Bio-Path Holdings, Inc.

Good morning, ladies and gentlemen. Welcome to the Biopath Holdings third quarter 2022 earnings conference call. At this time, all participants are in listen-only mode. Following the formal remarks, we will open the floor for your questions. As a reminder, this conference call is being recorded. I now would like to turn the conference over to Will O'Connor of Stern Investor Relations. Please proceed.

Thank you, Operator. Welcome to the Biopath Holdings conference call and webcast to review the company's third quarter 2022 financial results and to provide an update on recent pipeline and corporate development. Earlier, we issued a press release which outlines 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, 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, and thank you for joining us. I'm particularly pleased with the progress we made throughout the third quarter. as highlighted by the initiation of our Phase 1, Phase 1B study of BP1002 in refractory relapsed acute myeloid leukemia and made significant inroads in preparation for the initiation of our Phase 1 study of BP1001-A for the treatment of solid tumors later this year. These are exciting times at BioPath as our clinical progress is bringing us closer to achieving our mission to deliver meaningful new medicines to the most challenged cancer patients. Let's start with the progress we've made with our lead product candidate, Prexager-Burison. We continue to make significant progress advancing stage two of our phase two clinical trial of Prexager-Burison for the treatment of acute myeloid leukemia, or AML, in combination with frontline therapy to cytamine and venetoclax. The amended stage 2 of this phase 2 trial in AML is an open-level, two-stage, multi-center study of prexatubrosin in combination with the cytamin and venaglax in two cohorts of patients with previously untreated AML and relapsed resistant AML. A third cohort includes treating relapsed resistant AML patients who are venaglax resistant or intolerant with the two drug combinations, of Prexager-Burrison and Decidivin. The primary endpoint for the 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 the safety and efficacy of the treatment. As I mentioned earlier, we are also making progress towards initiation of a Phase I clinical trial, BP1001-A, in patients with advanced solid tumors, including ovarian, uterine, pancreatic, and hormone refractory breast cancer, some of the most challenging cancers to treat with today's therapeutic toolkit. BP1001-A, a fourth biopath drug candidate, is a modified product from Prexager-Borosin sharing the same drug substance with enhanced nanoparticle properties. In the coming weeks, we expect to initiate a Phase I-1B clinical trial of BP1001-A in patients with solid tumors, including ovarian, endometrial, pancreatic, and triple negative breast cancer. This trial will be conducted at several leading cancer centers and is planned initially to evaluate the safety of Prexagiviricin in solid tumor patients. Patients diagnosed with recurrent ovarian and endometrial cancer often have poor outcomes and it is our hope that Prexagiviricin may provide clinical benefit for such patients. Turning now to BP1002, our second therapeutic candidate, which targets BCL-2. As you know, BCL-2 is responsible for driving cell survival in up to 60% of all cancers. High expression of BCL-2 has been correlated with poor prognosis for patients diagnosed with AML. Venetoclax has shown activity against the anti-apoptotic protein BCL-2 and works by neutralizing the protein's BH3 domain. It is an approved treatment for chronic lymphocytic leukemia, or CLL, patients and untreated AML patients. However, with the exception of some patients treated with allogenetic and monopoietic 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 is 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. A total of six valuable patients will be treated with BP1002 monotherapy in a standard 3 plus 3 design with a starting dose of 20 milligrams per square meter. The approved treatment cycle is two doses per week over four weeks, resulting in eight doses administered over 28 days. The Phase 1b portion of the study will commence after completion of BP1002 monotherapy cohorts and will assess the safety and efficacy of BP1002 in combination with the cytamine and refractory relapse AML patients. We hope to be able to provide incremental updates on this program as we establish safety first, followed then by efficacy in the smaller patient cohorts. Finally, Let's review the progress we've made with our initial third drug candidate, BP1003, which targets the STAT3 protein. STAT3 is a transcription factor that regulates various tumor genetic processes, such as tumor proliferation, metastasis, and drug resistance. Its overexpression and aberrant activation characterize many cancers, including breast, lung, ovarian, liver, and colon cancer. Activation of the STAT3 pathway in breast and ovarian cancer cells promotes tumor initiation, migration, and taxol resistance. STAT3 also promotes 5-FU resistance in colorectal cancer cells. Its role in numerous malignancies made STAT3 a potential cancer therapeutic target. BP1003 is a novel liposome incorporated STAT3 antisense oligonucleotide that efficiently reduces STAT3 expression and enhances the sensitivity breast and ovarian cancer cells, to Taxel and 5-FU. These results are in line with previous work in which BP1003 plus gemcitabine displayed enhanced anti-tumor activity in pancreatic ductal adenocarcinoma. Together, these results strongly suggest that BP1003 combination therapy is a novel strategy for patients with advanced solid tumors. 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. Our goal is to file an IND application for this very promising product candidate in the first half of next year. The timing is determined by finalizing preclinical testing of drug substance presence in the animal species used in testing. Before turning the call over to Anthony, I'd like to highlight the considerable progress we have made bolstering our intellectual property portfolio. At BioPath, we have executed a global patent strategy aimed at building a fortress of protection for our DNA de-enabilized platform technology worldwide. I'm delighted to report that BioPath has five patents issued and six pending patent applications in the United States. Outside the United States, BioPath has four applications that have completed the grant process, and additional five applications have been allowed and are now completing the grant process. Finally, over 60 foreign applications remain pending. So, why is this so important? First, these protections are vital as we advance our programs through the clinic and begin to capture the attention of outside parties, which would be competitors and more. In addition, a strong patent position puts us in a strong negotiating position for any future partnership or licensing agreements. Importantly, These patent grants underscore the novelty of our innovative approach to fighting cancer with our de-enabilized technology. With that, I'll now turn the program over to Anthony Price for a brief review of our third quarter 2022 financials, along with balance sheet highlights.

Anthony? Thanks, Peter. The company reported a net loss of $3.5 million, or 49 cents per share, for the three months ended September 30, 2022, compared to a net loss of $2.1 million, or 29 cents per share, for the three months ended September 30, 2021. Research and development expense for the three months ended September 30, 2022 increased to $2.4 million compared to $1.0 million for the three months ended September 30, 2021, primarily due to manufacturing expenses related to drug product releases in the third quarter of 2022, as well as startup costs related to our Phase I clinical trial for BP1001-A in solid tumors. General and administrative expense for the three months ended September 30, 2022, was $1.2 million, an increase of $0.1 million compared to the three months ended September 30, 2021, primarily due to increased legal fees. As of September 30, 2022, the company had cash of $13.7 million compared to $23.8 million at December 31, 2021. Net cash used in operating activities for the nine months ended September 30, 2022 was $10.1 million compared to $7.1 million for the comparable period in 2021. With that, I'll now turn the call back over to Peter.

Thanks, Anthony. As we approach the close of the year and look forward towards 2023, we couldn't be prouder of the progress we've made or be more excited for our future, having recently initiated our Phase I-1B study of BP1002 in refractory relapse acute myeloid leukemia, and look forward to initiating our phase one study of BP1001-A for the treatment of solid tumors later this year, we expect to have a series of near-term value-creating inflection points. More importantly, as we advance these programs, we believe we are giving hope to patients with cancer who have limited treatment options. While this may sound a lofty goal, It is what drives our team every day and why we are so excited about the progress we have made. With that operator, we are ready to open the call for questions.

Thank you. At this time, we will begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble the roster. And the first question comes from Jonathan Ashoff with Roth Capital Partners.

Good morning, Peter. I was curious, when will we see the initial Phase I results both for 1002 and PREX-A and the Phase II results, the initial Phase II results for PREX?

Well, the phase two, again, we're well into that study, and our goal is to have interim readouts by the end of the quarter, first quarter next year. Recall, that's really three clinical trials. We have three cohorts, and we have now really established momentum as we worked our way through the problems of COVID created for our two main manufacturing facilities. We have accumulated quite a bit for it. That allows us to really treat a lot of patients. In the first quarter, seeing at least some of those cohorts in Phase 2. Phase 1 and Phase 1002 in the relapsed AML I would think I mean we've already dosed in that so the first cohort with three patients so I would we've had interest in that so I would think we'd have something by the first quarter next year of that first one which would be the first dose level three patient readout We're close, we only need one more patient. We have one more patient on the lymphoma portion of that phase one, and it's a separate trial. And I would think that we should be able to do that. It's harder to find patients for them because there's an attractive T-cell program out there that is enrolling a lot of patients. We have not started yet. We're open on 1001-A in solid tumors, but my clinical team tell me that we have a lot of interest in that study, and that is open now, and they are screening patients. So I absolutely think we should establish a first cohort study you know, evaluated and released information on by that first quarter.

So you're saying PREX-A, you'll have data next quarter? It's only three patients. So just like on 002, first quarter next year, likely three patients worth of data.

Yeah, those are both three plus three dose escalating trials. But we're allowed when we do, we report on it.

All right, where is the Phase II PREC study in its enrollment?

Well, we have more than... I don't like to get into specifics on enrollment, but it's well past 50.

Well past 50 patients or 50%?

Patients.

Okay. That's all I had. Thank you very much, Peter. You're welcome, Jonathan.

Thank you. And the next question comes from Yi Chen with HC Wainwright.

Thank you for taking my questions. Could you give us some additional details regarding which cohorts out of the three of the Phase II trial in ML have enrolled most patients so far?

Well, they're all doing about the same, and so... I think the performance has been reasonably well. So the patients are being enrolled and we have good institutions. But my sense right now is they're all well. I just can't speculate at this time which ones will come in first.

Okay. But you do expect that there should be... 19 available patients by the end of first quarter next year, right?

Well, that's the goal, yes. I mean, our enrollment is, we're able to go much stronger on that now because of drug supply.

Got it, got it. And for the solid tumor trial of Prexidibircin-A, which type of solid tumor do you expect to enroll the most based on the current interest?

Well, certainly ovarian, advanced ovarian has been one that we've worked long with. But the way the strategy for that trial, the 1-1B, was to open... open the dose escalation portion, because that's monotherapy, to pretty much all the solid tumors in that area. It's faster. I mean, we're just looking for the safety evaluation. Then once you get to the 1B, that's when you get, of course, the specific types. A 1B in advanced ovarian and intrametral, a 1B in pancreatic, and A1B in the triple negative cancer. And those are all, remember, combination therapies. So you wouldn't use one combination to go across those. They'd all have their specific ones.

Okay, got it. Does the company currently... have sufficient capital to fund operations to the point of starting the trial for BP1003?

I believe so. I think that should be ready to go next year. That's our goal. I think, as I mentioned last time, we're redoing the drug substance detection program so that we can finish that last tox study in rabbits. And we are remanufacturing, or have pretty much remanufactured the drug for that, and we'll get it off to the Charles River to finish that up. So, I mean, our goal, certainly, as we said, in our releases and whatnot, is that we should be in the first six months of this year. Once that happens, we can get our IND files. We've got everything else done. We have sufficient cash for requirements of runway. We noted the end of September and we just added that with a small strategic raise to make sure we kept that runway out there past October next year so that we continue to demonstrate that viability.

Okay. Thank you.

You're welcome. Thank you. And the next question comes from Laura Engel with Stonegate Capital Partners.

Good morning. How are you?

I'm doing well. How are you, Laura? Good to have you back.

I'm good. Thanks, thanks. Yeah, thanks for taking my call. So most of my questions have been answered, but you did mention discussions with partners and, you know, the strength of the patent portfolio. Any notable updates there? Anything, any discussions that are progressed to the point you want to talk about it for therapeutic areas either in cancer or even outside the realm of cancer?

No, nothing. I think the only time we'd do something is if we actually had something concrete that had happened. I think it's too speculative to talk about people's interests and whatnot, and there has been in the past. For us, it has to be the right time. I think past some of these things that are going on, starting at the end of the first quarter next year, you know, may prompt some interest, uh, that could finalize, but you know, I, I, I can't be definitive on that right now, but our main focus recall is to be a company that, uh, develops these DNA, uh, enable eyes drug products, um, that, uh, treat more difficult to treat patients diseases and some people will have interest in that but our model is not to be a pharma company that would pull those into the commercialization so we need to focus on making more of those kinds of products that can help hard to treat populations and so That's why we've spent, you know, we've had some pretty good advisors helping us identify not only, of course, the U.S. patents, but the foreign patents that you need that your bigger companies typically want to be interest in a license for the technology. They've got to have those foreign components, too. And so that's why we've been spending time developing those.

Right. Well, great progress. And again, appreciate you taking my call. And I'll get back in the queue. Thanks, Peter.

Thank you.

Thank you. And this concludes the question and answer session. I would like to turn the call off Peter Nielsen for any closing comments.

Thank you again, everyone, for joining us and for your continued support of Biopath Holdings. Have a great day. Bye now.

Thank you. The conference has now concluded. Thank you for attending today's presentation. May now disconnect your lines.