GlycoMimetics, Inc.

Good morning and thank you for joining the Glycomimetics call. At this time, all participants are in listen-only mode. Following management's remarks, we will hold a question and answer session. At that time, the lines will be open for you. If anyone should require operator assistance, please press star then zero on your touch-tone telephone. I would like to turn the call over to Shari Annis of the Investor Relations Group at Glycomimetics. Please go ahead.

Good morning. Today we will review our accomplishments and financial results for the quarter ended March 31, 2022. The press release we issued this morning is available on the company's website at www.glycomimetics.com under the Investors tab. This call is being recorded. A dial-in phone replay will be available for 24 hours after the close of the call. The webcast replay will also be available for 30 days in the investor relations section of the company's website. Joining me on the call today from Glycomimedics are Harut Samarjan, Chief Executive Officer, Brian Hahn, Chief Financial Officer, and Armand Girard, Chief Business Officer. We'll start today's call with comments from Harut. Brian will follow. Follow to provide an overview of the company's financial position. We'll then open the call for Q&A. I'd like to remind you that today's call will include forward-looking statements based on current expectations. Forward-looking statements on this call may include, but are not limited to, statements about the company's product candidates, you for Lesserland, GMI 1687, and other pipeline programs. along with statements about expectations regarding our operations, cash position, and data from preclinical studies or clinical trials, as well as planned or potential future development, regulatory interactions or submissions, and potential commercialization activities or strategic collaborations. Such statements represent management's judgment and intention as of today to and involve assumptions, risks, and uncertainties. Glycomimetics undertakes no obligation to update or revise any forward-looking statement. For information concerning the risk factors that could affect the company, please refer to Glycomimetics' filings with the SEC, which are available from the SEC or on the Glycomimetics website. I'll now turn the call over to Haroud.

Thank you, Sherry, and good morning, everyone. In our year-end call eight weeks ago, we shared our outlook and strategy for the year ahead. We provided updates on both our regulatory and commercial redness activities, all designed to advance glycomimetics and our lead program, Uproliferan, with a focus towards commercialization. Our highest priority today is collecting and confirming the data from the 70 sites in the U.S., Europe, Canada, and Australia that enrolled a total of 388 patients in our Phase III registrational trial in relapsed refractory AML. This is an ongoing effort that will position us to move quickly to data analysis, top-line readout, and subsequent regulatory submissions once the overall survival event trigger is achieved. Today, we are updating the projected timing of the event trigger for our top line data readout. As our phase three data matures, we continue to track events in real time. Based on current projections, we now anticipate reaching our overall survival events trigger in mid 2023, with top line data disclosure shortly thereafter. Our plan is to provide updates with even more precision on the timing of this milestone. We're confident that uprolaceron will prove to be an ideal combination with standard chemotherapy. It is highly differentiated and has a mechanism of action that is complementary to the salvage therapies used today. Importantly, by targeting extrinsic factors of drug resistance in the bone marrow microenvironment, uprolaceron is molecularly, cytogenetically, and treatment regimen agnostic. The clinical and research communities are taking note. Several of the key opinion leaders shared perspectives on uprolaceran and its potential role in treating AML patients in recent medical education programs. In parallel, we have launched a comprehensive effort to prepare for uprolaceran's anticipated market entry. This effort is currently focused on scientific communications. that will be central to educating the AML community on the role of targeting extrinsic factors of chemoresistance. Some of these materials can be now viewed on our website. As you know, your proletarian is also being evaluated in the frontline AML setting by the National Cancer Institute. You'll recall that the phase two portion of this phase two three trial enrolled its last patient last November as well. As per protocol, the NCI has suspended enrollment in anticipation of its planned interim analysis. When the outcome of the NCI's event-free survival analysis of the Phase II data is communicated to us, we will issue a press release. Under the terms of our partnership with the NCI, we will be able to access the NCI's data in the newly diagnosed setting for regulatory purposes. In addition to advancing two registrational stage programs, we have several investigator-sponsored trials currently evaluating your placerans potential in additional indications. We continue to collaborate with the principal investigators of these trials. We share a goal of publishing their findings at major medical meetings as the data matures. I would now like to comment on the progress we have made with GMI1687 in sickle cell disease. I'm pleased to report that the IND-enabling program for GMI1687 has been completed. GMI1687 demonstrated no safety concerns from GLP 28-day toxicity studies in two different species. The standard battery of IND enabling studies of GMI 1687 also showed no safety concerns. We have received pre-IND guidance from the FDA that will be incorporated into our submission. And we have manufactured GMP drug product that is now on stability to support its use in first in human clinical studies. We remain on track to file the IND in the first half of this year to evaluate the compound in sickle cell disease patients with acute VOC as the lead indication. Filing the IND represents an important milestone for positioning GMI 1687 for partnerships. I remind everyone that there remains no FDA-approved therapy for the treatment of acute vaso-occlusive crisis in sickle cell patients as of today. With Euproleteron now in late-stage development, our third asset, GMI1687, about to enter the clinic, and the declared orally bioavailable lead candidate in the Galectin-3 program, we have created a pipeline of assets to accelerate our transformation to a commercially-focused organization. Consistent with this journey, last week we reduced our headcount by approximately 20%. The reductions were largely in the early-stage research and chemistry departments, while we maintained our key expertise and institutional knowledge to support our development efforts. We greatly appreciate the efforts of our colleagues who helped produce a rich pipeline of future opportunities. By streamlining basic research, we now have greater flexibility to invest in activities that will advance your proletariat's commercialization efforts. Brian, I'll now turn it over to you to provide an overview on our financial results.

Thank you, Haroun. As of March 31, 2022, Glycomamedics had cash and cash equivalents of $76.5 million as compared to $90.3 million as of December 31, 2021. The company's research and development expenses decreased to $9.6 million for the quarter ended March 31, 2022, as compared to $11.1 million for the same period in 2021. The decreased expenses were primarily due to lower clinical trial and development costs related to our ongoing global Phase III clinical trial of upylacilin in individuals with relapsed refractory AML, as patient enrollment ended in November 2021. The decrease was partially offset by higher manufacturing expenses for upylacilin validation batches. The company's general administrative expenses increased to $5.1 million for the quarter ended March 31, 2022, as compared to $4.2 million for the first quarter of 2021, primarily due to commercialization, start-up expenses for upilacerin, and higher patent fees. I'd now like to turn the call back to Haroud. Thank you, Brian.

So to conclude, we believe upilacerin has the potential to transform outcomes in AML patients by achieving deeper, more durable remissions, higher rates of MRD negativity, and by bridging more patients to a successful stem cell transplant. This is a novel approach to AML chemoresistance not addressed by existing therapies. However, I'd like to stress that the opportunity here at Glycometics extends well beyond AML. The E-selectin ligands and other glycans are now known to play important roles in cancer, inflammatory disease, and fibrosis. Over the years, we have generated a pipeline of active drugs positioned to serve as the foundation of future therapeutic breakthroughs. The time is now to demonstrate its full clinical potential. I'd now like to open the line for Q&A. Operator?

Ladies and gentlemen, if you have a question at this time, please press the star and the number one key on your touch-tone telephone. If your question has been answered or you wish to remove yourself from the queue, please press the pound key. Again, ladies and gentlemen, if you have questions at this time, please press star and then the number one on your touch-tone telephone. Your first question comes from the line of Ed White with HC Winwright. Your line is open.

Good morning. Thanks for taking my questions. So just a couple of questions on UPRO to start. could you give us an update perhaps on your thoughts on the timing to submission following the top line data such as what CMC work you're doing right now, et cetera. And also with the hiring of a chief commercial officer, I just wanted to get your thoughts on the market and maybe you can give us some idea of your, you know, initial sales strategy.

Yeah, thanks, Ed, for your questions. So the way we're thinking of this, Ed, is we have a great opportunity now to prepare ourselves as data matures so that once that event trigger happens, Within a few weeks, we're able to communicate the top line data, and as part of our breakthrough therapy designation, we have ongoing discussions with the agency anyway, so that we want to make sure that we bring that forward fast. If, you know, just to remind everyone, once data matures and that is positive, that means for a segment of patients that have not had any true innovation for more than 30 years and that segment is the relapsed refractory patient population fit for chemotherapy that I'm sure everybody will be very motivated for us to move forward. So that we're planning, you know, from now by using our time proactively to make sure we're cutting time on the back end. Now the second part of your question regarding, you know, from a commercialization strategy Although it's too early to kind of talk about the overall strategy from a commercialization perspective, but think of this. There are 20,000 patients in the U.S. who are diagnosed with AML every year, and 12,000 of them die every year. And in the 60% of the patient population that is deemed fit for chemotherapy, there really hasn't been much change. advances in the relapsed refractory population, which is about 8,000 patients of that. So, you know, from that perspective, you can imagine there's going to be a lot of pent-up demand, given that it's not a competitive market. A lot of people have tried to bring in therapies in this area, and unfortunately for patients, that has not really been working out, and the last of them was the Raphael Pharma asset. So, You know, we're very excited to have a shot of bringing in a new therapy for these patients. It's 8,000 to start with in the relapse refractory. More if you take the frontline as well. So we're making sure that people are educated from now on the mechanism of action because the mechanism of action is quite novel. This extrinsic chemo resistance is quite novel and complementary. So we'll use that time from that perspective. So it's first education and then really ramp up to really focus on that high unmet Medicaid need. I hope I answered your question.

Yes, thanks, Sarut. And maybe a question for Brian. You had mentioned the reduced headcount of 20% last week. How should we be thinking about operating expenses going forward for 2022? Is the impact mostly in R&D? And also, if you can give us your thoughts on your cash runway. Thank you.

Thanks, Ed. See, I think previously we got it to about a $60 million spend for 2022. The reduction is several million from the headcount reduction, but we'll continue to be laser focused on where we spend our resources. So I would say that 2022 may be a slight reduction in some of those spend. and constantly reviewing to make sure where we actually are spending our money. With that, current cash on hand gets us into the third quarter of 2023. Great.

Thanks, Brian.

Your next question comes from the line of Boris Beaker with Colon. Your line is open.

Great. My first question is on the NCI study. Could you comment on the timeline when you think we'll get the data from the phase two part of the study? And the second component, do you know what's required, kind of what the threshold is in order to commence the phase three part?

Sure, Boris. Good to hear from you. Maybe I'll, before I pass it to Armand, we're very excited about that partnership. We've been having ongoing dialogue. with the NCI, and Armand is leading that effort. So do you want to comment on this, Armand?

Yeah. Hey, Boris. So the Phase 2 component is event-based. It's event-free survival. We don't get details with regards to the specifics of when that analysis is going to be conducted. So the way the trial runs is they've completed enrollment In November of last year, the enrollment is suspended for the time period at which they're waiting for the data to mature and when they conduct the actual analysis. When the analysis is done, they will communicate the outcome to us, and then we also have – they will also transfer the data to us confidentially to support our regulatory submissions. With regards to – The decision points, there's basically two of them. What they're trying to show is that if the combination arm of UPRO plus seven and three achieves a hazard ratio better than 0.831, then the study will proceed as promising into phase three. And if the hazard ratio is better than 0.64, that's what they would classify as overwhelming efficacy. then that would be a signal that we would act on.

Sure. But it sounds like you don't have an estimate of timing of when we should see that data at this point.

Yeah, the NCI has not communicated that, Boris. We've heard different versions, but it would be more rumors than anything else. As Armand said, once they're ready, they will communicate to us. I mean, it would be typical to think that an EFS report primary endpoint trial should theoretically read faster than OS. But, you know, again, that would be more of guesstimating rather than having official communication from them.

Got it. Great. Thanks very much for taking my question.

Your next question comes from the line of Roger Song from Jefferies. Your line is open.

Great. Thank you for taking all the questions. So first one also about the UPRO Phase 3 So can you just comment on what drives this mid-year projection for the event triggering, like enrollment or the events so far? Also, can you comment on the current dropout rate or event rates that are kind of in line with your previous expectation?

Yeah, thanks, Roger. So, you know, the things that we have disclosed, I mean, as you know, the trial started in November. and ended in November 21. So over a three-year period, we have enrolled 388 patients. And the study is an overall survival event-driven. So what drives it is events. You know, the more we have events towards the pre-specified number, the faster the data event trigger would happen. The way I think about it is once we're saying mid-year 2023, you look at last patient enrolled is November 2021, and event trigger is estimated at the middle of 2023. That's like, what, 18 months, 19 months period. What drives it is events. If we have faster events, we have a faster trigger. If we have slower events, we have a slower trigger timeline. And, you know, as I mentioned a couple of times before, I'd rather be in a situation where there is slower events. Obviously, it puts more pressure on getting data out there, but that means that patients are living longer. Now, obviously, with the right caveats of we don't know which arm they're on, we don't have access to anything other than the pooled data, But that's kind of what's driving it is when you have those events, you put them into statistical model, and we've run this several times now, it's indicating at this point towards a mid-year 2023. Got it.

That's helpful. Okay. So, and regarding the early pipeline, so with the recent kind of reduction, what would be the development plan for the other a couple early stage pipeline like the 3059 and the galactin-3 inhibitors?

Yeah, so just to reiterate what we've said, the reduction in head count has been predominantly in the early research discovery part of the organization. In fact, we're looking at the later stage or the development part medical affairs part to be enhanced over time. It doesn't have any impact on those, Roger, because typically a lot of the biotechs will have one lead asset and that's it. We have one lead asset. We have 1359 that was in clinic. Now 1687, we're filing an IND so that can be ready for clinic. And then we have galactin-3 where we declared eight weeks ago the orally bioavailable lead asset of 2093. So we already have four assets to really advance. And the whole point, what we wanted to do is to really keep the institutional knowledge of glycobiology, because we believe that is really the differentiating factor for us versus other players out there. We've honed this over the last 18 years. But to do additional work in chemistry and in early development. At this point, that's kind of what we paused, and we're really pivoting towards a commercialization focus, meaning more development, medical affairs, educational activities. And we can always go back and ramp up that department as we advance your professoran because of the fact that we're keeping that institutional knowledge in-house, Roger. So we've been very deliberate about how we go about doing it, As you know, biotechs have to make choices, especially these days, but we're in a position where we already have four assets we're looking at, and we believe we have the team that can advance them over the next 12, 18 months until data maturity with the EOPROS runs.

Got it. Yeah, that's helpful. Yeah, glad to see you still keep the bulk of the pipeline. Okay, so maybe just a last quick one. In terms of the burn rate and the cash runway guidance, I remember last time you say that covered this UPRO Pivotal Studies, CMC, and the IMD Enabling Studies for 1687. Just want to confirm for the 1687 Phase 1, that's mostly just waiting, seeking for partnership, not kind of included in your current cash runway guidance, right?

Correct, yes. So, you know, what we're doing with 1687, Roger, is really advancing the IND. We believe that filing an IND and getting notice for, you know, safe to proceed in humans is going to be a very important milestone that can, you know, then we will be more open to partnership discussions. And, of course, when we're talking partnerships, it's just not about the funding of the of the clinical trial, but also like-minded people who can bring in expertise and who believe, like us, that the vaso-occlusive crisis of sickle cell patients remains a very high unmet medical need that we want to tackle. So, yeah, that is not in the cash runway at this point beyond the IND filing for 1687.

Got it. Thank you. That's it for us. Thank you.

Your next question comes from the line of with Roth Capital Partners. Your line is open.

The first one I think is probably just a follow-up to the last one that we just had for 1687, which is kind of curious there about, you know, how you're thinking about the partnership. I know you just had a reduction there. in your team, and so I was wondering, do you anticipate looking for something with cash up front or more on the back end? And if it was coming up on the up front, you would think that you could use that, you know, towards perhaps maintaining your team or additional capital towards accelerating commercial plans for UPRO.

Yeah, thanks, Dagmar, and nice to catch up again. I mean, partnerships, I mean, we're flexible from a partnership perspective, you know, open to different ideas. As long as where we're not flexible is the thinking that we want to really address the vascular crisis of sickle cell patients. So that's kind of where we appeal passionately about it. And we want to have a like-minded partner who can advance. Obviously, funding will be important. but also this direction is also as important. Is the caching up front? Is it afterwards? We're open to it. Obviously, the more cash would be up front, then we're going to have to give value on the back end and so on and so forth. So we will evaluate these carefully as they mature, but the idea is that we believe it has to be a credible partner in terms of vision as a first starting point. And Armand, do you want to comment? I mean, you lead many of the questions.

Yeah. So, Z, I would say right off the bat, the stage of the asset matters. If it was a preclinical asset, you know, typically those deals are more back-ended. But, you know, having an IND is a significant de-risking and also value-creating event for glycomimetics. And, you know, You know, this compound is 1,000-fold more potent than upralesolin, and while we always expected a clean tox profile, showing it, demonstrating it is an important fact, along with the making of the drug product and have it on stability and ready to go in the clinic. So we think we're in a very strong position. There has always been interest in this program, but having the IND and that safe-to-proceed go from the FDA is going to be valuable to us, but also very valuable to a prospective partner. And we think that should translate into deal terms.

Thank you. And I think the data, even from with a pencil, even though it's a different program, I think it provides sufficient proof of concept. And now you're just using a different delivery method. But that's really interesting. And I think another question that I wanted to ask, It's just about you as we try to estimate when we could see the data. I thought maybe it would be helpful for you to remind folks on what you think the standard of care agents should provide in terms of EFS in the newly diagnosed setting or in terms of OS in the relapsed refractory setting.

Do you want to address the newly diagnosed setting?

Yeah, so question Z was just what is the expectation with regards to what we're trying to beat? Is that what you're trying to get at?

Yeah, so what is the standard care agent actually going to get you? And then I guess we'll be looking for anything beyond that.

Yeah, so with regards to the frontline setting on EFS, you'd expect something around seven months, best case. And so what we're trying to show is something in excess of 11 plus.

And then on the relapsed refractory, as you know, that has been quite stable for many, many years around that six-month overall survival point with transplant rates hovering around the 15%, 20%. Lately, with some advances in transplantation techniques, that has inched a bit higher to more like 25%-ish. So that's kind of an area of focus for us is getting patients to a deeper remission with the MRD negativity as the indicator. We've seen a 69% in our phase two data. And as we know, MRD negativity, recently there's been several publications that say that's a best indicator for how patients would do post-transplantation. So we're trying to beat, obviously, that six months overall survival, but really how by getting deeper remissions by MRD negativity, by bridging more patients to transplantation. That's why our phase three has not been censored for transplant, and we're pleased with those directions. And all that hopefully would translate into a longer overall survival So we're eagerly waiting for that data to come so that we can see what's happening. But that's the plan. That's what we're trying to beat.

And I would add, Z, that the NCI trial is not censored for transplant either. So, you know, transplant is a good outcome for us. So, you know, with the ESS, that's either failure to get a response, relapse, or death, but if they get transplanted, which we hope they do, that's not gonna be censored at the time that that occurs, that that's a good outcome.

Thank you, really helpful. And that additional color around the non-censoring was really good to ask people to try to estimate what we could actually see the data. And then the last one here is just a combo question. I think the first part is just an update on your Galactin-3 program. I know you've mentioned plans to kind of partner that, so I was just wondering, where you are with that effort. Again, I think folks would just be interested in kind of understanding potential for additional cash coming in from any of these partnerships. And then the last one is just on GMI 1359. You know, again, what are the plans there? Are you planning to move this forward? Are you going to put any additional capital into this program? Or are you also maybe considering partnering it as well?

So let me address your last question first, and then I'll ask Armand to weigh in on your first question. So on the 1359Z, I mean, obviously we've, you know, eight weeks ago when we announced that we have closed the Duke trial, the phase one, given that we have seen activity on both the CXCR4 and the E-selectant. So we're very pleased with that. That's why we closed that trial. And then now we're more into strategic options for 1359, to be honest, because, you know, where we are is we've got to make some choices. That we have gotten it to a point where it's ready for next phase, but we've got to, you know, kind of think of our cash runway, and we're really doubling down on your cholesterol and 1687, accelerating it towards an IND. And, of course, on the Galactin-3 as well, before I hand it to Armand for comments, we've also, eight weeks ago, announced the, now we've declared an orally bioavailable dose. So, maybe Armand, can you give us some color, if any, over there?

Yeah. No, listen, I think that what we wanted to get to was having an oral compound. Galactin-3 plays a significant role in diseases like NASH, like cardiac fibrosis, idiopathic pulmonary fibrosis, as well as some cancer settings, and the data is very strong in those arenas. But having an oral compound was a significant breakthrough for us. We are in full partnering discussion mode on GMI 2093, and the goal is to get to a point of having a research collaboration and option agreement with a with a partner, and those activities are ongoing as we speak, Zee.

Thank you. Really impressed with the progress.

Congrats.

Thanks, Zee.

Again, ladies and gentlemen, if you have a question at this time, please press star under the number one on your touchtone telephone. As there are no more questions in the queue, I would like to turn the microphone back to Mr. Zimmerman.

Thank you. And I would like to thank all of you for your time and attention. In May and June, we're planning to be in two different investment conferences in person at H.C. Wainwright's Global Investment Conference in Miami and the Jeffries Healthcare Conference in New York City. So we look forward to our one-on-ones that can be scheduled and to updating you on our progress and outlook. Once again, thank you so much for joining our call, and have a great day.

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