Moleculin Biotech, Inc.

Hello, and welcome to the Moleculin Biotech first quarter 2024 quarterly update conference call and webcast. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to turn the call over to your host, Janine Thomas, Investor Relations. Please go ahead, Janine.

Thank you, Darrell. Good morning and welcome, everyone. At this time, I would like to remind our listeners that remarks made during this webcast may state management's intentions, beliefs, expectations, or future projections. These are forward-looking statements and involve risks and uncertainties. Forward-looking statements on this call are made pursuant to the safe harbor provisions of the federal securities laws and are based on Moleculin's current expectations, and actual results could differ materially. As a result, you should not place undue reliance on any forward-looking statements. Some of the factors that could cause actual results to differ materially from these contemplated by such forward-looking statements are discussed in the periodic reports, molecular files with the Securities and Exchange Commission. These documents are available in the Investors section of the company's website and on the Securities and Exchange Commission's website. We encourage you to review these documents carefully. Additionally, certain information contained in this webcast relates to or is based on studies publications, surveys, and other data obtained from third-party sources and the company's own estimates and research. While the company believes these third-party sources to be reliable, as was the date of this presentation, it does not independently verify and makes no representation as to the adequacy, fairness, accuracy, or completeness of or that any independent source verified any information obtained from third-party sources. Any data discussed regarding clinical trials and progress are considered preliminary and subject to change. Joining us on today's call from Moleculin's leadership team are Walter Klempp, Chairman and Chief Executive Officer, Dr. John Paul Waymack, Senior Chief Medical Officer, and Jonathan Foster, Executive Vice President and Chief Financial Officer. I would now like to turn the call over to Walter Klempp, Chairman and CEO. Wally, please proceed.

Thanks, Janine. Well, calling 2024 transformational for Moleculin would be a massive understatement. We've now been able to lock in composition of matter patent protection for anamycin, giving us market exclusivity at least through 2040. This is the gold standard for intellectual property, and it's also underpinned by orphan drug designation in both the US and the EU. Of course, All of this proprietary protection would be meaningless if we didn't have the safety and efficacy we need to be approved and to be useful for patients. Well, now we've treated over 80 patients and counting with zero cardiotoxicity, something that no currently approved anthracycline can claim. But most importantly, we've now shown a 60% CRC rate in second line patients. And key opinion leaders are beginning to weigh in on what they think of this level of performance. In fact, you can hear what they're saying by checking out the clinical day video by clicking on the banner on the homepage of our website at molecular.com. Simply put, our efficacy results in our clinical trials to date are better than any drug ever approved for use in AML, period. And with a game-changing safety profile. Look, it's impossible for me to overstate the importance of our latest data. The greatest unmet need in AML is for an effective second-line therapy. Accordingly, we prioritize recruitment of second-line patients in our latest AML clinical trial, and as you can see, we had a 60% CRC rate. Not only that, but we had a 50% CR rate. Nobody does that in second line. Nobody. Again, we've never seen a performance this high from any approved AML therapy, and that's why the leading experts in leukemia are beginning to take notice. Since we closed the clinical trial to additional second-line patients, we've now added a few more patients in first line and third line. and we've seen more complete remissions, driving the overall performance up for the trial in total, and putting us now at a total of 20 patients. We'll continue this type of recruitment, especially in first line, so that we can learn as much as possible before kicking off our registration trial. But let's be clear, we don't believe we need any more data before proceeding with the registration enabling trial in second line. And that's why we're about to have our end of phase two meeting with the FDA. And clearly the most important next point of information is determining how the FDA views all this. As a point of reference, our senior chief medical officer, Paul Waymack, worked for the FDA, and he has a pretty well informed point of view on this. On that basis, we're requesting the FDA agree to an open label single arm trial of around 100 to 150 patients as our pivotal approval trial. This trial will be in second line patients where there is a clear unmet medical need as confirmed by the key opinion leaders on last week's conference call. And where we are confident that our most recent results, if repeated in this larger population, would be more than sufficient to achieve approval. In fact, we estimate we should be able to achieve approval with a performance level much lower than the one we've recently reported. So what does this mean for shareholders? In recent discussions, I've made no secret about the fact that we believe molecular is significantly undervalued. This chart on slide seven helps explain why we believe that. If you've been following the AML space, you have undoubtedly heard about Jazz Pharma paying $1.5 billion in 2016 for Vixios. And that's a drug that is really only relevant to the AML space and has a relatively limited share market. And that deal was cut pre-approval. And now you have AbbVie's Venetoclax, which is generating $2 billion a year in revenue. which at typical revenue multiples implies that venetoclax could be valued at over $10 billion as a standalone drug. What's even more illuminating, though, is how some of the gene-targeted therapies are being valued. For example, you've got Servier, a French mid-pharma company, paying nearly $2 billion for two niche-focused AML drugs, Iditha and Tidsovo. We estimate their combined impact on the AML population is to potentially produce complete remission in about 6%, 6% of the overall AML population. Then you have companies like Cura and Syndax, whose drugs are relevant to a fraction of the AML population and who are being valued in the billions. In fact, let's drill down on Cura for a moment. They're roughly at the same stage as we are, phase two results and looking to start a pivotal trial. But by the way, their reported performance is significantly lower than ours, and yet Cura has a $1.5 billion market cap. To show you how ridiculous this disparity is, if we had their market cap, our stock would be trading above $600 per share. And I firmly believe we have a better drug candidate that will save many more lives. This kind of disparity simply cannot continue, and we believe it's only a matter of time before the market wakes up to this. In the meantime, this is an earnings call, so I need to give our EVP CFO, John Foster, a chance to weigh in. John?