BioCardia, Inc.

Ladies and gentlemen, thank you for standing by. Good afternoon and welcome to the Biocardia Second Quarter 2024 Financial Results and Business Update Conference Call. At this time, all participants are in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Participants of this call are advised that the audio of this conference call is being broadcast live over the internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately one hour after the end of the call. I would now like to turn the call over to Miranda Pato of BioCardia Investor Relations. Please go ahead, Miranda.

Thank you. Good afternoon, and thank you for participating in today's conference call. Joining me from BioCardia's leadership team are Peter Altman, PhD, President and Chief Executive Officer and David McClung, the company's chief financial officer. During this call, management will be making forward-looking statements, including statements that address BioCardio's expectations for future performance and operational results, references to management's intentions, beliefs, projections, outlook, analyses, and current expectations. Such factors include, among others, the inherent uncertainties associated with developing new products, technologies, and obtaining regulatory approvals. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements. For more information about these risks, please refer to the risk factors and cautionary statements described in BioCardio's report on Form 10-K, filed with the SEC March 27, 2024, and in subsequently filed Form 10Qs. The content of this call contains time-sensitive information that is only accurate as of today, August 13th, 2024. Except as required by law, the company disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Dr. Peter Altman, BioCardius President and CEO. Peter, please go ahead.

Thank you, Miranda, and good afternoon to everyone on the call. This has been a tough quarter for our share price, even as we continue to deliver the milestones that underlie our business with signs of both safety and patient benefit from each of our efforts. Our lead autologous cell therapy for the treatment of heart failure is being studied today in two clinical trials. The cardiac heart failure one trial expects last patient follow-up at the end of September this year. We are hopeful that the monitored data on all patients will reflect the same results that we have seen with 90% of the patient follow-up data obtained in the interim review last year. Across all patients enrolled, this data showed trends in treated patients having improved survival, reduced major adverse cardiac events, and improved quality of life. The cardiac heart failure one trial is enormously important, particularly if these interim results are in line with the final results. The fully enrolled study is one of the largest cardiac cell therapy studies performed for the treatment of heart failure in the United States, with clinical results showing patient benefits that are meaningful for both patients and the physicians who care for them. Our team has been working to monitor sites and be prepared to lock the data for final readout this year. The data from this trial is intended to provide support for future product approvals and commercialization of the CAR-DM cell therapy in Japan and the United States. As we seek to complete CAR-DM Heart Failure I, and confirm the final results are as good as we believe them to be, we are advancing a second confirmatory clinical trial in CAR-D-AMP Heart Failure 2, which focuses on the remarkable benefits in patients treated with elevated NT-proBNP, a well-established biomarker of active heart failure. Results in these patients, presented at Technology and Heart Failure Therapeutics Conference in March 2024, showed a remarkable 86% relative risk reduction in heart death equivalence and a 24% relative risk reduction in non-fatal major adverse cardiac and cerebrovascular events. This is particularly exciting, as therapies that are available today do not have a significant impact on mortality for these patients. And unfortunately, mortality for these patients is still approximately 50% over a five-year period. The CARDI-AMP Heart Failure 2 trial is the only confirmatory pivotal trial of a cell therapy in heart failure that has ever been initiated. It has a greater than 90% power for statistical probability of success to meet the primary endpoint based on the CARDI-AMP Heart Failure trial interim results. The world-class cardiologists on the CARDI-AMP Heart Failure One Executive Steering Committee, on the Data Safety Monitoring Board, and on the Clinical Events Committee are all continuing with us to support the CARDI-AMP Heart Failure Two trial. Two additional world-class heart failure clinicians have also joined our Executive Steering Committee. The first is Dr. Wilson Tang, CARDI-AMP Heart Failure One trial investigator, professor in medicine at the Cleveland Clinic Lerner College of Medicine, and Research Director of Heart Failure and Transplant in the Department of Cardiovascular Medicine. The second is Dr. Leslie Miller, cardiac heart failure one trial investigator at the CHF Heart Function Clinic at BayCare Morton Plant Hospital in Clearwater, Florida, and a former president of the International Society of Heart and Lung Transplantation. Dr. Miller's site is the first site activated in the CARDI-AMP Heart Failure 2 study, and it is reported that five patients have already been consented for the trial by his clinical research team. Combined, these 12 world-class cardiologists, all of whom have seen our data and have worked with us on CARDI-AMP Heart Failure 1, are supporting the CARDI-AMP Heart Failure 2 study. We are more than thankful for each of their involvement extensive experience, valuable advice, and ongoing support. BioCardia intends to become an enrolling machine in the cardiac heart failure two clinical trial. Enrollment is expected to be significantly enhanced because of the positive data and experience from the cardiac heart failure one trial, which we feel is compelling for heart failure physicians and their patients. Enrollment will be further enhanced by efforts we have taken to streamline the clinical study and by the enormous experience in the broader CARDI-AMP clinical team. There are other advances to the CARDI-AMP autologous cell therapy that we hope to be able to announce soon, expected to further enhance enrollment in the CARDI-AMP Heart Failure II trial over that which was possible in CARDI-AMP Heart Failure I. Beyond our lead autologous cell therapy program in heart failure, we have also made progress this quarter in other programs. In April, open-label clinical results from cardiac cell therapy and chronic myocardial ischemia were shared, with greater benefits than other established therapies. We discussed this data in our last quarterly call, and the last role in cohort patient is now scheduled for treatment later this month. In May, our partner CellProThera announced the results of their cell therapy in the indication of acute myocardial infarction. We discussed this result in our last quarterly call and are excited for CellProthera and their data. These three programs and three distinct clinical indications of heart failure, chronic myocardial ischemia, and acute myocardial infarction demonstrate the broad utility and performance of BioCardio's Helix delivery system for the delivery of biologics locally to heart tissue. One element of the Helix delivery system is our MorphDNA steerable introducer. This MorphDNA product design has performed well for our procedures and has potential to enhance many other clinical procedures as a commercial product with a broader product family configuration. In late July, we announced that we had completed an FDA submission for market clearance for a broader product family of MorphDNA steerable introducers. We are hopeful for market clearance at the end of this quarter. On the business development front, we have active partnering discussions with potential to be meaningful for our business with respect to all four of our platforms, CardiAmp, Cardialo, Helix, and Morph. For CardiAmp, our autologous cell therapy platform, the focus has been on discussions with potential distributors even as the therapy is not yet approved. Receiving approval in a first world country such as USA or Japan is also expected to enable distribution partnerships to be realized in other regions of the world. We have had a number of discussions this quarter around distribution partnerships in Japan, Brazil, and the United Arab Emirates. There is potential to enter into such distribution arrangements in advance of approval as this has the advantage for potential partners, and that they can bring their experience to the table in positioning the therapeutic offering in their country of focus with respect to the physician community and payers. For cardi-allo, our allogeneic cell therapy, currently in the clinic for heart failure, we have extensive clinical experience from three trials. We have had discussions around partnering these cells for other clinical indications, beyond our current plans in cardiac and pulmonary disease, with one ongoing discussion this past month. For our Helix biotherapeutic delivery platform, potential biotherapeutic delivery partners who wish to have access to our delivery experience, products, and support capabilities remain active in discussions. Current partners realize that minimally invasive delivery not only enhances future commercialization, but it is also seen as a critical means for clinical development, enabling much faster enrollment, thus significantly reducing their operational costs by shortening timelines for their own therapeutic development. Lastly, partner therapeutics are expected to benefit enormously from our three-fold efficiency of delivery and the enhanced pharmacokinetics with our Helix system, supported by data from many groups. We believe this advantage is due to the stability of the helix and the beating heart and the cell-ceiling helical pathway into the tissue. We encourage all partners to perform pharmacokinetic studies, including a surgical delivery control, so that they will have their own data supporting what we have seen. Today, we have participated in more than 20 development programs and partnerships with almost every well-known program. some of which are identified in our corporate presentation. We are now evolving our business approaches with a higher bar for our involvement in therapeutic development, focusing on true partnerships meaningful for our shareholders. This will take time to evolve, but as our experience and products advance and the field as a whole advances, we do expect to enter into meaningful relationships with other therapeutic partners. Five biotherapeutic delivery partnership discussions have been ongoing throughout this quarter, and all but one of these are previous customers who have positive data with our biotherapeutic delivery team and system. On the more front, the recent FDA submission for clearance is a first step towards revenue generation from these clinical products, which also enhance partnering interest. We expect to have labeling that is appropriate for interventional cardiologists who perform our Helix procedures, but also cardiac electrophysiologists, interventional radiologists, and vascular surgeons, all of which may benefit from our Morph DNA Steerable Introducer platform. We have had a few discussions here on selling off these products, and extensive bench test data from multiple large firms has been generated that has been shared with us. It is my expectation that in the coming months, the decline in BioCardia share price will reverse as investors and partners better understand what we are accomplishing in our business, in our own therapeutic programs, in our biotherapeutic delivery partnering and licensing, and anticipated new FDA cleared morph product family. By the end of the current quarter, we intend to deliver on the following objectives. One, become compliant with NASDAQ listing requirements. Two, complete the last patient visit for the cardiac heart failure one trial. Three, submit cardiac heart failure for a general consultation with Japan PMDA in preparation for a future clinical consultation. Four, treat the first patients in cardiac heart failure two trial and begin demonstrating that we can enroll this trial quickly with our world-class clinical partners. Five, dose the last rolling cohort patient for the CARDI-AMP chronic myocardial ischemia trial. And six, receive FDA clearance for the MorphDNA product family. I will now pass the call to David McClung, our CFO, who will review our Q2 2024 financial results. David?

Thank you, Peter, and good afternoon, everyone. Revenues were $3,000 for the three months ended June 2024, comparable to $43,000 for the three months ended June 2023. Expenses quarter over quarter decreased by 53%. Research and development expenses decreased to $800,000 during the second quarter of 2024, compared to $2.3 million for the second quarter 2023. primarily due to completion of enrollment in the cardiac heart failure trial, coupled with related reductions in clinical and supporting function expenses. Selling general and administrative expenses decreased $852,000 for the three months ended June 2024, down from $1.2 million for the same period in 2023, primarily due to reduction in personnel related expenses. BioCardia's net loss decreased to $1.6 million for the second quarter of 2024 from $3.4 million from the prior year's second quarter, primarily due to the reduction in expenses we just noted. We used $1.4 million in cash for operations in the second quarter of 2024. That's down from $3.2 million in the second quarter of 2023. We expect our cash burn will increase moderately as we advance our trials, continuing our track record of operating efficiently and carefully managing the use of capital. This concludes management's prepared comments. We are happy to now take questions from attendees.

We will now begin the question and answer session. To ask a question, you may press star then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. The first question today comes with Joe Pantginnis from H.C. Wainwright. Please go ahead.

Hi, guys. Good afternoon. Thanks for taking the questions. A few, if you don't mind. So first, was curious, you know, with the Heart Failure 2 study, maybe a little more color, if you don't mind, how much the data from Heart Failure 1 with regard to, you know, improvement of survival and MACE might be helping your enrollment for heart failure too?

Joe, good day and thank you for the question. It's a great question. I think it's enormously valuable for us in the enrollment ahead. One of the challenges in these trials, which are where the procedure is performed by an interventional cardiologist, but it's the heart failure physician who cares for the patient, is the evidence that we now have that supports that one, this procedure can be done safely, and two, that the signals we're seeing of reduced major adverse cardiac and cerebral vascular events and reduced mortality coupled with an enhanced quality of life are sort of the holy trio for them. So for folks caring for these patients, You know, there are no other therapies out there that actually have a meaningful impact on mortality. And our data suggests that this cell therapy could have a meaningful impact. And particularly with the NT-proBNP population that we're targeting in heart failure 2, we saw an 86% relative risk reduction in mortality. So that's a huge selling point for physicians to trust their patients into this investigational trial. And that's another reason why we expect enrollment to move apace. And I note that the first center was just activated a few weeks ago, and they've already consented five patients. So yeah, the data's gonna be very important for us. Thank you, great question.

No, I got it, thank you for that. And then I know you alluded to maybe some additional details coming up, so I know you can't discuss them yet about potential further streamlining of the study, but can you discuss what's already in place or remind us?

Yeah, Joe, another great question. So in designing the CAR-DM Heart Failure 2 trial, we have such a strong safety signal that many of the interim endpoints have been lightened. So for example, our six-month follow-up visit and our 18-month follow-up visit can now be done by a phone call if a center wishes. And the value of that is by eliminating many of the standard follow-up elements at that time point, the first thing is that the coordinator is able to focus on new patients and not necessarily those patients at those time points. But there's also the benefit for biocardia that reduces our costs in the study. And there's a lot of places where we've looked to do that throughout the program. So I think it's gonna be less expensive for the company to advance, and it's gonna be easier for the clinical sites to work patients through the trial. And we do have some other things that we hope to share soon that we are not able to share yet today. So yeah, it should be a much easier trial for us than the cardiac heart failure one true trial, in part because the second time you do things, things get a lot easier, particularly if the data in the first one is as good as we think it is.

Got it. No, I appreciate that. And one last question, if you don't mind. I guess this has to do with trial logistics as well. So if you look at heart failure one, it was really predominantly, I believe it was approximately 90% male population. So I'm just curious, when you're looking to enroll about 250 patients, what can you do or what's the expected ratio between men and women you're targeting?

So, that is a very savvy question. It is one of the fundamental problems in much heart failure research today, in that almost all of the trials tend to be heavily tilted towards a male population. It's something that we have worked on in CARDI-AMP Heart Failure 1, and we even presented on it early in the study. and have encouraged centers to think broadly about equity, not only in terms of gender, but also different races, making it so that it's a diverse population and that all patients are aware of it. And that's gonna be an ongoing exercise in cardiac and heart failure too. My sense is that the data will help us there. I think physicians tend to be more protective of their female patients. And so don't advance them in the clinical trials as aggressively as they do a hardy male patient. And I think because we have such compelling safety data with real nice signs of efficacy, that there will be a larger percentage of female patients in the trial. I would love it to be 50%, although the reality of how these trials are enrolled, that is unlikely. But we'll aim for 50% if we can achieve it. Got it.

Thank you for the added details.

No, great questions, Joe. Thank you so much for being on the call.

The next question comes from James Malloy with Alliance Global Partners. Please go ahead.

Hello, this is Laura on for James Malloy. Thank you for taking the questions. So how's the status right now in the process for submission of CARDI-AMP for approval specifically in Japan? And do you still plan on obtaining potential approval there next year?

So the status with CARDI-AMP in Japan for the treatment of ischemic heart failure is we had our last consultation with Japan's pharmaceutical and medical device agency in November. As part of that discussion, They provided minutes with a whole series of questions, and almost all of the questions ended with, please contain this information in your submission for approval. And none of the questions we felt were daunting. One of the key things that we need to do is we need to have a general consultation addressing the differences in care in heart failure patients in Japan and in the United States, and then hopefully move to a clinical consultation with the final data from the CARDI-AMP Heart Failure 2 trial, which is one of the things that they would like to see. The thought process we have is that we're in pretty good shape to complete a submission if the data is as good as we think it is. And we feel there's a very good chance that Japan PMDA will support that submission for approval process. And so that's really where we're focused. Once the submission is in, once they invite that process, there's an enormous amount of details that they go through, including, I believe, a site visit to assess the manufacturing. But our sense is we're ready for all of those questions. And the key element is You know, will they allow us to submit for approval based on the cardiac heart failure one data? And the reasoning there, which I've said a few times in the past, that we think they will, is we've already treated approximately 20 times as many patients. So 200 patients relative to 10 patients for other cardiac cell therapies that they've either approved or they've had discussions on approving after 10 patients. Those three other cardiac cell therapies all require open chest procedures for delivery of the cells, and ours is a minimally invasive therapy. I also note that our cardiac cell processing platform is already approved in Japan and being used for orthopedic applications, and our delivery system has historically been approved in Europe under CE mark. And so that's sort of a badge of support for it as well. And then the last piece is we have reimbursement in the United States that will enable the Ministry of Health, Labor and Welfare to at least have an index for supporting cardiac cell therapy going forward. So all of those stars are what we are working to help make align. And that's why the cardiac heart failure one final data that the last patient follow-up visit expected at the end of September is so critically important for us. Even though we have 90% of the data, you know, until you have all of the final data, it's an estimate of the outcome, not the final outcome, and that will be coming shortly.

Got it. Thank you for the clarity. And just one more question for me. How's the collaboration going right now for cells with your especially following now the recent phase two trial? And when do you think you might start a subsequent phase three trial with them as well as any potential timelines or interim looks for this trial as well?

Well, that's a great question as well. I'd rather point to the fact that that's a clinical indication. that there's only two companies that have gone after intramyocardial delivery for that indication. One was BioCardio. We did a small study there ourselves many years ago. And CellProthera. And they benefit from much higher efficiencies of delivery than intracoronary artery infusion of their cells, which is what everybody else has done in the indication of acute myocardial infarction. And, you know, the value proposition of efficiency of delivery is I like to use the analogy that we have about 18-fold the retention relative to intracoronary delivery. So if anybody on the call has had a headache, it's the difference between taking 18 aspirin to get an effect versus one. So I don't speak typically to a partner's efforts going forward. I can tell you that we've been working together for many years. We have great respect for them as a team. They've done a lot moving forward. They need to address their regulatory and strategic pathways forward, whether or not they wish to do a trial only in Europe, whether they wish to do a trial in Europe and the United States, whether they wish to do a trial in the United States only, and how they wish to roll it out with which investigators. And we can be helpful to them on all fronts. So conversations are ongoing, and it's a really compelling program with a very real market and some nice data that they have in their Phase 2 program. So I know that's not exactly the question you wanted answered, Laura, but it's about all I can share because we really try to be respectful of our partners and let them share their strategy going forward as well as share their data going forward. And it's one of the challenges in this space is to be a great partner, you have to be trusted, and we work very hard on that every day.

Understood. Thank you for taking the questions.

No, I appreciate the question, Laura.

As a reminder, if you would like to ask a question, please press star then 1 to join the question queue. The next question comes from Kevin Marshall. Please go ahead.

Hi. Thank you, everyone, for taking my question. You know, Dr. Obman, I know you mentioned, you know, getting in compliance with uh you know the nasdaq listing requirements um i'm just curious to know if you can shed any details on how um you know the company's planning on going about doing that um if that would have any valuable effects on current shareholders um kevin that's a a great question so for nasdaq there are two requirements one is the share price uh being over a dollar share and the second is

minimum equity requirements or market capitalization requirements. If you look at our financials that came out today, you will realize that we don't have an enormous amount of resources in the bank today. So we are exploring pathways to secure funding. We have on Friday, there was an S-1 that was put on file. And I can't speak to whether or not we'll be doing anything under it. our strategy is always to pursue all opportunities for success and ultimately select the one that makes the most sense for us. I would have folks think about dilution as it is a significant issue, but as we advance, we historically have fought very hard as a company to avoid any dilutive impact for our shareholders. And so I think today, Our market cap is remarkably low. I think that as we advance the company, some of the milestones we have could be enormously valuable. We're not talking about 2x or 3x. We're talking multiples of that. As we go downstream, that's something we need to deliver, and we always need to be cognizant, Kevin, of dilution. At the same time, we have to run the business. So we'll see it unfold and share it as it unfolds for everyone who has been supporting us. And we do appreciate your support.

Thank you. Appreciate it.

Anytime. I appreciate the question, Kevin.

This concludes our question and answer session. I would like to turn the conference back over to Dr. Altman for any closing remarks.

Thank you very much, Betsy. So, all that we have accomplished here at BioCardia so far is to the credit of our amazing BioCardia team. Our incredible clinical partners, the hundreds of patients who have participated in our trials, to the FDA and the PMDA, which have been helpful in their reviews and input, and to the investors who have enabled our efforts. I thank everyone who has helped our mission to develop and enhance therapies to treat cardiovascular disease. We expect to deliver a rewarding end to 2024 and an incredible 2025 if we are successful in our efforts. Thank you for being on the call and have a great afternoon.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.