Q2 2023 Gracell Biotechnologies Inc Earnings Call
Yeah.
Ladies and gentlemen, thank you for standing by my name is Bob and I'll be your conference operator today at this time I would like to welcome everyone to the grass Grasso Biotechnologies second quarter 2023 earnings conference call.
At this time all lines have been placed on mute to prevent any background noise.
After the Speakers' remarks, there will be a question and answer session.
To ask a question during this time simply press the star followed by the one on your telephone.
If you'd like to withdraw your question. Please press the star followed by the one once again.
Thank you I will now hand, the call over to Kevin ship, you May begin your conference.
Good morning, and welcome to <unk> second quarter, 2023, corporate update conference call and webcast with.
With me today are Greenfield founder and the Chief Executive Officer, Robert Williams, and our Chief Medical Officer, Dr wouldn't really.
We're excited to discuss the advancement of the trials underway with our car T candidate on today's call.
We also look forward to sharing with you our recent business developments and upcoming objective as we progressed through 2023.
We will conduct a question and answer thanks, and following our formal remarks.
This morning, we issued a press release.
Announcing unaudited financial results.
The second quarter ended June 32023, we encourage everyone to read the press release.
Wed also like to remind you that this call is being recorded for replay.
Please know that for certain information discussed on the call today, including financial data clinical data and the future plans of our program results management will be making forward looking statements actual results could differ materially from those stated or implied by those forward looking.
Statements as a result of various important factors.
Please refer to the risk factors section of our latest 20-F filing.
For a full disclosure of this richness and the factors.
This conference call contains time sensitive information that is accurate only as of the date of this live broadcast.
August 14 2023.
<unk> undertakes no obligation to revise or update any forward looking statements.
Live events or circumstances.
The date of this conference call.
As may be required by applicable securities law.
I will now I'll turn the call over to Chris Our CEO , Dr. William Tom Wheeler.
Yeah.
Thank you, Kevin and again welcome everyone to our sector.
<unk> hundred 23, corporate update conference call.
I will begin today's call with key pipeline updates and details regarding our recent financial transaction.
I will then return the call mature CMO, Dr. Wendy Lee to provide insights into data presentations from three studies presented at the American Society of clinical oncology, ESCO and a European Hematology Association Inc.
In June .
Next our CFO , Dr. Kevin and Jim will discuss our second quarter 2023 financial results.
After our prepared remarks, we will open the call to questions.
We had a very successful second quarter with multiple data updates from our clinical programs.
Notably our lead product candidate <unk> CD 19 dual targeting.
Beach <unk>.
We received significant recognition.
<unk> and <unk> annual meetings.
Our investigator presented a two oral sessions with updated data from our studies in multiple myeloma and a b in nature.
In particular.
ESCO.
Zero trough out show, 93% overall response rate.
83% Tien tsin.
At CRH.
100% minimum residual disease negativity.
And medium progression free survival and PFS, Oh 38 months.
The investigator initiated trial.
With 29 relapse refractory multiple myeloma patients.
As a reminder.
G data shared in ESCO and had a cutoff date of April .
2023.
We believe <unk> represents a next generation car T therapy candidate in leverage multiple special features and a proprietary fast next day manufacture technology.
It is specifically designed to enhance therapeutic efficacy safety and product availability time.
<unk> zero 12.
And its bcm as CD 19, dual targeting design, where beauty utilizing our teams deep knowledge in biology, and immunology and molecular biology.
It went through years of development and protection.
Believe we have designed and have chosen a compound.
Tricastin optimal balance between safety and efficacy.
<unk> targeting approach not only broadens GC, Joe Bess applicability in indications, where either <unk> or CD 19, finally proven targets, but Moreover, makes <unk> a potent weapon against the complex diseases multi.
Multiple antigens.
Vault, which is true for many hematological cancers and autoimmune disease.
Based on the clinical data showcased at the medical meetings over the past year <unk> has demonstrated the benefits of Geo targeting in late and early line multiple myeloma as well as in NHL and.
<unk> deep and durable response.
Most recently, we are generating the data from preclinical studies supporting the strong rationale or utilizing dual targeting <unk> to treat refractory systematic Luke.
Eric the mattresses or our SRA.
Moreover, <unk> is produced utilizing our trough overnight.
Overnight manufacturing process.
The tapes short term patient wait times and enhance efficiencies.
Thereby giving clinicians more predictability and flexibility in managing the treatment.
Currently <unk> is being evaluated in company sponsored clinical trial.
Refractory multiple myeloma in the U S.
And in <unk>.
In newly diagnosed multiple myeloma and NHL.
NHL and <unk>.
Recently, we have reached a significant milestone as the patient enrollment.
Our U S phase one b trial evaluating <unk> F for Ohio and <unk>.
Screening is underway and the first activate sites as a.
The phase <unk> portion, primarily and to evaluate the safety and tolerability as well as determining a recommended phase II dose we.
Paid enrolling approximately 12 patients in the phase <unk> portion.
<unk> estimates that it might take approximately nine to 10 months to complete patient enrollment.
We plan to share data with the FDA and proceed into the phase II portion.
We are also continuing to augment the compelling clinical data on GCG will drop out across other indications.
At an oral session at Ehealth Congress the updated data from the B NHL China.
Showed 100%.
In three months and 67% CR at six months among nine patients all with a challenging diffuse large b cell lymphoma or <unk> subtypes.
Daiichi evaluating 12, a new diagnosed multiple myeloma patients is also advancing with plan to provide an update from this study.
Including data from additional patients and longer follow up.
At an upcoming medical meeting later in September .
Moving on to our Immunology program. We are excited to report that Q4, <unk> zero swap out in refractory. So he has been successfully launched in China during the second quarter.
Multiple patients being dosed and we expect to share clinical data in the first half of 'twenty three 'twenty four.
Simultaneously we're messaging.
Selling preclinical data strongly support the rationale for CD 19 became a dual targeting in the treatment of <unk>.
First of all in our clinical studies, our candidate has demonstrated effective.
A nation of CD 19 positive T cells, which is of course crucial to facilitate a new research and come back sorry.
Secondly, as aerospace so the BSL autoimmune disease, resulting from a range of auto antibodies attacking the patient's own system.
We believe that treatment to show also addressed and other antibodies, creating plasma cell or a S. C ASP.
AMC populations generally bcm, a pathogen and a significant portion of them CD 19 negative.
So the use of CD 19 single targeting car T therapy alone may not be sufficient to eliminate all the disease, causing asps in all patients there.
Therefore, targeting both <unk> and <unk>, which aligns with <unk> progressed dual targeting design has the potential to provide a more effective and the long lasting therapeutic approach or refractory <unk>.
In our preclinical studies 12 reps car T has shown a more effective elimination ASC some patches.
19 crunchy alone.
Last but not least based on preclinical data we collect the sofa, we found no evidence, suggesting occurrence of serious adverse events in body.
These preclinical data as well as the consistently favorable safety data, we have accumulated in over 50 cancer patients give us strong level of confidence in the pre clinical potential of <unk>.
<unk> in autoimmune disease.
We are currently on track to submit an investigational new drug <unk> filing to the U S. FDA in 2023 for the planned phase one trial.
This will be an important milestone as we continue to advance our efforts to provide innovative effective treatment options for patients with autoimmune disease.
During the second quarter, we completed a strategic review across our clinical programs and have decided to focus on our resources on our most innovative validated product candidates such as <unk> 12.
Which we believe have the potential to be the best in class and address large unmet medical needs.
You can find our we prioritized the pipeline chart in the Greensville corporate presentation deck available on our website.
The decisions made during the strategic review reflect our determination to be at forefront of medical innovation and underscore our dedication to improving the lives of patients through transformative life changing therapies.
In early August we have.
We were delighted to complete a private placement transaction, raising $100 million upfront and up to $50 million additional funds if the warrants are fully.
<unk> exercised within 24 months.
The financing was led by vivo capital and are joined by a capital TC Gx, Janus Henderson and other well known healthcare investors.
This additional funding greatly strengthened our financial position extends our cash runway into the second half of 2026.
<unk> is intended to support us through critical upcoming milestones planned for the clinical development of <unk> in multiple myeloma and so.
We thank our existing investors for their unwavering support and extend a warm welcome to our new investors, who took time to thoroughly understand our technology and pipeline.
And the confidence you have shown in us a truly appreciate it.
<unk> team is committed to our mission to develop innovative and application of cell therapy candidates for patients with cancer and autoimmune disease.
Thank you for being essential part of our success story.
Now I'll hand, the call over to our CMO, Dr. Wendy Lee to highlight the three datasets.
Were presented in June at ESCO.
Wendy Please go ahead.
Thank you William we're continuing to generate clinical data from the ongoing trials or Tcs they would cause F. Our fast car enabled PC Ami and the CD 19 door targeting autologous car T cell therapy.
This candidate apps to transform cancer and.
Emailed these days treatment by climbing fast deep and durable responses with an improved safety profile.
And fast overnight manufacturing.
And both <unk> and <unk> in June long term follow up data from the multiple center I E.
Our <unk> was presented.
Based on the data cutoff date of April 12, 2023.
The data showed eight responses with 100% <unk> negativity.
And 82, 8% I'm R&D narrative.
James They are in 2009.
And patients.
The median PFS was 38 months.
This data cutoff date.
<unk> that durable responses achieved by <unk> <unk>.
This part trade.
Our main mentally high risk patient population.
The safety profile was consistently favorable with no neurotoxicity of any grade.
And then no second primary malignancy reported with this longer term follow up.
We are very encouraged by this clinical data and has commenced patient enrollment in the phase one b trial in the U S.
Data evaluating <unk> F 14 meant B and etch Al was also presented at <unk> and <unk>.
Including as an oral session at the later meeting.
Based on a data cutoff date of April 12.
<unk> thousand 80 <unk> suite.
Updated data from the ongoing <unk>.
Showed and are 100% in all nine patients treated.
Notably all my anecdote missions.
He feels large T cell lymphoma patients, which is the most challenging subtype of <unk> and <unk>.
<unk>.
D C <unk> F.
<unk> impressive deep and durable responses and the complete response rate was 77, 8% at month, three and 66, 7% at month six respectively.
Five of nine patients experienced grade one crs.
And the one patients had grade three Crs, which resolved within two days after standard of care treatments.
No neurotoxicity or Atkins of any grade were observed.
This data further supports the clinical potential and the wide applicability of our key seasonal cloud staff.
Additionally, we presented the first data from the company sponsored Phase one study in China of <unk>. There are seven key parts of that.
Congress.
<unk> is the down that Iran.
<unk> anti CD 19 car T candidate that has been designed to treat relapsed refractory b cell acute.
For plastique leukemia patients, who may not be eligible for autologous.
<unk> car T therapy, due to poor sale fitness impaction or.
Or other suitable conditions.
Among the nine patients are node and the traded between March 2021, and the May 2022.
100% of patients achieved high margin negative.
We are of course they are at.
It's day 28 after infusion of <unk> 17.
At a median follow up.
<unk> hundred 15 days.
Seven of nine patients remained in CR or cri.
We're two patients had the CD 19 negative relapse.
The one year PFS and <unk> were 76 point.
2% and 85, 7% risk.
Respectively.
Grade 123, Crs were reported and all resolved after 18 months.
No neurotoxicity or I can upsell.
<unk> served.
Chronic gvhd occurred.
In closing I will now.
To highlight that several clinical studies have initiated over the past few months.
Including the company sponsored Phase <unk> study of <unk>, the World class asset in our.
In the U S.
Alpha <unk> class asked.
Patrick Terry S L E in China.
Smart car TTC five or six.
<unk> crowding $18 two in solid tumors.
Overall.
We are very pleased with progress of our clinical pipeline and were eagerly looking forward to building out this momentum.
Our now turn the call over to our CFO , Dr. <unk> haven't yet.
Kevin.
Thank you Wendy.
Turning to our financial results for the second quarter ended June 32023, I'd like to touch on a few financial trends.
As of June 32023.
The company had RMB 1.188 billion.
Or U S dollar $163 8 million in cash and cash equivalents and short term investments.
We expect the cash here this year to be approximately $100 million U S. Dollar primarily to fund our R&D and clinical programs in the U S and China.
As announced in early August we completed a private placement financing with a 100 million risk upfront and Ottawa additional 50 minute in the.
Event that the words are fully exercised within 24 months after the closing of the upfront purchase.
With this we have extended our cash runway by one and half years and now expect that our current cash position will be sufficient to cover our operational plan and the R&D activities into the second half of 2026, if the warrants are fully exercised.
For the three months ended June 32023.
Net loss attributable to ordinary shareholders was RMB $146 9 million or U S. Dollar 23 million compared to RMB 146 $3 million for the corresponding prior year period.
Research and development expenses for the second quarter 2023 were RMB $103 eight minutes.
Or U S dollars $14 3 million.
<unk> to RMB 117, one $1 million in the corresponding prior year period.
The decrease was primarily due to the slightly decrease the spending.
Research development clinical trials and the payroll.
With that I'd like to turn it back to the operator to open the session for your questions operator.
Thank you if any participant would like to ask a question. Please press the star followed by the one on your telephone keypad.
Our first question comes from the line of Kelly <unk> from Jefferies. Please go ahead with your question.
Thank you for taking my questions and congrats on the progress.
I have a cough trials regarding the <unk> phase one trial can you talk about patient selection criteria and as does the trial allow prior peak Amit is that make car T and also prospects that they get treatment targeting both the SMA and that you can't get back to you. Thank you.
Yeah.
Okay.
Hello, Okay Sir.
Hello.
Yes, Im sorry, you can hear me.
Yes, it's a little bit of weight, yes.
The patient screening is ongoing right now.
And were in response to the changing treatment landscape and hopefully opportunities or more patients can benefit from.
Tcs.
So we will now exclude patients you just mentioned about the PCM in the other treatment.
But we have done that come.
The washout time.
And between.
This therapy and.
Please proceed.
Sure.
Yes, one more question here.
Yes. Thank you and also would you be able to estimate.
I am going to dose the first patient in 2023 of how many patients will be dosed.
On Asia.
Yes, we plan half of 12 patients dosed in two doses.
And to the patients is still in the screening right now and so many test were ongoing and.
The <unk> screens on the track.
Thank you.
Thank you. Our next question comes from the line of Charles <unk>.
<unk> Zara from Piper Sandler. Please go ahead with your question.
Hi, everybody. Thanks for taking my questions, maybe maybe first one on the G. C zero 12 F phase one and in the U S. Here William I know you said that the phase <unk> might take nine to 10 months to complete enrollment of the 12 patients I guess is it your expectations.
To fully complete this portion of the trial before disclosing any data or is it possible we could see some data once the first dose level clears, thanks, and I have a follow up.
Yes.
Joe.
To report a full set of data.
You would take some time.
You have to question, whether we're going to report portion of the data.
No.
<unk> I think on the circumstance circumstances.
Maybe.
And the CVA, it's possible, but I don't think this.
This convention to release portion of the phase one data.
Okay got it that's helpful.
I guess as my follow up it looks like the meso deal and smart car.
It was removed from the pipeline with the prioritization I know it had dose some patients in China Iot. So I'm wondering if you could speak to maybe what you saw there that maybe led to this decision and whether theres any learnings there with the smart car platform that you could.
Applied to the Quad and program that you continue onward. Thanks.
Yes.
Our bar as we.
Discussed in previous meetings.
Our buy is not just seeing some patients.
May benefit from SB or partial response.
I think currently our the program for solid tumors seams.
There is a term cord, 50% NOI curse.
We think for such a sort of pricey and a complicated autologous car T therapy, the efficacy should be higher or the benefits to the patients should be highly.
Highly differentiated from standard of care.
Alright.
Engineered to be our sort of internal criteria.
Selecting.
A potential product to move forward.
Back to the fiber III.
Measure seating and the correspondent tumors.
Appears very challenging.
We do see.
For safety, we don't see.
Serious side effects that we need to.
Elaborates.
The Crs and neurotoxicity.
On a ruble.
But the safety.
The efficacy is not striking based on our standards.
So.
And the way above our re prioritization.
We focus on.
Strong runners.
Mmm early line by them.
Auto immune disease, we decided to slow down some of the early programs.
Okay got it makes sense and helpful. Thanks, so much for taking my questions.
Sure.
Thank you. Our next question comes from line of Justin <unk> from <unk>. Please go ahead with your question.
Hi, good morning, Thanks for taking my questions and congrats on the progress.
Maybe just first on <unk> phase one study.
If I heard correctly I think you're you opened up in one U S clinical site and I think previously you've said you expect to open up in five to 10 U S. Clinical sites I'm just wondering if that's still the case here and just.
When you might expect the net backs clinical site.
Come up online.
Yes, the first side is activity in.
And patients screening and some ongoing Andy yes, other fact coming.
Right.
And actually some part.
You all know everything's under control and I'm talking now.
Okay great.
Thank you.
Just wanted to see.
Just checking I think.
As far as the prioritization.
I mean, everything Thats reflected on your pipeline and your new pipeline chart here, we should assume that that is.
And the companies.
Prioritization correct.
Correct.
Got it okay, great well, thanks for taking my questions.
Thanks, Jeff.
Thank you as a reminder, if you'd like to ask a question. Please press the star followed by the number one on your telephone keypad.
Our next question comes from line of Emily Bodnar from Wainwright. Please go ahead with your question.
Hi, good morning, Thanks for taking the question.
First can you maybe talk about how you think about the market opportunity for ethylene in the U S. Specifically I guess what portion of the population you think could benefit from our car T therapy, and then I just wanted to clarify I think on the call. It's about the newly diagnosed data would be in the fourth quarter, but I think in the press release for the third quarter.
Just could you clarify that maybe comment on any next steps for that program. Thank you.
M&A.
So your first question first and then I'm going to ask.
Maybe you need to repeat the second question.
The market size, we are targeting.
Refractory Soe.
My impression sorry, I can't give you.
Exact numbers as we have been studying through.
Based on the.
Enrollment criteria and the endpoints that we are testing and evaluating so the exact number or the size of markets.
And I can't give you exact number but.
It's obviously, it's a significant unmet need.
Yes.
The fields are good.
<unk>.
Brian just potential.
What was your second question.
Could you just clarify when the newly diagnosed multiple myeloma data that's coming in on the next steps for that program.
Yes.
When do you can take that one.
I'm sorry, no question again.
Yes, the update.
The updates of newly diagnosed longer follow up.
B E.
Yes.
Okay, Yes, we're looking for yes, we're going to say.
Yes, we're going to share that.
Clinical data from the I T in MDM Mam later in September .
Right.
Alright.
Thanks, Matt.
Mhm.
The next step will be yes, the coupon.
Information in later.
23 of this year.
Okay. Thank you.
Yes.
Thank you. Our next question comes from the line of Yanan Zhu from Wells Fargo. Please go ahead with your question.
Hello, Hi, Thanks for taking a question. This is kwan for Yanan. So my first question is on <unk> so far.
The U.
U S phase <unk> two study can you discuss the company as well.
Internal bar.
Moving the program into Phase III and my second question is for <unk>, so far the signs.
Studies.
Why.
Thats companies.
Okay.
Brian on the dose level is it similar to the China <unk>. Thank you.
The first question, yes, we have we're going to finish this one first and then we're going to have the meeting with FDA.
And would it be more clear next step and the second question you made a compare with <unk>.
China Li.
Yes, it depends on the city and FDA requirements there.
I truly different.
From that dose never end.
Element frequency dose never in.
And China will be start to do so and one five and three.
Three.
And in China in U S will be one and three the two doses in the <unk>.
Currencies in China.
They can.
Three patients together.
In U S based on FDA requirement have tier one by one amounts.
And then very different but the timing will be soon thank you.
Good morning.
Thank you <unk>.
The dose of <unk>.
Yes, theres going to be similar but we haven't.
Just trying to yet.
We.
For this key studies in China.
We start from low dose, which is very similar to the low dose of <unk>.
Then <unk> trials.
It look like it's going to be the same dose.
Sorry.
Okay.
Escalating dose.
Okay. Thank you. Thank you for all the colors.
Youre welcome.
Thank you our final question for today comes from Eagle Rafael <unk> from Citigroup. Please go ahead with your question.
Yes, hi, Thank you for taking the questions on unchanged.
Or is there a seven you indicated that you're going to start or you have started a registrational phase III in China.
Can you talk about your thoughts for bringing that product to.
In the United States for clinical development.
Yes.
Randy I'll take this one.
The 77.
<unk>.
Very unique product.
And.
The unmet need compared to other indications.
Really small.
So our plan has been limited this product development in China.
So we don't have any intention.
And on another one on the pipeline for you guys.
Okay.
And then regarding the Soe trials can you just talk a little bit more about how the design of the U S.
For SLE trial will be structured.
In terms of the patient enrollment characteristics relative to the <unk>.
Alright.
In China.
Are they relatively similar.
And it will be too early it.
It will be too early to elaborate.
The designs.
Each trial in the U S.
Alrighty.
Opus will die.
Just exactly to test out.
What would be the dose what would be the endpoints enrollment criteria.
These will be evaluated through the trial.
Trump.
While we are preparing for the filing.
Yes.
Happy to share with you we haven't gained a lot of insight. So the first few patients.
But at this moment, it's too early to.
Have a review.
But we do see a lot of.
Mhm.
To obtain.
New valuable information, including the dose to see.
Safety profile again preliminary.
And the response.
Okay and then last question I had was you mentioned that the 9% to 12 month timeframe for enrolling.
Our study in the United States.
Can you just comment a little more in terms of the assumptions supporting that timeframe.
Is it a function of the competing therapies in this space and the enrollment criteria.
And any additional.
Details you can provide.
On that timeline. Thank you.
I wish you Andy.
Yeah, Mitch do you keep that like you just mentioned about.
About 10 months after submission for <unk>.
And now we're going to have the <unk> meeting with FDA.
And that will be more clear next step.
Regarding the competing therapies so far.
We don't.
See that happening.
And given the <unk> from Motors Pis from these centers.
Obviously, the unmet need is clear.
Features of this potential product.
Potential compound means a lot to the patients and the doctors.
The fast turnaround safety profile.
These are still very attractive so far.
We see.
Everything is planned.
Okay. Thank you.
You're welcome.
There are no further questions at this time, Kevin ship I'll turn the call back over to you.
Thank you again to everyone for joining us on the call.
With the strategic re prioritization of our pipeline, we are focused on advancing our highly differentiated and our most competitive candidates, including the past Carl <unk>.
The U S. R&D trial in <unk> is now underway and we look forward to submitting the R&D filing in.
Sorry later this year.
We remain committed to pushing the boundaries of medical innovation and improving patient outcomes through our transformative therapies.
Okay.
Thank you. This does conclude today's conference call. Thank you for participating you may now disconnect.
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