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spk03: Thank you all for participating in PolyPede's fourth quarter and full year 2023 earnings conference call. Joining me on the call today will be Dikla Chachkis-Axelbrad, Chief Executive Officer of PolyPede, Joni Misalawan, PolyPede's Chief Financial Officer, and Ori Warshawski, Chief Operating Officer of PolyPede. Earlier today, PolyPede released financial results for the three and 12 months ended December 31st, 2023. A copy of the press release is available in the investor section on the company's website, www.polypeed.com. I'd like to remind you that 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 timing for recruitment and top-line results from the SHIELD 2 trial and of the unblinded interim analysis, the planned new drug application submission for DPLEX 100, the potential impacts and uses for Oncoplex and the Plex platform, the company's expected cash runway, and the potential to receive additional funds if warrants are exercised. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks 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. 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 that may cause actual results or events to differ materially from those described in the forward-looking statements. PolyP 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, February 14th, 2024. With the completion of these prepared remarks, it is my pleasure to turn the call over to Digla Traskis Axelrod, CEO of Polypeed. Dikla?
spk02: Thank you, Brian. On behalf of our team at Polypeed, I would like to welcome everyone, including our new shareholders, to our fourth quarter and full year 2023 earning call. We are thrilled with the significant progress recently achieved throughout our business. As we expected, enrollment in our ongoing SHIELD2 pivotal trial for DIPLEX-100 for the prevention of abdominal colorectal surgical site infection has began to ramp up. We have also generated some new, highly compelling preclinical data with OncoPlex that demonstrates its potential in oncology. Moreover, in order to support our robust clinical development efforts, we successfully completed a $16 million financing that included participation from multiple new U.S. life sciences-focused investors. I will discuss all of this in greater detail shortly, but let's begin with the status of SHIELD2. The study has now enrolled more than 100 subjects, and approximately 40 centers are currently open. As a reminder, we intend to conduct an unblinded interim analysis once approximately 400 patients a planned total of 600 subjects complete the 30-day follow-up, which is expected to occur in mid-2024. Topline results are anticipated in the second half of this year. With respect to the expected recruitment rate, as we said on our last call, once the site is fully up and running, which takes several weeks following its being formally opened, we anticipate approximately one and a half patients being recruited into the trial per center per month, and we expect to have overall approximately 60 centers opened and recruiting patients. Moving on, to reiterate what we have said previously, we have a clear regulatory pathway for the potential NDA submission for DPLEX-100 in the U.S. Last year, the FDA acknowledged not only that the SHIELD1 result may provide supportive evidence of the safety and efficacy of DIPLEX100 in patients with large surgical incisions, but also confirmed that, if successful, SHIELD2 is sufficient to support a potential NDA submission. We continue to strongly believe that SHIELD2 is a de-risk phase retrial, giving the more focused patient population in which we have already generated highly positive data in Shield 1, and the fact that it will not be conducted within the tight COVID-related restrictions that were in place during the pandemic and throughout the duration of Shield 1, we are also leveraging key learning from Shield 1 related to the sites involved in the study. While we are targeting approximately 60 centers for Shield 2, around the same number as Shield 1, We now have firm knowledge of the best performing sites from Shield 1 in terms of recruitment, patient monitoring, and good clinical practice. We believe this to be essential in the execution of Shield 2. We have also enhanced our clinical operation team, another key step towards supporting a successful study. Moving on. I'm excited to report today some new preclinical data generated with our Oncoplex product candidate. We have recently demonstrated the ability of Oncoplex to be injected intratumorally while having effective and prolonged anti-tumor impact. A single intratumoral injection of Oncoplex significantly reduced tumor growth and increased survival in two well-established and commonly used tumor animal models, urine melanoma, and murine colon carcinoma. Oncoplex has now shown efficacy in all models it has been tested in and across the various therapeutic approaches, either as a neoadjuvant via intratumoral injection or as an adjuvant via post resection application in the tumor bed. To date, Oncoplex has been tested in six different models and applications. all with highly effective results. The effect of Oncoplex is attributable to the Plex technology's unique mechanism of action that allows constant and prolonged release of the therapeutic chemotherapeutic drug, docetaxel. The locality, combined with the prolonged and constant release rate, can promote deep penetration of the drug into the tumor with minimal systemic exposure to the chemotherapeutic agent. The intratumoral injection of the Plex platform could enable it to be used as an interventional oncology treatment, not only with docethexel, but also with additional chemotherapeutics or other types of molecules, such as antibodies, D-specifics, and nucleic acid. Shifting gears. We were pleased to recently significantly modify our balance sheet by successfully closing a private placement financing, or PIPE, for $16 million of gross proceeds. The PIPE syndicate was comprised of new and existing investors, including participation from U.S. life science-focused investors, Daphna Capital Management and Rosling Advisor. Due to the PIPE, the investor purchase $3,371,312 of the company's ordinary share, or pre-funded warrants in lieu thereof, at a purchase price of $4.81 per share for gross proceeds of $16 million and received warrants to purchase up to the same amount of shares of common stock with an exercise price a $5.5 per share for an overall exercise price of $19 million. The warrants expired upon the earlier of two years from the date of issuance and 10 trading days following PolyPID's announcement of a positive recommendation by the Data Safety Monitor Board regarding the company's unblinded interim analysis in its SHIELD II Phase III trials. of DPLEX 100, resulting in the stopping of the trial due to positive efficacy. The initial $16 million extended our cash one way until late in the third quarters of 2024 and behind the anticipated timing of SHIELD 2's planned unblinded interim analysis. If the results of the unblinded interim analysis are positive and all warrants issued in the financing are exercised, the additional $19 million would fund PolyPIT to the start of a planned new drug application submission for DPLEX-100. I'd like to take the opportunity to thank all of the investors who participated in this financing for their confidence and support. With that, it is my pleasure to turn the call over to Johnny. Johnny?
spk05: Thank you, Nicola. As of December 31st, the company had cash and short-term deposits of $5.3 million as compared to $12.6 million at the end of 2022. This does not include the net proceeds of approximately $15 million generated from the pipe financing closed in January 2024. As Dikla noted, that our pro forma cash balance will be sufficient to fund operations into late third quarter 2024. Now, let's turn to our income statement. Research and development expenses for the three months ended December 31st, 2023 were $4.6 million compared to $4.7 million in the same three-month period of 2022. R&D expenses in the most recently completed fourth quarter were driven by the ramp-up of the ongoing SHIELD II Phase III trial. For the full year ended December 31, 2023 and 2022, R&D expenses were $16.1 million and $28 million, respectively. Marketing and business development expenses for the fourth quarter of 2023 were $193,000 compared to $350,000 during the prior year period. General and administrative expenses for the fourth quarter of 2023 were $1.2 million compared to $1.6 million recorded in the same three-month period of 2022. For the fourth quarter of 2023, the company had a net loss of $6.4 million as compared to $6.6 million in the fourth quarter of 2022. For calendar year 2023, the company had a net loss of $23.9 million compared to a loss of $39.6 million in the full year 2022. Finally, we continue to execute well on our cost containment initiatives. As such, our net cash use in operating activities for full year 2023 decreased by $17 million as compared to calendar year 2022, from $34.3 million to $17.3 million. With that, we will now open the call to your questions. Operator?
spk00: Thank you. As a reminder, to ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. We will take our first question. And your first question comes from the line of Roy Buchanan from JMP. Please go ahead. Your line is open.
spk06: Hey, great. Thanks for taking the questions. First, I had a couple on the SHIELD2 interim. Just can you remind us the powering of the interim for a successful efficacy outcome, i.e., stopping the trial early for efficacy? And then what is the alpha spend for the interim?
spk02: So first of all, good morning, and thank you for the call. The alpha depends on the final on the overall number in general, in order to get to an early stop the power for the interim itself in order that the committee will tell us that we should stop the trial for robust data. The alpha should be zero point zero one. Um, the overall the, the penalty of the alpha depends on the. overall size of the trial. So if we are sent to 600 or whether we are sent to 800, the alpha will be different because it gives you an earlier sort of look into the data. I can tell you that at the end of the day in Shield 1, the alpha on the interim was very, very minimal. We had the interim on 750. If I recall, and overall 1000 patient, and it was very minimal. And the power is 90%.
spk06: Okay, great. And then just to be clear on the potential warrant exercise, again, for the interim success is considered to be. a recommendation to continue the trial unchanged, correct? You don't need to stop early for efficacy to be considered a success.
spk02: So the 10-day period is only in effect if the study is stopped for positive data. The overall, at the time, we will have around a year plus for the warrant is that the rest, all other scenarios.
spk06: Okay, got it. Thank you. And then just on the pipeline, can you just discuss a bit the, I guess, partnering outlook or progress for the Plex technology outside of D-Plex 100? And then just what other development activities do you have planned for this year? Thanks.
spk02: Sure, sure. So we are continuing and also initiating some additional discussions around the platform. Part of the On complex new data that we published today. Or referred to today is part of. Input that we're getting from from some of those discussions, so understanding. Um, what should be the next step or what partners would want to see. In terms of potential efficacy of the product helps our. Research and development to direct the. the internal development, obviously, and some of these animal data are part of our understanding from discussion. And we are continuing robustly to discuss both the potential future collaboration of DPLEX as well as platform-related collaboration. And within that, we conclude on COMPLEX. Obviously, the timing of the maturity of this discussion is something that we cannot predict and cannot discuss, but we are very pleased with the kind of companies that are discussing with us. The level of the company that are discussing and showing interest in our approach is encouraging.
spk01: Okay. Thanks for taking the questions.
spk00: Thank you, Roy. Thank you. We will take our next question. Your next question comes from the line of Balaji Prasad from Barkers. Please go ahead. Your line is open.
spk04: Hi, good morning. This is Xiao Ang for Balaji. Thanks for taking our question. I'm wondering if it is possible for you to provide an update on the number of patients who have completed their 30-day follow-up at this time? Thank you.
spk02: Sure. So first of all, good morning, Sean. Thank you for your question. We recently announced that we recruited the 100 patients. And if you noticed in our, in today's press release, we've already indicated that we have more than 100 patients, although only a few days have passed. I think two or three days, so things are progressing and we started to see, we obviously had the. Some slow down around the end of the year, beginning of the year due to the holidays and the winter break. But we do start to see the similar trend that we saw in shield one of ramping up most of the patient that, um. finished the follow-up. Most of the 100 patients finished their 31 days follow-up. We did not go into specific numbers, but I can tell you that we expect to see recruitment, if we're looking at the next quarter, significantly ramping up, both in terms of having sent additional centers open And some of the centers that were open but only recently started to recruit patients, at most of the 100 have finalized their 30 days.
spk04: Called it very helpful. Thank you.
spk00: Thank you. Thank you. Once again, if you wish to ask a question, please press star 1 and 1 on your telephone. We will take our next question. Your next question comes from the line of Bublan Peshe Yapin from HC Wainwright. Please go ahead. Your line is open. Good morning, Tim.
spk01: Thanks for taking my questions. So a couple of this from our side. First, as we think about commercial batch production, so I'm curious how the expected COGS of D-Plex 100 compared to other platform technologies involving polymers or lipids attached to small molecules.
spk02: So as we see things now and for a long time, you know, because we've built our own manufacture facility and we have full control on the manufacturing, we actually just a few months ago cast a GMP review by the ministry, Israeli Ministry of Health, that is also applicable for the European authority for the commercial stage. So our facility is now approved for GMP commercial stage. And we have all the indication that the COGS will be less than 5%. Again, it's a bit early to be very specific because we do not know exactly the final price of the product, the selling price of the product. but all indication shows that the COGS should be less than 5% of this.
spk01: Great. Thanks for the clarity. And then you mentioned about positive preclinical data in melanoma and colon carcinoma animal models. So I'm just curious, can you discuss the rationale behind choosing these tumor indications and also potential commercial opportunities associated with D-Flex 100.
spk02: So it's not that these are the... That we are pursuing for clinical, but the idea was to look at, because this is an intratumoral approach, we are injecting our oncoplex directly into the tumor And the chemotherapy is released within the tumor environment for three weeks. The idea was here to look at models that have fast-growing cells and look at the approach, the local approach, the prolonged local approach in the tumor and see the effect. And we were very pleased with the result. They repeated also the similar results that we saw. as an adjuvant. This was a neoadjuvant approach. We saw similar effect as an adjuvant that is applied into the tumor bed post resection, also in animal models. So the idea was here to expand our preclinical data into a neoadjuvant approach in a fast-growing cells model. All right. Thank you so much for taking our questions. Thank you. Thank you. Good day. Thank you.
spk00: There seems to be no further questions. I would like to hand back for closing remarks.
spk02: Thank you for joining Polypeet's fourth quarter and year-end 2023 earning conference call. We remain highly confident in our long-term prospects, especially the potential of our promising late-stage product candidate, DIPLEX 100. As always, we are grateful to our team members, existing and new shareholders, and all our external partners for their commitment to our mission and their support in continuing to advance towards our goal of bringing DPLEX 100 to healthcare providers and patients as quickly as possible. We look forward to speaking with you again on our next conference call.
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