Q1 2023 Gracell Biotechnologies Inc Earnings Call
Ladies and gentlemen, thank you for standing by and welcome to the Gray self Biotechnologies first quarter 'twenty to 'twenty three conference call. At this time all participants are in a listen only mode. After opening remarks, we will open the call for your questions instructions for queuing up will be.
Given at that time.
I would now turn the conference call over to Doctor Kevin.
Sure.
Please go ahead.
Good morning.
Welcome to <unk> fourth quarter 2023.
Update conference call and webcast.
With me today, <unk> I'm, the Chief Executive Officer, Dr Williams and.
We're excited to discuss progress of our differentiated clinical pipeline of car T therapies on today's call.
We also look for to sharing with you our recent business development and upcoming objectives.
<unk> 2023.
We will conduct a question and answer session solid in our formal remarks.
This morning <unk> issued.
Press release announcing unaudited financial results for the fourth quarter ended March 31 2023.
We encourage everyone to read the press release and would like to remind you that this call is being recorded for replay.
Please note that for certain information discussed on the call today, including financial data clinical data and the future plans of our Borgwarner.
Management will be making forward looking statements.
Actual results could differ materially from those stated.
Hi.
Those forward looking statements as a result of various important factors.
I am pleased with work to the risk factors section of our latest 20-F filings with SEC or disclosure of these risks and the factors.
This conference call contains time sensitive information that is accurate only as of the date of this live webcast March 13, 2023, we saw undertakes no obligation to revise or update.
Any forward looking statements reflect events or circumstances. After the date of this conference call.
As may be required ACA bubble securities law.
I will now turn the call over to Presell CEO of Alcoa Williams.
William.
Thank you, Kevin and again welcome everyone to our first quarter 2023, corporate update conference call.
It has been very productive few months for us.
I will begin today's call with key pipeline updates.
I'll, then turn the call over to our CMO, Dr. Wendy Leigh could provide insights into the data presentations from three studies and it will be showcased in ESCO and <unk> in June .
Next our CFO .
Kevin will discuss our first quarter 2023 financial results.
After our prepared remarks.
We will open the call to questions.
That's 2017, while we began the development of <unk>.
Hi, Terry.
Next day manufacturing platform and our lead.
<unk> autologous car T product candidate <unk>.
The Bcm ACD 19 dual targeting the CTO of 12 that we.
We have commenced scientific knowledge manufacturing expertise and the cleaner the data to support our.
Growing conviction in the transformation of this technology and in the therapeutic potential that our product candidate <unk>.
To the contrary industry.
2023 is shaping up to be a great year.
We gathered long term follow up data from several proof of concept studies in two hematological indications.
Our R&D trials in the U S and China and also an adverse DC hero 12 them into a new therapeutic category.
Auto immune diseases.
You see they were 12 that is currently being evaluated across three hematological malignancies.
<unk> relapse refractory multiple myeloma.
Amendment issue.
Newly diagnosed multiple myeloma or Andy and then.
And relapsed refractory b cell non Hodgkin lymphoma.
Uh-huh B NHI.
Starting with <unk>.
And then.
We're on track to provide updated clinical data from the fully enrolled multi sensor investigator initiated trials or <unk>.
At both <unk> and <unk>.
This is Jim.
This long term follow up data and offer further validation to GCU 12, Fabs differentiated profile.
<unk>, it's a unique be CMA slash CD 19, dual targeting approach that it contributes to deep responses.
And it could potentially help to extend the durability of response.
More details will be provided once the ESCO in backhaul lifts.
May 25th.
We believe <unk> is a next generation car T therapy candidate that has the potential to push the boundary of autologous car T on multiple fronts, such as manufacturers see safety.
And durability.
<unk> efficacy.
We are focused on the clinical development of <unk> 12.
And are on track to commence our company sponsored phase one be slashed II clinical trial in the U S evaluating Tc zero profit.
And then before the end of the second quarter 2023.
In addition, we plan to initiate the company sponsored phase one phase two clinical trial in China in the third quarter of 2023.
Next week on May 29.
Nine am eastern time.
Host a key opinion leader webinar with our lead principal investigator Dr to SaaS.
As money Chief of Myeloma service at Memorial Sloan Kettering Cancer Center.
Webinar will include a discussion of the hour.
Met needs and the therapeutic landscape for <unk>.
And then.
Turning to Andy and then <unk>.
So up continue in ongoing.
Evaluating GC zero profit in a group of newly diagnosed high risk transplant eligible multiple myeloma patients.
As you May recall, the first clinical data presented at Ash 2022 demonstrated that one single infusion of <unk> Zero program achieved a 100% overall response rate.
And 100% of minimal residual disease negativity in all 16 treated the patients across all dose levels.
Lemme safety profile was outstanding with 75% patients.
Not experiencing cytokine release syndrome and.
And none of the patients had neurotoxicity of any grade.
Anticipate sharing updated clinical data in the second half of this year.
Related to the ongoing evaluating GC zero trough afternoon.
The NHL, we look forward to presenting updated data at the 2023, ESCO and in <unk> 2023, including as an oral presentation of the year.
More details about the data set will be made available on may 25th in the line with ESCO in Banco policy.
As unveiled in the press release issued earlier today.
We're very excited to announce our strategic decision to pursue clinical development in the immunology field or <unk> program.
Talking with systemic lupus erythematosus and so.
We believe fast car Ts in Europe , <unk> is well positioned.
Ideal product candidate for a wide range of autoimmune diseases.
Given the three key differentiators, including CD 19, Bcm, a few targeting capability consistently favorable safety profile demonstrated across three <unk>.
And our proprietary fast car T manufacturing process.
This strategic decision is also supported by a robust body of clinical data as well as the clinical development and manufacturing experience, we have accumulated by studying <unk> in over 50 patients across three hematological cancers.
So he is a chronic autoimmune disease in which the auto antibody produced by immune system attacks a patients own tissues.
<unk> multi organ damage.
It affects over 3 million people worldwide.
Immunosuppressants are used as a current standard of care.
<unk> remains a chronic condition that is difficult to manage.
Inefficiency impact quality of life and has no cure.
Furthermore, refractory severe Soe could lead to permanent organ damage without gene serious morbidity and even death.
As such there.
Urgent high unmet medical needs for more effective and even curative therapies, particularly to help manage a refractory Soe.
<unk> represents a novel approach entering human study or refractory Soe and pioneers to use a CD 19, <unk> dual targeting car T.
Also immune disease.
By targeting both CD 19, B Xiaomi.
This is <unk> 12 potential without any deeper wider depletion of disease, causing cells and plasma cell.
Hence enhancing therapeutic outcomes in comparison with CD 19 only approaches.
However, <unk> zero 12, five is develop the whole SaaS next day manufacture platform and it's the technology could offer a handful distinct advantages, including shorten patient wait times reduce the cost as well as enhanced T cell fitness.
As announced we have commenced an IIT in China to evaluate <unk> in refractory <unk> patients.
We plan to file R&D application for this indication in the U S and China in coming quarters.
In addition to meaningful progress related to <unk>.
Where concurrency advancing other product candidates in our clinical pipeline.
Notably at <unk> 2023, we will present for the first time the clinical data from the phase one portion of the ongoing phase one slash two clinical trials in China evaluating D. C double of <unk> for the treatment of relapsed refractory b cell acute.
Meaningful plastic leukemia or AML.
We are currently enrolling patients in the phase II portion.
Now I'll hand, the call over to our CMO, Dr. Wang Daily to highlight the three datasets that will be showcased next month and ESCO and <unk>.
In greater detail.
Wendy.
Please go ahead.
Thank you William early next month.
<unk> and <unk> meetings, we will present data from three studies. The first two data SaaS hopefully will provide further evidence supporting the differentiated efficacy and the safety profile for our lead Fox car product candidate <unk>.
SaaS.
The first presentation will it be the longer term follow up data from the market Center.
<unk> evaluating <unk> app.
Heavily pretreated.
Our.
Patients.
The data will be presented in our presentation session at Opco on June 3rd.
And in the poster presentation session at <unk> in June .
Nice.
Great for that.
At last.
We shared that <unk> 12 app.
<unk> achieved 100% and Marty inactive and 75, 9% and Marty in that case.
Our rate in 29.
Patients.
The expenses were still deepening the newly enrolled patients.
Safety profile was favorable and consistent with previous funding.
Yes, mostly low grade Crs and no neurotoxicity of any grade.
Now.
The first patient enrolled more than three and half years ago, we look forward to providing updated data to further showcase he sees the world class as strong efficacy and safety profile.
The data is subject to ask those embargo at this point.
The full abstracts will be posted on the Opco and the Ehow website on may 25th.
Okay.
The updated clinical results from an ongoing.
Evaluating these easier to SaaS, but attainment of our RFP and ex out would it be highlighted.
Poster presentation at <unk> on June 5th and.
And oral presentation at <unk> on June 10.
Well saving 19 erupted car T has proven effective for the treatment of an edge out.
There are opportunities for improvement in terms of the response rate.
Our ability and it's paid off for manufacturing.
CD 19, NBC I may do or targeting approach is no room for this treatment of and etch al and could potentially help address this unmet needs.
At last year's EBITDA, we have shared.
The initial clinical data from this team.
I'm, not saying, 100% complete response at month, one and three among <unk> patients.
We hope to provide an update on <unk>.
Sure no patients and the longer term follow up to this.
This abstract is also subject to the May 2000, and Pasco embargo.
Third the first clinical data or do you see zones. There were 17, a CD 19 targeted so not derived allogeneic car T cell therapy from a phase one trial in patients with RP Eh IL al who relapse after an allogeneic human stem.
Sales transplant, where it be showcased in a poster presentation at <unk> on June nine.
The abstract posted to <unk> website on may 11th.
Data demonstrated encouraging persistence of allogeneic car T cells, durable remission and a favorable safety profile.
Between March 'twenty, 'twenty, one and the May 2022.
My our RBA al.
All patients were enrolled and treated in the phase one portion of that Registrational phase one and achieve clinical trial in China, you bought in <unk> 17.
<unk> added two different those levers.
All patients had the relapse.
Al Al Falih are partially or fully matched prior human stem cell transplant.
At day 28, after infusion, 100% patients achieved I'm RV next to complete remission with with or without incomplete count recovery.
The median follow up off of 445 days.
Thank you from $282 600.
49 days.
Seven of my patients remained in CR or Cri.
Well two patients had CD 19 negative relapse.
At one year progression free survival PFS.
O S.
We're 76, 2% and 85, 7% respectively.
Crs is presented.
One two grade three evens, Tommy and all resolved after treatment.
I can was observed.
I will now hand, the call over to our CFO , Dr. <unk> Havent sit talent.
Thank you Wendy turning to our financial results for the fourth quarter ended March 31, 2023, I'd like to touch on a few financial trends.
As of March 31, <unk>. The company had RMB 1 billion $277 3 million or U S dollar $186 million in cash and cash equivalents and short.
Short term investments.
We expect the cash use.
For this year to be approximately U S $100 million.
Primarily as a fund.
On the clinical programs in the U S and China.
We expect our current cash position could be sufficient to cover our operating plan and R&D activities through the end of 2024.
Net loss attributable to ordinary shareholders for the three months ended March 31, 2023, with RMB $151 7 million or U S dollar $22 1 million.
Compared to RMB $158 6 million for the corresponding prior year period.
Research and development expenses for the three minuses ended March 31st 2023.
RMB $137 5 million.
Our U S dollar deployment.
Compared to RMB 121, $8 million in the corresponding prior year periods.
The increase was severity due to increased spending our research environment.
No clinical trials, including licensing expenses with CJ.
With that I'd like to turn it back to the operator to open the session for your questions operator.
Okay.
The floor is now open for your questions to ask a question of time. Please press star one on your telephone keypad, if any point you'd like to withdraw from the queue. Please press star one again, we will now take a moment to compile a roster.
Our first question comes from the line of vehicles.
<unk> from Citigroup. Your line is open. Please go ahead.
Alright, Thank you for taking my questions with respect to the.
This isn't to pursue SLA for 12 out can you talk a little bit more about what other autoimmune diseases, you were considering potentially for future development. How did you decide on SLE is the first opportunity and could you talk about when we would see the initial data from the China for.
For SLE. Thank you.
Okay. Thank you for the question.
Ciao.
So, yes, probably one of the largest indication autoimmune arena.
And then more importantly.
There is a nature medicine paper.
Everybody knows now.
The CD 19 car T successfully treated patient.
Patient.
So these proven concept.
Initial data.
<unk>.
Well, we're certainly we'll pursue other autoimmune indications as well.
This moment I can say.
And this is the plan.
Sorry.
As fast as we can.
Now the mechanism of action will have a.
And coming events.
Close.
We think that Youre targeting.
Is that a fit for this indication other auto immune disease.
Simply just high level.
<unk> targeting CD 19 is targeting B cell.
We all know and if need be CMA targeting.
Plasma myself that is also a major part of auto antibody producing cells.
Okay. So I hope.
And then we'll answer your questions.
Yes, yes. Thank you.
And then just with regards to the.
Phase one will be too that you are starting in the U S. Can you talk a little bit about more.
Recruitment strategies for that trial, obviously that is a very competitive space in terms of identifying and recruiting patients.
Relapsed refractory multiple myeloma setting given some of the newer therapies specifically the specifics and also when you think about the U S trial for the phase one two.
Is it basically the same design as whats going to happen in China or are there. Some differences in terms of the way youre going to recruit the trial.
In China or design differences.
I think this question is for when the patient okay. Yeah.
We are on track to initiate the U S and the trial in this quarter.
And then the next quarter in China.
The currently studying side has been activated in the U S.
Our study will be conducted in the top medical center and Theyre well experience in cell therapy study. So we're very excited to work with our Prs.
Okay. Thanks, and then last question.
Oh, sorry.
Okay.
Okay.
And then just one other question with regards to the decision between <unk> 70, and just because you are too.
Can you just comment there it seems like you're moving forward with GC zero-zero strategy instead.
Zero, two but if you could just clarify thank you.
Okay.
When did you want me to take that one.
Yes. Please.
Okay.
007, G is being in R&D trial for awhile.
So it was much earlier than the 502, we haven't even filed to R&D.
Application, yet so that.
Just due to logistics.
Claude.
<unk>, which include a $5 two.
Still developing.
Early stage of development.
We have gathered.
The clinical evidence for that gene modification.
And hopefully this year.
Have something to share with.
Sure.
17.
Phase two.
Okay. Thank you very much.
Okay.
Our next question comes from the line of Emily <unk> from H C. Wainwright. Please go ahead.
Hi, good morning, and thanks for taking the questions.
Are there any other phase one two studies that you might plan to initiate in the U S. This year next year I know you just mentioned the ethylene study. So maybe if you could give a bit more of a timeline on that and then also can you discuss your strategy for newly diagnosed multiple myeloma.
An indication that you think you would move forward in the U S. Eventually and how do you kind of think about use of our car T in that setting.
When EMEA.
Yes.
Four.
I think that that's the two questions. We got in the U S trials currently.
Currently we have.
She says they will cause as our.
Trial is going to be conducted in U S is the one b this wouldn't be in the tier.
And the more studies were being considered and.
In plan.
Because to your question. So this year next year right in the plan.
And Andy and then actually we have the presentation last year ash.
And that was so much salmon around our presentation last year at Ash and yes were.
The contactor that studies the U S were in plan.
Our next question comes from the line of Joe <unk> from Piper Sandler. Please go ahead.
Hey, guys. Thanks, so much for taking my questions. Maybe just two quick ones from me first I just wanted to see if you had any thoughts on the top line card attuned for data for Covid D. What it means for the space and maybe more importantly, how you think about the development strategy for <unk> Zero 112, that's in light of these data and then.
With regards to SLE, just wondering if theres any dosing work that needs to be done there or can the dose levels that you've been using.
In the setting of oncology translate directly into the autoimmune setting. Thanks.
Let me take Randy.
Okay.
The data we presented at Ash.
It provides a good proof of concept.
To talk about.
Yeah.
And.
I don't think its.
Easy for us to come.
Head to head.
Parison wood.
Victory.
And there are different lines.
As we will be updating.
New follow up data longer follow up data.
ESCO.
Hey man.
Please proceed.
Im.
Very competitive efficacy and.
Okay.
And other features.
Regarding the <unk> dosing to.
Too early Joe to talk about it.
But I think.
Yes, it's too early.
We could decide.
We need to.
We have more information.
Obviously.
Steady verification.
And.
The reference to others.
But I don't think it will be very strong.
On the dose from college.
Okay, great. Thanks, so much for taking my questions.
Okay.
Our next question comes from the line of Kelly <unk> from Jefferies. Please go ahead.
Hi, everyone. Thanks for taking my question this is Dave.
Caliche.
Couple of questions first one is on gcs neutralized. So now you have.
Initiated.
Manufacturing setup in the U S. Just wondering is there a scope to increase manufacturing capacity.
Manufactured that you will be doing.
CMO.
Our next question is on zero seven G can you highlight a little bit of a longer treatment landscape in China, and what is the market opportunity and believe it will be for <unk>.
Patrick Allen Thank you.
And just final question Alright, yeah, Okay, Yeah no.
Questions.
Louisa is our U S. CMO. So right now it is supplying for our U S clinical trial currently.
And the second question for.
<unk> <unk> hundred seven.
<unk>.
<unk>.
As one tap the allogeneic car T at that derive from the HLA.
Matched donors.
A L L patients that relapse from the allogeneic.
Stem cell transplant, they usually happen.
Matched donor really elaborate.
<unk> basically available some of these patients are not suitable for autologous car T therapy due to the sale of quality or other issues.
Yeah, so using T cell donated.
H L. A matched donor one strategy to help with us the size of the patient to get access to car T. Well also addressing the gvhd risk for an allogeneic car T. So this <unk> will be the first time, we disclose the phase one clinical data.
Our technology.
We have observed encouraging persistence of allogeneic.
Allogeneic car T cells, durable remission and the favorable safety profile.
The first one it could.
Might be a L. L patients that relapse, following partially or fully matched the prior human stem cell transplant.
At day 28 after infusion why don't you patients achieved <unk> CR Cri at a median follow up after a 445 days.
Some of my patients remained in CR Cri, well two patients at the CD 19 negative relapse.
The one year PFS and OS were 76, 2% and 85, 7% this vaccine.
Crs is presented to a great one to grade two events only.
And all resolved after treatment no <unk> was observed.
So right now the phase two.
It's ongoing.
Thank you.
Our final question comes from the line of Louise Chen from Cantor.
Yes.
Please go ahead.
Hi, Hi team. This is Wayne Loeb for Luis Congrats on a progressive quarter and thanks for taking our questions. So our first one is on the S. L. E. What is the current standard of care and what is the efficacy for that then what data from the GC. They're owed 12, you have seen so far that gives you the confidence it could be a potential treatment.
Option and then from a modeling.
Perspective, with a lot of English Asia will commence this year, how should we think about the operating expense for the year.
Yes.
First.
Maybe you can do better.
Jim.
Alright.
Okay.
Regarding all the detail.
Evidenced subdued targeting.
<unk>.
<unk> mechanism of actions.
I think it will.
Fine.
Appropriate event to present evidence.
All right at this moment I think it would be the good evidence coming from not just preclinical studies published by other groups.
But primarily from this nature medicine paper.
Got the CD 19 car T.
Is it very effective and Joey or CD 19.
<unk> disease.
Sure.
So that's all I can comment.
Hum.
We do have.
Foundation.
Right.
Based decision.
We're getting into the field.
No.
It's a good question regarding resources.
How do we handle multiple project.
In the coming years.
First of all we are re prioritized some of our early programs.
And.
And this is.
So you're filing in a phase <unk> study.
And it would be a major.
Costly program.
I think we are in good shape to manage through that.
Got it thank you very much.
Jonathan.
Okay.
Okay and it does appear we do have one more question from the line of Yanan Zhu from Wells Fargo. Please go ahead.
Hi, Thanks for fitting me in.
I have a couple of questions on the lupus program.
Do we know the relative contribution of plasma cells and T cells.
Because the auto immunity.
It does appear from the nature paper.
Is that targeting b cells alone might have already had good efficacy. So just wondering the incremental benefits from targeting <unk> MAA.
And then also a question on <unk>.
The acceptance.
Depletion in lupus as well as seeing additional broader autoimmune diseases, how do you.
Luke.
At that.
Client maintained what it means.
For uptake in those diseases.
Good morning.
Yes, yes.
Good question I think it's similar to part of the question similar to the previous questions.
That is <unk>.
Hey.
There were 12.
Or other autoimmune disease.
Maybe I could sort of it.
A little bit by referencing.
One of the publications by your Paas growth.
Uh huh.
<unk>.
Subject group up.
Auto antibody producing cells.
Expression piece GMA is high however, CD 19 years low.
And these are very long lasting antibody auto antibody producing cells.
And then Pedro discussed.
Uh huh.
There will be certain patients.
Remain refractory to.
CD 19 targeting.
The expression of <unk> 19.
That's diminished.
When they are self developed into plasma myself stage.
And we all know Marcel.
The major antibody producing Josh.
And we do have preliminary data to support.
The direction, but we will.
Just a couple of points.
Property again.
Okay.
And so your question Ian.
Thanks William.
The ROE for depletion in autoimmune diseases are.
How it might affect uptake.
Low link for depletion.
Sorry.
The length of depletion alright.
Yes, LIFO depletion game, what do you mean linford depreciating autoimmune disease is lower.
I think I missed that.
Sorry.
Meant to say.
Four.
Car T to be used to treat autoimmune disease.
NIM for depletion is required.
So I was just wondering how that might.
Fit in our in our autoimmune disease treatment.
Uh huh.
Situations, especially how patients.
Be willing undergo treatment.
Right.
It is not issue.
<unk>.
Sort of evidenced by nature.
In nature Medicine group in Warsaw.
The clinical studies.
We intend to conduct.
In China.
Is it being approved.
It's not a concern.
I think for depletion for.
For these autoimmune disease patients.
Tolerable.
Okay.
Yes.
So is chemicals.
Used.
<unk>.
Sure.
Auto immune disease treatments.
Thanks.
And patient acceptance.
I am not aware of could it be the issue.
Okay.
<unk> disease.
I think for depletion.
Relatively light treatment.
Very helpful. Thank you Willa.
Okay.
I will now turn the conference over.
Two Doctor William Charles.
Thank you again to everyone for joining us on our call.
We're proud of the progress the great sale team has made over the past year.
23, there will be an exciting year for us as we are on track to initiate the hour.
Mmm <unk> studies in both the U S and China.
And expanding <unk> into the ultra IMMU field.
We believe <unk> is well positioned to deliver a car T cell therapies that can potentially transform the treatment landscape we.
We look forward to providing clinical data updates and sharing key pipeline of technology updates throughout the year.
Ladies and gentlemen, this concludes today's presentation.
Thank you once again for your participation you may now disconnect.
[music].