Q2 2023 Cellectis SA Earnings Call
Good morning, everyone and welcome to the Celtics South piece second quarter 2023 earnings call. At this time all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time. Please be aware that today's conference call is being recorded.
I would now like to introduce the first speaker Arthur stall Chief business Officer, you may begin.
Good morning, and welcome everyone to selected second quarter 2023, corporate updates and financial results Conference call.
Joining me on the call today with prepared remarks are Dr. <unk> <unk>, our Chief Executive Officer, Dr. <unk>, Wang our Chief Financial Officer, and Dr. Marc <unk>, Our Chief Medical Officer Yesterday evening, <unk> issued a press release reporting our corporate and business update for the second quarter of 2023, and it's not all of it.
Financial results for the six months period ended June 32023.
As disclosed in our press release published yesterday, the reporting sitting are not audited financial statements for Q2 will be released in the coming days.
As a reminder, we will make statements regarding selected financial outlook, including the sufficiency of cash to fund operation. In addition to its manufacturing regulatory and product development status and plans and product development of its license partners.
These forward statements, which are based on management's current expectations and assumptions and on information currently available to management, including information provided or otherwise publicly reported by our license partners are subject to risks and uncertainties that may cause actual results to differ from those forecasted.
A description of these risks can be found in our most recent form 20-F filed with the security Exchange Commission SEC and the financial reports, including the management report for the year ended on December 31, 2022, and subsequent filings <unk> makes with the SEC from time to time.
I would now like to turn the call over to Andre.
Thank you Arthur and good morning, and thank you everyone for joining us today.
Second 2023 quarter was marked by strong execution.
Our last clinical data presented for your car T 22 at the European Hematology Association annual meeting are encouraging for patients with relapsed or refractory b cell acute lymphoblastic leukemia, who have failed multiple lines of treatment options, including chemo immunotherapy.
CD 19, directed car T cell therapy, and allogeneic stem cell transplant.
We're looking forward to releasing our new data later this year, our new car T 22 manufactured in house.
Blake. This also presented an encore of the clinical data of the Emily Zero, one clinical trial evaluating <unk> car T 123.
American Society of gene and cell therapy annual meeting.
These preliminary data support the continued administration of <unk> 123, after Fludarabine cyclophosphamide and Alemtuzumab linked with depletion in patients.
Relapsed or refractory acute leukemia.
Addition, this quarter.
This innovation team was proud to present strong.
Preclinical data on gene editing process to develop the bonafide HBV gene correction of sickle mutation.
In addition to that we have presented a comprehensive analysis to better design efficient Tau based editor at the International Society of cell and gene therapy annual meeting.
These achievements.
So case more of the power of gene editing platform, both as tailing for therapeutic gene editing and that we are continuing to deliver constant breakthrough innovation to treat diseases with unmet medical needs.
I'd like to announce that during this annual shareholder meeting Dr. <unk> has been appointed as a director of the company's board of director.
At the end of this meeting the terms of the office of Mr. <unk> and Mrs. <unk> ended.
Yeah.
I am very pleased to welcome Dr. <unk> to select this board our extensive experience in the development of next generation cell and gene therapies, coupled with her deep knowledge of <unk> by technology industry with a huge asset.
B, a huge asset to select us.
We look forward to contributing and insights as we continue advancing the development of our product candidates.
In 2023, we made substantial progress with our pipeline despite.
Despite an unprecedented challenging market environment for the cell and gene therapy company.
Select remains deeply focused on its core clinical trial Bally's zero, one is evaluating new car T 22, net at least everyone is creating new car T 20 by 'twenty two.
And Emily zero, one evaluating new car tier 123, and on its mission to develop innovative cancer therapy product candidate.
With that I would like to turn the call over to Dr. <unk> <unk>, our Chief Medical Officer, who will give an overview of these clinical trials Mark. Please go ahead.
Thank you Andre as Andre mentioned, we have made progress in our valeo, one clinical trial with the presentation of updated clinical and translational data at the European Hematology Association annual meeting.
Of course, the preliminary safety and efficacy of <unk> 22 in a heavily pretreated relapsed refractory b so popular.
Population.
The poster presentation reviewed clinical and translational data from patients who received <unk> 2002, after LIFO depletion with Fludarabine, and cyclophosphamide or FC or Fludarabine cyclophosphamide and Alemtuzumab.
FCA.
In patients with relapsed refractory b cell <unk>.
Compared to the clinical update on <unk> at Ash 2021, the poster presented data from six additional patients who received <unk> <unk> 'twenty two at dose level three as of December 31, 2022 data cutoff.
<unk> 22 administered after FC or FCA Lindsay depletion regimen was well tolerated no dose limiting toxicities or immune effector cell associated neurotoxicity syndrome were observed.
For FCA dose level, three 5 million cells per kilogram, 50% of the six patients responded.
Close lymphocytes remains suppressed through day 28 for all patients who received FCA liquid depletion.
Peak ferritin levels correlated with <unk> 22 cell expansion and cytokines secretion.
<unk> 22 continues to be safe and tolerable with no treatment emergent serious adverse events or <unk> recorded.
You acquired <unk> T cell expansion was detected in 9% to 13 patients in the FCA lymphoid depletion arm and associated with clinical activity.
The <unk>. One study is currently enrolling patients after FCA liquid depletion with select this is in house manufactured product.
The next data set as we expect it to be released later this year.
Our <unk> one study evaluating <unk> three in patients with relapsed refractory AML continues to progress and enroll patients in the FCA two dose regimen arm.
On May 17, select this presented an encore of the clinical data that were unveiled at the Ash 2022 annual meeting.
At the American Society of gene and cell therapy annual meeting.
These preliminary data supports the continued administration of <unk> three after FCA lymphoid depletion in patients with relapsed refractory AML.
The oral presentation review preliminary data from patients who received <unk> three of one of the following dose levels.
Dose level 125 times 10 to the fifth cells per kilogram dose level 2625 times 10 to the fifth cells per kilogram dose level two intermediate one five times 10 to the six cells per kilogram.
Or dose level III three three times 10 to the six cells per kilogram after LIFO depletion with FC or FCA.
The data presented showed that adding <unk> to the FC LIFO depletion regimen was associated with sustained a host liquid depletion and significantly higher <unk> Q3 solid expansion that correlated with improved anti leukemia activity.
Two of eight or 25% of patients at dose level, two and the FCA arm achieved meaningful responses, including one patient who failed five prior lines of therapy, including allogeneic stem cell transplant, who experienced a durable minimal residual disease.
<unk> complete response that continued beyond 12 months as of December 2022.
Lastly, I will speak about our <unk>, one study evaluating <unk> 'twenty by 'twenty two.
<unk> 'twenty by 'twenty two is selected US as first dual allogeneic car T cell product candidate targeting both <unk> and <unk> 22, and is being evaluated in patients with relapsed refractory b cell non hodgkin lymphoma.
The <unk> hundred one clinical study is ongoing and select this expects to provide first in human data later this year.
So like this also continues to advance our preclinical programs and provided preclinical proof of concept data for <unk> 2022 to overcome current mechanisms of resistance to car T cell therapies in b cell NHL, while providing a potential therapeutic alternative to.
CD 19, targeting and allowing a reduction in the time from treatment decision to sell infusion.
We've demonstrated that <unk> 'twenty by 'twenty, two displays robust activity, both in vitro and in vivo against targets expressing heterogeneous levels of CD 22, and <unk> 20.
In vitro cytotoxicity assays against different tumor cell lines showed strong activity, whether these cells express the single antigen, <unk> 20, or <unk> 22, or both antigens simultaneously.
These preclinical data were presented in June at the International Society of cell and gene therapy annual meeting.
With that I would like to hand, the call over to Dr. Being a lung selective <unk> Chief financial officer for an overview of our financials for the second quarter of 2023.
Being please go ahead.
Thank you Mark I would like to highlight that in our financials, the cash cash equivalent and restricted cash position was selected excluding calix as of June 32023 was $89 million compared.
Compared with $95 million as of December 31, 2022.
This difference mainly reflects a $55 million of cash out which includes $50 million of payments for R&D expenses.
$7 million or SG&A suppliers $23 million for staff costs $7 million for rent and taxes $3 million of reimbursement of the PGE loan.
1 million net cash inflow from EIB loan.
A $1 million of refundable events from BPI 2 million financial investments capital gain in interest.
1 million reimbursement of social charges on stock options.
A 1 million cash inflow from customers and a $23 million net cash inflow from the capital raise close in February .
This cash position is expected to be sufficient to fund selective stand alone operations into the third quarter of 2024.
The closing of the proposed Calix merger was finalized on May 31 of 2023.
Consequently <unk>.
<unk> was the consolidated and presented as discontinued operations in our financial statements only until May 31 2023.
Okay.
The net loss was $46 million and the six month period of 2023 compared to a loss of $54 million in the six month period of 2022.
This $8 million decrease in net loss between 2023, and 2022 was primarily by a decrease of $6 million in purchases and external expenses because of quality and manufacturing internalization.
A decrease of $4 million in personnel expenses due to headcount rationalization and an increase of $2 million of net financial gain.
Almost fully offset by an increase of $3 5 million a net loss of discontinued operations.
The net loss attributable to shareholders of select us was $41 million.
Or 76 cents per share in the six month period of 2023 compared to a loss of $51 million or $1 12 per share in the six month period of 2022.
This $10 million decrease in net loss between 2023, and 2022 was primarily driven by a decrease of $11 million of R&D and SG&A expenses.
An increase of $2 million of the financial gain partially offset by the $3 $5 million decrease of net loss from discontinued operations attributable to shareholders of select us.
The adjusted net loss attributable to shareholders of selectors, which excludes non cash stock based compensation expenses was 37 million or <unk> 68 per share in the six month period of 2023 compared to a loss of $46 million or $1 <unk>.
For sure in 2022.
Okay.
The tranche a of 20 million euros of the <unk>.
Facility, we received from the European investment Bank was received in April the.
The initial payment for BPI related to our grant a refundable events of $1 1 million was received in June .
Four zero point $9 million and zero point $2 million in July .
We are laser focused on spending our cash on developing our clinical candidates and operating our state of the art manufacturing facilities in Paris and in Raleigh.
In addition, our focus on maintaining an efficient corporate infrastructure should also enable more limited growth in G&A spend in the future.
Thank you Bing.
To close out this call I would like to reiterate how confident we are about the continued progress offers three ongoing clinical trials.
In metallurgical malignancies, as well as our continued development of our preclinical programs.
At selective.
We strongly believe that our product candidates our technologies.
Our in house manufacturing capabilities will lead us to a paradigm shift for patients with hard to treat cancers.
<unk> us.
The forefront of this promising medical and scientific field.
With that I'd like to open the call for the Q&A.
Thank you we will now be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad.
Confirmation tone will indicate that your line is in the question queue. You May press star two if he would like to remove your question from the queue for.
For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys, one moment, please while we poll for questions.
Our first question comes from Yigal knuckle knockoff of Itch with Citigroup. Please proceed with your question.
Yeah, Hi, I had a question about the valley.
One study.
Hello.
So you you said you have six additional patients at dose level, 350% or Ron.
Continuing with the study.
In house product.
Going to be going with the same dose.
The in house product that will be in house product moved to to a higher dose above.
Of deal through thanks.
Thank you Yigal Great question I'll hand, this one over to Mark.
Hi, guys. Thanks for your question.
So yes so.
At presentation was at <unk> three with the <unk>.
<unk> manufactured product.
As we've discussed previously.
In vitro comparability tests that were done between the CMO manufacturer product and the product that was manufactured at selected.
Showed that to select this product was significantly more potent.
And then the CMO manufactured product and therefore.
We elected to bring the select this product into the clinic.
At a reduced dose level at dose level two so it's so it started in patients at 1 million cells per kilo due to the.
<unk> significantly increased potency of the product.
Okay, Thanks, and what it could you talk about the expectations for when we might see the first data from the in house products.
Yes, so we will discuss the first patients dosed with the <unk> product later this year it will be disclosed.
Okay. Thank you.
Okay.
Our next question comes from Gena Wang with Barclays. Please proceed with your question.
Thank you for taking my questions I have two.
The first one is regarding clinical data that <unk> 22.
Additional very promising response at her.
Just wondering how long do you think of post treatment could give us a definitive durability profile and this question.
Apply to your car 22, but also placed two other programs in general for Allo car T approach.
My second question is regarding your base editor and you're also demonstrate your gene editing platform capability with base editor.
Any plan to maximize your potential and a value proposition with this tool.
Thank you Gena and these are two great questions I'll give you the first one to Mark and then on base editing maybe Andre.
Okay, great. Thanks, Gena for your question so.
Yeah agreed in terms of durability of response. This is obviously once we get to.
And our <unk> dose that we want to move forward with.
I think in similar fashion, that's been shown in the autologous space you know where look you know looking at the six months.
Six month duration I think would be.
We'd be appropriate.
Oh, Hi, Gena. Thank you very much for the question on base editing. It's we're very excited by the technology because of its extreme precision and.
The ability to reduce as much as possible the potential.
Gino toxicity, because it doesn't clip DNA, Unlike new places.
And we consider using them in series of different type of disposition for example, making combos.
When you want to do not Kinder knockouts with the base editor you can essentially.
<unk> added the base. So you can disable the gene so we'll make a knockout.
Restore function of the gene in changing the base there that might do.
<unk> mutation, but you cannot in search.
Replace DNA.
Therefore, the technology could be used for example, when you want to multiplex and in order to reduce the number of clip in the DNA, even though if you do two series of cutting.
And your weight between the two.
If you want to pile up it's better to combine based editor that does not claimed the DNA with the potential nuclear to do not kin.
Wait a bit and do a second second shot for example, when you look at the products that we have the mark one.
As <unk> knockouts.
And this could be for example disposition for this amazing prologue for triple negative breast cancer and ovarian cancer. So it has a lot of potential with this the second thing that we believe that could be used for base editing is potentially for in vivo delivery.
For a certain type of genetic diseases and.
Because it doesn't require to have.
The combination with repair matrix to for example, fixing DNA and can essentially either by not capital by fixing a mutation induced certain.
Certain mutations and then also in other type of application and genetics Budd.
Essentially I think thats going to be a huge.
Add up on.
The design of the car T that we do when we move into the scale of the sophistication of the.
Gene editing into this and multiplexing and modification <unk> Nextgen things that we're bringing the thing that you don't want us to make too many cuts into DNA because that would induce.
Whenever you do it will induce translocation in certain rate is not acceptable.
Okay.
Hope it answers your question.
Yes, that's very helpful. Thank you both.
Thanks.
Our next question comes from Yanan, Zhu with Wells Fargo. Please proceed with your question.
Hi, Thanks for taking the questions I was wondering about the cart 20 by 'twenty two.
Data read out later this year.
What could we expect from <unk>.
The readout in terms of how many patients and what duration of follow up.
And also will the patients be mostly in a setting of post hoc Congress car T and CD 19 car T.
And what would be considered a successful outcome.
From this readout from the Companys perspective, thank you.
Thank you very much and answer the spotlight on your card 20 by 'twenty two over to you Mark.
Yeah, great. Thanks for the question.
So obviously, we're all very excited about 20 by 22 and as you know the trial just recently.
Started accruing earlier this year, so we expect to.
Reveal the first in human data for this very interesting dual allogeneic car T cell product.
In patients with relapsed refractory b cell non hodgkin lymphoma.
As part of the inclusion criteria for this study the patients will have to have failed.
Some form of CD 19, directed therapy, including.
Autologous CD 19 car T. If they're eligible to get them, but patients are also eligible for this study if for some reason that they are not able to.
<unk> generated an autologous product.
So and in terms of the.
The response these are early days in escalation so.
So.
Well.
We will reveal that response rate later this year with the first in human group.
Got it.
And.
In terms of the dose level.
No.
Could you talk about.
Oh, the designed those levels at which those level, we might see data.
Yes, so the initial dose level that.
We started enrolling patients.
$50 million sales flat dose.
So it's a flat dosing like most of the NHL car T cell studies.
Got it and lastly, I was wondering if you could talk about options to extend.
Cash runway.
And whether there.
Could be consideration for.
For example, the.
For example, monetization.
The royalty.
Scream from Halloween.
Yes, Sheryl just one go.
Great.
Sure I mean from a cash perspective I'll also highlight we have.
Multiple other options.
<unk> for example.
European investment Bank loan.
We signed an end of last year. For example, we haven't drawn tranche b, yet, even though we fulfill all the precedent condition for tranche B as an example.
As opposed to monetization of royalty, we're not obviously in a position to discuss that right now.
This one thank you very much Andrew.
Great. Thank you.
Our next question comes from <unk> Richter with Goldman Sachs. Please proceed with your question.
Hi, Yes. This is.
Unfortunately, thank you for taking our question just.
So I'll move on that back off the previous question. If you could just provide an update on how enrollment is going in that trial with our <unk> bottlenecks.
Just one quick one wholesome food platform with respect to that.
Thank you so much.
Thank you. These are great questions I'll hand that over to Mark.
Yes, thanks for the question so yes in enrollment.
Is continuing.
And what I can say is that the investigators are incredibly excited by the potential.
To use an alternative to CD 19 in this disease space and particularly dual.
Car T cell and <unk>.
That's allogeneic coming off the shelf to provide.
Our rapid access of these to these patients of this.
This product so there's there's intense excitement around this protocol.
Thank you.
Our next question comes from Kelly <unk> with Jefferies. Please proceed with your question.
Hi, This is Dave oilfield initiate that great. Thank you for taking a function.
Continuing on slide 22 quick question.
Many patient data should we expect that ebay and the baseline will be similar to what we saw the previous sort of also just wondering if you can add how many sites are.
Given the U S and EU.
Maybe if you can remind me if you have initiated dosing.
USA. Thank you.
Thank you that will be for you mark as well.
Yes, thanks for the question so.
As we discussed previously we will be.
We will be revealing the first.
Patient data with the new in house manufactured product.
And as we discussed prior we did bring that into the clinic at dose level two.
So that's what we will be discussing later this year.
In terms of enrollment.
Enrollment this trial is enrolling both in the U S and in the EU.
With the in house manufactured product.
Thank you for taking our questions.
Our next question comes from Heart hedge thing with Oppenheimer <unk> co. Please proceed with your question.
Great. Thank you and thanks for the question after a very busy week. This Friday just had a quick question on your car 'twenty two maybe.
If you could just talk a little bit about the unmet need in that <unk> 19 patients it seems that a.
Few years ago that was a small maybe for lack of a better word niche population, but it seems to be increasing the patient population there and the unmet need is fairly high too. If you could just talk a little bit about that.
I imagine Thats, where your car 22 slots and then Richard Clark 123.
Indicated previously.
This target is can be unstable and it's a difficult patient population with the addition of FCA that changing in your view and your ability to treat thank you for the questions.
Thank you Hi, Todd and I think both questions would definitely give a hallmark.
Thanks for touch for the question. So I think in the 22 space you know this.
The <unk> 22.
Right now is the only allogeneic car T. So that's being developed in the in the ALLL space as you point out.
There was.
Are the initial success of 19, which which is a great target. However, there are.
A significant number of relapses that had been seen as also in terms of.
The duration.
In the allo space as well and so this.
Clearly as you point out open up a very significant window for.
This <unk> 22 in this space.
Also in the fact that in terms of being able to give this product to patients that have been so heavily pre treated chemo transplant prior.
Prior CD 19 car T.
A lot of times these patients come in with limited marrow reserve. So obviously, an allogeneic car T. So.
Is in fact a.
A great option for them at that point, where they may not be able to mobilize anything for an additional autologous products.
I think for 123.
I don't know about it being stable I think.
I think the issue is more that we needed the alemtuzumab.
To allow for.
Significant host Lymphoseek suppression throughout.
Throughout the DLT period, and beyond so at least 28% to 30 plus days of having the host lymphocytes down so that we could see.
Significant expansion of the <unk> three and therefore.
Clinical activity, so I think thats really.
The major focus for for the addition of the <unk>, it's very similar into what we've shown in the 'twenty two study for why we need beyond excuse me ma'am.
To allow for better you carriage expansion and clinical activity.
And this is also the reason why we just proceeded with 20 by 'twenty two going in with FCA lymphoid depletion for that reason.
Thank you Mark good question.
Okay. No that's great. Thank you Mark I appreciate the update.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
Our next question comes from Jack Allen with Baird. Please proceed with your question.
Great. Thank you so much for taking our questions just two quick ones from us.
Starting on the clinical side with your car 'twenty, if I point to it's great to see that product getting a lot of focus on the call today.
A number of questions have already been asked here, but the one I had was what are the express and requirements for <unk> 2020, two and the patients on as it relates to enrollment criteria are there any expression requirements or are you taking all comers in that.
Postcard to your pro CD 19.
Setting and then on the financial side I was hoping maybe you could speak just briefly about any comments around the CVA disputes I know, it's more analogy in CVA thing, but I'd.
I'd love to hear any updates you have on that perspective as well. Thanks so much.
Thanks, Jack set of questions and the continued progress on Duane by 'twenty, two I will start with Mark on this one.
Hi, Jack Thanks for the question so yeah.
Yes, so for the 20 by 2002 study.
There is no requirement for both antigen, there's a they only have to express one or the other so either 'twenty or 'twenty two or both.
So that's in terms of expression.
Okay. Thanks, and further question on the survey I'll hand, it over to Andre.
Hi, Jack and I will thank you very much for the questions really appreciate it.
Last year like in September 2020 to Allergan in us issued some information.
Survey was.
Not helping that much on these trials and since then there was limited communication.
Given the situation going to obtain to see anything in order to not too complex defied the situation.
Therefore, you will have to wait.
Up to the time the situation clarifies and.
To date.
Hope that there will be clarity in the future.
No problem. Thank you very much for your question about I know, it's frustrating, but this is like you know these type of situations.
Yes completely understand thanks for the comment.
Okay.
Our next question comes from Silvan <unk> with JMP Securities. Please proceed with your question.
Hey, good morning, and thanks for taking my question I just have.
A quick question on your car T could you talk about the target and the initial population there and then in terms of a big picture when would that move that into the clinic.
Or are you currently just executing on your three.
Assets in the clinic. Thank you so much.
Thanks, Hal then great question on new khaki fab that one would be for Andre.
Well, we're super excited by this this prologue.
<unk> is an amazing cancer like a product for a series of different type of cancer, but could do play potentially for other things also and we.
We would like to we can push it either in monotherapy or combo therapy.
And.
We haven't.
Given clear.
Guidance on how we're going to use it but definitely it is one of the product that is one of the highlight of the preclinical pipeline. That's like this is once wants to push.
And there is like I mentioned about this product in frontiers in knowledge publication.
If we have currently.
What's the company the cash position will change in the near future its something that will definitely be.
One of the highlights and the current pipeline we have.
Alright, thank you.
There are no further questions at this time I would now like to turn the floor back over to Andre for closing comments.
Well. Thank you very much everyone for attending this Q&A.
Session and our earnings call in.
We're very excited by first half of this year and execution are extremely proud of what happen and we're really looking forward into the second half of this year, because very strong event that will mark the company.
Yeah.
For the second half up to the end of the year and definitely watch select this.
Execution that is happening today and also the innovation that we're bringing.
Through the clinic.
It would be it would be very interesting and thank you very much for everyone.
This concludes today's conference you may disconnect your lines at this time. Thank you for your participation.
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