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spk05: Good day, ladies and gentlemen, and welcome to the PanBella fourth quarter 2021 earnings call. At this time, all participants are in a listen-only mode, and the floor will be open for your questions and comments following the presentation. It is now my pleasure to turn the floor over to your host, James Carbonara. Sir, the floor is yours.
spk01: Thank you. And once again, welcome to PanBella's fourth quarter 2021 earnings call. With me on the call are Jennifer Simpson, Chief Executive Officer, and Sue Horvath, Chief Financial Officer. Before I turn the call over to Dr. Simpson, please note that statements made on this call that are not historical facts may be forward-looking statements. Significant risks and uncertainties that could cause actual results to differ from those expressed or implied in the forward-looking statements are detailed in the company's annual report on Form 10-K and supplemented by subsequently filed quarterly reports on Form 10-Q, as well as in other reports that the company has filed with the SEC. Any forward-looking statements made on this call are made only as of today's date, and the company does not undertake any obligations to update or supplement any such statements to reflect subsequent developments. Now I would like to turn the call over to Jennifer Simpson, CEO of Panvela. Jennifer, please proceed.
spk06: Thank you, everyone, for joining. I will begin the call by touching on 2021 and recent significant accomplishments. Sue will then follow with a review of the financial results and then we will open it up for Q&A. So starting with 2021 and recent highlights. As many of you know, most recently, we entered into a definitive agreement to acquire Cancer Prevention Pharmaceuticals Incorporated, or CPP for short. The agreement consideration is a combination of stock and future contingent milestone payments that Sue will review in greater detail. CPP is currently a private clinical stage company developing therapeutics to reduce the risk and recurrence of cancer and rare diseases. Initial areas of focus include familial adenomatous polyposis, or FAP, and colorectal cancer prevention. The current lead asset for CPP is Slimpovy, which is a combination of CPP-1X, or aflurathine, and Sulindax, and it has a dual mechanism inhibiting polyamine synthesis and increasing polyamine export and catabolism. As a result of a 2021 North American license agreement, CPP's FAP registration trial is fully funded and is scheduled to begin by year end. In addition, a phase three trial in colon cancer survivors is currently underway and is sponsored by the Southwest Oncology Group, or SWOG. Several other clinical trials in neuroblastoma, gastric cancer, and early onset type 1 diabetes are underway in collaboration with various cooperative groups. The combined company will have a much larger pipeline targeting approximately a $5 billion aggregate market opportunity for the areas of initial focus. Those include FAP, first line metastatic pancreatic cancer, neoadjuvant pancreatic cancer, colorectal cancer prevention, and ovarian cancer. With the combined development programs, we will be poised to have a consistent stream of catalysts and use events with programs ranging from preclinical to registration studies under the guidance of a veteran management team with a demonstrated track record of drug discovery, development, and commercialization expertise. Moreover, acquiring CPP significantly advances our mission of treating diseases where there is an unmet need through a diversified pipeline addressing numerous targets and thus expanding the potential of the joint company. The combined platforms will be better positioned to treat more patients. The transaction is a strategic fit and we feel drives shareholder value. About a month prior to announcing CPP, so at the end of January here in 2022, we announced the initiation of our global randomized trial. This trial is a randomized, double-blind, placebo-controlled trial for SBP101 in combination with gemcitabine and nabpaclitaxel versus gemcitabine, nabpaclitaxel, and placebo in patients with untreated metastatic pancreatic ductal adenocarcinoma and is referred to as the ASPIRE trial. The primary endpoint is overall survival with a futility analysis evaluating progression-free survival or PFS at 104 events. If the futility analysis is passed, the trial expands to allow for additional subjects so that the full trial could serve for registration. We are seeking to conduct a trial at leading cancer centers in the United States, Europe, and the Asia Pacific region. This Phase 2-3 trial is designed as a Phase 3 trial but with an interim Phase 2 look to assess whether the experimental treatment is active enough to continue the trial to its Phase 3 sample size. We believe the primary advantage of a Phase 2-3 trial over a separate Phase 2 and Phase 3 trial is speed and resource mitigation and that the Phase 2 patients can be included in the Phase 3 analysis and one does not have to wait for the Phase 3 protocol development after the Phase 2 results become available. Summit Cancer Centers in Spokane, Washington was the first clinical site activated with Dr. Arvind Chowdhury serving as its principal investigator. Approximately 60 to 70 additional sites are expected to be activated in 2022. We have commenced screening for eligible patients with enrollment expected to complete in approximately 12 months after the first patient enrolled. Supporting the advancement into the Phase 2-3 ASPIRE trial was data announced from our Phase 1b study at the ASCO Annual Meeting in 2021 and more recently in January of 2022 at the ASCO GI Meeting. Interim data from cohort four in the expansion showed an objective response rate of 48% and a median overall survival of 12 months, which at the time of the poster presentation was not yet final. Both exceeded historical rates reported for gemcitabine and nabpaclitaxel and supports the continued development of SPP101 as an addition to first-line treatment for metastatic pancreatic cancer and also for neoadjuvant treatment for patients with potentially resectable disease. Since the poster presentation, the median overall survival has been reached at 12.53 months. This is four months longer than what is typically seen with gemcitabine and nabpaclitaxel. While this data is from a phase one trial, this increase in objective response rate and median overall survival is encouraging. Lastly, we also have had patients who have demonstrated long-term survival with two patients from cohort two, one of which achieved 30.3 months and final, and 33 months and still alive. There are seven patients, one from cohort two and six from cohort four in the expansion, that are still in survival follow-up. We are excited to continue development of SBP101 in our global randomized phase 2-3 study in metastatic pancreatic cancer, which I spoke about earlier. In addition to SBP101's promise in pancreatic cancer, we believe it could be a treatment option for other cancers as well. Thus, early in 2021, we announced a research agreement with the Johns Hopkins University School of Medicine. The collaboration's intended focus was on the further development of PAMBELLA's investigative agent, SBP101, including activity in cell lines outside of pancreatic cancer, evaluating possible biomarkers which can form diagnostics, and potential combination with checkpoint inhibitors. In December, we were pleased to announce positive preclinical data supporting the activity of SBP101 in ovarian cancer cell lines. We expect to launch a development effort for SBP101 in ovarian cancer in the first half of this year. The preclinical results illustrate SBP101's potential to expand into another area of high unmet need. According to the American Cancer Society, ovarian cancer was the fifth leading cause of cancer deaths among women, accounting for more deaths than any other cancer of the female reproductive system. In fact, the European Society for Medical Oncology, or ESMO, has stated that ovarian cancer represents a significant unmet need in gynecologic cancers with the absence of a well-defined screening program or programs and inconsistent initial symptoms leading to late diagnosis in most patients. Considered largely incurable, ovarian cancer typically relapses within three years in 80% of women, with subsequent recurrence arising sooner each time as resistance to chemotherapy develops. Therefore, it is vital to progress potential new therapies such as SBP101 for ovarian cancer. We recently issued a press release that an abstract for SBP101 had been accepted for poster presentation at the American Association for Cancer Research, or AACR, which will be held April 8th through the 13th of this year. The work reflects the company's ongoing collaboration with Johns Hopkins University School of Medicine. Before the end of 2021, we also completed the preclinical work necessary to begin a neoadjuvant trial. We are working with key opinion leaders to finalize the protocol and obtain the necessary institutional approvals to open this investigator-initiated trial in the second half of this year. Turning to intellectual property in 2021, we announced that we received an issue notification for covering a shorter synthesis of SBP 101 that provides many benefits, including the ability to manufacture product with a reduced lead time, quicker access to drug supply, which facilitates expansion into additional indications, and a potentially scalable, efficient, and cost-effective manufacturing process to implement as soon as we are ready to commercialize upon approval. Also, in terms of the balance sheet, recall that in Q3, of 2021, we closed on a $10 million underwritten bought deal offering of our common stock. That capital has provided important resources to keep us on the path of further developing and expanding the application of SBP 101 and drive shareholder value. Another 2021 highlight for us includes joining the Russell Microcap Index. Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for active investment strategies. At this point, I would like to finish by reiterating our milestones. In the first half of this year, we expect to announce the first patient enrolled in our ASPIRE trial, as well as expansion outside the U.S., satisfaction of conditions and closing of the CPP acquisition, research call to review the ovarian cancer data and ovarian cancer treatment standards, The final data from our phase one first line metastatic pancreatic cancer study, initiation of the ovarian cancer program for SPP 101, and in the second half of this year, we expect to open the neoadjuvant pancreatic cancer investigator-initiated trial. With the expected closing of the CPP transaction, we anticipate that additional milestones for 2022 will increase the flow of planned development activity and data. In summary, we have made tremendous progress in 2021 and year to date. We are excited to shareholder value in 2022 by executing against our stated milestones. I will stop here and turn it over to Sue to review the financials.
spk03: Thank you, Jennifer. General and administrative expenses were $1.3 million in the fourth quarter of 2021 compared to $0.9 million in the fourth quarter of 2020. The change is due to expenses, including legal and financial advisory fees associated with the acquisition of CPP. Research and development expenses were $2 million in the fourth quarter of 2021 compared to $0.7 million in the fourth quarter of 2020. The change is due primarily to increased clinical trial and manufacturing costs as we prepare to launch our randomized study in approximately 60 sites around the world. Net loss in the fourth quarter of 2021 was $3.5 million, or $0.26 per diluted share, compared to a net loss of $0.9 million, or $0.09 per diluted share, in the fourth quarter of 2020. Total cash was $11.9 million as of December 31, 2021. Total current assets were $12.3 million, and current liabilities were $2.7 million as of the same date. There was no debt on the balance sheet as of December 31st. Looking to the cap table, we had 13.4 million of common shares outstanding at the end of the year, and including shares reserved for options and warrants, we were at a total of 21 million shares. These shares reserved numbers include all outstanding equity awards, including stock options, which are held primarily by insiders, and all warrants to purchase common stock. Turning briefly to additional details regarding the definitive agreement to acquire CPP, under the terms of the agreement and plan of merger, the holders of CPP's outstanding capital stock immediately prior to the merger will receive shares of common stock of Pendella upon closing of the mergers. On a pro forma and fully diluted basis, holders of Pendella common stock are expected to own approximately 59% of the post-merger holding company, and holders of CPP securities, including converted indebtedness, are expected to beneficially own approximately 41% of the post-merger holding company. CPP stockholders will also be eligible to receive contingent payments totaling a maximum of $60 million from milestones and royalty payments associated with the potential approval and commercialization of the lead assets. We expect to close by the second quarter of 22, subject to approval of the issuance of securities in this transaction by our stockholders and satisfaction of other customary closing conditions. Moving back to our balance sheet, previously we discussed that our available cash would take us into early 2023. We now project the cash will take us into Q4 of 2022. This difference is related primarily to an increased activity in the randomized trial, preparation for expansion into the ovarian cancer development program, and costs associated with our acquisition of CPP. We view all three to be positives that will add tremendous value. CPP's operations and development activities post-closing are not expected to add significantly to our operating burn in 2022. That concludes my prepared remarks. Operator, can you please open the phone lines for Q&A and poll for questions?
spk05: Certainly. Ladies and gentlemen, the floor is now open for questions. If you have any questions or comments, please press star 1 on your phone now. We ask that while posing your question, you please pick up your handset if listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star 1 on your phone now. Please hold a moment while we poll for questions. Your first question is coming from Jason McCarthy with Maxim Group. Your line is live.
spk00: Sure. Hi. Thanks for taking the questions. Just briefly on the ASPIRE study, what is the expectation on PFS in first line historically with NAB and GEM? And also, at your interim look, it's PFS events, but that would include debts, right? Would there be any survival, overall survival, that you might see a signal for at that interim that you would be sharing with investors?
spk06: Hi, Jason. Thank you so much. Yeah, so the PFS, you know, when you look at Geminibraxane, you're in the roughly five and a half month PFS, give or take, you know, that's pulling from the MPAC trial, and obviously you can see some variation across other trials that have been run. You know, we will be looking, you know, clearly that it will incorporate also deaths, of course. We will have a DSMB and because it's a blinded study, you know, they will certainly be looking at all efficacy parameters. If at that point they were to see, you know, a larger split and survival, that would be something that they would probably certainly flag and we would have to address it at that time. But the way we've structured it is really to make sure that there's, we are seeing the benefits that we believe will translate ultimately into an overall survival. as the primary endpoint for the entire trial is overall survival. So that's how we structured it.
spk00: And can you just review with us what the parameters are going to be for the ovarian cancer program and what potential combinations we'll be looking at?
spk06: Certainly. So we're working to finalize that right now. We're working with some of the gynecologic oncology KOLs It is not fully defined yet. I think it's a high likelihood that it'll be in the platinum-resistant population because that's where there really truly is a huge unmet need for patients. If you think about what's currently used in that setting, you know, it's paclitaxel, it's a pegylated liposomal doxorubicin, gemcitabine, topotecan to a lesser extent. So we would probably look to combine with with one of those agents is my best guess, given that that's really all that's been shown any efficacy. And by that, that's really not that much, unfortunately. So we are looking to see which one makes the most sense and hopefully improve upon that for patients.
spk00: And this would exclude, if it's platinum resistance, are you excluding platinum? of use of PARPs in these populations, or is that the expectation?
spk06: You know what? I think we have to look at that a little deeper. You know, I know PARP inhibitors are being used, especially also in maintenance. So I think that's something that we do have to look at and figure out what makes sense, just to make sure that we can truly identify a signal with the addition of SPP101. So it's a great question, and I don't have a definitive answer yet until we finalize the protocol, but something to consider for sure.
spk00: And just a last question briefly. Going back to the ASPIRE, you have 104 PFS events. That's the futility analysis. And you'll make a determination of how many patients you would need for the Phase III based off of that. That's one part. And the second part is I think I missed it. But you said the first patient is expected to be enrolled by the end of this month?
spk06: Yes. So we're expecting the first quarter, the first patient to be enrolled. And then from that point, approximately 12 months to complete enrollment. And we're estimating roughly 150 to reach the 104 PFS events.
spk00: Okay.
spk06: And the, yes, you are correct. We will, based on that utility analysis, that will drive the final sample size. for the phase three portion.
spk00: Got it. Okay. Thank you very much for taking the questions.
spk05: Certainly. Thank you so much. Your next question is coming from Tony Butler with Roth Capital. Your line is live.
spk02: Thanks very much. Jennifer, just one question on the ovarian cancer study. Is it, and this actually hits on the part as well, but is it, considered BRCA positive patients or BRCA mutant patients, or would that be irrelevant? That's question one, if I may. And then question two is, in the neoadjuvant trial, and I recognize that that's not complete, at least the trial design's not complete, but could you provide a view at what that actually might look like? For example, how many days in front of, say, surgery or resection a patient may receive a dose of SPP, or would there be several doses along some, you know, continuum? And then would they continue post-surgically as well? Thank you.
spk06: Okay. Thank you, Tony. So I will tell you for the ovarian cancer, I think it's too premature to comment yet on the BRCA status. Again, we'll be meeting with the KOLs. But you bring up a great point. There's a couple factors for sure that we need to account for. And again, make sure that the population we pick is as clean as possible to identify a signal. So I'm not sure about mixing both positive and negative. might stick with more streamlined and pick one subset. So what I would say is stay tuned and as soon as we have that finalized, we'll certainly put that out in the public. We're very much looking forward to starting this program. So stay tuned on that one. For the neoadjuvant, typically you'll see anywhere from two to four cycles of chemotherapy given and then you have a washout period because you want, you know, healing from the chemotherapy before you take them to surgery. You bring up a good point, which is, is it just neoadjuvant therapy or do you want to add some adjuvant on the back end after the surgery? And that is something we are discussing with the KOLs that will be running this trial. You know, we will be for sure giving, you know, at least two cycles of therapy before. It could be up to four cycles before. And then, we will be discussing, as I just mentioned, the possibility of giving something in the adjuvant post-surgery.
spk02: So it's a great question. Thanks, Jennifer. Yeah, thank you. Really appreciate it.
spk05: Sure. Your next question is coming from Robin Garner with Craig Hallam. Your line is live.
spk04: Hi, good evening, and thank you for taking my questions. Just wanted to ask a little bit more on the SBIER study. and the 104 events, what was the assumption there to get to the 104? And then if we just carry that idea of it would take 150 patients to get to that point, at that point, how many patients would be required in the phase three?
spk06: Yeah, so, you know, the, we're looking, from a PFS, we're looking at, you know, we haven't actually given the exact delta that we're looking for. but obviously we want to make sure that we've got a delta that we believe will translate into survival. I think probably the more important is that when you look at survival, we'll be looking for at least a three-month benefit in survival because that is, especially in this disease, what we believe the FDA will consider meaningful. And so the sample size will be derived based on what we see in that futility analysis. If I had to take a guess, Right now, I would say you're looking at a total number of subjects, you know, somewhere in the range of 400 to 500. And that's really based on the activity that we've seen with the SPP-101 combination with geminobraxane in the phase one study.
spk04: So if that continues to hold, that would be what we would expect. Okay. Thank you for that. And if it were four to 500 patients based on the times required for enrollment, how long would it take to enroll the additional patients to get to that four to 500 number?
spk06: Yeah. So, you know, we will, um, we'll take a look at that, but I will tell you, we would be certainly aiming, um, no, no longer than 24 months, if at all possible. Could it be upwards of 36 months? The answer is yes, absolutely. But I will say that we have a very aggressive team, collective team between our internal team and the CRO. And as you can tell, roughly 150 patients in 12 months, I think we can move pretty quickly. And also, as you probably know, when the investigators are seeing patients and patients
spk04: doing better or well obviously they'll be blinded so they won't know that gets excitement there as well and so I think we would probably bring on some additional sites to to meet our goal okay thank you for that and for my last question I wanted to just ask about the neoadjuvant study the total numbers of patients you expect and then very specifically what would you plan to do in with the biopsy data that you could have, very special to the design of the neoadjuvant study, how would you be able to use that to your benefit? That's a great question, Robin.
spk06: You know, in terms of the sample size, this will be a small phase two, so it's really meant to see the activity, so more of a signal-seeking, if you will. So, you know, I expect it'll be, you know, in the realm of, you know, a smaller phase two. Again, we need to finalize that with the KOLs, so I don't have a definitive number yet. But in terms of the biopsy, I think that's an interesting question. We have our collaboration with Johns Hopkins as well, and so I do think that there may be some markers that we may be targeting to look at and see if that can inform us about the activity of SPP-101. at the tissue level. So I think that's a great question and it's something we just haven't fully fleshed out yet.
spk04: Okay, thank you and congratulations on the quarter. Thank you so much, Robin.
spk05: You have a follow-up question coming from Tony Butler. Your line is live.
spk02: Jennifer, apologies. on the heels of the 104 events in Aspire, and I'm asking you to speculate, you wouldn't necessarily know today, but would you then actually state, I guess, in a press release that you've hit the futility and whatever happened, you're continuing to roll, and what that enrollment number would be at that time? Yes. Or, okay.
spk06: Yes, I think that would be obviously very important, right, because that'll drive to, I believe it was Robin's question, you know, the total number of patients and also that the planned enrollment time as well, which, you know, would be very important for, you know, clinicians, scientists, investors, you know, everyone.
spk02: Yes, ma'am. Thanks a lot.
spk05: Sure. We have no further questions coming from the lines at this time. Thank you, ladies and gentlemen. This concludes today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.
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