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spk00: Greetings and welcome to OncTernal's fourth quarter 2023 financial results call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Richard Vincent, Chief Financial Officer. Thank you, Richard. You may begin.
spk01: Thank you, Alicia. Good afternoon, everyone, and thank you for joining us today. Joining me on the call this afternoon are our President and CEO, Dr. James Breitmaier, and our CMO, Dr. Celine Yazchi. Today's call includes a business update and discussion of our results for the fourth quarter and full year 2023. Our 10-K for the full year 2023 was filed earlier today. Today's press release and a replay of today's call will be available on the investor relations section of Monterno's website for at least the next 30 days. Please note that certain information discussed on today's call is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. We will be making forward looking statements during this call about future events, such as our business and product development strategies, the timing of our clinical studies, planned interim data updates, regulatory filings, and our cash runway. Our actual results could differ materially from those stated or implied by these forward looking statements due to risks and uncertainties associated with our business. These forward looking statements should be considered in conjunction with and are qualified by the cautionary statements contained in today's press release and our SEC filings, including our Form 10-K for the full year ended December 31, 2023 as filed today. This call contains time sensitive information that is accurate only as of the date of this live broadcast, March 7, 2024. We undertake no obligation to revise or update any forward looking statements to reflect events or circumstances occurring after the date of this call. With that, it is my pleasure to hand the call over to our CEO, Dr. Jim Breitmaier.
spk06: Thank you, Rich, and good afternoon, everyone. At Oncternal, we are advancing two first-in-class clinical programs targeting cancers for patients with significant unmet medical needs. We continue to be excited about the potential of Onct 534 and its novel mechanism of action which may address a significant unmet need for advanced prostate cancer patients who progress after currently approved AR pathway inhibitor therapy and before they move into more aggressive treatment options such as chemotherapy or radioligand therapy. Earlier this year, we announced that four patients with metastatic castrate-resistant prostate cancer had been enrolled into our Phase I-II dose escalation, dose expansion study of OCT534. We have been able to dose escalate as planned without unexpected dose limiting toxicities, and the third dosing cohort of 160 milligrams of OCT534 is now fully enrolled. We plan to announce an initial clinical data update for this program late next quarter. With respect to OCT808, our ROR1 targeting autologous CAR-T We released initial clinical data in December from Phase 1-2 study, OCT808101, in patients with relapsed to refractory aggressive B-cell lymphoma, including patients who have failed previous CD19 CAR-T therapy. We saw an encouraging response signal at the initial dose of 1 times 10 to the 6th CAR-T cells per kilogram, with two of the three patients achieving complete metabolic response and the third achieving a partial response. as of the December 4th cutoff date. Common adverse events in this dosing cohort included decreased blood counts, pneumonia, and grade 1-2 cytokine release syndrome, or CRS. The first patient treated at the dose level of three times 10 to the sixth CAR T cells per kilogram, an 80-year-old with bulky disease who had received four previous lines of therapy, including CD19 CAR T, experienced a fatal serious adverse event consistent with CRS and immune effector cell associated neurotoxicity syndrome. This patient's autopsy showed no histological evidence of his lymphoma, despite the fact that there were two large tumor masses present prior to treatment with Onc808. As a result of this unfortunate event, and in alignment with the FDA, we decided to implement additional protocol changes that include modified eligibility criteria, additional screening for adult infection, and testing lower doses of OCT808. We believe these changes will help us further ensure patient safety as we investigate the optimal dose of OCT808 for patients with advanced B-cell lymphoma, including patients who have relapsed after CD19 CAR-T treatments. We expect to report updated clinical results, including from this new dosing schedule for Onc 808 in mid 2024. Overall, our two clinical programs, Onc 534 and Onc 808 are advancing, and we are looking forward to potential significant value inflection points for the company from both programs in the near term. With this, I now turn the call over to our CFO, Rich Vincent.
spk01: Rich? Thank you, Jim. Our revenue is currently derived from research and development grants received from the NIH. Our grant revenue was $0.3 million for the fourth quarter ended December 31, 2023, and $0.8 million for the full year 2023. Our total operating expenses for the fourth quarter were $9.9 million, which included $2.2 million in non-cash stock-based compensation expense. Full operating expenses for the full year were $42.5 million, which included $7.5 million in non-cash stock-based compensation expense. In the fourth quarter, research and development expenses totaled $6.7 million, and general and administrative expenses totaled $3.2 million. For the full year, research and development expenses totaled $29.8 million, and general and administrative expenses totaled $12.7 million. Net loss for the fourth quarter was $9.2 million for a loss of $3.11 per share, basic and diluted. For the full year, our net loss was $39.5 million for a loss of $13.43 per share, basic and diluted. As of December 31, 2023, we had 2.9 million shares of common stock outstanding with $34.3 million in cash, cash equivalents, and short-term investments and no debt. We believe these funds will be sufficient to fund our operations into the first quarter of 2025. With respect to upcoming milestones, we remain on track. BRONC 534, our lead DARI product candidate, we expect to present initial clinical data late in the second quarter of 2024 with additional data readouts in the fourth quarter of 2024. BRONC 808, our ROR 1 autologous CAR T, We expect to report a clinical data update mid-2024 with additional data readouts in the fourth quarter of 2024. Now, I will turn the call back over to Jim.
spk06: Thanks, Rich. So, with that, I think we are ready to take questions. Alicia, if you could open up the floor for questions.
spk00: Of course. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tool will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. 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. Thank you. Our first question comes from the line of Carl Burns with Northland Capital Markets. Please proceed with your question.
spk04: Thanks for the question and congratulations on your progress. I was just wondering if when you have the update in the late second quarter on Program 534, is that going to be data through the 160 milligram dose? And then when would you expect to begin dosing the 300 milligram cohort. And then I have a follow-up as well. Thanks.
spk06: Sure, Carl. Thank you for the question. So, you know, of course, progress of clinical trials is difficult to predict with accuracy, but we are hopeful that we'll be able to, we'll be speaking about both the 160 milligram dose and the 300 milligram dose by the end of the second quarter.
spk04: Oh, great. That's very helpful. And then moving over to 808, in terms of the specifics of eligibility criteria, I know you mentioned screening for infection and then also the new dosing schedule. Have you provided an update on what that new dosing schedule is? Obviously, it's going to be, you know, probably somewhere significantly below 1 to the power of 10 to 6. Is that like starting at like 0.25 and then escalating from there? Thanks.
spk06: Thank you, Carl, and that's exactly right. Salim, do you want to discuss the new dosing schedule?
spk02: Sure. So, Carl, the dosing schedule will start with 0.3 times 10 to the 6th, and then the next dose level will be 0.6 times 10 to the 6th. And then, you know, it will be one, and then based on the results, the SRC can decide if they want to do anything between one and three doses. And because we have an SRC that's actually making those dosing decisions. And the SRC is the PIs who are enrolling in the study as well as an independent academic physician who's treating patients with CAR T and company physicians.
spk04: Great. Perfect. Thank you. That's very helpful. Sure.
spk00: Thank you. Our next question comes from the line of Hartad Singh with Oppenheimer. Please proceed with your question.
spk03: Great. Thank you. Thank you for the questions. I've got a couple. One is maybe to just dig in a little bit to the questions earlier about ONCT. You know, in some calls we've done with key opinion leaders, they've indicated that, you know, there's a high unmet need for such a mechanism of action, you know, in the area of metastatic castrate or resistant prostate cancer. You know, Rich, if you can just kind of give us an idea of what that market size looks like. you know, and what would be the TAM potentially even, you know, in terms of pricing? Because there is some genericization in the market. Just any thoughts there? And I got a couple of quick follow-ups.
spk06: Sure. Sure, Hartaj. Thank you for the question. So there's two, we've been penciling in two different market sizing options. The first would be if we, if it is a drug that is used in patients who are, who have failed, who have metastatic disease and have failed an available, one or more available androgen receptor pathway inhibitors. And we do believe that there is a potential for a sales potential of a billion dollars or near one billion dollars. But as you know, unlike some other drugs that are in development and are focused on mutations of the androgen receptor, ONK534 is also very active against cancers expressing the native androgen receptor. So that means that it has the potential to move into earlier lines of therapy such as hormone sensitive prostate cancer. And so, as you can imagine, with that kind of indication, there's a multibillion-dollar potential.
spk03: Yep, Jim, that's very, very helpful. And then, you know, the other question is just going back to 808. I know that the last time we had talked on our healthcare conference, actually just a few weeks ago, the Oppenheimer Healthcare Conference, you had indicated that you're getting the amendments through IRBs. You know, when could we start seeing patients being recruited into the 808 trial? I know you've already set the timelines for the next data updates, but just any thoughts there?
spk06: Absolutely. So we're very encouraged that our treating physicians, our principal investigators, are very eager to get patients into the study. And in fact, several patients have been identified that the investigators want to get on the study. And so they are doing everything that they can at their sites to expedite the approval of the amended study so that their patients can be treated. So we're optimistic that it's not going to take too long.
spk03: Great. Great. Thank you, Jim. And then last question is, you know, just looking at your OpEx burn, you know, Rich, you came in pretty, decent bid, 10% below what we were expecting. I know the fourth quarter generally tends to be a little on the heavy side. And you've already given your guidance for your cash runway into next year. But just what are the reasons that your R&D was, you know, it seems to be almost a million dollars less than what we were expecting. And then is that the way to think about it sort of going forward also?
spk01: We believe that the primary reason that the fourth quarter came in under is because we were wrapping up the zillow 301 program and we actually did that very efficiently earlier than planned and we brought a lot of the work in-house kind of in the q3 time frame and we were able to keep those costs down very significantly compared to what the original forecast looked like so i think The majority of the Zillow 301 costs are clearly behind us, and that really holds true for a good chunk of the Zillow program costs, even for the Phase 1-2 study. We're really winding that down and treating the last patients there earlier this year.
spk03: Got it. So, I mean, would the $9 million to $10 million cash burn per quarter be realistic, basically, through the next few quarters?
spk01: Well, keep in mind that the $9 to $10 million included roughly $2 plus million of non-cash stock-based compensation expense. So it's closer to the $7.5 to $9 million range as enrollment ticks up.
spk03: Yep. Great. Thank you, Jim. Thank you, Rich. Thanks for all the questions.
spk06: Thank you, Haritosh.
spk00: Thank you. Our next question comes from the line of Kent Oliver with Brookline Capital Markets. Please proceed with your question.
spk05: Great. Thank you. A couple of questions regarding 808. So, just to be clear on how the program will proceed. So, you've dosed three patients at the one times 10 to the sixth dose. You're going to go down to the first dose cohort, and then move up to the second. And it sounds like you will dose the initial dose a second time, such that if you do three patients each, you will, you potentially at a minimum would have 12 patients before deciding whether you should go up to a higher dose.
spk02: Yeah. So, I mean, actually, this is why I said earlier, we will evaluate the 0.3 times 10 to the 6 and 0.6, which is the two new cohorts that we added first before we decide if we want to go again into one or we want to do an intermediate dose, you know, above one and between one and three. And that will be decided by the SRC, as I said earlier. Because as you know, the one was well tolerated and we moved into the next cohort. So I think based on what we're gonna see from the 0.3 and 0.6, it will be decided if we're gonna add more patients into one or do an intermediate dose between one and three.
spk05: Okay, and what's the reason for potentially dosing at one again? Is the protocol changes significant enough that the data wouldn't be comparable?
spk02: No, and that's why I said the SRC will meet and will decide. And the only reason probably will be there if we start seeing some toxicity at 0.6, and then we may want to add more patients into one. I mean, I think there's multiple reasons to do that, but I mean, I cannot predict what we're going to see, but it's all going to be depending on what the data will tell us from the two new cohorts.
spk05: Okay, that's fine. And with regard to the approvals that are remaining, are you awaiting IRB approvals or FDA?
spk02: No, we have actually got agreement with the FDA about the protocol changes, and actually everything was submitted to the IRB, and we're just waiting some of the logistical things at the site to be done at the last things to be, you know, before we initiate the enrollment again.
spk05: Okay. Got it. And, Richard, it sounds like there will be a small amount of expenses for Zolivertumab in 24, but we're probably talking about a six-digit number or less. Is that a fair assumption?
spk01: Rich? That's close.
spk06: Okay, great. Thank you. Thank you, Kemp. Thank you.
spk00: Thank you. There are no further questions at this time. I'd like to turn the floor back over to Dr. James Breitmaier for closing remarks.
spk06: Thank you, Alicia. We continue to advance our two clinical programs towards significant clinical data inflection points by mid-year while reiterating our cash runway guidance into 2025. We are excited to be advancing the clinical development of novel pathways in areas with very high unmet medical need, specifically patients with metastatic castrate-resistant prostate cancer harboring androgen receptor mutations and splice variants, and patients with aggressive B-cell lymphoma who are relapsed, refractory, or unable to obtain CD19 CAR-T therapy. With that, Thank you for joining us today, and we look forward to updating you throughout the year. Alicia?
spk00: Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your
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