PLUS THERAPEUTICS, Inc.

Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Good afternoon ladies and gentlemen. Welcome to the Plus Therapeutics third quarter 2020 earning results call. At this time all participants have been placed in a listen only mode and the floor will open for your questions following the presentation. If you would like to ask a question at that time, please press star 1 on your touch tone phone. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. We ask that you please pick up your handset to allow optimal sound quality. If you should require operator assistance, please press star 0. And before we begin, we want to advise you that over the course of this call and question and answer session, Foreworking statements will be made regarding events, trends, business prospects, and financial performance which may affect PLUS Therapeutics' future operating results and financial position. All such statements are subject to risk and uncertainties, including the risk and uncertainties described under the risk factor section included in PLUS Therapeutics' annual report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commissions from time to time. PLUS Therapeutics advises you to review these risk factors in considering such statements. PLUS Therapeutics assumes no responsibility to update or revise any forward-looking statements to reflect events, trends, or circumstances after the date they are made. It is now my pleasure to turn the floor over to Dr. Mark Hedrick, PLUS Therapeutics President and Chief Executive Officer. Sir, you may begin.

Thank you, Kathryn. Good afternoon, and thank you for taking the time to join us today. as we provide a business update and discuss our 2020 third quarter results. Joining me on the call today is Mr. Andrew Sims, our Chief Financial Officer. Before Andrew provides financial performance, .

. And second, an update on additional potential target clinical indications .

Recurrent glioblastoma is the most common and lethal form of brain cancer affecting about 13,000 patients per year in the United States. Essentially, all primary glioblastoma tumors recur after initial treatment. There are currently few approved treatments in the recurrent setting, which in aggregate provide only marginal survival benefit. has a number of unique aspects that provide compelling scientific rationale that it may show improved outcomes over currently used therapies. First, compared to external beam radiation therapy, whereby high-energy radiation passes through and affects healthy tissue to reach the tumor, RNL is prepared in liquid form and injected directly into the tumor. This inside-out, targeted approach with RNL may reduce unwanted radiation exposure to nearby healthy tissue. Furthermore, because rhenium can be visualized in real time during administration, RNL may let doctors better control the radiation dose and distribution to more effectively treat not only the bulk tumor, but also the attendant occult microscopic disease that lies in the surrounding healthy tissue and fuels recurrences. Also, it may be possible to deliver a radiation dose to the tumor that is up to 50 to 20 times higher with RNL than with external beam radiation therapy. We have yet to determine a maximum tolerated dose in our preclinical or clinical studies. In addition, with a long half-life, namely about 90 hours, liposomal encapsulation and low clearance rate, RNL's pharmacokinetic profile allows the drug to stay for a long time where it's applied, maximizing the time on tumor of the radiation and theoretically maximizing the cancer killing effects. Finally, in terms of patient convenience, RNL is administered in a single treatment and a short hospital stay compared to external beam radiation therapy that may require 20 or more treatment visits. for a full therapeutic course. One of the company's first priorities in advancing the development of RNL is to surround and support our efforts with a world-class expert group who possess the knowledge and experience in the fields of neurosurgical operations and neuro-oncology, as well as have a clear understanding and appreciation for RNL's profile and potential. To that end, We were pleased to announce in October, the formation of a clinical advisory board that helps successfully bring our investigational RNL drug through the clinical development process. These five experts are leaders in their fields and will be important to our efforts on behalf of the patients with glioblastoma. We are on track and making good progress on the important 2020 milestones for this program, including completion of the clinical trial enrollment, optimization of the regulatory plan and bringing the manufacturing and supply chains forward to industry standards in anticipation of the next steps in clinical development. During the third quarter, the FDA granted both orphan designation and fast track designation for R and L for their treatment of patients with recurrent glioblastoma. Now let me just provide an update specifically on the respect safety and feasibility trial for R and L. The fifth dose escalation cohort is now complete, and 15 patients have been treated thus far with RNL. Single treatment radiation dosing with RNL is now above 10x the typical dose administered in the recurrent setting. The increased treatment volume and dose in the sixth cohort should accommodate tumors up to approximately 4.5 centimeters, which should include the majority of tumor recurrences. No treatment-related serious adverse events have been observed thus far. And as previously mentioned, there appear to be early signals of efficacy in patients with adequate dosing and tumor coverage even at the lower volume and dosage levels. We have also expanded enrollment to a second site, and we intend to have a third site on board soon. Finally, as recently announced by the company, our abstract on the clinical experience thus far with regard to RNL will be presented at the 25th Annual 2020 Society for Neuro-Oncology held November 19 through 22nd. And that's actually going to be a virtual meeting due to COVID-19, but it's being held in Austin, Texas. Regarding additional clinical development programs for RNL outside of recurrent glioblastoma, We intend to provide an update and discuss concrete next steps sometime in Q4. As previously mentioned, leptomeningeal carcinomatosis, peritoneal carcinomatosis, and recurrent head and neck cancer represent three promising potential indications based on existing preclinical data that we have generated thus far. Regarding our out-licensing activities, We are having discussions with potential partners regarding opportunities to help us expand R&L development internationally, while the company focuses its efforts primarily on the U.S. development for R&L. Regarding our two other clinical stage assets, Dosit Plus and Doxo Plus, we continue global partnering discussions while remaining focused primarily on R&L and its development in the U.S. So now let me turn the call over to Andrew for a review of the third quarter financial results. Andrew.

Thank you, Mark, and good afternoon, everyone. Please refer to our press release issued earlier today for a summary of our financial results for the third quarter and nine months ended September 2020. At September 30, 2020, cash and cash equivalents were $7.6 million compared to $17.6 million as of December 31, 2019. Debt principle September 30, 2020 was $4.3 million. In April 2020, we amended our debt with Oxford, providing additional flexibility by pushing out the interest-only period through May 2021, together with a pay down to $5 million of principal. Cash used in operations was approximately $5.2 for the nine months ended September 30, 2020, compared to $6.9 million for the same period last year. There were no reported revenues in the third quarter of 2020 as compared to 4.8 million in the same period last year. The decrease in both periods was due to the closeout of the BARDA contract we mentioned last quarter. Research and development expenses was 0.3 million in the third quarter of 2020 as compared to 0.9 million in the third quarter last year. For the nine months ended September 2020, R&D expenses were 1.6 million compared to 3.6 million in the same period in 2019. The decrease was partly attributed to the completion of the BARDA contract in 2019. Approximately 0.8 million was incurred in Q2 2020 relating to the in-license agreement with NanoTX. 0.4 was paid in cash and it closed in early May with a balance in stock. In addition, our grant from NCI covers the clinical costs on the Respect RNL clinical trial. Our sales and marketing expenses were approximately $0.1 million in the third quarter of 2020 and $0.3 million for the nine months ended September 30, 2020, essentially unchanged compared to the respective periods last year. G&A expense was $1 million for the third quarter of 2020, unchanged from the same period last year. For the nine months ended September 30, 2020, G&A was $3.8 million as compared to $3.3 million in the same period of 2019. The slight year-over-year increase reflects an increase in professional fees in Q2 2020 relating to the recent in-licensing transaction. This increase was partially offset by a decrease in payroll and related expenses. Interest expense decreased in the nine months to September 30, 2020, the $0.9 million from $1.5 million in the nine months to September 30, 2019, reflecting the principal pay downs in 2019 and 2020. Net loss for the third quarter of 2020 was $1.7 million, as compared to a net income of $0.5 million in the third quarter last year. This change is primarily due to the approximately $7 million loss from discontinued operations in 2019 that is related to the Q2 2019 asset divestiture. And now I'll turn it back to you, Mark.

Great, Andrew. Thank you. So just before we finish up and have Q&A, regarding previously announced forthcoming milestones, in short, we are on track. As to our primary year-end goal, completion of enrollment in respect, we currently believe that cohort six will be the final dosing cohort and still intend to complete that by year-end. To that end, Active patient screening is ongoing now at Site 2. That's at UT Southwestern in Dallas, Texas. And Indiana's Houston is on track to begin screening soon, and that will be Site 3. As recently announced, we plan to report the up-to-date data set and enrollment progress on respect at the Society for Neuro-Oncology meeting in mid-November of this year. Informed by the data from the final cohort, which, as I mentioned, we presume to be cohort six, we'll take that data, optimize the regulatory and clinical plan for R and L for recurrent glioblastoma, and then seek FDA guidance on next steps, which will likely fall sometime in the second half of 2021. Going on in the background and parallel to the current RESPECT clinical trial and our regulatory efforts, as I mentioned before, Our CMC team is now actively manufacturing the drug for respect. So we brought that in house as well. We're putting in place the proper manufacturing controls and capabilities appropriate to provide drug for a late stage clinical trial. And that we anticipate to also be a second half 2021 event. In Q4 of this year, As I mentioned, we'll discuss more publicly what we plan to move into the clinic as it relates to the R&L pipeline. And then we're going to continue to push forward on the R&L, DOSA+, and DOXA+, partnering discussions. And we'll discuss that further when and if those discussions merit that discussion. So with that, Catherine, I'll turn the Q&A over to you and be happy to answer, along with Andrew, any questions that anyone may have.

At this time, if you have a question or comment, please press star one on your touch tone phone. If at any point your question is answered, you may remove yourself from the queue by pressing the pound key. Again, we do ask that while you pose your question, you pick up your handset to provide optimal sound quality. And we will pause for just a moment. Your first question comes from the line of Jason McCarthy with Maxim Group.

Hi, guys. Thanks for taking the questions. A couple of questions. First, as far as the data that we could expect to see at Snow in November, will we be seeing overall survival data? And if so, will that data be compared to some sort of historical control? And if so, that historical control, would it be kind of matched in terms of the disease state that these patients are in?

Hey, Jason. Yeah, we'll provide all survival data. The caveat there is they'll be patients that have been recently treated and still alive. So we won't be able to draw meaningful conclusions on overall survival only in so much as we can take a look at the patients that both have expired or are still alive. So it'll be sort of a blend there. And then we'll discuss historical overall survival. We don't intend to have an age or a specific disease match control. But I think the overall survival in the current setting is pretty well known to be in the six to nine month range.

Great. And as you start thinking about meeting with FDA and then Phase II or a Phase II registration study, however you're going to map it out, you know, we've found that a lot has changed in the space just in the last 12 to 24 months. And now we're seeing smaller trials with external controls or the synthetic control arms that the FDA seems to be open to, and also the GCAR, the Agile program for glioblastoma that's using a very large groups control for all the drugs that they're testing. Are these different avenues that you're looking at when you're thinking about getting RNL towards a registration study and how to actually frame that study?

Yeah, they are. As you know, there hasn't been anything approved in a recurrent setting since, I think, going back maybe almost a decade. So it's a tough problem. We've obtained orphan drug status, fast-track status. Breakthrough status is not out of the question, depending on the clinical data that comes forth out of the respect trial. And then using synthetic control or looking at other trial approaches will definitely be something that will incorporate into our discussions with FDA. I think there are a lot of alternatives here based on the severity of this disease and the paucity of good therapies.

Gotcha. And just the last question on the pipeline for expanding R and L. I know you haven't specifically said which indications, but are certain indications like prostate cancer or ovarian cancer kind of on your on your short list areas where BRCA therapy and radiation implants are more widely used where these physicians would be comfortable using an isotope like rhenium and could make that switch and do those trials?

So I would say those, the ones you mentioned are probably second tier. First tier are going to be those indications where we have preclinical data that we think is suggestive of potential clinical success. We like leptomeningeal carcinomatosis, of which there's nothing approved for that. The only approved drug, Vipacite, was taken off the market in the last couple of years. And peritoneal carcinomatosis, similar, both indications affect about 100,000 patients in the U.S. every year. Late stage or current head and neck cancer is also an area where there's promising preclinical data and not a lot to offer these patients who have usually been maxed out on surgery, radiation, and chemotherapy. Anything that goes much beyond those will require additional preclinical studies. It doesn't mean we're not interested in those, but those three I mentioned before, things that we think are are things we're looking at most closely. Potentially, there are also some other areas in the CNS in the brain or the related structures that might be useful that aren't specifically recurrent glioblastoma but might provide some indications where we can leverage existing clinical data set to get into the clinic more rapidly.

Great. Thank you, Mark, for taking all the questions. Good luck.

Thank you, Jason. Appreciate you being on the call.

Your next question comes from the line of Ed Wu with Ascending Capital.

Yeah, thank you for taking my question. My question is on Cohort 6. Do you expect the timeline on that to be similar to the cohorts that you've done before? Or have there been, you know, either increases in speed or delays in speed, particularly, you know, with what's been going on with, you know, the pandemic?

Hey, Ed. It's Mark. You know, so when we enroll the first patient in cohort six, we'll announce that. We'll have a 30-day review period. We'll increase both the dose of the drug and the volume of the drug. So we're obligated to wait 30 days and go back to the DSMB before we can go back and complete that cohort. So that cohort will likely be a total of six patients. I would say the enrollment pace is accelerating. Just having corporate resources behind the trial, as opposed to this being a purely academic trial, and also having the NCI behind the trial, which is new to 2020. I think all those things together, allowing us to move more quickly, adding additional sites also is important. As you know, UT Southwestern is now on board, MD Anderson, we hope to be a third site. So that's why we're still cautiously optimistic. We could complete enrollment by the end of the year. There'd still be a push, but we think we can get there. And then we'll have to let the last patient, the trial, play out six months before we're ready to proceed to the next step. But, you know, I think as mentioned, I think we're roughly on track with that timeline.

Great. And then has there been any update on, you know, funding from, you know, the state cancer fund? And also how will that funding affect your decision into, you know, moving on to other cancer indications?

So, CPRIT has, you know, COVID, I didn't answer your question about COVID in the trial. COVID hasn't really hurt our efforts in a meaningful way with respect to enrollment. Where COVID has made an impact is on the availability of CPRIT grants. And in fact, we were just alerted, I think in the last week or so, that there's likely an RFP coming that we might be able to go to to seek funding for either R and L for recurrent glioblastoma or for additional indication. So we're waiting for specifics around that, but it, it looks like now that the secret is, is now back open for, for business. There historically had been two funding periods, one, and one in the, one in the December, January, February timeframe, and one in the, August-September timeframe. So it's our plan to submit at each cycle, and we hope that they are getting back to a normal cycle, which will be to grant submission opportunities on a yearly basis. And our plan would be to use that both for these new indications or potentially follow-on trials with R and L, for example, in diffuse angiopatin glioma. nonoperable glioblastoma, and potentially some other areas that we're not currently treating or addressing.

Great. Well, thank you, and I wish you guys good luck.

Thanks, Ed. Appreciate you being on the call.

Your next question comes from the line of Sean Lee with HC Wainwright.

Hi, guys. Thanks for taking my question. Most of my questions have been answered already, but I just have a quick one. In the prepared remarks, you mentioned that the CMC work has been completed and is preparing the GMP batch for the pivotal study. So I was wondering whether there's any additional work left to be done on the manufacturing side. Do you intend to produce all the drugs yourself going forward for the study needs? And when do you expect the GMP batch will be ready? Thanks.

So right now, as I mentioned, we're manufacturing the drug along with our radionucleotide manufacturing partner in San Antonio for the Phase I trial. We make the liposomes, and then we work with them to load them and then make them available to the three clinical trial sites. In the background, we're working on the validation and verification studies as it relates to the drug to move it kind of out of Phase I production drug readiness into a potential pivotal trial. That's going to require not only the V&V work that I mentioned before, but also the scale up, too, so that we can get roughly 10% of commercial scale. So all that's going on in the background. That will largely be outsourced, even though we have a fully capitalized clinical stage and even commercial stage manufacturing facility in san antonio our plan is to because of the unique nature of this drug the fact that there's a radionucleotide that the liposomes have to be loaded we'll likely outsource a lot of that cmo work and then and then you know once we get approved then we'll um we'll decide kind of whether to completely outsource that or bring that in-house we have the capability to bring it in-house but The supply chain and logistics are such that it's a little too early to tell whether that will make sense at this point. Thanks, if I have. Okay. No, thank you, Sean. Appreciate it.

And there are no further questions at this time. I'd like to turn the call back over to Dr. Hedrick.

Great. Thank you, Kathryn. Appreciate everyone that joined in and participated in the call. Just to close, I'd like to thank the employees of the company and the patients involved in the trials and the physicians that are increasingly excited about the opportunity to potentially work with us and helping to bring this through the approval process. So have a good evening and, again, appreciate you being on the call.

Ladies and gentlemen, this concludes today's conference call. Please disconnect your lines at this time and have a wonderful day.