Celcuity Inc.

Good day, ladies and gentlemen, and welcome to your Salcuity second quarter financial results conference call. All lines have been placed on a listen-only mode, and the floor will be open for your questions and comments following the presentation. If you should require assistance throughout the conference, you may press star zero to reach a live operator. At this time, it is my pleasure to turn the floor over to Robert Jewell with Westwick ICR. Sir, the floor is yours.

Thank you, operator. Good afternoon, everyone, and welcome to Selcuity's second quarter 2021 financial results and business update webcast and conference call. Thank you for joining us. Earlier today, Selcuity released financial results for the second quarter ended June 30th, 2021. The press release can be found on the investor relations section of the company website. Joining me on the call today are Brian Sullivan, Selcuity's chief executive officer and co-founder, and Vicki Hahn, Chief Financial Officer. Before we begin, I would like to remind listeners that our comments today will include some forward-looking statements. These statements involve a number of risks and uncertainties, which are outlined in today's press release and in our reports and filings with the SEC. Actual events or results may differ materially from those projected in the forward-looking statements. Such forward-looking statements and their implications involve known and unknown risks, uncertainties, and other factors that may cause actual results or performance to differ materially from those projected. On this call, we will also refer to non-GAAP financial measures. These non-GAAP measures are used by management to make strategic decisions, forecast future results, and evaluate the company's current performance. Management believes the presentation of these non-GAAP financial measures is useful for investors' understanding and assessment of the company's ongoing core operations and prospects for the future. You can find the table reconciling the non-GAAP financial measures to GAAP measures in today's press release. With that, I'd like to turn the call over to Brian Sullivan, Salpuity's CEO.

Thank you, Robert. Good afternoon, everyone, and thank you for joining us today. As always, we appreciate your continued support of CellQuiti. On this call, we'll update you on our second quarter financial results, the status of our Gadatalysid program, some recently reported clinical trial results, and an update on our Celsignia companion diagnostic programs. Vicky will follow my comments with a discussion of our financial results, and then we'll open up the line for questions. I'm sure many of you are aware of the transformational step that CellQuiti took in April with the in-licensing from Pfizer of Gatala-Lisib, a pan-PI3K mTOR inhibitor. Gatala-Lisib is currently in clinical development to treat patients with ER-positive HER2-negative advanced or metastatic breast cancer. Under the terms of the licensing agreement, Pfizer provided Salcuity with a worldwide license to develop and commercialize Gatala-Lisib. Salcuity paid a license fee of $5 million cash, and $5 million of Salcuity's common stock is upfront payments. Pfizer is eligible to receive up to $330 million of back-end-loaded development and sales-based milestone payments and tiered royalties on potential sales. We estimate that the potential annual market available for Gadalilisib as a treatment for breast cancer is approximately $5 billion. We also believe there are additional opportunities for Gadalilisib to treat other tumor types that could further increase its market potential. Our interest in GETA was spurred by encouraging data obtained from the expansion portion of an ongoing Phase 1B clinical trial evaluating GETA plus the CDK4-6 inhibitor, IBRANS, and an endocrine therapy. As of a January 11, 2021 data cutoff, 53 of the 88 evaluable patients, or 60%, were reported to have had an objective response to the treatment regimen. Gattalo-Elizabeth was also generally well-tolerated, with the majority of treatment-related adverse events, or TRAEs, being grade 1 or 2. The most common grade 3 or grade 4 TRAE related to Gattalo-Elizabeth were stomatitis and rash and are considered to be manageable. A relatively low TRAE dropout rate of approximately 10% was reported. We expect to update this data in December in conjunction with the San Antonio Breast Cancer Symposium. We continue to plan and prepare for a Type C meeting with the FDA later this year to get feedback on the design of our Phase III clinical trial for Gattala illicit. Subject to FDA feedback, we would expect to initiate a Phase III clinical trial evaluating GEDA in combination with IBRANTS and an endocrine therapy in the first half of 2022. To support our GEDA development program, we closed two financings recently. In early April, Salcuity entered into a debt financing agreement that can provide up to $25 million in term loans. The first tranche of $15 million was funded at closing. And in early July, Salcuity closed the follow-on equity offering that raised gross proceeds of approximately $56.3 million. After the follow-on offering, Salcuity had approximately $94.4 million of cash on hand. As we've previously discussed, our assessment of different PI3K and mTOR inhibitors using our CellSignia platform led us initially to approach Pfizer about our interest in pursuing a collaboration to evaluate Geta-Alizib. Subsequent to that initial internal study, and as part of our due diligence on Geta's mechanism of action, we conducted additional studies to evaluate Geta-Innovalizib, a PI3K alpha inhibitor, and Navigoclax, a BCL inhibitor, in breast and ovarian patient tumors using our CellSignia platform. We presented the results of these studies at the AACR annual meeting in April. The results showed that GETA inhibited nine times more signaling test activity in tumors with hyperactive RAS network signaling on average than in a volisib when evaluated at equal concentrations with a cell-signia test. A cell-signia test also found that GETA inhibited five times more signaling activity when evaluated at one-fifth the concentration of in a volisib. This data supported our hypothesis that hyperactive RAS network signaling involves more than just the PI3K alpha isoform, and that inhibiting all four class I PI3K isoforms, as well as mTORC1 and mTORC2, is required to address it. Our study also detected the synergistic cooperation between the PI3K mTOR and BCL pathways, which suggests the potential patient benefit of combining GETA with a BCL inhibitor. We plan to conduct similar additional investigations using our CellSignia platform to identify classes of agents that may be appropriate to combine with Geta-Licit, Ketala-Licit. Since we last reported to you, results from a 17-patient phase one dose escalation study were published. This study evaluated the safety and preliminary activity of Geta combined with carboplatin, a platinum-based therapy, and Paclitaxel. The intention was to explore the hypothesis that inhibition of the PI3K mTOR pathway can promote sensitivity to platinum-based therapies. This is relevant because platinum therapies are the backbone of combination therapy for a wide range of tumors, including ovarian, lung, breast, and bladder cancers. Amongst the 17 patients evaluated, 11, or 65%, had an objective response. Of these 11 responsive patients, eight had a partial response and three had a complete response. Three additional patients, or 17%, reported stable disease. 11 of the 17 patients enrolled had advanced ovarian cancer, 10 with clear cell ovarian carcinoma, and one with low-grade serous ovarian cancer. Clear cell ovarian cancer is a tumor type with poor prognosis, generally considered to be chemoresistant. Of the 11 patients with ovarian cancer, 9, or 82%, reported an objective response. Among the 9 of 17 patients who had received prior platinum therapy, 4, or 45%, had a partial response. These four responders included three patients with ovarian cancer and one patient with non-small cell lung cancer. The drug combination was found to be tolerable with a manageable safety profile. While the sample size is very small, the data from the ovarian cancer patients is interesting nonetheless. Nine of the 11 ovarian cancer patients, or 82%, had an objective response. Of the seven patients with clear cell ovarian cancer who were platinum naive, six, or 86%, had an objective response. This compares to objective response rates of 25% to 50% reported in other studies evaluating platinum therapy in platinum-naive clear-cell ovarian cancer patients. It's premature for us to assess the priority of pursuing further development of an indication in ovarian cancer, but nonetheless, the study provides additional preliminary evidence for gadotilisib's anti-tumor activity. Now I'd like to move on to the diagnostic side of our business. Salcuity, or Salsignia, Salcuity's third-generation diagnostic platform identifies the underlying cellular activity, dysregulated pathway signaling, that may be driving a patient's tumor so that a matching targeted therapy can be identified. Since dysregulated signaling is too complex for molecular tests to characterize in most patients, our platform can identify new treatment options for patients who lack actionable molecular biomarkers. Our strategy is to develop companion diagnostics that enable a pharmaceutical company to expand the number of patients eligible to receive their targeted therapy. To achieve this, we're collaborating with pharmaceutical companies to evaluate the efficacy of their targeted therapies in patient populations selected by a cell-signia pathway activity test. If the clinical trial results are favorable, these collaborations may lead to advancement of a new indication that expands the market for the targeted therapy. As an example, we believe there is a significant unmet need for new therapeutic options for HER2-negative breast cancer patients. Our research suggests that many of these patients have an undiagnosed and untreated disease mechanism. Our self-signia test has the potential to identify the disease mechanism for roughly 25% to 35% of these patients and the targeted therapy most likely to benefit them. Earlier this year, we entered two new clinical trial collaborations. In January, as previously announced, we entered a collaboration with the Sarah Cannon Research Institute and Pfizer for a Phase II trial. The trial is evaluating the efficacy and safety of two Pfizer-targeted therapies, Vizimpro, a Panher inhibitor, and zelcurie, a CMET inhibitor, in patients with previously treated metastatic HER2-negative breast cancer selected with our cell sigmia test. Patient enrollment is expected to begin this quarter, and interim results are expected in the second half of 2022. In March, we entered into a clinical trial collaboration with MD Anderson, Novartis, and Puma Biotechnology to study a new drug regimen. Collaboration will evaluate the efficacy and safety of Novartis' CMET inhibitor, Tabracta, and PUMA's pan-HER inhibitor, NeurLynx, in patients with metastatic HER2-negative breast cancer selected by the Cell Signia platform. And this is the second clinical trial to treat patients diagnosed with hyperactive HER2 and CMET signaling breast cancers with matching targeted therapies. Patient enrollment is expected to begin in the third quarter of this year. Salcuity now has five clinical trial collaborations in place, and we expect to announce additional collaborations by the end of this year. The ongoing FACT-1 and FACT-2 trials that Salcuity is conducting are evaluating anti-HER2 therapies in early-stage HER2-negative breast cancer patients. The goal of each of these trials is to demonstrate that breast cancer patients identified by our Celsignia HER2 pathway test obtain a higher rate of pathological complete response to neoadjuvant anti-HER2 drug treatment than from current standard-of-care chemotherapies. Patients who receive a pathological complete response to neoadjuvant drug treatment are less likely to have their cancer recur So we believe our cell-signia test can play a significant role in extending the lives of many breast cancer patients. We continue to expect interim results from our FACT-1 and FACT-2 trials in late 2021 or early 2022. We are excited about these collaborations and the opportunity to work with some of the world's most prominent cancer research centers. We have additional collaboration discussions in progress, and our goal is to announce new agreements in the coming months. I'd like to turn the call over now to Vicki Hahn to review our financial results.