Bio-Path Holdings, Inc.

Good morning, ladies and gentlemen. Welcome to the Biopath Holdings Full Year 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open the call up for your questions. I would now like to turn the call over to Will O'Connor of Start Investor Relations. Please proceed.

Thank you, Operator. Welcome to the Biopath Holdings Conference Call and webcast to review the company's full year 2020 financial results. and to provide an update on recent pipeline and corporate developments. Earlier, we issued a press release which outlined the topics that we plan to discuss on today's call. The release is available at biopathholdings.com. With me today from Biopath are President and CEO Peter Nielsen and Senior Vice President of Finance, Accounting, and Administration Anthony Price. Before we begin the call, I'd like to remind you that today's discussion will contain forward-looking statements that involve risks and uncertainties. These risks and uncertainties are outlined in today's press release and in the company's recent filings with the Securities and Exchange Commission, which we urge you to read. Our actual results may differ materially from what is discussed on today's call. With that, I'll now turn the call over to Biopath CEO, Peter Nielsen. Thanks, Will.

Good morning, everyone. Thank you for joining us. I'm pleased to be addressing you all today to discuss the significant progress we made in 2020, which saw important advances across our clinical development pipeline. Despite headwinds from COVID-19 pandemic, the progress we made throughout 2020 formed the foundation for us to advance and expand our clinical portfolio toward key inflection points in 2021 and beyond. We continue to execute on our clinical development plans across our de-enabilized platform of innovative RNAI nanoparticle therapeutics to treat patients suffering with a variety of life-threatening cancer indications. Despite some groundbreaking progress with immuno-oncology and combination therapy, there continues to be a large unmet medical need for a great number of cancer patients. I'll begin with our lead product candidate, Prexidibiracin, where we continue to make meaningful progress. Last year, we dosed the first patient in stage two of our phase two of Prexidibiracin for the treatment of acute myeloma leukemia, or AML, in combination with frontline therapies. dacitabine, and venetoclax. As we have previously reported, Phase II clinical development of prexigerburicin in AML commenced with Stage I of the Phase II clinical trial, which was open-label and treated de novo AML patients with a combination of prexigerburicin and low-dose citerabine, or LDAC. The combination of Prexin-Geborosin and LDAC was shown to be safe and more efficacious to treat. As many of you know, there has been an evolving landscape for care in AML. Despite these new therapies, there are still patients who are refractory or resistant, and those are the therapies. There are still patients who are refractory or resistant, and those are the patients we aim to help. As standard of care evolved, we adapted our trial design to reflect these changes. Feedback from treating physicians pointed to a preference for Decidivin. The approval of frontline therapy Venetoclax provided an opportunity for adding Prexidibiricin to the newly approved frontline two drug combination of Venetoclax and Decidivin for the treatment of previously untreated AML patients. The amended Stage 2 of this Phase 2 trial in AML is an open-label Phase 2, two-stage, multi-center study of prexotuburacin in combination with the cytamin and venetoclax in two cohorts of patients with previously untreated AML and relapse-resistant AML. A third cohort includes treating relapse-resistant AML patients who are venetoclax-resistant or intolerant with the two-drug combination of Prexagerboricin and Decidivine. The full trial design plans have approximately 54 evaluable patients for the cohort treating relapsed refractory AML patients with the triple combination treatment of Prexagerboricin, Decidivine, and Venetoclax, and the cohort treating AML patients who are Venetoclax-resistant or intolerant with the two-drug combination of Prexagibiricin and Decidamin, with a review of both cohorts performed after 19 evaluable patients. The full trial design plans have approximately 98 evaluable patients for the cohort treating untreated AML patients with the triple combination treatment of Prexagibiricin, Decidamin, and Venetoclax, with a preliminary review for the cohort performed after 19 valuable patients and a formal interim analysis after 38 valuable patients. The higher number of patients in the full trial design for the untreated AML patient cohort is due to the higher baseline response of the frontline therapy with previously untreated AML patients. The primary endpoint for this study will be the number of patients who achieve complete remission which includes complete remission with incomplete hematologic recovery and complete remission with partial hematology recovery. An interim analysis will be performed on each cohort to assess safety and efficacy of the treatment. In the event these results exceed the primary endpoint in a number of patients that meets or exceeds statistically determined thresholds, we plan to seek to convert the trial into a registration trial for accelerated approval. In February, we announced that the United States Patent and Trademark Office issued a third patent in our family of platform intellectual property that offers expended defense of our de-enabilized platform technology. In addition, we were pleased to receive the issuance of a patent related to Prexager-Burison in combination with either a cytidine analog, such as Desidamin, or the BCR-Able tyrosine kinase inhibitors, Desatinib and Nelotinib. This addition further strengthens our intellectual property portfolio and complements our already granted patents. Our growing patent estate continues to be a valuable asset for BioPath, as it provides protection not only for our core product portfolio and research efforts, but now also offers broad protection in combination with established frontline therapies. These new patents protect the unique therapy combination and supports our ongoing investment in this program to bring a new treatment option to patients with AML who have limited treatment options. As I have said before, we will continue our efforts to build a fortress of protection around our technology, as it safeguards our platform technology and target-specific technology, is a deterrent to would-be competitors, and creates value around our core competencies. Next, I'd like to turn to our planned phase one clinical trial of Prexigybericin-A in patent patients with advanced solid tumors, including ovarian, uterine, pancreatic, and hormone refractory breast cancer. Prexagibiricin-A, a fourth biopath drug candidate, is a modified product from Prexagibiricin, sharing the same drug substance with enhanced nanoparticle properties. This trial will be conducted at several leading cancer centers. and is planned initially to evaluate the safety of Prexidibiricin in solid tumor patients. Patients diagnosed with recurrent ovarian and endometrial cancer often have poor outcomes, and it is our hope that Prexidibiricin may provide clinical benefit for such patients. Turning now to BP1002, our second therapeutic candidate, which targets BCL2. Last year, we filed an IND application for our second pipeline candidate, BP1002. Venetoclax has also shown activity against the anti-apoptotic protein BCL2 and works by neutralizing the protein's BH3 domain. It is an improved treatment for chronic lymphocytic leukemia, or CLL, patients and untreated AML patients. With the exception of some patients treated with allogenetic hematopoietic cell transplantation, disease relapse invariably occurs, oftentimes due to BH3 domain mutation over time. BP1002 also targets the BCL2 protein. However, BP1002 activity is based on blocking the BCL2 messenger RNA, and not the BH3 domain. As a result, we believe that BP1002 could provide an alternative for venetoclax patients who have relapsed, including AML patients who previously received venetoclax treatments. Finally, let me briefly review the progress we've made on our third drug candidate, BP1003, which targets the STAT3 protein. This program has shown promising preclinical data and we are very excited for the future of this program. We are studying BP1003 for the treatment of pancreatic cancer in a patient-derived tumor model. Previous models have shown the drug to successfully penetrate pancreatic tumors and enhance the efficacy of standard frontline treatments. The potential for our STAT3 program is compelling for a number of reasons. Signal transduction and activator of transcription 3, or STAT3, though typically inactive in normal cells, is aberrantly active in cancer cells. The abilities of tumor cells to proliferate uncontrollably, resist apoptosis or cell death, induce vascular formation and invade distant organs are well-recognized hallmarks of cancer. STAT3 is a regulator of the genes involved in these cancer processes. More recently, the capability of tumors to evade immune surveillance and avoid destruction by the immune system has also gained significant acceptance in the cancer research field. STAT3 which is a point of convergence for many oncogenic pathways, has emerged as a critical mediator of tumor immune evasion at multiple levels. We are particularly excited to launch our first in-human validation of this cutting-edge therapy in an especially challenging cancer indication that has limited treatment options. We are aiming to file an IND application with this very promising product candidate later this year. With that, I'll now turn the program over to Anthony Price for a brief review of our full-year 2020 financials, along with balance sheet highlights.

Anthony? Thanks, Peter. The company reported a net loss of $10.9 million, or $2.83 per share, for the year ended December 31st, 2020 compared to a net loss of 8.6 million or 3.24 per share for the year ended December 31st, 2019. Research and development expense for the year ended December 31st, 2020 increased to 6.6 million compared to 4.6 million for the year ended December 31st, 2019 primarily due to increased enrollment for a Phase II clinical trial of prexygebersin in AML, startup costs related to Phase I clinical trials for BP1002 in lymphoma and prexygebersin A in solid tumors, and increased preclinical expenses for BP1003. General and administrative expense for the year ended December 31, 2020, increased to $4.3 million compared to $4.1 million for the year ended December 31, 2019, primarily due to increased franchise tax expense. As of December 31, 2020, the company had cash of $13.8 million compared to $20.4 million at December 31, 2019. Net cash used in operating activities for the year ended December 31, 2020, was $11.0 million compared to $8.4 million for the comparable period in 2019. Net cash provided by financing activities for the year ended December 31, 2020, was $4.3 million. With that, I'll now turn the call back over to Peter.

Thanks, Anthony. I'd like to leave you today with a few thoughts on the imperative Biopath has in bringing our de-enabilized products to market. According to the American Cancer Society, more than 600,000 people lose their lives to cancer each year. During the COVID-19 pandemic, cancer patients are among our most vulnerable of populations. This is why we at Biopath continue to be relentless in our pursuit to bring better treatment options to these patients. who so desperately need them and for whom there are no treatment options. I'd like to take this opportunity to express my gratitude to the Biopath team and the researchers and physicians supporting our scientific and regulatory advancement. Because without their collaboration and support, we could not have made the progress we have made to date. And we look forward to advancing together to secure our future success. With that, operator, we are ready to open the call for questions.

Okay. Ladies and gentlemen, if you have a question at this time, please press the star and then the number one key on your touchtone telephone. If your question has been answered or you wish to remove yourself from the queue, please press the pound key. Your first question is from the line of Yi Chen with HC Wainwright.

Hi, thank you for taking my question. My first question is, could you tell us which arm of the AML trial involves patients faster than the others, and whether this arm is likely to report into data before the end of this year?

Thank you. My expectation is that the third cohort, the one that actually is doing the venetoclax-intolerant or resistant patients. Recall that group is being treated with the two-drug combination, plexigibiricin and Decidivitin. I also think that's a lower bar. The null hypothesis is smaller, and that's a very attractive option. It's very similar to to what we did previously with, uh, uh, the two drug combination LDAC. And we exceeded the, uh, LDAC null hypothesis very nicely. We just couldn't proceed because the oncology community went away from, uh, LDAC. So I think that one, uh, I, I believe, you know, we have over half of the patients we need for that, uh, interim readout. And, uh, You know, I think, you know, notwithstanding any kinds of patient interruptions or whatnot with COVID, hopefully the vaccine program is going to work and we're not going to have variants and all that kind of thing. But that would be the first one. The other one, you know, we're competing with, like in the newly diagnosed, there's still competition for those vaccines. patients as they continue to try other things with venetoclax. So I would say the two-drug combination is the one that is most likely for 2021. Got it.

And the second question is, is the phase one trial of praxeduversin A in solid tumors due on track to start soon?

Yeah, we recall... There were just some new studies, latest testing that the FDA, at least in this division, wanted. And so we had to go formally test the entire batch in a reconstituted material. This was testing the stability of the drug as reconstituted in a hospital before administration of a patient. We've completed all of that. And then we have an additional test that we're doing that's a new one. And we think we've just about finalized that. Once that's done, we should have the IND right away. And, you know, I'm thinking the second quarter, unless there's, you know, the second set of testing, you know, still needs more refinement. Because you not only do the testing, but you have to, you know... develop a, you know, qualify the method and whatnot. So we think that'll be the case. We had a good call with the FDA on the additional things we wanted. And so we know the, you know, the last steps, those get completed and we should have our FDA and, and start treating.

Got it. Thank you. You're very welcome.

Your next question is from the line of Jonathan Ashhoff with Roth Capital Partners.

Thank you. Good morning, guys. I was wondering a little more on PREX-A. Should we expect PREX-A development only in ovarian and endometrial and also for 1003 only in pancreatic, or do you think those two phase one trials would be very much a mixed solid tumor bag?

Yeah, I think generally, Jonathan, Dash A and 1003 will have a similar pattern. The phase one, of course, is dose finding, and it can go across several sets of solid tumors. And once you do that dose escalate, establish your safety, find a dose, then we would proceed, let's say in dash A, with phase one Bs, One of the first ones would be Paclitaxel and Prexi-A in advanced ovarian and endometrial. The second target trial would be in stage four metastatic pancreatic with gemcitabine and MD Anderson and and a biopath have also worked on breast cancer, and I believe the hormone-resistant area of triple negative. The 1003, again, similar concept, enroll from several of the solid tumor cancers. Once you, again, dose up, establish safety, get our dose, then we would go on. The two candidates that we've done work on would be, again, the metastatic pancreatic and also non-small cell lung cancer. And, you know, I suspect once we get into it, we would do other things. I think STAT3 is also amenable to AML. But that's the general plan. Broadly across in the one where you don't escalate, establish safety, and then you go into 1Bs in the specific areas with your specific combination treatment drug.

Okay, thank you, Peter. I don't know if you addressed this in the opening comments, but when do you think we can see the safety results with PREX in the double and the triple combination, and how soon, once you get those safety board findings, you know, those affirmations of safety, can you start your cohorts?

Well, we're going to – I expect to be reporting out on that as early as the end of this first quarter. The testing has been done, but we have to have a safety review, and then we'll write it up and put it out, okay? So we've completed that stuff and continue to test. So it's really just the formal reporting part of it.

Okay. And if you assume no additional warrant option or ATM use, how long does $25.9 million fund operations?

Well, we actually, you know, we had, what was it, $13 million at the end of December. And we actually raised close to... approximately 20 million in February. So through a couple of different things, including that registered direct, uh, with Roth. And so we actually have more than 25, but, uh, that will, that will, uh, probably take us, uh, well into 2022, uh, and, uh, probably through the end of it. So that's a good, uh, it's a good slug of money for us. And we'll, and, We will probably do another strategic raise maybe in the third quarter to anticipate all of those trials reaching through their phase ones and being 1Bs in the following year.

Okay. Thank you very much, Peter.

Thank you, Jonathan.

The next question is from the line of Laura Engel with StoneGate Capital Partners.

Good morning. Hope all is well. My main question has already been asked. I wondered if maybe you could give us an update if there's any progress or anything new to report with some of the collaborations you have going on, such as with MD Anderson or I think Thomas Jefferson University at one point. Anything new on that horizon that you could share with us?

Thomas Jefferson, you know, it doesn't really require our active involvement. We supply and develop the drug. We actually have intellectual property on that being developed. So I think they continue to work on that, but it doesn't require our active involvement. I think at MD Anderson, we're really more through the clinical programs with those folks, but yeah, They continue to have an interest in our technology. Of course, they're doing a site for the AML. They're a site for the 1002 in lymphoma and CLL. They'll be a site when we get going in the venetoclax relapsed AML. And for solid tumors, they were kind of the lead... group that, uh, did the original dash a solid tumor work, which was done in advanced ovarian. Um, so, and endometrial. So, um, you know, they, they continue to, you know, we continue to work along with them. Uh, we have some other things that, uh, as we've gained more notoriety, uh, we have other, uh, collaborations being discussed. Uh, so, uh, moves on in the near future.

Okay, great. Well, appreciate the update. Look forward to this year, hoping COVID-19 continues to improve so y'all can keep making this progress and move forward with these trials. So, again, I'll get back into Q, but thanks for the update.

Thank you, Laura.

Again, to ask a question, press star 1 on your touch-tone telephone. At this time, there are no further questions.

All right. Thank you again for joining us, everyone, and for your continued support of BioPath. Have a great day.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation. Have a wonderful day. You may all disconnect.