fees and again.
Market exclusivity.
We are highly encouraged by the regulatory support in the promising clinical safety and efficacy data generated to date.
In March of 2022.
We announced the publication of our Phase one study investigating the safety and Tolerability of intravenous V. C. N O one administered to patients with solid tumors, including pancreatic cancer.
The multicenter open label dose escalation study reported in the journal for immunotherapy of cancer was divided into three parts.
In part one we see no one was administered intravenously as a single agent to patients with solid tumors.
Parts, two and three B C. N O. One was administered intravenously in combination with the standard of care chemotherapy regimen of Gen side, I mean, plus Nab paclitaxel in patients with locally advanced or metastatic Unresectable P deck.
In part two we see no one was administered on the same day as the first dose of chemotherapy known as the kind of comedy regimen and in part three B C. N O. One was administered seven days prior to the first dose of chemotherapy known as the sequential regimen.
The objective was to determine the maximum tolerated dose the recommended phase two dose and dose limiting toxicity.
The results from the publication provide value dose binding context and support for IV V. C. N O one administered using the sequential dosing regimen.
The encouraging biological and clinical data from this study underscore V. C. N O one differentiated mechanism of action and suggest that treatment of cancer patients with V. C. O N O. One is feasible and has an acceptable safety profile.
We look forward to leveraging these findings and initiating our planned phase two clinical study of intravenous V. C. N O. One in combination with Gen side of me and Deb Paclitaxel the standard of care chemotherapy as a first line therapy and newly diagnosed patients with metastatic P deck we.
We expect to initiate the phase two study in the fourth quarter of 2022.
As a reminder, the proposed randomized multi center open label Phase II clinical study is projected to enroll up to 92 adults with P deck. It will be conducted across sites in the U S and Europe .
The study, which is not yet been agreed to by regulators is designed to have two treatment arms in arm one patients will receive gen side in India Paclitaxel the standard of care chemotherapy.
In arm two patients will receive B C. N O one administered seven days prior to Gen side of being in Nab Paclitaxel.
It is proposed that two doses of V. C. N O one will be administered approximately three months apart.
Primary endpoint for this study may include overall survival and safety and Tolerability.
Additional endpoints may include progression free survival objective response rate and measures of bio distribution virus replication immune response.
Since this is anticipated to be a two arm open label study we plan to monitor the studies progress very closely and May try to accelerate the clinical program is supported by the emerging data.
The study will be led by Dr. Manuel Hidalgo and internationally renowned physician scientist academic and the chief of the division of Hematology and medical oncology at wheel Cornell Medicine, New York Presbyterian Hospital.
Now moving on to our planned clinical study in advanced Retinoblastoma.
We believe <unk> holds tremendous progress and promise as a novel rescue therapy for patients, who fail standard therapy or as an adjunct to chemotherapy to improve outcomes for these patients.
We are working closely with key opinion leaders to finalize the protocol for a phase two three study of inter vitro DCNR, one to treat vitreous seeds and children with retinoblastoma.
There is no current regulatory guidance for the development of Retinoblastoma medicines. So we will be working closely with regulators Tory agencies to determine the appropriate study endpoints and pave the way for the development of new treatment options to address this large unmet need.
The phase two three study of <unk>, one is expected to initiate in early 2023.
In addition to the planned company sponsored studies and <unk> and Retinoblastoma V.
<unk> one is undergoing evaluation and number of investigator sponsored studies, including a study at the University of Pennsylvania, combining V. C. L. One wood missile dealing directed car T cell therapy in pancreatic and ovarian cancer patients and a study at the universe.
The city of leads in patients with high grade brain tumors.
We look forward to a number of potentially exciting upcoming milestones from the plan diverse V. C. N O one clinical programs over the next 12 to 24 months.
Our next product candidate VC and 11 is a modified version of V. C. N O. One that incorporates our proprietary albumin binding domain and the viruses outer shell.
B C and 11 is designed to improve systemic delivery by enabling the virus ducote itself with host serum albumin and prevent and activation by antiviral neutralizing antibodies.
I N D. Enabling studies are being planned and are expected to commence following the completion of ongoing preclinical studies and CMC activities.
Earlier this month, we announced that our abstract NBC and 11 was selected for an oral presentation at the upcoming 2015 annual meeting of the American Society of gene and cell therapy or a S. G C T.
The conference will be held virtually and in person starting today and continuing through may 19th in Washington D. C.
The presentation at a S. G. C. T. This evening will include preclinical results showcasing the potential of VC and 11 to balance safety and effectively target tumors by evading neutralizing antibodies after intravenous re administration.
We look forward to building upon our foundation of compelling proof of mechanism data and continuing to advance our V C and 11 program through clinical development.
In parallel we.
We will drive our Ob programs forward clinical development for <unk> for <unk> and 'twenty continues to progress.
Washington University continues to screen and enroll patients in our phase one b to a clinical study of syn for ore write backs amaze and allogeneic hematopoietic cell transplant or H C. T recipients for the prevention of acute graft versus host disease and bone marrow transplant patients.
The phase <unk> study is designed to assess the feasibility of using <unk> for in this specific patient population and to provide key information requested by the FDA regarding the safety and Tolerability of <unk> four in patients with impaired intestinal barrier function.
Last year, we announced that enrollment and patient dosing had commenced in the first of three sequential antibiotic cohorts that will each be administered a different IV beta lactam antibiotic to treat fever following conditional therapy.
In total eight participants in each cohort will receive syn <unk> and four will receive placebo.
To date, we have dosed 70 patients 11 that are currently considered available in the study.
One more available patients required to complete the cohort.
If enrollment proceeds on the current schedule will be position to announce topline data from the first cohort in the second half of 2022.
We have also advanced our <unk> 'twenty intestinal alkaline phosphatase program and recently reported positive safety data from the phase one a multiple ascending dose or Mad study in healthy volunteers.
The phase one Mad study enrolled 32 healthy adult volunteers into four cohorts within 20 administered orally in doses ranging from five milligrams to 75 milligrams twice daily for 14 days with a follow up evaluation at day 35.
Each cohort included six subjects, who receives in 'twenty and two who received placebo.
Analysis of preliminary data demonstrated that syn <unk> maintained a favorable safety profile and was well tolerated across all dose levels.
There were a few treatment related adverse events and all were grade one and resolved without medical intervention.
Since <unk> 'twenty levels were also below the limit of quantification in all plasma samples at all time points during the study.
Additionally, all analysis.
Is underway, including fecal levels of say in 'twenty and anti drug antibody levels and again this data will be available in the near future.
These phase one data support the development of Syn, <unk>, 'twenty and multiple clinical indications targeting disorders stemming from gastrointestinal and inflammation.
We will continue to explore the therapeutic potential of <unk> 'twenty across indications, including silly if disease, non alcoholic fatty liver disease and age related metabolic and inflammatory diseases.
Contingent on funding, we expect to initiate a phase Iia study in the second half of 2022.
As part of our strategic transformation, we are exploring value, creating options around our sin for ensign 20 assets, which have significant potential opportunity in non oncology indications.
We are currently evaluating the path the best path forward for these assets and whether to advance these programs internally or out licensing or partnering.
Yes.
As we look to the year ahead, the projected progress of our clinical development pipeline is expected to deliver numerous upcoming milestones that have the potential to drive significant value for shareholders.
Key near term clinical milestones over the next six months include the initiation of <unk> dosing and the investigator sponsored study of brain tumors at the University of Leeds.
The initiation of <unk> dosing in combination with Mesothelin directed car T cells and the investigator sponsored study in pancreatic and ovarian cancer at the University of Pennsylvania.
And during the second half of 2022, we expect to initiate key clinical trials, including the phase II study of <unk> in pediatric patients a data readout from the first cohort of this enforced study an allogeneic acte's patients and again contingent upon funding a phase two study of <unk> in 'twenty.
<unk>.
Additionally, we anticipate the initiation of a phase two three study of <unk> in retinoblastoma in early 2023.
Now I'd like to turn briefly to our financial results for the three months ended March 31 2022.
General and administrative expenses increased to $1 $7 million for the three months ended March 31, 2022 from $1 4 million for the three months ended March 31 2021.
This increase of 17% is primarily comprised of increased consulting and legal costs related to the V. C N N their acquisition.
Higher insurance cost audit fees and public a recent relations expenses and VC and administrative expenses not included in the prior year.
The charge related to stock based compensation expense was $85000 for the three months ended March 31, 2022 compared to $82000 for the three months ended March 31 2021.
Research and development expenses increased to $2 6 million million dollars for the three months ended March 31, 2022 from approximately $1 $1 million for the three months ended March 31 2021.
This increase of 132% is primarily the result of higher manufacturing expense for Syn <unk> 'twenty cost incurred related to our phase <unk> clinical trial of <unk> and 'twenty and phase one b to a clinical trial of Syn <unk> and allogeneic <unk> recipients.
And BCN research expenses related to V C N O one not incurred in the prior year.
We anticipate research and development expense to increase as we planned for and initiate enrollment for our phase two clinical trial for <unk> and <unk> phase two three clinical trial in retinoblastoma expand GMP manufacturing activities for V. C N O one and in 'twenty and <unk>.
<unk> with supporting RBC and 11 in other preclinical and discovery initiatives.
The charge related to stock based compensation expense was $28000 for the three months ended March 31, 2022 compared to $19000 related to stock based compensation expense for the three months ended March 31 'twenty one.
Other expenses was $21068 for the three months ended March 31, 2022 compared to income of $347 for the three months ended March 31, 2021. Other expenses, primarily composed of exchange losses of 22000 and $607 offset by interest income.
<unk> hundred $39.
Cash and cash equivalents totaled $56 $7 million as of March 31, 2022, a decrease of $10 5 million from December 31 2021.
Yes.
With an advanced clinical pipeline and a strong cash position, we are more excited than ever about the outlook for the company.
We look forward to providing further updates as we advance our technologies and products.
With that said, we're happy to take some questions.
Thank you.
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Questions.
Okay.
Our first question is from the line of Jim Molloy.
Alliance Global partners. Please go ahead.
Hi, Good morning. Thank you for taking my questions I know in the past you've discussed a potential partners, particularly for Syn <unk> for <unk>.
I guess for you across the board.
Speak a little bit about.
Can you characterize perhaps out of the partnership landscape looks given.
The buzz that everyone's going through.
First part of the year.
Uhm changes has that increased or decreased the opportunities for partnership.
So one of them one of our strategies all along Jim was to make sure we had sufficient clinical data that would be necessary to advance partnering discussions. So in the case of syn for we need to get through this wash use study and generate.
The data necessary so.
So that we can reengage with folks who have expressed interest in the asset.
So those discussions will commence once that trial ultimately is completed and actually after this first cohort is completed we will have a good read on whether or not we're backs amazes systemically absorbed we don't believe it will be but after we have those initial data.
Think we'll be able to reengage with the folks that have previously expressed interest on this in 'twenty side as I as I said last quarter, we have.
We have interested parties plural.
And in some cases, we continue to have discussions and go through diligence activities.
And I.
I would say that the two phase ones gave us a sufficient amount of safety data that I think gives comfort to the folks that we've been having discussions with and as you know in keeping with practice in the past once those discussions moved far enough long and we have something that.
As legally binding will we'll talk about it at that time.
Yeah.
Understood.
We see an acquisition you're.
In early 'twenty, two we're closing the closing that down excellent work.
Are you guys still on the hunt for additional opportunities can you characterize how that looks for potential additional acquisitions going forward.
Well I think it's safe to say, we have our plate pretty full right now so although there could be some interesting.
Things to add into the portfolio in the future right now the focus is totally on.
Getting the <unk> trial initiated in the fourth quarter and as we said, we're really excited about the opportunity to develop a clinical program for retinoblastoma there.
As I mentioned in my our comments there is there is no treatment today, that's approved for retinoblastoma. So we clearly have an opportunity to be pioneers in this area. So we're very excited about getting these two trials underway and to continue our work on <unk>.
<unk> four which as you know that trial is still ongoing and then.
We will evaluate our options as it relates to us in 'twenty.
The bottom line here is we're well financed we've got sufficient cash that allows us to advance all of these programs that I discussed today and that cash carries us at least through 2023 without having to go back to the market. So we're in really really good shape financially.
And maybe final question I know that.
Obviously the <unk>.
Car T with U Penn the brain tumor University of Leeds.
How is the enrollment environment going.
And then obviously you Didnt you can add.
The <unk> and retinoblastoma coming up later how's the enrollment environment going currently and how I know it can be a challenge sometimes working with them.
We are working with.
Third parties to get them to focus on.
Perhaps.
Getting trials up and running how has that been going through.
The partnership on getting you know.
Given your trials priority and getting patients in there.
So I can tell you that the relationships with both leads and new Penn are outstanding we are in constant.
Communication with both of the organizations.
We know that both trials are screening patients for enrollment.
And once once we're in a position where the patients are pass all the screening criteria and they've been enrolled and dosed at that point in time, we'll we'll put the announcements out.
Excellent. Thank you for taking the questions.
Okay.
Thank you next.
Next question is from the line of.
Jason Mccarthy with Maxim Group. Please go ahead.
Hi, This is Joanne me on the call for Jason Mccarthy, Thanks for taking the question.
For the metastatic PDOC study initiating later this year could you just share what kind of data is expected to be seen in terms of overall survival, which you mentioned could be the primary endpoint for.
We can one competitive treatment arm just standard of care what will be considered a successful I'll comment maybe if you could briefly remind us with some of the key findings from phase one are that help shape. The design for the upcoming study. Thank you.
Yeah, I'll, let <unk> take that question. Thank you.
Hi, Yeah, what we have to find that overall survival.
The primary endpoint of our phase II pancreatic trial, because that's probably the more powerful tool.
Just to get a read.
He also hands off the activity of the product and that's probably that paved the road for approval of the product later.
In our phase one trial, we have observed that in the sequential arm that has some more pricing in desktops clinical activity without <unk>.
Our overall survival of 20 months four O pointed at March towards the.
Higher dose treated group.
And this obviously thats, a small goerke and what we think that could be broadly.
Sure.
Significantly in this space to play out probably trying to to have our overall survival around 15 months that that's basically what Manuel you talked about anticipating as a relevant and now bar in the space to trial and we are pretty comprehended, we can reach the spine, but obviously, we need to collect the data as soon as possible.
Yeah.
Got it thank you for that and just as a brief follow up to that what is the expected timing for now come with our regulators on getting the trial design.
So we have right now are very close to the submission. So we expect the submit the IMD to F. D. A broadly meet next this year sorry.
So we suspect and shaping our recruitment of this trial by the last quarter of 2022 and that obviously depends on what's going to be the recruitment rate, but probably a respect of having the enrollment complete by ending next year probably.
Great. Thank you for the details and taking my question guys.
Thank you.
Thank you.
Next question is from the line of Lee.
And from Galicia.
It is open please go ahead.
Good morning, Thanks for the update and I wanted to ask if you were maybe a member of your team could review with us the intellectual property.
Surrounding the BCN assets, maybe you could share just what the key protections are on these kind of one and to live and then perhaps any further.
Further our protections around the albumin coating.
Platform.
Every technology that that could be used for other programs in the future. Thank you.
Okay, Okay, Leila and I'll, let Matt and I will have that as well.
Okay perfect. So basically four we see no one we have two patents covering the product one is the more general patent that effectively covering the <unk> expression technology that pattern has already been granted in the measure.
Area. So in Europe and also in in U S. We have also granted a patent in Israel in Mexico, and Russia in Canada and Australia.
Al Gore I saw in the major areas. This bad and it has already in place and has been already granted.
And we have a second patent specifically cover NBC on product.
For Retinoblastoma. This pattern has been already granted in the U S and in China. So we are expecting to happen to the approval in Europe quite soon.
And with respect to the AVG technologies albumin binding technology that cobalt dramatically the product <unk> 11.
We have already obtained yet.
Bravo in glass in China in Japanese rally in Mexico, and Australia.
Our steel are not finishing the process because obviously that was pilot later in time, but we expect the ultra affiliation fulfilling all the major areas and Thats basically the the protection for our main products in the pipeline right now we have all of our technologies and we are also exploring other possibilities to cover.
The product from different.
Are there possibilities and Thats, obviously on <unk>.
<unk> work that we are currently conducting.
Okay.
Great. Thanks, that's very helpful. Thanks.
And Leland I will just add to that a little bit the team at <unk> has just done a tremendous amount of work.
On the preclinical side with respect to both V. C. N O. One NBC in 11 and has generated tremendous amounts of data. So now we've loop the BCN team in with our patent team and we're revisiting all of this data and there may be some real interesting idea.
Is about for additional applications to be filed throughout this year.
Terrific. Thanks for the yogurt category.
Thank you.
Ladies and gentlemen, we have reached the end of the question and answer session and I would like to turn the call back to Steven Schwartz for closing remarks.
Thank you Peter and thank you everyone for taking time to join our call today.
In the first quarter of 2022, we continue to build on the momentum following the transformational DCM transaction.
We are well positioned to deliver on our sharpened clinical development strategy as well as our key objectives that we believe will drive significant value for our shareholders in the months and years ahead.
We are extremely pleased with the progress and the transformational growth that continues to propel our business forward and that continues to position synthetic biologics at the forefront of analytic virus development to improve patient outcomes for very very hard to treat cancers before we conclude today's call.
I'd like to thank our shareholders the entire team.
And the many people who have been supportive along the way, including our patients and their families.
Once again, thank you for joining us today, and we look forward to keeping you updated on our continued progress.
Thank you.
This concludes today's conference you may disconnect your lines at this time.
Thank you for your participation.