BioLineRx Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to the BioLineRx first quarter 2023 financial results conference call. All participants are presently in a listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. For operator assistance during the conference, please press star zero. I would now like to turn over the call to John Lacey, Head of Investor Relations and Corporate Communications, BioLineRx. Please go ahead.

Thank you, Operator. Before turning the call over to management, I would like to make the following remarks concerning forward-looking statements. All statements in this conference call, other than historical facts, are indeed forward-looking statements. The words anticipate, believe, estimate, expect, intend, guidance, confidence, target, project, and other similar expressions are used typically to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and may involve and are subject to certain risks and uncertainties and other factors that may affect BioLine RX's business, financial condition, and other operating results. These include, but are not limited to, the risk factors, and other qualifications contained in BioLine RX's annual report on Form 20F, quarterly reports filed in a 6K, and other reports filed by BioLine RX with the SEC to which your attention is directed. Actual outcomes and results may differ materially from what is expressed or implied by these forward-looking statements. BioLine RX expressly disclaims any intent or obligation to update these forward-looking statements. At this time, it is now my pleasure to turn the call over to Phil Serwin, Chief Executive Officer of Byline RA.

Thank you, John, and good morning, everyone. Thank you for joining us on our first quarter 2023 results conference call today. Earlier this morning, we issued a press release, a copy of which is available in the investor relations section of our website. It was also filed as a 6K. As is our practice, I will begin with an overview, then Molly Zevi, our Chief Financial Officer, will provide a discussion of our financial results. We will then open the call and are looking forward to your questions. Also joining the call for Q&A are Ella Serrani, our Chief Development Officer, Holly May, President of BioLine Rx USA, and Tommy Rachmilevich, MD, our Chief Medical Officer. Beginning with our lead program, Motixifortide for stem cell mobilization in patients with multiple myeloma, we announced in November of last year that the FDA accepted our new drug application and assigned a PDUFA target action date of September 9th, 2023. We continue to be on track. In anticipation of potential FDA approval, we have had a very productive quarter across each of our commercial readiness activities, including completing the hiring of an experienced sales force most of whom have particular expertise in relevant transplant centers across the U.S. We have also substantially advanced supply chain, market access, and medical affairs activities. We previously talked about our U.S. leadership, including Holly May, who heads all of our U.S. activities and has led 14 product launches throughout her career, and Kevin Campbell, our new head of U.S. sales and market development, whose prior experience includes serving as head of transplant at Sanofi, where he led a 23-person commercial team whose portfolio included Plurixifor, known by its brand name Mozabil, for stem cell mobilization. Kevin helped to grow and expand the use of Mozabil, and we believe he is the ideal person to help make Motixifortide the new standard of care mobilization agent. As we have said several times in the past, but it is worth repeating, Based on proprietary market research that we commissioned, the stem cell mobilization market continues to grow and is worth some $360 million in the US and more than $500 million globally. With the team that we have assembled, I believe we are very well positioned to capture a significant share of this market over time. Further validating the potential benefits of metixifortide in stem cell mobilization, we were pleased during the quarter to announce the publication of our Genesis Phase III clinical trial data, which supports our pending new drug application in the highly regarded peer-reviewed journal Nature Medicine. Of particular note, the publication describes how the Genesis trial included patients representative of the current multiple myeloma population undergoing autologous stem cell mobilization, including older patients and those who received lenalidomide-containing induction therapies, both factors associated with impaired mobilization. Multiple myeloma is the second most common hematologic malignancy, and stem cell transplantation has been shown to improve survival, and as such, plays a central role in the treatment of these patients. A meaningful number of patients, however, are unable to collect the target number of peripheral blood CD34 positive hematopoietic stem and progenitor cells with the current standard of care in stem cell mobilization. The primary objective of the study was to demonstrate that one dose of metixifortide with GCSF compared to placebo with GCSF allowed more patients to mobilize six million CD34 positive cells or more per kilogram of body weight in up to two apheresis sessions. A secondary objective of the study was to demonstrate that one dose of metixifortide with GCSF was superior to placebo with GCSF in its ability to mobilize six million CD34 positive cells or more per kilogram of body weight in just one apheresis session. the clinical trial found that all primary and secondary endpoints were achieved with statistical significance p-value of less than 0.0001. If approved, metixifortide would be the first true advancement in stem cell mobilization in over a decade. In parallel with our development work in stem cell mobilization for multiple myeloma, we believe there are additional therapeutic areas where the demonstrated benefits of metixifortide can be beneficial. One of these is autologous hematopoietic stem cell-based gene therapy for patients suffering from sickle cell disease, one of the most common genetic diseases globally. To that end, in March, we announced a clinical trial collaboration with Washington University School of Medicine to evaluate metixifortide in this indication. Unlike multiple myeloma patients, one of the current standard of care mobilization agents, GCSF, carry significant risks and potential severe side effects for patients suffering from sickle cell disease. Furthermore, in many cases, the other current mobilization treatments fail to reliably yield optimal numbers of stem cells to facilitate gene therapy. As such, this patient population is in urgent need of an effective new mobilization regimen. Through this collaboration, we plan to conduct a proof of concept trial that will study metixifortide as both a single agent and in combination with the immunomodulator natalizumab. This study will assess the safety and tolerability of the two regimens as mobilization agents of CD34-positive hematopoietic stem cells in patients with sickle cell disease and is anticipated to begin enrollment in the second half of 2023. Let's turn now to our clinical programs in metastatic pancreatic cancer. Recall that metixifortide is being evaluated in an investigator-initiated metastatic pancreatic cancer trial in collaboration with Columbia University. This Phase II study is evaluating metixifortide in combination with the anti-PD-1 simiplimab and standard of care chemotherapy in first-line metastatic pancreatic cancer patients. This study continues to progress, and we anticipate data from the first cohort of patients this year. We also previously announced a collaboration with GenFleet Therapeutics pursuant to which GenFleet will execute a rigorously designed randomized phase 2B clinical study assessing metoxifortide in combination with a PD-1 inhibitor and standard of care chemotherapy in approximately 200 first-line metastatic pancreatic cancer patients in China. This collaboration follows the positive results that we reported from our phase 2A combat keynote 202 triple combination study of metixifluortide in combination with the anti-PD1 prembolizumab and chemotherapy in second-line patients. As a reminder, data from that phase 2A study demonstrated a substantial improvement across all study endpoints as compared to historical data, including median overall survival, median progression-free survival, confirmed overall response rate, overall response rate, and disease control rate. We anticipate that the GenFleet Phase 2b trial will initiate by the end of this year. Turning now to our second clinical candidate, the Investigational Intratumoral Anti-Cancer Vaccine, AGI134. We believe AGI134 coats tumor cells with alpha-gal to make them look like foreign tissue in order to evoke an immune response that both destroys existing tumors and also provides a vaccine-like effect. In December, we announced results from a phase one two-way study of AGI-134 in metastatic solid tumors. The first in human single agent study met its primary endpoint for safety and tolerability and demonstrated immune activity across multiple biomarkers. At this time, we are evaluating potential development program pathways in consultation with the program scientific advisory board. and we will provide further updates as appropriate. I would now like to turn the call over to Molly Zevi, our CFO, who will give a brief overview of our main financial results. Molly, please go ahead.

Thank you, Phil. As is our practice, in our financial discussion, we will only go over a few significant items on this call, research and development expenses and cash. Therefore, let me invite you to review the 6-K filing we made this morning which contains our financials and press release. Research and development expenses for the three months ended March 31st, 2023 were $3.7 million, a decrease of $0.7 million or 16.9% compared to $4.4 million for the three months ended March 31st, 2022. The decrease resulted primarily from lower expenses related to NDA supporting activities related to motixofortide, as well as lower expenses associated with a completed AGI-134 clinical trial. Turning to cash, the company held $43.3 million of cash, cash equivalents, and short-term bank deposits as of March 31, 2023. This does not include $30 million available to us under the debts agreement with Krios Capital, which is tied to the attainment of certain milestones. We believe we are well financed to fund our operations and as currently planned into the first half of 2024. And with that, I'll turn the call back over to Phil.

Thank you, Molly. In closing, as is our custom, I would like to take a few moments to summarize our key upcoming milestones. First, potential FDA approval of Afeksta this coming September. Potential US launch of Afeksta shortly after approval. Initiation of a clinical trial in collaboration with Washington University School of Medicine to evaluate metixifortide as monotherapy and in combination for CD34 positive hematopoietic stem cell mobilization for gene therapies in sickle cell disease. which is expected to begin in the second half of 2023 of this year. Initiation of a Phase IIb randomized clinical trial with 200 patients assessing metixifortide in combination with a PD-1 inhibitor and standard of care chemotherapy as a first-line metastatic pancreatic cancer therapy with collaboration partner Gensleep also by the end of this year. And finally, initial cohort data from the ongoing Columbia University investigator-initiated study evaluating motixifortide in combination with the PD-1 inhibitor simiplimab and standard of care chemotherapy in first-line metastatic patients with pancreatic cancer, also in the second half of this year. With that, we have now concluded the formal part of our presentation. Operator, we will now open up the call to questions.

Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. If you would like to ask a question, please press star 1. To withdraw your question, press star 2. If you're using speaker equipment, kindly lift the handset before pressing the numbers. Your questions will be polled in the order they are received. Please stand by while we poll for your questions. The first question is from Joe Pangenis of H.C. Wainwright. Please go ahead.

Hey, everybody. Good morning. Good afternoon. Thanks for taking the question and continued good luck wishes ahead of the PDUFA date. So a couple questions, Phil. First, as you're preparing for the potential approval, I guess one of the things I wanted to see you get more color on, how have your, I guess let's call it pre-discussions with payers been going?

Yeah, so first of all, good morning, Joe. Thanks for joining the call. Let me turn that question over to Holly. She can probably do a little bit. color on that.

Thank you for the question. I would say going quite well. We have since the last time we spoke solidified more of our market access plans and that includes the full complement of national account representatives, executives in the field being able to really understand the marketplace and understand where the payers are. Obviously, we aren't talking anything at this point in time specifically about product, but we do have a very experienced national executive team that is really starting to understand what we need to do to be successful around market access in the marketplace. We also are engaging with external stakeholders As time goes on, we will be having a steering committee to continue to advise us in the future.

Got it. No, that's helpful. Thank you. And then I guess I'll just stick with metixifortide for just a second here. And, of course, it's my obligatory question on, you know, sort of status of BD discussions, but I want to approach it this way today in the sense that, you know, it's a bit of a hybrid approach here where, you know, going into September, you might have an approved drug for a particular therapeutic approach, And then, of course, you have the long-standing oncology approach as well. So how do you think that impacts your potential BD discussions going forward? And if you just focus on the oncology standpoint, do you think it might fit into the category of, or long-standing category of, you know, a partner would be interested once they see the randomized Phase IIb data? Thanks a lot.

Yeah, so, I mean, we've had that... that approach for quite a while. So, I mean, we are fully focused right now on the commercialization of stem cell mobilization, the self-commercialization in the U.S., and we're moving forward on that, as Holly mentioned, and, you know, as we've disclosed in our public filings. Of course, we do have the PDAC and the oncology, the solid tumor area that we're developing, and our idea is with the randomized data, both from the study that we're doing in collaboration in China, as well as the data that we have and that is being produced in the Columbia University Collaboration. We're hoping the two together would provide us with the type of data that we would be able to initiate discussions with a potential partner with. And so that's sort of what we're doing, and I think that we haven't veered from that approach for several quarters already.

No, I appreciate that. Thanks. And if you would just indulge me a little bit of a shift question on 134. Obviously, things are developing. You're very resource-focused on Metixifortide, but any potential broad strokes you can take with regard to the design of next steps?

Yeah, so let me turn that over to Ella. Ella, you want to take that question?

Yeah, sure. Hi, Joe. This is Ella. So with regards to to AGI. We are currently assessing the development program forward. We are discussing it with our scientific advisory board. I cannot go into too much specifics. However, it's probably fair to say that going forward, we will probably consider to do a combination study.

Okay, thanks for all the answers, and good luck with your background discussions.

Thanks so much, Joe. Have a great day.

The next question is from Mark Breidenbach of Oppenheimer. Please go ahead.

Hey, guys. Congrats on the progress this quarter, and thanks for taking our questions. Just a couple of quick ones from me. First, Just with respect to the upcoming expiry date of the Genzyme-Sinopi patent on cleric Sephora, how quickly after that expiration do you expect generics to enter the U.S. market? Is it kind of going to be an immediate thing, or is it maybe we'll see a little bit of a lag or a gap before generics are approved here? And then the second question is just – I think Molly was clear with regard to the financial guidance and cash runway guidance, but operational runway extending into the first half of 2024, that is exclusive of the $30 million in debt tranches from previous. Is that correct? Yeah. Thanks for taking the questions.

Okay, so first of all, good morning, and thanks for joining the call. I'll take the second question, and then the first part of the question I'll hand over to Holly. Regarding our financial resources, our guidance does not take into account the $30 million of the framework of the Creos loan. Okay, so that's with regard to the second part of your question. Regarding generics, I will just say overall, you know, the exclusivity runs out at, you know, at the end of July for Plurixifor. I think we do expect a couple of generics. There are, you know, some ANDAs that have filed, and so we do expect a couple of generics, but it's really hard to say. I think maybe Holly can provide a little more color on that. Go ahead, Holly.

I was going to say basically that. I mean, in some ways it's It's anyone's guess as to what the generic manufacturers are going to do. That said, through our research, we have not uncovered anything that would say they are not coming to the market. I know this is a little bit of a different situation just because Sanofi Genzyme did defend their patent. So it's been kind of a longer time to market for these manufacturers. So we are keeping a key eye on it. This is all part of our ongoing market research is to have, you know, some sort of intelligence around marketplace and landscape. And we are taking that into consideration. That said, our default research really suggests that nifecticortide is well-positioned who take a significant share of the market over time despite generic competitors to the first-generation mobilizer that's currently in the marketplace. So we still have great confidence.

Yeah, I mean, I'd like just to add to that. I mean, it's very important for, you know, and I think that we've emphasized that. We believe that we are highly differentiated from Cloroxifor and, you know, obviously any generics, that are coming in once the loss of exclusivity happens. And so therefore, we believe that obviously it may affect us, but we think that we are still moving forward and are confident that we can, as Holly said, take a significant share of the market.

And I think Phil and I are tag-teaming on this answer. Just to add on to what Phil said, Yes, well-positioned. Our research has shown both on the clinical side as well as on the value and economic side of the value proposition.

Thanks, Holly. Thank you, guys. Okay, have a great day, Mark.

The next question is from John van der Molsten of Zacks. Please go ahead.

Thank you, and hello, everyone. Phil, you've mentioned the $500 million global market for Effecsta, and what are the trends outside the U.S. for growth and the structure of the market? Is it similar to the U.S., where there are a few sites responsible for most of the procedures, or does it have a different structure?

You know, I think that overall, you know, there are certain, you know, there are large transplantation centers that are handling transplantations both, you know, in the U.S. and also around the world. But, of course, I think that we've mentioned that In Europe, the pricing is different. The regulation is different. The payer is different. The way a reimbursement happens is different. In certain areas, the standard of care is different than the U.S. So there are question marks regarding the rest of the world, and obviously we're focusing right now on the U.S. because that's the key market, and that's where we're initiating our commercialization steps. And I think that we've said this several times in the past. Once we get approval and launch, we will certainly look to maximize the value outside of the U.S.

Okay. And as you look at your other MOTICSA four-type programs, there's the two PDAC programs and the sickle cell gene therapy program. How do you look at those in terms of opportunity? I mean, you know, you have some geographical expansion partners there. You know, what do you see when you see those in terms of opportunities and how do you rank them?

Yeah, so I mean pancreatic cancer is a huge market. It would open up if we have successful data, you know, both in the study that's going to be initiating in China as well as the one that's happening at Columbia University. We believe that, you know, the next steps would be something much more significant, much more global. And that's obviously not only in pancreatic cancer. We think that if it works in pancreatic cancer, it's likely to work in several other indications. And so we look at that as a huge, you know, potential market. Of course, pancreatic cancer is a difficult indication, and, you know, it's a high-risk indication, but also, you know, very, very high rewards. So, you know, I think that that would be obviously, if we do see the results that we're hoping to see, that could be, you know, obviously a very, very, you know, significant opportunity for us. In gene therapy, I think that's also something that we look at as, you There are new therapies that are being developed, and we hope that there are going to be several gene therapies in the next 18 to 24 months that will receive approval. We think they all require a substantial number of cells, and we believe that we are very well positioned to move into that market. because of, you know, what we believe to be, you know, we believe that we're a, you know, highly differentiated and very robust mobilization agent. So we think that that will, you know, also be a key area of growth for us in the future.

Okay, great. Yeah, lots of opportunities for that. Yes. And one for me on the manufacturing and CMC side, I guess those efforts are progressing significantly. as expected, and there'll be sufficient quantities. And I believe you have those arrangements with Biokine. I think that's still current. Do you look for perhaps another partner as you expand further, perhaps geographically, to have another manufacturer to support global operations?

Yeah, so Biokine is the licensor. for Motixifortide, but they are not the manufacturer. They're just simply, they were the original licensor to us of the product. Our manufacturers are larger, well-established manufacturers for the API in the U.S. and for the drug product in Europe. And we don't see any problems meeting our current demand over the next number of years. So that really isn't an issue from our perspective at this point.

Okay, great. Thank you, Phil.

Appreciate it.

All right. Thanks, John. Have a great day.

There are no further questions at this time. Before I ask Mr. Phil Thurland to go ahead with his closing statement, I would like to remind participants that a replay of this call is scheduled to begin two hours after the conference. In the U.S., please call 1-888-295-2634. In Israel, please call 03-9255-904. Internationally, please call 972-39255-904. Mr. Sirlin, would you like to make your concluding statement?

Yes, thank you. Thank you, Operator. In closing, we are progressing through 2023 with significant momentum. We are preparing for the potential U.S. approval of our first therapy in stem cell mobilization, and our commercial organization is readying for a robust launch with a highly experienced team. We have initiated a new program in an additional and important transplant area by entering into a collaboration to execute a clinical trial with Motixifortide as a mobilization agent in gene therapies. We are also making notable progress in our pancreatic cancer program and anticipate important data from our first-line investigator-initiated study later this year, as well as the initiation of our gen-fleet collaboration study. I am very pleased with our progress during the first quarter, and I am very excited about what we are in the process of achieving this year. Thank you all very much for your continued interest in BioLine Rx, and we look forward to providing our next comprehensive update in August. Be safe and have a great day. Thank you.

Thank you. This concludes the BioLineRx first quarter 2023 conference call. Thank you for your participation. You may go ahead and disconnect.