Q3 2022 Lisata Therapeutics Inc Earnings Call

November 10, 2022

The conference will begin shortly to raise your hand during Q&A you can dial star one one.

[music].

Welcome to the Lacerta Therapeutics third quarter 2022.

Financial results.

The conference call.

Currently all participants are in a listen only mode. Following the management's prepared remarks, we will hold it.

The Q&A session.

Ask a question at that time, Please press star one one when your telephone.

Didn't hear an automated message advising you that your hand, just right.

As a reminder, this call is being recorded today Thursday November 10 2022.

I'll now turn the call over to John <unk>, Vice President of Best of Relations and corporate communications at <unk>. Please.

Please go ahead Sir.

Thank you operator, and good afternoon, everyone welcome to the sources.

Third 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, Chief Executive Officer, David <unk>, President and Chief Business Officer, Dr. Christopher Buck Executive Vice President of research and development and Chief Medical Officer, and James <unk>.

<unk>, Vice President of finance and Treasury.

Shortly before this call we issued a press release announcing our third quarter 2022 financial results, which is available under the investors and use of.

The company Web site, along with the webcast replay of this call.

Not received the news release or if you'd like to be added to the company's email distribution list. Please email me at Jay <unk> at <unk> Dot com.

Before we begin I'll remind you that comments made by management. During this conference call contain forward looking statements that involve risks and uncertainties regarding the future operations and results of Lasalle.

I encourage you to review the Companys filings with the Securities and Exchange Commission, including without limitation. Its forms 10-Q, 8-K, and 10-K, which which identify specific risk factors that may cause actual results or events to differ materially from those described in the forward looking statements.

Furthermore, the content of this conference call contains time sensitive information that is accurate only as of the data of the live broadcast Thursday November 10 2022.

<unk> 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.

It gives me great pleasure today to host our first quarterly conference call as <unk> Therapeutics, where we will provide an overview of recent business highlights and discuss our third quarter 2022 financial results.

Zada, we strive to create value for our shareholders and for our stakeholders the patients who suffer from the debilitating and often graves diseases that we have targeted and the physicians, who treat them by developing and commercializing products that address important unmet medical needs.

Our portfolio of product candidates contains treatments in development that are designed to be regenerative Android to bring significant therapeutic improvement.

As a development company or <unk>.

Focus is on the generation of meaningful data by the most expeditious and cost effective means.

Evidenced by the fact that even though our merger with <unk> therapeutics occurred approximately six weeks ago. We are in a position today to report tangible progress advancing <unk>. One four listed <unk> as we call. It internally the company's lead investigational product candidates from our proprietary <unk> platform.

This is the one thats the subject of multiple planned and ongoing clinical trials being conducted globally and a variety of solid tumor types and in combination with several chemotherapy and immunotherapy anticancer regiments.

Based on favorable safety Tolerability and activity data to date, we believe <unk> has the potential to become an integral part of a revised standard of care therapy for many difficult to treat cancers.

In the past few weeks, we have received advice from the U S food and drug administration on what would be required for registration. We have discussed this guidance with our development partners and we are now preparing for the implementation of protocol changes that we expect will improve the regulatory standing and scientific value of our studies our chief.

Medical Officer, Dr. Buck will provide more specifics on our clinical programs. Shortly following a review of the quarter's financial results. However, before getting into that allow me to introduce <unk>, President and Chief business Officer, David Slack.

David is a seasoned industry executive with over 25 years of experience in public and private life science companies working in a variety of senior business roles. We believe that his experience and expertise will prove instrumental to <unk> as we work to expand the applicability of Lister, one and send our platform programs to other SAR.

<unk> tumor targets treatment combination and corporate partnerships with that I'll turn the call over to David and by the way in order to avoid confusion internally, we've adopted the convention of referring to David as David and to me as Dave David.

Thanks, Dave It's Greg.

To be a part of today's call.

It was a real pleasure working with the teams at <unk> and.

And collateral during the merger and now it would be a part of the combined team episodic.

Excited us send the most about this merger.

Does the expertise and experience of the team that was already in place to collaborate.

By Dave Matt So its leadership.

And the shared enthusiasm and focus to advance and develop list one.

And to broaden the applications at the center of our platform.

We believe that <unk> has the potential to revolutionize the treatment of cancer.

I am pleased to be a part of such a talented and dedicated team with a goal to not only create value for shareholders, but most importantly to bring innovative treatments to patients in need.

And with that I now will turn over the call to James <unk>, our VP of finance and Treasury.

To review and provide commentary on our third quarter 2022.

Financial results James.

Thanks, David Good afternoon, all I am pleased to.

Is that a summary of our third quarter 2022 financial results starting with operating expenses.

Research and development expenses were approximately $3 4 million for the three months ended September 32022, compared to $4 8 million for the three months ended September 32021.

Representing a decrease of zero point step.

Or 18, 1%.

This was primarily due to a decrease in expenses associated with our <unk> phase <unk> study the freedom trial as a result of the suspension and enrollment in the second quarter of 2022.

And study closeout activities in the third quarter of 2022.

A decrease in expenses associated with co natura in Japan related to.

Backlog, partially offset by the addition of chemistry manufacturing and controls also known as CMC activities for list, one and enrollment activities for Australia Asian gastrointestinal trials.

Alright.

D G ascend study.

Research and development in both periods related to expenses associated with our <unk> phase <unk> study the freedom trial.

Expenses.

Registration eligible study for one extra and critical limb ischemia in Japan, as well as corresponding regulatory discussions and support expenses.

Expenses associated with the preparation of our filing of an investigational new drug application.

As well as study execution expenses for the clinical study of listed.

For treatment of diabetic kidney disease.

Phase <unk> open label proof of concept trial, which includes six subjects in total.

And expenses associated with the CMC activities for Lister, one enrollment activities for the lift the one phase II B study and preparatory activities associated with the design of our planned Lissa one proof of concept trial.

In various solid tumors and in combination with the corresponding standards of care.

General and administrative expenses, which focus on general corporate related activities were $3 9 million for the three months ended September 32022, compared to $2 8 million for the three months ended September 32021, representing an.

<unk> of 39%.

This increase was primarily due to an increase in equity expense as a result of performance stock unit vesting.

Onetime merger option assumption expense and departing board member restricted stock unit vesting. In addition to an increase in expenses associated with our annual stockholder meeting and merger.

Net losses were 37 4 million for the three months ended September 32022, compared to $6 9 million for the three months ended September 32021.

Turning now to our balance sheet and cash flow.

As of September 30th.

The company had cash cash equivalents and marketable securities of approximately 75 5 million.

That completes the financial overview I will now turn the call over to our chief.

Dr. Christopher Buck for the review of our clinical development pipeline.

Kristin.

Thank you James and good afternoon, everyone I will begin by providing a high level summary of what we are doing at Lasalle and why we believe our development programs are an increasingly relevant and attractive investment opportunity today.

Before that though I'd like to reiterate our motivation to translate our expertise and unique scientific approach in the clinical trials, which could lead to treatments for patients most in need.

This pipeline is built on a portfolio of proprietary and patented technology that is grounded in strong scientific rationale to identify and treat patients most likely to respond to our targeted therapies.

We appreciate the critical importance of generating meaningful clinical data.

To validate our platform technologies.

And create shareholder value and our entire team is focused on accomplishing this quickly cost effectively yet rigorously.

With that I will now provide a summary and status update for each of <unk> clinical development programs.

Kicking off with our lead product candidate list. The one for the treatment of advanced solid tumors in combination with other anti cancer agents.

Despite advances in cancer therapy today, many solid tumors remains difficult to treat.

Many solid tumors, including pancreatic cancer gastric cancer and other solid tumors are surrounded by dense fibrotic tissue known as stroma.

It limits the efficacy of current chemotherapy for the treatment.

A variety of advanced solid tumors.

Many tumors also exhibit an immuno suppressive tumor microenvironment or T M E.

Which suppresses our patients immune system's ability to fight the cancer and therefore can limit effectiveness of current therapies.

These factors negatively impact the ability of many cytotoxic agents and immunotherapies.

Effectively treat these cancers.

To address the tumor stroma his role as a primary impediment to effective treatment with.

<unk> approach is to activate the <unk> rule or send our.

Natural transport system that normally brings nutrients intuit tissue.

Under emergency situations, such as an injury.

Tumors hijack this system to promote their growth.

Let's start as lead candidate list the one formerly known as send one.

Is an investigational drug that actuate the sundar active transport mechanism, while also having the potential to modify the tumor microenvironment and make it less immunosuppressive.

Lister one targets the tumor vasculature bites affinity for alpha.

Three in beta five immigrants.

It is selectively expressed in tumor vasculature, but not healthy tissue.

Lister wanted to specific cyclic internalizing RGD peptide that one's balance to these <unk>.

Is cleaved by proteases expressed in tumors to release a peptide fragment.

Called ascend Arb fragment.

Which then binds to a second receptor called neuro pill in one.

To activate and novel uptake pathway that allows anti cancer drugs to more selectively penetrate solid tumors.

The ability of list one to modify the tumor microenvironment to enhance delivery and efficacy of co administered drugs.

<unk> has been demonstrated in a range of preclinical solid tumor models.

These results come internally from La Sato and from collaborators and research groups around the world.

And have been the subject of over 200 scientific publications.

Along with our collaborators.

We have amassed significant non clinical data demonstrating enhanced delivery of a range of emerging anti cancer therapies, including Immunotherapies in R&D RNA based therapeutics.

Clinically list. The one has demonstrated favorable safety tolerability and activity and clinical trials.

To enhance delivery of standard of care chemotherapy for pancreatic cancer.

We are exploring the potential of lists one to enable a variety of treatment modalities to treat a range of solid tumors more effectively.

Currently list. The one is the subject of a phase one b slash Iia and <unk> clinical studies being conducted globally.

In various solid tumors. These include metastatic pancreatic ductal adenocarcinoma.

Colorectal cancer Appendiceal cancers in combination with a variety of anti cancer regimens.

Additionally, the evaluation of list of one administered in combination with corresponding standards of care and advanced solid tumors and a phase II placebo controlled basket trial is planned to initiate in the first half of 2023.

As Dave mentioned.

I mentioned earlier, the FDA provided us with guidance on our requirements for a pathway to registration in the U S for list of one in metastatic pancreatic ductal adenocarcinoma or as we refer to it as <unk>.

We have subsequently shared this feedback with our global partners and are now finalizing development programs and individual study protocol modification to address Fda's recommendation.

Turning now to LST, a 12 or a net draw in Japan.

Our product candidate for the treatment of critical limb disease, excuse me critical limb ischemia or CLI and burgers disease.

<unk> was awarded a socket gawky designation from the Japanese regulatory authorities for the treatment of CLI and burgers disease.

Which is an orphan size subset of CLI.

The sakigake designation is akin to a regenerative medicine advanced therapy designation or an <unk> designation in the United States.

Sakigake designation affords the recipient prioritized regulatory consultation a dedicated review.

Welcome to Vulcan.

Thank you.

Okay.

Registration information.

As well as the reduced revenues.

Patient application.

Okay.

Additionally, under Japan regenerative medicine legislation.

Products, such as <unk> are eligible for early conditional approval and possibly full.

Full approval in Japan based on the assessment of the data from the trial or trials designed in direct collaboration with the Japanese pharmaceuticals, and medical devices agency or PMD.

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 soft Kentucky 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 partnering to a Japanese pharmaceutical company.

Data from the follow up of all patients treated in the company's registration eligible study of <unk> in Japan for the treatment of CLI and burgers disease.

Consistent with our expectations of therapeutic effect and safety based on previously published clinical trials data generated in Japan, and the United States.

These data have been compiled and are the subject of discussions with the <unk> as part of the Japanese regulatory pre consultation process and in preparation for the formal consultation meetings, which precede the Japanese new drug application.

If successful on the pre consultation process with.

Masada expect formal clinical consultation to occur by mid year 2023.

Concomitant Lee.

The company continues its efforts to secure a Japanese partner to complete the remaining steps to produce registration in Japan.

Moving on to <unk> for <unk> for the treatment of coronary microvascular dysfunction or CMT.

Okay.

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

In May of 2020, <unk> announced the full data results from the phase Iia.

<unk> CMT trial, showing a highly statistically significant improvement in coronary flow.

Reserve correlating with symptom relief for patients with CMV after a single <unk>.

Inter coronary injection of XOMA.

Subsequently the company initiated a rigorous phase II clinical trial known as the freedom trial, which to our knowledge is the first controlled regenerative medicine trial in CMV in the United States.

The freedom trial was a double blind randomized placebo controlled trial designed to corroborate the results of the escape <unk> trial.

While assessing the efficacy and safety of delivering autologous CD 34 cells are XOMA product too.

Two subjects with CMT and without obstructive coronary artery disease.

Unfortunately, and as previously reported the COVID-19 pandemic in the United States in both the direct.

And indirect impact on freedom, which made enrollment much slower than originally predicted and challenging to accelerate.

As a result, the company suspended trial enrollment and conducted an interim analysis of the data.

Following this analysis and along with key opinion leaders input the company determined that execution of our redesigned freedom like trial would be the appropriate next step, but the cost of such a trial would be prohibitively expensive to undergo without a strategic partner.

Thus <unk> development will only be continued if a strategic partner.

Can contribute the necessary capital for future development is identified and secured.

Lastly, L. S. T E 201 for the treatment of diabetic kidney disease or <unk>.

The company initiated a phase <unk> open label proof of concept trial evaluating <unk> 201, our CD 34 positive regenerative cell therapy investigational product for intra renal artery administration and.

In patients with diabetic kidney disease.

This development program focuses on patients and exhibit rapidly progressing stage <unk> or four 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 in improved kidney function.

Our proof of concept protocol provided for a staggered sequentially dose cohort of six patients overseen 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 <unk> hundred one to regenerate kidney function.

A key readout of data will occur at the six month follow up visit for all patients.

The first patient was treated in this study of <unk> hundred one in April 2022, followed by completion of enrollment of all six subjects in July 2022.

We continue to anticipate topline data from all subjects by the first quarter of 2023.

With that I'll now turn the call back to Dave.

Thanks Kristen.

As you heard our talented and dedicated team is working hard to maximize the value potential of our development pipeline and to drive our programs to clinical success. We have designed our studies to provide clear results as fast and inexpensively as reasonably practicable.

Nevertheless, we understand that even sure youre in patients and getting the quality data and ask your indulgence and understanding as we focus on achieving this goal. We are excited by the promise of our platform technologies and pipeline of product and partnering opportunities and look forward to providing updates on our progress in the coming months and with that overview. Operator, we are now.

Now ready to take questions.

As a reminder to ask a question. Please press star one one on your telephone you will then hear an automated message advising that your hand, just raised each listener will be permitted to ask one question at a time and we'll return to the Q4 additional.

Questions.

Please standby, while we compile the Q&A roster.

Our first question comes from Pete Enderlin with <unk> Partners. Your line is now Ben.

Thank you hi, everybody.

Dave.

This is a kind of a.

Broad question, but I'll categorize it as one question.

That as you go to.

<unk> and potentially a very large number of trials and development activities with <unk>.

Major pharma is in many cases, so can you.

Talk about the framework of how are you going to structure. Those generally speaking I mean in terms of cost sharing.

Protecting our respective IP rights and.

And resolving potential conflicts between different partners and between the partners.

Your company itself, just a lot of sort of general possible.

Our ability and the way all of those.

Agreements will work, but maybe there are some common ground underneath them all.

Sure Pete and thanks for the question.

Actually there is quite a bit of common ground and our strategy, although youre right.

Different agreements with different companies will have different terms, but generally speaking our goal is to.

Find mechanisms by which we can broadly explore the potential for list one to augment or enhance the activity of a variety of combination of cytotoxic and immunotherapies.

Without.

The one.

Big Pharma agreement that has been announced already is that with Roche genentech in and we're not going to be able to give you all the specifics.

In public but generally speaking this is a shared program so.

Yeah.

We are testing <unk>.

Lister one in combination with standard of care in MP deck, along with Roche.

Roche's immunotherapy, a T cell <unk>.

<unk> and the general structure of this deal is that.

Each company owns their own IP.

That if there is any new IP generated during the course of the work and one would expect that that would not occur but if there was we would share it.

And the cost of the trial.

Are generally being split equally each company provides their own drug.

For the trial use and we've each put it in a certain amount of money.

Roche However is actually executing the trial as part of their Morpheus platform.

So they probably.

Dedicated more resources.

Two the program than we have in our entire company.

So, but it's basically a sharing arrangement now going forward similar arrangements will be looked at to be established with other companies the idea being that list of one <unk>.

As a.

Promiscuous mechanism of action, meaning that it is agnostic.

I'll stick to the chemo or Immunotherapies with which it is administered and we believe its mechanism of action has the ability to enhance the delivery of all of these things to the targeted areas of solid tumors and so we expect that we'll be in a position to have a.

D of deals where we always either.

Sure the cost or have the partner bear the costs and where we retain complete product rights to list one and so that's the general approach.

A quick follow up to that and that is if for example, Roche does a lot of their own work and actually.

Implementing the trial would they allocate any of that back to you or would that just be on there.

So to speak.

The resource distribution and cost distribution is defined.

Defined in the the contract and there is no way that either party is going to be able to back charge. The other surprise charges.

Okay.

Thanks, a lot.

Thank you Pete.

Please standby for our next question.

Our next question comes from Chapin do ROI with Brooklyn Capital markets. Your line is now.

Hi, Thanks for the update.

With regards to the Phase school basket trial for Lister, one next year, what kind of tumors are you planning to include that.

Would you also are you thinking of evaluating brain cancers, as well, where just a London zafar to cross the blood brain barrier.

So I'll, let I'll, let Christian our Chief Medical officer jump in here and give you the latest on our plans for tumor types in the basket trial as well as some other arrangements that were making to look at different tumor types, including potentially glioblastoma Kristen.

Hi, great. Thanks for the question. The basket trial is looking at head and neck squamous cell carcinoma, esophageal squamous cell carcinoma and cholangiocarcinoma.

The first two being second line therapy, the latter being first line therapy.

As Dave alluded. We are also looking for explorations in joint development in tumors, such as first line glioblastoma potential collaborations.

Collaborations in locally advanced pancreatic ductal adenocarcinoma.

And potentially locally advanced Resectable gastroesophageal adenocarcinoma.

So we are truly looking across solid tumor types as we believe this asset is tumor tissue agnostic Dave.

Thanks.

Yes.

Great. Thanks for the color.

Youre welcome. Thank you for joining us.

As a reminder to ask a question. Please press star one one on your telephone.

At this time I am showing no further questions.

Apologies.

Please standby for our next question.

Our next question comes from Pete Enderlin with MDC Partners. Your line is now open.

Thanks.

Remember that I had a question about.

Stock options at.

And before the deal closed were there any in.

There was a provision for them, but then I think I read that.

Actually it was none that actually transferred over so what's the story about that.

James would you like to take just described briefly the treatment of the stock options.

Yes.

Pete.

Through the merger the company acquired about one 3 million shares.

Stock option.

So we assumed the model over at the same exchange ratio that we did for any shares that we.

That we acquired through the merger.

Okay.

Thanks.

Okay.

Yes.

This concludes the question and answer session I will now turn the call back to Dr. Mazzo for closing remarks.

Well again, thank you all for participating on today's call. We look forward to speaking with you again during our next quarterly conference call and to continuing to provide updates on our achievements and progress.

We remain grateful for your continued interest and support stay well and have a good evening.

This concludes today's conference call. Thank you for participating you may now disconnect.

The conference.

We will begin shortly to raise your hand during Q&A you can dial star one one.

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Welcome to the Lacerta Therapeutics third quarter 2022.

Financial results and business update conference call.

Currently all participants are in a listen only mode. Following managements prepared remarks, we will hold a Q&A session to ask a question at that time. Please press star one one on your telephone.

Here, an automated message advising you that your hand is right.

As a reminder, this call is being recorded today Thursday November 10, 2022, I will now turn the call over to John <unk>, Vice President of Best of Relations and corporate Communications at <unk>. Please go ahead Sir.

Thank you operator, and good afternoon, everyone. Welcome to resources third 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, Chief Executive Officer, David <unk>, President and Chief Business Officer, Dr. Christopher Buck.

<unk>, 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 third quarter 2022 financial results, which is available under the investors and use of.

The company Web site, along with the webcast replay of this call.

<unk> not received the news release or if you'd like to be added to the company's email distribution list. Please email me at Jay <unk> at <unk> Dot com.

Before we begin I'll remind you that comments made by management. During this conference call contains forward looking statements that involve risks and uncertainties regarding the future operations and results of Lasalle.

I encourage you to review the Companys filings with.

With the Securities and Exchange Commission, including without limitation. Its forms 10-Q, 8-K, and 10-K, which which identify specific risk factors that may cause actual results or events to differ materially from those described in the forward looking statements. Furthermore, the content of this conference call contains time sensitive information that is accurate.

Only as the data of the live broadcast Thursday November 10 2022.

<unk> 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.

It gives me great pleasure today to host this our first quarterly conference call as <unk> Therapeutics, where we will provide an overview of recent business highlights and discuss our third quarter 2022 financial results.

Our portfolio of product candidates contains treatments in development that are designed to be regenerative Android to bring significant therapeutic improvement.

As a development company or <unk>.

Focus is on the generation of meaningful data by the most expeditious and cost effective means.

Evidenced by the fact that even though our merger with <unk> therapeutics occurred approximately six weeks ago. We are in a position today to report tangible progress advancing <unk>, one or listed <unk> as we call. It internally the company's lead investigational product candidates from our proprietary <unk> platform.

Lister one subject with multiple planned and ongoing clinical trials being conducted globally and a variety of solid tumor types and in combination with several chemotherapy and immunotherapy anticancer regiments.

Based on favorable safety Tolerability and activity data to date, we believe list. The one has the potential to become an integral part of a revised standard of care therapy for many difficult to treat cancers.

In the past few weeks, we have received advice from the U S food and drug administration on what would be required of us for registration. We have discussed this guidance with our development partners and we are now preparing for the implementation of protocol changes that we expect will improve the regulatory standing and scientific value of our studies our chief.

Medical Officer, Dr. Bob who will provide more specifics on our clinical programs. Shortly following a review of the quarter's financial results. However, before getting into that allow me to introduce <unk>, President and Chief business Officer, David Slack.

David is a seasoned industry executive with over 25 years of experience in public and private life science companies working in a variety of senior business roles. We believe that his experience and expertise will prove instrumental to levada as we work to expand the applicability of Lister, one and send our platform programs to other SAR.

Thanks, Dave.

To be a part of today's call.

It was a real pleasure working with the teams at <unk> and.

<unk> during the merger and now to be a part of the combined team episodic.

Excited us extend the most about this merger.

Does the expertise and experience of the team that was already in place to collaborate.

By Dave <unk> leadership.

And the shared enthusiasm and focus to advance and develop list one.

And to broaden the applications at the center of our platform.

We believe that Masada has the potential to revolutionize the treatment of cancer.

I am pleased to be a part of such a talented and dedicated team with a goal to not only create value for shareholders, but most importantly to bring innovative treatments to patients in need.

And with that I now will turn over the call to James <unk>, our VP of finance and Treasury.

To review and provide commentary on our third quarter 2022.

Financial results James.

Thanks, David Good afternoon, all I am pleased to Joel.

Okay, then a summary of our third quarter 2022 financial results starting with operating expenses.

Research and development expenses were approximately $3 4 million for the three months ended September 32022, compared to four 1 million for the three months ended September 32021.

Representing a decrease of zero point.

Or 18, 1%.

This was primarily due to a decrease in expenses associated with our ex Ona Phase <unk> study the freedom trial as a result of the suspension and enrollment in the second quarter of 2022.

And study closeout activities in the third quarter of 2022.

A decrease in expenses associated with co natura in Japan related to.

Hi.

Partially offset by the addition of chemistry manufacturing and controls also known as CMC activities for list, one and enrollment activities for Australia Asian gastrointestinal.

That's helpful.

D G a sense Scott.

Research and development in both periods related to expenses associated with our <unk> phase II <unk> study the freedom trial.

Expenses.

Registration eligible study for one extra and critical limb ischemia in Japan, as well as corresponding regulatory discussions and support expenses.

Expenses associated with the preparation of our filing of an investigational new drug application.

As well as study execution expenses for the clinical study of listed.

For treatment of diabetic kidney disease.

Phase <unk> open label proof of concept trial, which includes six subjects in total.

And expenses associated with the CMC activities for Lister, one enrollment activities for the lift the one phase II B study.

Study and preparatory activities associated with the design of our planned Lissa one proof of concept in various solid tumors and in combination with the corresponding standards of care.

<unk> of 39%.

This increase was primarily due to an increase in equity expense as a result of performance stock unit vesting.

Onetime merger option assumption expense and departing board member restricted stock unit vesting. In addition to an increase in expenses associated with our annual stockholder meeting and merger.

Net losses were 37 4 million for the three months ended September 32022, compared to $6 9 million for the three months ended September 32021.

Turning now to our balance sheet and cash flow.

As of September 30th.

The company had cash cash equivalents and marketable securities of approximately 75 5 million.

That completes the financial overview I will now turn the call over to our chief.

Dr. Christopher Buck for the review of our clinical development pipeline.

Kristin.

Before that though I'd like to reiterate our motivation to translate our expertise and unique scientific approach in the clinical trials, which could lead to treatments for patients most in need.

We appreciate the critical importance of generating meaningful clinical data.

To validate our platform technologies.

And create shareholder value and our entire team is focused on accomplishing this quickly cost effectively yet rigorously.

With that I will now provide a summary and status update for each of <unk> clinical development programs.

Kicking off with our lead product candidate list. The one for the treatment of advanced solid tumors in combination with other anti cancer agents.

Despite advances in cancer therapy today, many solid tumors remains difficult to treat.

Many solid tumors, including pancreatic cancer gastric cancer and other solid tumors are surrounded by dense fibrotic tissue known as stroma that.

Limits the efficacy of current Chemotherapies.

For the treatment.

A variety of advanced solid tumors.

Many tumors also exhibit an immuno suppressive tumor microenvironment or TM E <unk>.

Which suppresses our patients immune system's ability to fight the cancer and therefore can limit effectiveness of current therapies.

These factors negatively impact the ability of many cytotoxic agents and immunotherapies.

To effectively treat these cancers.

To address the tumor stroma his role as a primary impediment to effective treatment.

<unk> approach is to activate the <unk> rule or send our natural transport system that normally brings nutrients intuit tissue.

Under emergency situations, such as an injury.

Tumors hijack this system to promote their growth.

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Lasalle is lead candidate list of one formerly known as <unk>.

<unk> is an investigational drug that actuate the sundar active transport mechanism, while also having the potential to modify the tumor microenvironment and make it less immunosuppressive.

Lister one targets the tumor vasculature bites affinity for alpha.

Beta three in beta five immigrants.

Is selectively expressed in tumor vasculature.

Not healthy tissue.

Lister wanted to specific cyclic internalizing RGD peptide that one's balance to these <unk>.

Is cleaved by proteases expressed in tumors to release a peptide fragment.

Ascend arb fragment.

Which then binds to a second receptor called neuro pill in one.

To activate and novel uptake pathway that allows anti cancer drugs to more selectively penetrate solid tumors.

Yeah.

The ability of list the one to modify the tumor microenvironment to enhance delivery and efficacy of co administered drugs.

It has been demonstrated in a range of preclinical solid tumor models.

These results come internally from La Sato and from collaborators and research groups around the world and have been the subject of over 200 scientific publications.

Along with our collaborators.

We have amassed significant non clinical data demonstrating enhanced delivery of a range of emerging anti cancer therapies, including Immunotherapies in R&D.

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