PolyPid Ltd.

Thank you all for participating in PolyPID's third quarter 2021 earnings conference call. Joining me on the call today will be Amir Weisberg, Chief Executive Officer, and Dikla Chachkis-Oxobrod, Executive Vice President and Chief Financial Officer of PolyPID. Earlier today, PolyPID released financial results for the three months and nine months ended September 30th, 2021. A copy of the press release is available in the investor's section of the company's website, www.polyped.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 results thereof, the capacity of the company's manufacturing facility, the company's pipeline, potential benefits of D-Plex 100 and Oncoplex, the company's potential partners, 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 SEC filings. Our results may differ materially from those projections. These statements involve material risks and uncertainties that could cause actual results or events to materially differ. Accordingly, you should not place undue reliance on these statements. I encourage you to review the company's filings with the Securities and Exchange Commission, including without limitation the company's Form 20F, which identifies specific factors which may cause actual results or events to differ materially from those described in the four legal statements. PolyP disclaims any intention or obligation, except those 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, November 10th, 2021. With the completion of those prepared remarks, It's my pleasure to turn the call over to Amir Weisberg, CEO. Amir?

Thank you, Bob. On behalf of our team at PolyPID, I would like to welcome everyone to our third quarter 2021 earnings call. I will begin today with some brief introductory comments. Dikla will provide a detailed business update, and then she will review our financial results after which we will open the call for your questions. We continue to rapidly advance our many development programs, as well as our commercial preparations. Most importantly, our large phase three program for our lead asset, DPLEX-100, for the prevention of surgical site infections, or SSI, is progressing as planned. As a reminder, SSI account for around 20% of all hospital acquired infections in the U.S. resulting in extended hospital stay and readmission and adding up to $10 billion in annual medical costs. From a commercial perspective, as we discussed on our last call, we have developed a launch plan that including all the details activities that will occur from now until launch for the various functions at PolyPID, including sales and marketing, formulary access, and medical affairs. In addition, a resource plan has been developed to determine hiring needs and timing for each of the different functions, as well as the infrastructure that will be needed in preparation for launch. In addition, We have also engaged a leading launch excellent service provider to support polypids regarding this pre-launch activities in the US market. I'm also pleased to report that our promising Oncoplex development platform initially targeting brain tumor continues to generate compiling preclinical data which DECLA will highlight shortly. Of significance, our pre-IND meeting with the FDA, where we hope to achieve agreement with the agency on the preclinical and clinical development plan for Oncoplex, is scheduled to take place later this month. Based on our recent accomplishment, PolyPID is well positioned for further clinical and operational success. Moreover, we continue to operate from a position of financial strength. We expect that our current balance sheet will be sufficient to complete the SHIELD 1 study, to conduct SHIELD 2, and prepare for the submission of NDA to the FDA, as well as further advance our on-complex development platform. With that, I will now turn the call over to Dikla to provide you with some further updates on our business. Dikla.

Thank you, Amir, and thank you all 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 SHIELD1 trial has continued to increase over the last several months, and we expect an even greater acceleration in enrollment in the coming months. We now have approximately 480 patients enrolled into the study, and based on the current environment, we anticipate that the recruitment rate will increase to 200 to 250 patients per quarter. As you know, during the second quarter of 2021, we received written responses from the FDA regarding our development plan for DPLEX-100. The FDA agreed that our proposal for single phase three pivotal study, provided the study results are adequate, would constitute significant evidence of clinical efficacy to support approval of DPLEX-100 for the prevention of SSI in colorectal surgery. As a reminder, our plan was to enroll up to 900 patients into the study within 60 centers in the US, EU, and Israel. Based on this agreement with the FDA, we have determined that it is in the best interest of our DPLEX-100 program to utilize the higher end of the targeted patient enrollment range for this study, which is approximately 900 patients. From a clinical perspective, this will help ensure that SHIELD-1 is well-powered and will provide additional data that will potentially be used to further demonstrate the medical and health economic benefits of DPLEX-100. As we reached approximately 480 patients, we expect to enroll 500 patients by the end of the month and to blindly assess the overall infection rate in the trial once these 500 patients have completed the one month primary endpoint follow-up. We intend to further update investors and analysts on enrollment status once the 500 patients have been enrolled and then again following the blinded infection rate assessment. Based on the target enrollment of approximately 900 patients, we now anticipate the last patient to enroll in Shield 1 will be during the second quarter of 2022 and the availability of top-line data two months thereafter. Importantly, we believe the potentially significant commercial and pharmacoeconomic benefits of conducting SHIELD1 in the higher hand of the targeted patient enrollment range far outweigh the resulting modestly extended timeline to top-line data. From a financial standpoint, because we only need to conduct SHIELD1 to potentially receive FDA approval and do not need to ramp enrollment in SHIELD2 at an equally robust pace, we now anticipate that our cash runway will be extended to year-end 2022. This is an improvement from our prior expectations that our cash would fund us into the second half of 2022. As a reminder, approximately 70% of the patients currently enrolled in Shield 1 have a colorectal cancer diagnosis, a rate similar to the 74% seen in our successfully completed Phase II trial. The remaining procedures primarily consist of those related to Crohn's disease and IBD. Finally, the Data Safety Monitoring Committee, in charge with the review of accumulating safety data and study conduct for the SHIELD-1 study, has now recommended for the third time to continue the study without modification. meaning that no major safety issues related to DIPLEX-100 have been observed in SHIELD-1 to date. Moving on to SHIELD-2, our second Phase III trial in abdominal surgery, which includes broader relatability criteria, including minimally invasive procedures. This study also continues to progress as planned, although our focus remains on opening centers at the measured pace. total enrolled patient in SHIELD2 is currently over 130. In terms of potential collaboration for the future commercialization of DIPLEX100 in the US, we remain in dialogue with several large and mid-sized pharmaceutical and medical device companies that we believe would be ideal commercial partners for DIPLEX100. As I said on our last call, These companies are leaders in commercializing pharmaceutical products and medical devices, have strong established commercial infrastructures, exhibit a detailed understanding of clinical and pharmacoeconomic benefits in the hospital channel, and maintain strong relationships with the hospital clinical, medical, and administrative staff. Importantly, There continues to be a high level of interest in DIPLEX-100 from these potential partners. In parallel, we also remain in highly active discussions with multiple large and mid-sized strategic partners, all with significant presence and experience sailing into the hospitals and operating rooms for potential collaboration in Europe and Asia. Now I'd like to further elaborate on the status of Oncoplex. our intratumoral chemotherapy product candidate, initially targeting solid brain tumors, including those that are chemotherapeutic resistant. As a reminder, OncoPlex provides local, prolonged, and controlled exposure to Dosat XL in the intraoperative tumor resection setting. As you know, Dosat XL is one of the most widely used chemotherapy agent worldwide. Brain tumors were selected as the initial indication for Oncoplex because there is currently almost no meaningful chemotherapeutic treatment options for brain tumors, primarily due to the limited ability of the treatments to penetrate the blood-brain barrier. Due to the localized and prolonged nature of Oncoplex, we believe it is highly beneficial as compared to systemic treatments as well as the currently available local treatment in these devastating tumors that often cannot be fully resected surgically. We recently reported additional positive preclinical data in two key glioblastoma multiforme or GBM animal models, demonstrating that a single local treatment of Oncoplex significantly inhibited tumor growth and prolonged survival. In addition, a dose response was demonstrated for Oncoplex in the different animal models. These important results further support our work toward the pre-IND meetings with the FDA to potentially initiate a Phase I-II clinical trial. As Amir noted, we are pleased that we have a pre-IND meeting scheduled with the FDA for later this month with the objective of coming to agreement on a clinical and non-clinical development plan for Oncoplex in GBM. We remain focused on potentially initiating a Phase I-II clinical trial of Oncoplex in GBM in 2022 and continue to expand our network of top experts and KOLs around our Oncoplex development program to support our efforts in this promising area. With that, I will now review our recent financial results. Let's begin with Polypid's balance sheet information. As of September 30, 2021, the company had cash, cash equivalents, short-term and long-term deposits of $42 million, as compared to $67 million as of December 31, 2020. Cash used in operations for the three months ended September 30, 2021 total $10 million. Now let's turn to our income statement. Research and development expenses for the three months ended September 30, 2021 were $7.3 million compared to $4.2 million in the same three months period of 2020. The increase in research and development expenses resulted from the increased cost and activities related to the ongoing SHIELD I and SHIELD II Phase III clinical trials and abdominal surgery. Marketing and business development expenses for the three months of 2021 were $400,000 compared to $300,000 for the same period of 2020. General and administrative expenses for the third quarter of 2021 were $2.1 million, consistent with $2.2 million in the prior year period. For the third quarter of 2021, the company had a net loss attributable to ordinary shares of $9.9 million as compared to $6.5 million in the prior year period. We will now open the call to your question. Operator?