Q3 2023 Brainstorm Cell Therapeutics Inc Earnings Call

Greetings and welcome to the Brainstorm cell Therapeutics third quarter 2023 earnings call.

At this time participants are in a listen only mode.

As a reminder, this call is being recorded and I would now like to introduce your host for today's call Michael Wood of lifestyle advisors. Mr. Wood you may begin.

Hi, good morning, and thank you everybody for joining us.

Year to date Brainstorm issued a press release with its financial results for the third quarter of 2023, including our corporate update before.

Before passing it off the company management for prepared remarks, I'd like to remind listeners on this conference call will contain.

Numerous statements descriptions forecasts projections regarding brainstorm cell T cell therapeutics and its potential future business operation and performance statements regarding the market potential for treatment of neuro degenerative disorders, such as ALS, the sufficiency of the company's existing capital resources for continuing operations in 2023.

And beyond the safety and clinical effectiveness of the Neurotechnology platform clinical trials of neuron and related clinical development programs as well as the company's ability to develop strategic collaborations and partnerships to support its business planning efforts.

Forward looking statements are subject to numerous risks and uncertainties many of which are beyond brands drops control, including the risks and uncertainties described from time to time in the company's SEC filings.

The company's results may differ materially from those projected on today's call and the company undertakes no obligation to public up publicly update any forward looking statements.

Joining us on the call today will be Mr. Frank Leibowitz, President and CEO of Brainstorm, Dr. Stacy Lindbergh, our co Chief Executive Officer, and Allen Topless interim financial Officer.

Now I'd like to call turn the call over to Mr. Leibowitz. Please go ahead right.

Thank you Michael.

Well, thanks to all who have joined us to discuss our Q3 2023.

Actual results and ongoing progress.

We are committed to our goal of making nor an available today less community.

Our priority now is to work with the F D a and do everything in our power to align on a path forward.

As announced previously we made the decision to withdraw the BLA for new Rolling from FDA review.

This decision was made following the outcome of the Advisory Committee.

It took place to review and neuron in September.

This action was coordinated with the F D a.

And is used by the F D a to withdraw without prejudice.

Okay.

The next important step will be for us to conduct the meeting with the FDA.

We submitted the official request just a few days ago.

We will use the opportunity to discuss next steps, including the design for a confirmatory phase III study in L. A.

Which we intend to conduct such meetings.

As part of our regulatory strategy.

We intend to seek.

A special protocol assessment.

With the FDA before continuing with the planned registration trial.

It's by indicates the agreement with the agency on the Ida.

Let's see.

Sure.

All critical elements of the trial design.

Including items, such as patient entry criteria endpoints and planned analysis.

We believe that having gets put in place.

Well derisked, the regulatory aspect of our Airbus programs.

We believe the process will likely take one or two meetings.

With the FDA.

<unk> will provide an update once we have clarity on the path forward.

In parallel with these regulatory activities.

Our management team and board are giving serious thought.

To finance the company.

Sure we have the resources to fund the planned phase III trial and positioning.

So for success in the future.

We're actively exploring various options to raise capital.

Including non dilutive grants as well as capitalizing on certain noncore assets, such as our <unk> technology.

In October we announced a strategic realignment to prioritize and conserve resources.

This is all a.

A number of steps, including streamlining our operations as well as a positive reduction in head count of approximately 30%.

Importantly.

Those positions that are most critical to managing the planned phase III trial.

And regulatory submission.

We will be returned.

We estimate.

Overall, the strategic realignment will cut total resource consumption approx.

Approximately 50%.

Many of Us <unk>.

Including all senior management.

Took a 30% plus in their wages.

As for myself I took over a 90% plus from now.

These were difficult but necessary decisions.

We're very thankful for.

For the hard work and commitment of all our colleagues have been strong.

For the contributions in advancing world.

I'll now turn the call over to Dr. Stacy Lindbergh for additional comments.

Thank you.

There remains an urgent need for new treatments for a less treatments that are safe and effective.

Everyday patients and their families confront the hearing reality of this terrible disease.

We've assembled a considerable body of data on your own and Atlas participants and we continue to believe that if approved this product has the potential to be a valuable new treatment option for people living with this disease.

We are motivated by the courage of Atlas patients.

We're driven by the opportunity to bring a product to market that we believe can improve their lives.

We look forward to continuing to engage with the FDA and conducting a confirmatory phase III trial.

Efficiently as possible.

Hi.

Thank you so much they see now.

Thus our financials a lot.

Thank you.

Cash cash equivalents and short then when deposits floor at Brooks and get $1 $4 million as of September 32023, compared to $3 million as of December 31st 2022 in July I'd like to thank the three the company raised net proceeds after approximately $7 million in a registered direct offerings research and.

<unk> expenses for the three months ended September 30% to 73 in 2010.

Approximately $3 3 million and $3 8 million respectively.

General and administrative expenses for the three months ended September 2023, and so that doesn't there's still more disruption, let me $2 7 million and $3 1 million respectively.

Net loss for the three months ended December 31% to three plus approximately $1 2 million or <unk> <unk> per share as compared to a net loss after approximately $6 9 million or <unk> 19 per share for the three months ended September 32022.

<unk>.

Thank you very much a law.

Michael Ward from lifestyle will now read some questions. We have received from investors Michael.

Okay.

Michael are you there.

Yes, sorry, I was on mute yes. Thank.

Thank you Guy is it possible that even with the AD Comm Division around me Rob.

The FDA could grant for limited approval for early stage data that patients are.

Why though it hasn't been an observable positive response.

Basically when it takes us.

Sure.

We firmly believe that generating additional data in the formats that phase III B trial that we've been discussing is the only password that we'll gain regulatory approval dinner and.

We would've never withdrawn the BLA, if we weren't convinced that we would not be successful with the current data alone.

Therefore, it's in our best interest to move quite as quickly as we can to get the trial started.

Thanks, Steve next question.

How long before you know more about your funding plans.

And as a follow up to that what are you hoping to start the phase III.

And are you waiting for funding our growth to come in before you can come into the study.

Yes. Thank you.

We're working with banks, who have been successful including very recently.

Raising funds for biotech companies like rain storm.

And their confidence in our ability to raise the funds needed to run this trial.

We will first work to secure a bridge to ensure stability as a company.

As we work in parallel to secure funding for the phase III trial.

As we shared in our prepared remarks.

We are exploring a variety of avenues, including partnerships and grants.

Although there is always the chance of a larger excuse me the phones.

Back to raise money for the trailing stages.

We also do not intend to weak to start the trial until we have raised the full amount needed we'll be thoughtful about starting to tie up of patients deserve more urgency around this.

Thank you next question.

Are you working on the new trial private hers that with the F D. A.

Stacey.

Yes, that's correct.

And as I mentioned in the prepared remarks, we've requested an expedited face to face meeting very recently and this meeting will allow us to discuss the next steps for neuron, which will focus on the core design elements of the phase <unk> trial that we've been working on with our scientific advisory panel Ana panel.

And people from the analyst community, including those living with the disease.

We intend to seek a special protocol assessment from the FDA, which as many of you will know as an opportunity to reach an agreement with the FTA before the study starts on the design of a clinical trial.

And this trial of course is intended to serve as the primary basis for an efficacy claim and a BLA.

We view this as beneficial on a valuable tool to accelerate the phase <unk> be trial for known and potentially derisk the regulatory aspects of the program.

Thank you and one final question.

Why don't you partner with Big pharma.

Thank you so we are seeking to partner.

In fact, we are in contact with.

Please.

Although <unk> is a relatively rare rare disease, the commercial opportunity is still compelling.

And we know there's interest from companies, who would lifestyle of a successful product in this area.

And to be able to serve patients.

You have to remember, though that cell therapy is still an emerging modality.

Especially in neuro degeneration.

There are very few approved cell therapy products.

And R&D products are largely focused on oncology and genetic disease.

Presumable with D. A.

Major approvals the sulfur displays will bring divestments on a pool of them some will remain cautious.

As you May know it took many years to develop car T cell therapy for various cancer treatments and innovation came from within smaller companies before developing partnerships just a few examples.

Farmer went alone until after approval and then was bought out by Julia.

Juniper pharma did the same was also acquired after FDA approval.

Sure.

While bluebird wasn't required and remains independent today.

We have a derisked phase III asset.

Which will have an attractive upsides are the right company.

So we will pursue a partnership is a promising avenue.

Lula is a technology represents a strategic approach and therefore, we would welcome a partnership with them.

Until the pumps were willing to do all we can to proceed with the funds we were able to raise.

Jenny would you like to open the call for any additional questions.

Of course.

Right now the floor is open for your questions if you'd like to ask a question. Please press star one on your phone keypad now I'll go from there.

<unk> title indicate that your line is in the question Keith You May Press Star two if you'd like to receive your question from Nicky if anyone using speaker equipment. It may be necessary to pick up your handset before pressing the keys. Please hold on a moment, whilst we poll for questions.

Thank you. Your first question is coming from David bouts of Zacks small cap research David Your line is live.

Hey, good morning, everyone. Thanks for the update this morning.

So chaim or Stacy you could I was wondering if you could talk a little bit more about the S. P. A.

And basically what differentiates that from saying you know just a quote unquote coming to an agreement with the FDA about a trial design.

Christine.

Yeah, David I think that does spar pathway and the opportunity to to formally recognize and use them.

The way that the F D a offers.

Really just gives us the platform to take come together into a line, but to have a formal agreement. That's that's documented and I think it's something it's a constructive way to approach this and it's something that I think.

It will be positive for brainstorm, but also really ensure that the discussion and the work that we do ahead ultimately is.

It nets out.

With the successful trial really what we expect which would be an approval. So.

It really is about a formal engagement and interaction and it's it's a pathway, that's well established and and leveraged.

Okay.

And as far as Oh go ahead sorry.

I was just trying to add on that of course, I just want to emphasize fda's.

As discussing with us on expedited pathway for a spa.

Additional answer to your question, what we're looking for expedited supply as you know that.

Those companies that are able to have a spa with FDA.

A far higher tonnes from the pool at the end of the day, but many choose not to do that because usually you can take a year or two years just to get through an agreed upon spots.

Just perhaps when you're talking about.

Expedited spot process.

We're looking forward for that.

Go on and give you. Another question. Please yeah actually that's going to key off of what you just said and basically kind of looking at a timeline. So would that would normally that process. It would be a year or two you're looking at less than a year, probably then for an expedited spa.

Yeah.

Well I don't want to put any words in <unk> core.

I'm here, so I won't be very cautious.

I do see our first meeting very fast and I think after that meeting will be.

We'll show that by the way, we'll share what happened at the meetings.

With the Investor community because this is our number one priority right now to see if we can come to an agreed upon spots and we will learn from this meeting.

That should be very soon and we'll be announcing when that meeting is.

Okay.

No I understand you probably won't be able to get into specifics, but do you first see the primary outcome for the next phase III trial being the same as it was for the previous one.

Yeah.

We are gonna have to have the discussion with the agency at that meeting.

So, let's keep us without we will share once once those meetings are done that we've come to an agreement with share what the trial design looks like.

Okay, alright, thanks for taking the questions.

Sure.

Thank you very much. Your next question is coming from William Barr from Tiffany Adventures.

William Your line is life.

Thank you. Thank you.

Thank you Stacey and thanks to everyone at Brainstorm.

We've been following and we've been investors in the company for many years so.

My question is.

Why is this time is going to be different than those of US who know you guys have been fighting how hard you've been working and all of us.

Any of US are really sold beyond grateful for everything that you've done and continue to do for ALS patients. We're finally, starting to see that the analytics treatment is maybe not what some people thought it was and we're finally starting to see that.

You know somebody else chapters are maybe recognizing the issues and also in.

And as far as the breakaway and we all saw what happened at the AD com and many of US believe that it was extraordinarily unfair.

A lot of investors won't brainstorm through the FDA.

Instead, you guys are in basically embracing the F D a.

We know you want a treatment for AOS as quickly as possible and we know that you guys have really done everything in your power to try to effectuate that so why is this time is going to be different.

Alright. Thank you. So very good question. So first allow me I cant I don't want to comment on other treatments or both organizations were looking to have everyone supporting us all the organizations and all the advocates and we're going to work on that as well we're going to reach out once we have a trial design and shared with them and listen to their.

Inputs.

Going forward.

What I think will be different you have heard in our opening statements. We're trying to come to an agreement with the spot and I want to share with you.

Proposed by the FDA to do that to have an expedited path. So again, we should see.

How they will treat a different going forward.

We should acknowledge that.

Even though some see the outcome has been.

Over the negative two neurons.

What we are being explained and I want to be cautious of what I'm, saying.

Many don't disagree with what we are saying they just feel we need more data to prove that.

So therefore, they want to align on a.

And our agreed upon trial.

To provide that data and therefore that discussion together with them is very important to see what are these seeking an addition to what we provided and.

So we should align with what should be provided.

Should be sufficient for an approval that's what its filings.

Going into that meeting I think we are going to get an expedited meeting.

We are getting indications from agency.

They want to have this meeting very fast so they are showing interest in it.

Supporting us being able to have another trial versus just talking about the drivers.

Well, Steve you also to comment.

Okay.

Yeah really my thank you for the comment and and your and your question and I think you know when we stepped back and we look at what.

What we have before us certainly when.

When we brought forward or a product we believe and we still believe in our data and we believe that there was a discussion that should happen around the efficacy and safety in the appropriateness given regulatory flexibility.

At the end of the day when we look forward one of the strongest positions in the things that we can do is we can execute on a trial design leveraging the learnings that have occurred and we can read out of trial that that meets the 10 points and so what you see US doing is is really doubling down we understand our.

Next we have a lot of information that we believe gives us a lot of confidence in our ability to deliver this trial.

So what we're focused on is bringing forward a product that straightforward in this in this next trial that that makes the regulatory process.

Certainly more more conventional <unk>.

And and then that the next time around certainly.

Well, Mitch more streamlined and Smith.

What I think of when I think about what's different next time and and you know drug development is incredibly complicated we always learn things in our in our endeavors. When we're when we're tackling very tough diseases and I think in the setting of this last phase III space.

Phase III program.

Certainly there were things that the the community did not appreciate and did not understand and we now have those learnings that we take forward to this next trial design.

Thank you. Thank you very much.

For those of us that.

<unk> patients in our lives have lost family and friends I just wanted to say thank you to both of you and thank you for fighting the good fight for us.

No and thank you for your ongoing support many years really appreciate that.

Thank you for your question please.

Your next question, we have time for one more yes, please Daniel Walker.

Private Investor Daniel Your line is life.

Apologies that comment on manufacturing you mentioned that the recent Brainstorm town Hall meeting that Brainstorm had successfully manufactured 500.

Potent products. They think there have been some questions about brainstorms ability to manufacturer can you just comment on that and then also moving forward you know.

How will the clean rooms to be manageable it be Cadillac will it be the academic centers and maybe you could just comment a little bit on that.

Yes. Thank you very much Danielle for the question so.

We did have quite a few centers, where we already produced as you know for the 15 phase three trial.

The academic centers and commercial sensors only for the EAP going forward. Its first financial question you know the academic centers are cheaper than the commercial centers.

Operator.

On the other hand, you don't want to have a site that once you are successful with the trial.

You should have a commercial site ready so we can balance that timing wise to see maybe we will start with academic and then.

For the second part of the trial do a commercial site. So we can gain from the cheaper cost earlier, and then but simultaneously people to have a commercial site ready once the trial is done.

Does that answer your question.

That does and I guess with the Spa I mean, how do you ensure that this go around because the the FDA was quite critical of the manufacturing at the AD Com. How do you ensure moving forward, though that there is alignment not only on the spa, but also in addition to the manufacturing so that at the time you resubmit the BLA they feel.

Confident in the manufacturing because obviously, there's a difference between manufacturing you know at the trial level.

Compared to you know actually at the time of commercialization.

Thank you that's very helpful. You clarify the question even more so the answer is the FDA agreed to have discussions with us while we do the trial on the same patients to come to alignment.

As I've said previously we have come to alignment on many of the CMC issues, if not most but some of them. It takes longer to do those qualification test, which we are continuing to do those that are critical but yes. They will have with a separate conversations with the CMC team.

And separately from the clinical team.

Excellent. Thank you so much and then just lastly, I was wondering if you could just expand on the <unk> technology I know you're working on capitalizing that can use their states and just comment very briefly on what is that technology and why that might be interesting and compelling.

Pharma or biotech.

Yes, you mentioned safety and I'll ask <unk> to talk to that of course.

A lot of them.

Sure Danielle this is and additional technology that that we have been developing and certainly have thought of as high as they are interesting and exciting part of our portfolio and you know what's interesting about exosomes is of course that.

It allows us to take to move into and explore different diseases.

Can carry cargo and can penetrate different parts of.

Uh huh of human bodies, and therefore, you know brings different different advantages.

But we've done a number of preclinical studies some of which we published and we think Theres a lot of excitement in our in this technology platform, which again offers a wide array of diseases that there's a great unmet need and that these nano scale particles.

No really would be able to open it possible administration options on that.

That would be very effective for treatment.

Excellent. Thank you both so much I really appreciate it.

Thank you.

Thank you very much that appears to be the end of our question answer session I will now hand back over to Haim for closing comments.

Thank you very much and have a wonderful day. Thank you.

Yes.

Thank you everybody. This does conclude today's conference you may disconnect. Your phone lines at this time and have a wonderful day. Thank you for your part thank you Jonathan.

Okay.