Athersys, Inc.

Good day and thank you for standing by. Welcome to the AuthorFace 3rd Quarter 2021 Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Karen Honody, Director of Corporate Communications and Investor Relations. Thank you. Please go ahead.

Thank you, Abigail, and good afternoon, everyone. As Abigail mentioned, I'm Karen Honody. I'm the Director of Corporate Communications and Investor Relations for Adversis. Thank you for joining today's call. If you do not have a copy of the press release issued at the close of market, it is available on the Athersys website at athersys.com. I'm here with BJ Lehman, our President, Chief Operating Officer and Interim CEO, and Ivor MacLeod, our Chief Financial Officer. A webcast of the audio will be available three hours after the call's conclusion on our website under the events section. The access information for the replay is also in today's press release. Any remarks that we may make about future expectations, plans, and prospects constitute forward-looking statements for purposes of the safe harbor provision under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by the forward-looking statements, as a result of various important factors, including those discussed in our Form 10-Q, 10-K, and other public SEC filings. We anticipate that subsequent events and developments may cause our outlook to change. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. For the benefit of those who may be listening to the replay, this call was held and recorded on November 15th of 2021. Since then, we may have made announcements related to the topics discussed, so please reference our most recent press releases and SEC filings. With that, I'd like to turn the call over to BJ Lehman. BJ?

Thanks, Karen. On behalf of the ATHERSIS team, in our call today, I will provide an overview and summarize recent corporate operations and business activities and developments. In addition, I will reflect on our 2021 performance and the emerging focus for 2022. Ivor will then provide an update on our company's financial position. We will then address several questions submitted by our shareholders and open it up to general Q&A. For a more comprehensive overview of our company and platform, I would like to refer you to our website and our updated corporate presentation. First, we provide an update on our ARDS program. As for the program, we provided a thorough update in our last quarterly call, which followed shortly after the release of data from Helios' OneBridge study. To summarize, the results from the OneBridge study appear to be consistent with results from our MustArt study, with Helios reporting higher ventilator-free days, or VFD, over a 28-day period and lower mortality in the multi-stem treated group compared to standard therapy. Last week, Helios reported in its third quarter financial results update presentation that that it plans to file in either Q4 of 2021 or Q1 of 2022 a JNDA for the ARDS program, which is designated as an orphan regenerative medicine product. Further, preliminary analysis of the data pooled from both the Mustards and OneBridge studies suggests a strong signal of potential impact. This pool data set includes 40 non-COVID ARDS patients treated with multi-stem cell therapy and 20 ARDS patients treated with placebo or receiving standard of care. According to this analysis, average VFD was higher in the multi-stem treated group compared to non-treatment group, 13.9 days compared to 10.1 days, with a p-value of 0.07 when adjusting for baseline differences in condition severity and age, and using a two-tailed statistical test. Median VFD was also substantially higher. Based on this data, there was also a trend to lower mortality in the multi-stem treatment group. These data are provided in our updated corporate presentation deck, which is available on our website. We are also pleased to announce that the manuscript describing the must ARDS study results has been accepted for publication shortly. Further details will be forthcoming. We look forward to continued progress in our Mecovia study, treating patients with ARDS induced by COVID and other pathogens. Our intention is to continue and complete enrollment of the studies cohort two and reflect on the evolving standard of care as a result of the COVID pandemic before proceeding with cohort three, the phase three efficacy cohort. It is possible that we would make changes to the design of the phase three efficacy cohort to improve our chances to help patients and have a successful clinical trial. Separately, in our Q&A section, I will address some recent questions about BARDA and the recent amendment to the broad agency announcement reinstating a revised version of Area of Interest 9.3. To conclude, we remain very enthusiastic about the potential for our multi-STEM or, indeed, MRS cell therapy to help these ARDS patients. and we will continue to actively support efforts in Japan to advance the program to JNDA submission and, if approved, into commercialization. Next, we turn to our stroke program. As we noted in a press release on Friday, Helios has provided further clarity about the timing of disclosure of top-line data from its treasure study, evaluating multi-stem administration to Japanese stroke patients. Simply put, the treasure study has not been delayed. Enrollment completion was announced several months ago. However, based on advice received from the PMDA in conjunction with recent regulatory interactions, Helios now plans to disclose top-line results from the Japanese study after data from the one-year follow-up visit of the last patient has been collected. Helios expects this last follow-up visit late in March 2022 and top-line data disclosure to be made as soon as possible thereafter. To be clear, the available data set has not been unblinded and would not be unblinded for analysis until after the last patient last visit. We would expect the pre-specified analyses to be completed expeditiously once the dataset is unblinded. This approach, advised by the PMDA, is intended to preserve the integrity of the data collected from the last patients in the study during the one-year follow-up visit. A conservative approach, given the number of subjects whose one-year data could be affected by disclosure is very small, and other less restrictive measures to protect and study data integrity are available. as we used in our own Master's I study, for example. This outcome is additionally frustrating given that the analysis and disclosure of 90-day data was included in the submitted TREASURE study protocol approved for the study. We are optimistic that the TREASURE study will show therapeutic impact from administration to patients shortly following an ischemic stroke. Our conviction is founded on a number of important factors, including A, the study design, including the targeted subjects, screening guidelines, and evaluation metrics that replicates the core design elements of our Master's I study. B, early administration of multistem therapy during 18 to 36 hours post-stroke. And within this window, an expected shift to earlier administration compared to Master's I, which appears to be associated with better outcomes based on statistical analyses. And C, evidence from the Master's I study that multistem is greater relative benefit in older patients. That said, there are some risks, such as limited prior data from Japanese or Asian ischemic stroke patients and very old patients. and some differences in the standard of care compared to our Master's I study. Additionally, this approach would make available 90-day and one-year results, likely both during the second quarter of 2022. Note that in the Master's I study, patients who received multi-stem treatment within 36 hours of stroke continued to improve after 90 days, as shown in several outcome measures, including excellent outcome in the MRS shift analysis, the primary outcome measures for the TREASURE and MASTERS II studies respectively. For example, the proportion of multi-stem treated patients achieving excellent outcome increased from 16% at three months to 29% at one year. 16 out of 100 serious stroke patients were essentially back to normal by 90 days. and another 13 were back to normal by one year, compared to non-treatment, where just seven of 100 patients were back to normal at 90 days, and only one more had achieved this degree of improvement by one year. We also observed continuing improvement for multi-stem treatment across the severity spectrum, as is evident in improvements in MRS distribution through one year, which is shown in our corporate presentation. We eagerly await the treasure data, and we are planning for a positive outcome that would enable Helios to move forward with the JNDA by making preparations in the regulatory and manufacturing areas in particular. We are making progress in our Master's II study. As we have noted in previous communications and calls, we have had challenges over the past 18 months tied to COVID-19 and supply constraints. However, over the past quarters, we have focused heavily on site-level operations to enable us to meet our development objectives. We have recently initiated sites outside of the United States as we continue to add more sites to the study. Increasing the number of sites, including outside of the U.S., will be an important element to accelerating our monthly enrollment figures. We have also been investing meaningfully in site-level support to supplement local clinical research operations and increase the pool of patients eligible for the study. This includes increased clinical research personnel deployment and site investigator and personnel engagement and problem solving through meetings and other communications. Based on our current plans and assumptions regarding the site network and site level activity, we hope to complete planned enrollment before the end of 2022. However, regional COVID surges or other unanticipated factors may impact site initiation, operations, and enrollment activity, or even the product supply chain, with impact on enrollment timelines. To summarize, we believe that both the TREASURE and MASTERS II studies are well-designed and well-powered to show positive impact for multi-stem treatment of moderate to moderate severe stroke patients. We remain confident in our cell therapy's potential to change treatment and outcomes for a significant proportion of ischemic stroke patients. A major area of focus for the company, as we have discussed in the past, is planning and preparing for manufacturing and supply of product for commercialization if the product is approved for marketing. This is a multi-year effort with emphasis on making product at scale and reasonable cost, supply chain security and redundancy, and distribution of the product into hospitals. We continue to make progress with establishing our larger-scale bioreactor-based production process, working internally with outside experts and commercial manufacturers to build capacity in a stepwise fashion to align with our regulatory and commercial needs. We have made substantial progress in solidifying our supply relationships with long-term continuity and redundancy in mind. and we continue to advance our thinking and technologies for localized product distribution. Indeed, recently we have completed our alpha prototype for the Secured Integrated Freezer Unit, or SIFU, demonstrating how the SIFU would work in practice. As we have discussed previously, generally speaking, 2021 has been focused on advancing the development of our platform and programs with a focus on manufacturing supply chain, clinical development, and initial planning and preparations for commercialization. We resolved open issues with our Japan partner, Helios, to set the stage for the completion of development and commercialization in Japan, and we have made substantial progress in the area of manufacturing supply chain and distribution, as noted above. We have fallen short of our clinical development objectives, in particular our progress in our Master's II study. However, as discussed above, we have taken several actions to execute a strategy that will improve our trajectory and progress. As we look forward to 2022, several important themes will be reflected in our objectives and actions. As we await data from the Important Treasures Study, We will be devoting our attention and substantial efforts to enabling and supporting our clinical development, particularly the completion of enrollment of our Master's II study as soon as possible. We plan to continue preparing for manufacturing and supply of product in a commercial setting, which is noted as a multi-year effort. Also, we plan to further ramp up our other efforts to support commercialization, providing support to our partner in Japan, further developing internal commercial capability and personnel, and building out our market access and reimbursement strategy. In addition, we will continue efforts focused on securing the best possible partner to develop and commercialize the European markets with us for one or more of the multi-STEM critical care indications. Though we believe our platform has broad applicability and potential beyond our current activities, we plan to remain focused on the critical value drivers in the near term. With that, I will turn it over to Ivor for an update on the financial results.