PolyPid Ltd.

Greetings and welcome to the PolyPID first quarter 2021 conference call. At this time, participants are in listen-only mode. As a reminder, this call is recorded. And I would now like to introduce your host for today's conference, Mr. Bob Yadid from LifeSci Advisors. Mr. Yadid, you may begin.

Thank you. And thank you all for participating in PolyPID's first quarter 2021 earnings conference call. Joining me on the call today will be Amir Weisberg, Chief Executive Officer, and Dikla Chavka-Oxobrod, Executive Vice President and Chief Financial Officer of PolyPID. Earlier today, PolyPID released financial results for the three months ended March 31, 2021. A copy of the press release is available in the Investors section of the company's website, www.polypid.com. I'd like to remind you on this call, management will make forward-looking statements within the meaning of the Federal Securities Law. For example, management is making forward-looking statements when it discusses the expected recruitment for trials, timing of trials and release of trial results thereof, the capacity of the company's manufacturing facility, the potential benefits of PLEX and Oncoplex, and the sufficiency of the company's cash, to fund future operations. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described from time to time in our filings with the Securities and Exchange Commission. Our results may differ materially from those projections. These statements involve material risks and uncertainties that can cause actual results or events to materially differ. Therefore, you should not place undue reliance on these statements. I encourage you to review the filings with the SEC, including without limitation, the company's forms 20F and 6K, which identifies specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. PolyPede disclaims any intention or obligation, except as required by law to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and speaks only as of the live broadcast today, May 12, 2021. With the completion of those prepared remarks, it's my pleasure to turn the call over to Amir Weissberg, CEO. Amir?

Thank you, Bob. On behalf of our team at Polypeed, I would like to welcome everyone to our first quarter 2021 earning call. I will begin today with some brief introductory comments and then Dikla will provide a little update on our business and we'll review our financial results after which we will open the call for questions. I'm very pleased with the recent progress we have achieved in advancing our development programs and in continuing our evolution toward becoming a commercial company. As you know, we are currently in a large phase three program with our lead asset, D-Plex 100, for the prevention of surgical site infection, or SSI. DECLA will provide further details on this program shortly. but I am excited to report today that our ongoing SHIELD1 trial is proceeding as planned, and we are having great success accelerating enrollment into this study. Moreover, our second Phase III trial in abdominal surgery, SHIELD2, is also advancing as expected with new site opening at a robust phase. As a reminder, this two phase three trial will serve as a basic for polypid first new drug application submission and we believe will contribute to support a broad level for the prevention of SSI. Importantly, our broad DPLEX-100 development program is supported by a vast patent portfolio. In fact, we now have 101 patents granted and allowed worldwide for our platform and products. I am also pleased to report today that our manufacturing facility is now fully scaled up. This facility will be able to support the first 30 months of product demand worldwide. As you can see, Polypid has recently achieved important progress in all aspects of its business. We also continue to be supported by a strong balance sheet, which we expect to be sufficient to complete the Shield 1 study, to conduct Shield 2, and prepare for the submission of NDA, as well as further advance our on-copy development platform with cash on hand. I will now turn the call over to Dikla to provide you with some further details on our business. Dikla, please take it from here.

Thank you, Amir, and thank you all again for joining us on the call. I would like to begin with a brief discussion on the status of our pipeline. The pace of enrollment in the SHIELD-1 trial has been strong to date and is expected to continue to accelerate. The recruitment rate in the SHIELD-1 trial doubled in the last three weeks, and we now have nearly 200 patients enrolled into the study. We believe the recruitment rate will continue to increase as several centers have been recently opened and new one will open throughout the current month. Importantly, approximately 70% of the patients currently enrolled in SHIELD1 have a colorectal cancer diagnosis, a rate similar to the 74% seen in our successfully completed phase two trial, meaning that we are talking about high priority surgical procedures that are less influenced by the COVID-19 pandemic worldwide. Moreover, the Data Safety Monitoring Committee, in charge with the review of accumulative safety data and study conduct for Shield 1 study, has now recommended for the second time to continue the study without modification, meaning that no safety issues related to the DPLEX-100 have been observed in Shield 1 to date. Based on these collective data points, we continue to anticipate the availability of top-line data from SHIELD1 by the end of this year. As a reminder, our plan is to enroll 616 to 900 patients within 60 centers in the US, EU, and Israel. Following the enrollment of 500 patients, the study design provides for a blinded sample size re-estimation based on the overall infection rate observed in the study. Moving on, Shield 2, which has broader eligibility criteria than Shield 1, including minimally invasive surgical procedure, also continues to progress as planned, though our initial focus here remains on opening centers. The second trial will enroll approximately 900 to 1,400 patients across 60 hospitals different from the one participating in the SHIELD-1 study. From a commercial perspective, to reiterate what we have said previously, in order to maximize our commercial success in the US, we have began to establish our own footprint in the US to initiate commercial preparation activities while also exploring potential partnering opportunities with leading pharmaceutical companies. We recently completed a large US market research project to ensure optimal positioning and coverage of DIPLEX-100 that included a total of approximately 90 in-depth one-hour interviews with pharmacy director and other hospital administrators and a mix of general cardiac and orthopedic surgeons. The result of this work only strengthened our confidence in the U.S. commercial prospects for DIPLEX-100, especially in abdominal surgery. Most interestingly, while both hospital administrators and surgeons reported a significant need for a product like DIPLEX-100, the hospital administrators were especially enthusiastic. Typically, hospital administrators push back on new technologies more so than surgeons. This does not appear to be the truth for DIPLEX-100. We believe the view of hospital administrators is indicative of the significant cost burden treating surgical site infection with associated prolonged length of stay and the fact that hospital readmission of Medicare patients for SSIs are not reimbursed by CMS. Ultimately, this market research will support our efforts to demonstrate favorable health economics for hospitals to drive the commercial potential of our drug candidate. In parallel, we also remain in active discussion with potential partners for the US, EU, and Asia market. Before I move on to the rest of our pipeline, I'd like to take a moment to discuss manufacturing, another key area where we have recently made important progress. As Amir noted earlier, our manufacturing facility is now fully scaled and can produce the first 30 months of anticipated commercial demand for DPLEX-100. We recently ramped up our capacity by two and a half times to achieve this critical milestone. This is a key milestone in our vision to become a fully integrated biopharmaceutical company. Looking farther ahead, we are currently evaluating potential plans for additional manufacturing capabilities to address product demand beyond the first 30 months. Now, I'd like to elaborate on the status of Oncoplex. are intratumoral chemotherapy product candidate for solid tumors, including tumors that are chemotherapeutic resistant. Oncoplex provides prolonged and controlled exposure to docetexel, one of the most widely used chemotherapy agents in the intraoperative tumor resection setting. The control and prolonged release at the tumor resected site have critical impact to prevent the local tumor reoccurrence and the potential spreading of cancer cell, and ultimately improve the overall survival of cancer patients. In addition, Oncoplex is expected to significantly reduce the known toxic systemic exposure, one of the important attributes of successful local delivery in cancer therapy. You will recall that late in 2020, we announced positive preclinical data from this program. In a syngenic mouse model, for solid tumor colon carcinoma using cancer cell highly resistant to docetexel among the most treatment-resistant tumor cell types, a single local application of OncoPlex generated significantly better result compared to the group treated with six cycle of systemic docetexel treatment in multiple key measures, including overall tumor reoccurrence, overall survival, and overall tumor-free survival. Moreover, we recently generated additional compelling safety data in animal that we are excited about, including positive safety data in a promising solid tumor indication. We are also in parallel building a network of top experts and KOLs around our OncoPlex development program, so to accompany us during the development stages. We continue to conduct other preclinical safety and efficacy studies of Oncoplex in various types of solid tumors and are advancing towards the completion of a preclinical package for the filing of pre-IND requests with the FDA later this year in order to potentially initiate first-in-man clinical trial next year. We continue to believe that Oncoplex has potential to become part of the standard of care for in the tumor resection surgical setting within multiple solid cancer types, including glioblastoma, prostate cancer, and head and neck cancer. With that, I will now review our recent financial results. Let's begin with PolyPIT's balance sheet information. As of March 31, 2021, the company had cash, cash equivalents, short-term deposit, and long-term deposit, of $61.4 million, as compared to $66.6 million as of December 31, 2020. Cash used in operation for the three months ended March 31, 2021, totaled $5.6 million. We continue to expect that our current cash runway will extend into 2022 and remain confident that this strong balance sheet will allow us to complete our first phase V-trial, Shield 1, in abdominal soft tissue infection, to conduct the second abdominal surgery study, Shield 2, and to prepare for the submission of an NDA for DIPLEX-100. Now let's turn to our income statement. Research and development expenses for the three months ended March 31, 2021 were $6 million, compared to $3.4 million in the same three months period of 2020. As spending increased due to the ongoing SHIELD I and SHIELD II phase three clinical trials in abdominal surgery. Marketing and business development expenses for the first quarter of 2021 were $700,000 compared to $300,000 for the same period of 2020. These expenses increased primarily due to an increase in marketing and business development personnel in our offices in New Jersey and an increase in market-facing activities as we began building our commercial infrastructure. General and administrative expenses for the first quarter of 2021 were $2.1 million compared to $700,000 in the prior year period, as cost increased due to being a publicly traded company with higher DNO insurance costs and an increase in non-cash share-based compensation. For the first quarter of 2021, the company had a net loss attributable to ordinary share of $8.7 million as compared to $5.9 million in the prior year period. We will now open the call for your question. Operator?

Thank you. As a reminder, if you wish to ask a question, press the star and 1 on your telephone keypad. Your first question again comes from the line of Balaji Prasad from Barclays.

Hi. Good morning and thanks for the questions. On Shield 1, could you A reminder of how many sites have been activated. It's reassuring to see the patient enrollment data, especially the last three weeks. Can we expect that this is likely to continue based on our earlier discussion that sites have been activated and patient enrollment is going to be faster? So is this the trend that's going to be for Q2? And that means we would be going through a sample size re-estimation in mid-2021 as you planned earlier? That's one. Two, do you have any updated thoughts around raising capital and at what point? You did give a cash balance and said that it's sufficient until end of 2022, but any thoughts around that would be appreciated. Thanks.

Thank you, Balazian. Good morning again. So I'll start with your first question on Shield 1. The plan was to open 60 centers, We now have about 40 that are activated and running, and opening is going pretty fast. It was nice. Some of them were open in the last few weeks, and additional is expected to be open, and this is why we've seen such an increase in the recruitment, and we expect it to continue. As we said, we nearly recruited 200 patients, which is in line with what we planned, and the timeline remain as as we expected meaning that we'll have the sample size and the free 500 stations not meet this year but rather q3 early q3 probably so we're talking about between the end of q2 early q3 we'll have the 500 and after that we will be able to report top line results by the end of the year so we are online with the permit we are not At this stage, we are not reporting that it will be shortened. With regards to financing, so you see that we ended the quarter with over $61 million in cash equivalent. We have a very strong position, cash position. The cash is sufficient to finance both Shield 1 and Shield 2, as well as progress with our oncology program. So we don't see any immediate need to raise money. And we think that a substantial raise will only be made after the top-line result.

Great. Thank you, Jigla. Just one follow-up maybe. You called out interviews with hospitals and hospital administrators recently. So in terms of findings, how different were your takeaways from the earlier research that you had conducted around a year ago? Any incremental findings that was different from what you had done earlier? Thanks.

It was very similar, which is again reassuring. I think what was different in a way that the product is more mature, the clinical trial more mature. We are now describing, when describing to surgeons, we are describing a product with an actual positioning in terms of potential NDA because we know what is the phase three, how many patients, So this is based on something that is more mature in terms of the development program, but the aspects of hospital administrators seeing the economic value of the product is similar to what we've seen in the past. Maybe a bit more, but we've seen an aspect of pricing was very similar. Also, price sensitivity was similar. So this is, for us, this is now a trend.

Understood. Thank you.

Thank you. Your next question comes from the line of Gary Nackman from BMO Capital Markets.

Hi, good morning. Good to hear all the progress. So as you accelerate the rate of enrollment for Shield 1, does that hold back the enrollment for Shield 2 in any way? So, you know, just remind us, how much overlap is there between the sites in those two studies? And then also, what's the average number of patients being enrolled per site at this point in Shield 1? And what number do you think you need to get to in order to get the data by the third quarter?

First of all, good morning and thank you. Those are very good questions. With regards to SHIELD2, those are different centers, as we said. Actually, there is only one parallel center, and this is by strategic decision. We want to have different centers in order to avoid competing between the two trials. So those are totally different centers. 60 that are in Shield 1. Once Shield 1 reaches a point where the centers have met the maximum capacity of recruitment per center, we can transfer them, but there won't be any overlap during the trial. You were also asking about how the patients are distributed between the centers, so it's It's still early to say, because we are in 200 patients out of the expected 600 patients. And some centers have been open since the beginning of the trial, and some are open for one month. But we see a very nice distribution, and we expect it to be divided in a more or less similar way, if not between centers, but between countries. So depending on the number of centers, we don't see patients coming from one country or from one center over the other. So yes, there is some differentiation between, but it's quite similar in terms of having several patients in center. Our average assumption, as we said in the past, centers will recruit, in average, along the trial, one patient per month per center. And this is what we're seeing. We're seeing it support this. So we expect this to continue. And this way, the statistic will be more or less the same between center. You were also asking about the overall number of patients. So if you recall, The trial is designed on an adaptive design and allow us to recruit between 616 to 900 patients. And we can make the decision on between this range after having recruiting 500 patients with sample size re-estimation. Our assumptions are based on the 600 patients. But again, at that stage, if we would decide to add patient, a few dozen patients, it shouldn't be more than one, two months at the time, because at the end of the opening and the recruitment, we have all the centers up and running, so we are at this stage recruiting more than one patient per center per month. This is an average along the life of the trial, but it's not the equivalent during all the time.

Okay, that's very helpful. And then just to follow up on on complex. So just what are the gating factors to starting a phase one study. Is it just resources and it sounds like you're confident you'll have behind a meeting before the end of the year. What and you're collecting a lot of data here preclinical data. So just maybe talk a little bit more about what you think that package is going to look like and just your confidence that you'll be able to have that meeting before the end of the year. And then starting the phase one, you know, what point next year will you be able to do that? Thanks.

Sure. So, first of all, we are very excited with this program. We see how the experience that we've gained with the Plex 100, with the development, with the Plex platform, how we are able at this stage to shorten the development. Things that have taken us several years for Duplex 100, for example, CFC processes and preclinical package are taking place in a matter of months. So this is a very exciting program within the company, our ability to use all the knowledge that we have gained with DPLEX-100, whether it's regarding regulatory, regarding manufacturing, pre-clinica, is taking place in this program. We are confident that we can get through the pre-IND this year. Of course, we are We don't know what will be raised in that. Our assumption is that we should be in a position to start first in May next year based on our understanding of what will be required for an IND. But we'll need to hear from the FDA and see if they agree with our plan. We will also be in a position to share more information with investors on this program in terms of safety, and efficacy in preclinical studies. So I think we will be able to update on this program along the year as we get closer to submitting the package. We'll also have some additional efficacy studies in animals. But for now, we are confident that this is doable.

Okay, great. Thank you very much.

Thanks, Gary. Thank you. Your next question comes from the line of Elliott Wilbur and Raymond James.

Thank you. Good morning or good afternoon. Good to hear your voice and thoughts are with you and your families in these very difficult times. My first question, I just basically want to ask a follow-up question on the Oncoplex program. It sounds like there's been a lot of progress in a very short period of time. When might we expect additional data points, publications, et cetera, anything we might see before the end of the year on that program entering the public domain? I guess as you think about initial first-in-man trials, are you thinking about a specific tumor type at this point, or would you expect to initiate trials in the range of tumors that you outlined earlier?

First of all, thank you for your kind words. We have made progress and we do expect to be able to share more around this program during this year in terms of both safety as well as indication and plans as well as efficacy. With regards to the specific indication, this is part of the process of what we're looking at. Of course, we do have some thoughts here, and there are things that we think that are more likely, but we want to make sure with animal studies that things are looking as expected before we make a final decision and submit that to the FDA. And we'll make the decision, again, based on the data. We'll review the data and make a decision whether it makes more sense to start with one indication and approve the product first and take it first in this one indication and have more of a bundle type of submission. But I don't want to say anything before we actually see the data. But again, I'm saying this again, we expect to be able to share this data before the end of six years, before we meet the FDA for the pre-IMD, with regards to additional efficacy data and safety.

Okay. And I have a question with respect to the market research study or project that you mentioned earlier. It's encouraging, obviously, to hear the favorable feedback from hospital administrators. Obviously, they kind of get it in terms of the incremental cost, but curious if there's anything you could share in terms of their impressions of some of the price points that you have talked about for the product earlier, assuming that that data to some extent was shared with them, and if there's anything that you could convey to us in terms of their receptivity around some of the price points that the company had been previously considering. And then with respect to the commercial side or feedback from surgeons, anything that you learned thus far from that study that maybe is somewhat different in terms of what you were previously thinking about with respect to commercial positioning of the product?

With regards to pricing, we got reassured that our thinking on pricing is valid, and this is how they view that in terms of sensitivity. I think we could even say that our assumptions that were presented based on 50% reduction of infection were very valid, and if the overall efficacy in the phase three is higher than that, We could even consider higher price than we initially thought. But again, this is too early. We'll need to see what comes up from the phase three and make final decisions. I think another thing that we clearly see both from this study by discussions with opening centers that there is an unmet need in colorectal resection, in abdominal in general, but specifically in colorectal resection. A lot of the patients have infections. And this is not just holding back the surgeon in terms of additional hospitalization days, readmission. It's also hurting the patient from the aspects of most of those surgeries, oncology surgeries. Most of the patients coming to the hospital for colorectal resection are doing that due to cancer tumors. And this is holding them back. on their oncology protocol. They should go to the either radiation or chemotherapy a few weeks after surgery. If they have an infection, this delays the process, and this jeopardizes their oncology treatment, their cancer treatment. So there is a lot of benefit here in terms of patient health as well as the health economics, and this is quite clear from the market research that we've performed.

Okay. And then just last question. Obviously, there's been some incremental spend tied to commercialization efforts in the U.S., but anything specifically you can share in terms of key hires or what exactly the investment has been targeted towards? Thanks.

So we are very cautious here in terms of budgeting and expenses. with looking at what is the main route that is needed to meet the timeline for commercialization. This market research that we've done, we are looking to build a plan, the commercial. There are discussions that we are having in parallel. So we do have three people there that are working, and this is something that we are cautiously progressing on. especially with aspects of things that are critical in the path for commercialization, whether it goes to packaging, naming, and things that need to be done today in order not to hold us. Amir, would you like to add to that?

No, actually, this is an important point. I just want to add something else about the research market. I think that what is more clear to us in this research market, if I compare it to the previous one, it was very clear the need. And we heard it from the doctors and from the administrators. And this was very good support for our approach, and it gave us to understand that the administrators, that sometimes top activities like that, they are supportive and they are very happy to see this kind of product in the market.

Once again, ladies and gentlemen, if you wish to ask a question, press the star and 1 on your telephone keypad. We have no further questions if you wish to continue.

Yes. Thank you for joining our first quarter 2021 EIRMING conference call. I would like to repeat how excited we are about the progress we have achieved up to date, as well as the compelling opportunities that lie ahead of us. We remind grateful to our team members and all of our external partners for their strong commitment to our mission and their cooperation to ensure that we continue to advance toward achieving our goal of bringing D-Plex 100 to healthcare providers and patients as quickly as possible. Thank you very much.

Thank you. That does conclude your conference for today. Thank you all for participating and you may now disconnect. Thank you. you Thank you. Thank you. Bye.

Thank you. And thank you all for participating in PolyPede's first quarter 2021 earnings conference call. Joining me on the call today will be Amir Weisberg, Chief Executive Officer, and Dikla Chatskas-Oxelbrod, Executive Vice President and Chief Financial Officer of PolyPede. Earlier today, PolyPede released financial results for the three months ended March 31st, 2021. A copy of the press release is available in the investor section of the company's website, www.polyp.com. I'd like to remind you on this call, management will make forward-looking statements within the meaning of the federal securities laws. For example, management is making forward-looking statements when it discusses the expected recruitment for trials, timing of trials, and release of trial results thereof. the capacity of the company's manufacturing facility, the potential benefits of Plex and OncoPlex, and the sufficiency of the company's cash to fund future operations. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described from time to time in our filings with the Securities and Exchange Commission. Our results may differ materially from those projections. These statements involve material risks and uncertainties that can cause actual results or events to materially differ. Therefore, you should not place undue reliance on these statements. I encourage you to review the filings with the SEC, including without limitation, the company's forms 20F and 6K, which identifies specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Holly P. disclaims any intention or obligation that is required by law to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and speaks only as of the live broadcast today, May 12th, 2021. With completion of those prepared remarks, it's my pleasure to turn the call over to Amir Weissberg, CEO. Amir.

Thank you, Bob. On behalf of our team at PolyPede, I would like to welcome everyone to our first quarter 2021 earning call. I will begin today with some brief introductory comments and then Dikla will provide a little update on our business and we'll review our financial results after which we will open the call for questions. I am very pleased with the recent progress we have achieved in advancing our development programs and in continuing our evolution towards becoming a commercial company. As you know, we are currently in a large phase three program with our lead acid D-Plex 100 for the prevention of surgical site infection, or SSI. The CLAR will provide further details on this program shortly, but I am excited to report today that our ongoing SHIELD-1 trial is proceeding as planned, and we are having great success accelerating enrollment into this study. Moreover, our second phase three trial in abdominal surgery, SHIELD2, is also advancing as expected with new site opening at a robust phase. As a reminder, these two phase three trials will serve as a basic for polypid first new drug application submission and we believe will contribute to support a broad level for the prevention of SSI. Importantly, our broad DPLEX-100 development program is supported by a vast patent portfolio. In fact, we now have 101 patents granted and allowed worldwide for our platform and products. I am also pleased to report today that our manufacturing facility is now fully scaled up, This facility will be able to support the first 30 months of product demand worldwide. As you can see, PolyPID has recently achieved important progress in all aspects of its business. We also continue to be supported by a strong balance sheet, which we expect to be sufficient to complete the Shield 1 study, to conduct Shield 2, and prepare for the submission of NDA, as well as further advance our on-copy development platform with cash on hand. I will now turn the call over to Dikla to provide you with some further details on our business. Dikla, please take it from here.

Thank you, Amir, and thank you all again for joining us on the call. I would like to begin with a brief discussion on the status of our pipelines. The pace of enrollment in the SHIELD1 trial has been strong to date and is expected to continue to accelerate. The recruitment rate in the SHIELD1 trial doubled in the last three weeks, and we now have nearly 200 patients enrolled into the study. We believe the recruitment rate will continue to increase as several centers have been recently opened, and a new one will open throughout the current month. Importantly, approximately 70% of the patients currently enrolled in SHIELD1 have a colorectal cancer diagnosis, a rate similar to the 74% seen in our successfully completed Phase 2 trial, meaning that we are talking about high-priority surgical procedures that are less influenced by the COVID-19 pandemic worldwide. Moreover, the Data Safety Monitoring Committee in the in charge with the review of accumulative safety data and study conduct for Shield 1 study, has now recommended for the second time to continue the study without modification, meaning that no safety issue related to the DPLEX-100 have been observed in Shield 1 to date. Based on these collective data points, we continue to anticipate the availability of top-line data from Shield 1 by the end of this year. As a reminder, our plan is to enroll 616 to 900 patients within 60 centers in the US, EU, and Israel. Following the enrollment of 500 patients, the study design provides for a blinded sample size re-estimation based on the overall infection rate observed in the study. Moving on, Shield 2, which has broader eligibility criteria than Shield 1, including minimally invasive surgical procedure, also continue to progress as planned, though our initial focus here remains on opening centers. The second trial will enroll approximately 900 to 1400 patients across 60 hospitals different from the one participating in the SHIELD-1 study. From a commercial perspective, to reiterate what we have said previously, In order to maximize our commercial success in the U.S., we have began to establish our own footprint in the U.S. to initiate commercial preparation activities while also exploring potential partnering opportunities with leading pharmaceutical companies. We recently completed a large U.S. market research project to ensure optimal positioning and coverage of DPLEX-100 that included a total of approximately 90 in-depth one-hour interviews with pharmacy director and other hospital administrators and a mix of general cardiac and orthopedic surgeons. The result of this work only strengthened our confidence in the U.S. commercial prospects for DIPLEX-100, especially in abdominal surgery. Most interestingly, while both hospital administrators and surgeons reported a significant need for a product like DIPLEX-100, the hospital administrators were especially enthusiastic. Typically, hospital administrators push back on new technologies more so than surgeons. This does not appear to be the truth for DIPLEX-100. We believe the view of hospital administrators is indicative of the significant cost burden of treating surgical site infection with associated prolonged length of stay and the fact that hospital readmission of Medicare patients for SSIs are not reimbursed by CMS. Ultimately, this market research will support our efforts to demonstrate favorable health economics for hospitals to drive the commercial potential of our drug candidate. In parallel, we also remain in active discussion with potential partners for the US, EU, and Asia markets. Before I move on to the rest of our pipeline, I'd like to take a moment to discuss manufacturing, another key area where we have recently made important progress. As Amir noted earlier, our manufacturing facility is now fully scaled and can produce the first 30 months of anticipated commercial demand for DPLEX-100. We recently ramped up our capacity by two and a half times to achieve this critical milestone. This is a key milestone in our vision to become a fully integrated biopharmaceutical company. Looking farther ahead, we are currently evaluating potential plans for additional manufacturing capabilities to address product demand beyond the first 30 months. Now, I'd like to elaborate on the status of Oncoplex. are intratumoral chemotherapy product candidate for solid tumors, including tumors that are chemotherapeutic resistant. Oncoplex provides prolonged and controlled exposure to docetexel, one of the most widely used chemotherapy agents in the intraoperative tumor resection setting. The control and prolonged release at the tumor resected site have critical impact to prevent the local tumor reoccurrence and the potential spreading of cancer cell, and ultimately improve the overall survival of cancer patients. In addition, Oncoplex is expected to significantly reduce the known toxic systemic exposure, one of the important attributes of successful local delivery in cancer therapy. You will recall that late in 2020, we announced positive preclinical data from this program. In a syngenic mouse model, For solid tumor colon carcinoma using cancer cell highly resistant to docetexel among the most treatment resistant tumor cell types, a single local application of OncoPlex generated significantly better result compared to the group treated with six cycle of systemic docetexel treatment in multiple key measures, including overall tumor reoccurrence, overall survival, and overall tumor-free survival. Moreover, we recently generated additional compelling safety data in animal that we are excited about, including positive safety data in a promising solid tumor indication. We are also in parallel building a network of top experts and KOLs around our OncoPlex development program, so to accompany us during the development stages. We continue to conduct other preclinical safety and efficacy studies of Oncoplex in various types of solid tumors and are advancing towards the completion of a preclinical package for the filing of pre-IND request with the FDA later this year in order to potentially initiate first-in-man clinical trial next year. We continue to believe that Oncoplex has potential to become part of the standard of care in the tumor resection surgical setting within multiple solid cancer types, including glioblastoma, prostate cancer, and head and neck cancer. With that, I will now review our recent financial results. Let's begin with PolyPIT's balance sheet information. As of March 31, 2021, the company had cash, cash equivalents, short-term deposit, and long-term deposit, of $61.4 million, as compared to $66.6 million as of December 31, 2020. Cash used in operation for the three months ended March 31, 2021, totaled $5.6 million. We continue to expect that our current cash runway will extend into 2022 and remain confident that this strong balance sheet will allow us to complete our first phase V-trial, Shield 1, in abdominal soft tissue infection, to conduct the second abdominal surgery study, Shield 2, and to prepare for the submission of an NDA for DIPLEX-100. Now let's turn to our income statement. Research and development expenses for the three months ended March 31, 2021 were $6 million, compared to $3.4 million in the same three-month period of 2020. As spending increased due to the ongoing Shield 1 and Shield 2 phase 3 clinical trials in abdominal surgery. Marketing and business development expenses for the first quarter of 2021 were $700,000 compared to $300,000 for the same period of 2020. These expenses increased primarily due to an increase in marketing and business development personnel in our offices in New Jersey and an increase in market-facing activities as we began building our commercial infrastructure. General and administrative expenses for the first quarter of 2021 were $2.1 million compared to $700,000 in the prior year period, as cost increased due to being a publicly traded company with higher DNO insurance costs and an increase in non-cash share-based compensation. For the first quarter of 2021, the company had a net loss attributable to ordinary share of $8.7 million as compared to $5.9 million in the prior year period. We will now open the call for your question. Operator?

Thank you. As a reminder, if you wish to ask a question, press the star and one on your telephone keypad. Your first question today comes from the line of Balaji Profat from Barclays.

Hi, good morning and thanks for the questions. On Shield One, could you A reminder of how many sites have been activated. It's reassuring to see the patient enrollment data, especially in the last three weeks. Can we expect that this is likely to continue based on our earlier discussion that sites have been activated and patient enrollment is going to be faster? So is this the trend that's going to be for Q2? And that means we would be going through a sample size re-estimation in mid-2021 as you planned earlier? That's one. Two, do you have any updated thoughts around raising capital and at what point? You did give a cash balance and said that it's sufficient until end of 2022, but any thoughts around that would be appreciated. Thanks.

Thank you, Balazia, and good morning again. So I'll start with your first question on Shield-1. The plan was to open 60 centers, We now have about 40 that are activated and running and opening is going pretty fast. It was nice. Some of them were open in the last few weeks and additional is expected to be open and this is why we've seen such an increase in the recruitment and we expect it to continue. As we said, we nearly recruited 200 patients, which is in line