Qualigen Therapeutics, Inc.

Good day, and welcome to the Qualigin Therapeutics Business Update Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Yvonne Briggs. Please go ahead.

Thank you, Operator, and good afternoon. This is Yvonne Briggs with LHA. Thank you all for joining Qualigent Therapeutics Business Update Conference Call. Before we begin, I'd like to remind listeners that comments made during this call by management will include forward-looking statements within the meaning of federal securities laws. These forward-looking statements involve risks and uncertainties that could cause actual results to be materially different from any anticipated results. For a list and description of risks and uncertainties, please review Qualigin's filings with the SEC. Importantly, this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast today, August 18, 2020. Except as required by law, Qualigin undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. Joining me today from Qualigen are Michael Poirier, President and CEO and Chairman, and Chris Watts, the company's Chief Financial Officer. During today's call, management will provide an overview of the company's development programs and future milestones and its recent financial results. At the conclusion of the prepared remarks, we'll open the call to questions. With that, let me turn the call over to Michael Poirier. Michael?

Good afternoon, everyone, and thank you for joining the call today. Since completing our reverse merger almost three months ago, it's been an exciting and productive time for the company. We expanded our therapeutics pipeline by signing two more exclusive licensing agreements with the University of Louisville for cancer and antiviral drug candidates, developed and then initiated shipments of our COVID-19 antibody test on our FastPak Pro system, and raised an additional $18 million of capital all of which we will review shortly. As this is our first conference call as a public company, and my first as a public company CEO, let me begin by welcoming our new shareholders and providing some background on Qualigen Therapeutics. I founded Qualigen over 20 years ago with the first commercialized product being the FastPak Rapid Diagnostic System. FastPak provides rapid and accurate point of care testing with an assay menu of nine tests, including tests for prostate cancer, thyroid function, metabolic disorders, and research applications for physician offices, clinics, and small hospitals worldwide. Since launch, we have sold more than $100 million worth of FastPak systems in test pouches. We see these historic sales to be a good indicator that the Qualigen team knows how to develop and manufacture medical products, how to get them approved through the FDA, and how to bring them to market worldwide. Diagnostics is a highly competitive market with a challenging reimbursement environment. As a result, a few years ago, we accelerated our focus on therapeutics, which included our decision and recent completion of our GO public strategy. I am pleased to say we now have a robust pipeline of product candidates, drug candidates that we look forward to advancing through clinical development and a materially stronger balance sheet to see this through. So let's talk about Qualigens technology. Our lead drug candidate, AS1411, is a DNA aptamer, which is the basis of separate programs against cancer and against viral diseases such as COVID-19. AS1411 targets and binds to a protein called nucleolin. This protein is expressed on the surface of cancer cells and enables AS1411 to selectively target these cells without damaging normal cells. In addition, nucleolin is believed to play a role in how viruses attack and utilize cells for replication. With the onset of the pandemic, researchers at the University of Louisville conducted in vitro studies at their prestigious Center for Infectious Disease to evaluate AS1411's effects on COVID-19. These studies demonstrated AS1411's ability to protect cells from the damaging effects of the coronavirus by binding the nucleolin protein. Subsequently, in June, we signed an exclusive license agreement with the university for the U.S. patent rights covering the treatment of COVID-19 with AS1411. We are aiming to commence a phase one slash phase two human trial early next year. Although the first indication we are pursuing is for the treatment of COVID-19, we believe AS1411 has the ability to be effective as a broader antiviral therapeutic. since other viruses, such as HIV, hepatitis, and Ebola, also utilize nucleolin. While we're still in the preclinical stage, we know AS1411 is safe in humans, as it has been administered in Phase I and Phase II trials to more than 100 patients with advanced cancers, where it was well-tolerated with no evidence of severe side effects. In addition, the data demonstrated clinical responses in several of the patients, where their cancers disappeared or tumors shrank substantially. These trials were conducted 10 years ago by a different British company that decided to change its strategic direction and their rights to the compound reverted to advanced cancer therapeutics in the U.S. In 2018, Qualigen obtained exclusive worldwide rights to AS1411, as well as assignment of the original cancer IND from advanced cancer therapeutics. The early promising but incomplete results of AS1411 in cancer trials led to our cancer drug candidate, ALLEN, which stands for aptamer-linked antimucleoli. ALLEN is a combination of AS1411 plus a gold nanoparticle using a coding process that we have been doing successfully for almost two decades within our fast-pack assay test pouches. This combination dramatically increases its potency, and we believe its efficacy with the potential to target and destroy tumor cells in a wide variety of cancer types, including leukemia, kidney, pancreatic, brain, and breast, as well as other applications such as enhancing radiation therapy and aiding in tumor scanning. The gold nanoparticles increase potency by extending the life of time the drug remains in the body. And I am glad to say that although it might seem that gold would make the product very expensive to produce, In fact, the small size of the nanoparticles means this would not be the case. We have an exclusive worldwide license agreement from the University of Louisville for Allen, and we have been working with them to advance this program. We plan to conduct IMD enabling studies against acute myeloid leukemia toward the end of this year and expect to be able to commence phase one human trials in calendar 2021. In July, we announced the signing of another exclusive license agreement with the University of Louisville, this one for the intellectual property covering the RasF family of Ras oncogene protein-protein interaction inhibitor small molecule candidates. Ras genes produce proteins that regulate when and where the body produces new cells. Problems occur when these genes become mutated. and the resulting new RAS proteins cannot switch in the off position. These mutations are present in approximately one-third of all cancers, including a high percentage of pancreatic, colorectal, and lung cancers. Current therapies only target downstream signaling of RAS, but blocking one or two pathways does not provide effective clinical activity because RAS acts like a hub for multiple pathways. The intended mechanism of action of our Ras-F small molecule compound instead blocks the binding of mutated Ras protein for their effective proteins upstream and stops them from causing further harm. Our plan is to evaluate these compounds in order to identify a lead drug candidate for further development against one or more cancers. We expect to begin preclinical IND enabling studies in calendar 2021. As I mentioned, we have quite a few ongoing development programs with the University of Louisville. We believe the university is an extremely valuable partner to advance these programs due to their expertise, resources, and ability to conduct clinical studies in a cost-effective manner. We are fortunate to be in a position to partner with them on so many programs. We are also seeking other strategic partnerships to advance clinical development of our promising drug candidates and will always seek opportunities to strategically build our portfolio. Let me point out that all these drug candidates, AS1411, Allen, and the RAS inhibitor, can be considered platform technologies. They all have multiple uses for different types of cancers, and in the instance of AS1411, also infectious diseases. We believe this aspect increases the chance of success in clinical trials when looked at in the aggregate. Further, we believe the potential markets for each of these drug candidates could be very large if we're able to bring them through commercialization. While we cannot guarantee these results, and while everyone knows how difficult and slow the drug development process in the United States is, we are optimistic of our future in therapeutic drug development. In addition to our drug candidates, our therapeutics pipeline also includes our SARS blood cleansing system. STARS, which stands for Selective Target Antigen Removal System, is a blood filtration device product candidate rather than a drug candidate. With STARS, we would aim to utilize DNA aptamers in our core commercialized fast-pack particle coding technology to remove tumor-produced compounds and viruses from a patient's blood. In June, we received a notice of allowance for another patent covering the STARS technology. which utilizes a filtration cartridge designed for use in a standard dialysis machine and contains aptamer-coated microparticles that bind to specific agents in circulating blood for targeted removal. I am pleased to report that this new patent issued today. Proof of concept for SARS has been established with in vitro testing, and this program is in the early stages of development. With respect to our diagnostics business, As I mentioned, we have been commercializing the FastPak system for almost 20 years. Except to a limited number of direct customers, we sell FastPak to our distributor, Sekisui Diagnostics. Sekisui has been a supportive partner of ours since 2016 and also holds over 9% of our outstanding common stock. Sekisui serves as our exclusive distributor for FastPak worldwide, except in China. until May of 2022. Therefore, they are key to the amount and pace of products we sell. In addition, we are working to assist distribution through lead generation and marketing. For instance, last month, Mike Haynes, a Pro Football Hall of Fame and College Football Hall of Fame inductee, signed with Qualigen as an advisor and spokesman for the FastPak system. One of the tests run on the FastPak system is for PSA, which, as you know, is a marker for prostate cancer. Mike received an elevated PSA result using a fast-pack test at a 2008 Hall of Fame event sponsored by Qualigen and the American Urological Association and was subsequently diagnosed with prostate cancer. He underwent treatment and made a full recovery. Ever since then, Mike has been a prominent advocate for prostate cancer testing, and he often tells people that the fast-pack testing system saved his life. We look forward to working with Mike on our outreach efforts and sponsorship opportunities with the NFL and other professional sports organizations for the FastPak system. In June, we submitted to the FDA for Emergency Use Authorization, or EUA, for our COVID-19 antibody test on our FastPak Pro system, which is an upgraded version of FastPak meant to run more complex tests. Subsequently, we submitted an official notification to the FDA of our plan to commence sales while the EUA is pending. We are allowed to do this, and we are confident that the FDA will grant the emergency use authorization request for this product. Limited shipments of our FastPak Pro with our COVID-19 antibody test commenced at the end of last month, and we are working to install full-scale manufacturing of our new FastPak Pro analyzers. In addition to our own validation studies, the University of Louisville has begun conducting independent validation studies with hundreds of patient samples using our COVID-19 antibody test on the FastPak Pro system. These validation studies are expected to continue for several months as a range of patient types in various stages of the disease will be examined. Over the next few months, we expect to increase production capacity with the goal of having analyzers and test kits positioned to assist in the fight against the novel coronavirus. We believe these testing resources are needed, especially as the pandemic enters the vaccine stage, where drug supplies will likely need to be rationed and an accurate antibody test would be most useful. Please understand that our FastPak Pro COVID-19 antibody test, like all our tests in the FastPak family, are blood tests, not swab tests, and need to be administered by a credentialed healthcare professional. FastPak provides rapid results in the case of the COVID-19 antibody in about 10 minutes. Our analyzer processes one test at a time, not dozens of tests simultaneously as in large laboratory settings. Large reference laboratories, of course, cannot give results to the patient in 10 minutes at the point of care. The potential market for our product is quite large. However, it will take time to ramp up production and place our analyzers in optimal settings for its unique characteristics. We want our shareholders to view our COVID-19 antibody test as just one of many areas where Qualigen seeks to make a difference in people's health and lives. Along these lines, in an effort to continue to expand our test menu for FastPak Pro, we will be offering another test, cellular fibronectin, or CFN for short, which is a new stroke assessment test developed as a companion diagnostic for Prediction Sciences LLC. This test is expected to attain CE mark in the next month or two for commercialization in Europe and other geographies that recognize CE mark. Even with that news and progress with the FastPak system, I'd like to be clear that Qualigent is primarily a therapeutics company. The bulk of our resources are being invested in therapeutic product candidates, because that is where we see the maximum potential return, the largest market opportunities, and the best path to creating value for our stockholders. The foundation of this company over the years has been diagnostics, which is clearly a very important and scrutinized area right now. Our future, however, is in developing drugs and other technologies that may one day cure or defeat cancer and infectious diseases. With that brief overview, let me turn the call over to Christopher Watts for a discussion of the company's financials. Chris?