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spk02: Good morning, everyone, and thank you for joining today's VBL Therapeutics Second Quarter 2021 Financial Results and Corporate Updates. Leading the call will be Professor Dror Haras, Chief Executive Officer, and Amos Ron, Chief Financial Officer. A press release of the company's financial results was issued earlier this morning and is available on the Investor Relations page of the company's website at vblrx.com. Before turning the call over to management, I would like to remind everyone that during this conference call, Forward-looking statements made by management are intended to fall within the Safe Harbor Provisions Act of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934 as amended. As set forth in our press release, forward-looking statements involve risks and uncertainties that may affect the company's business and prospects, including those discussed in our filings with the SEC, which include, among other things, our annual report on Form 20F. These filings are available from the SEC or on our website. Any forward-looking statements made on today's conference call speak only as of today's date, Monday, August 16, 2021, and the company does not intend to update any of these forward-looking statements to reflect events or circumstances that occur after today's date. As a reminder, this call is being recorded and will be available for audio rebroadcast on the company's website. There will be a Q&A session following the company's prepared remarks. With that, I'd like to turn the call over to Professor Harath. Please go ahead.
spk00: Thank you, Eric, and good morning, everyone. Joining me on today's call is Amos Ron, our chief financial officer, who will discuss the second quarter financial results for 2021. We continue to make progress in our Oval Clinical Trial, a registration-enabling phase three study of VB111 in ovarian cancer. The most significant event of the second quarter was the overall protocol change agreed upon with the US FDA. Progression-free survival was added as a primary endpoint to the original overall survival endpoint. Successfully meeting either endpoint is expected to be sufficient to support a BLA submission. The details of the change were described in a presentation at this year's ASCO Annual Meeting in early June and the accompanying press release. Successful meeting of the progression-free survival endpoint with the readout anticipated in the second half 2022 has the potential to accelerate the BLA submission by approximately one year compared to original projections based on the readout of the overall survival primary endpoint, which remains anticipated in 2023. In addition to potentially shortening the time for the anticipated BLA submission, the protocol changes have several positive implications for the Oval Trial and VP111's potential use as a treatment for platinum resistant ovarian cancer. First, including a second independent endpoint, de-risks the trial, as we now have two shots on goal to obtain a result that will enable us to submit a BLA. Second, keeping the overall survival endpoint preserved the opportunity to differentiate VB111 from currently available ovarian cancer treatments, which were approved based on progression-free survival data so far, and did not show an overall survival benefit. As part of our discussion with the U.S. FDA's CMC, the Chemistry Manufacturing and Controls Group, it was agreed that VBL would provide additional data and documentation on new batches to be used in the oval study in the U.S. We submitted all requested material to the agency in early August. and the CMC group is evaluating the data we sent them. At this point, we do not have an estimated timetable on when we will hear back from the agency regarding their review. In the meantime, we took a precautionary step to reserve supply of FDA-approved batches of VB111 for U.S. patients who are being actively treated in the oval study And in June, we voluntarily paused enrollment of new U.S. patients. Existing patients enrolled in the U.S. continue on protocol, and enrollment continues in Europe, Israel, and Japan. Despite the temporary pause in U.S. enrollment, we maintain our expectations with respect to the timing of the PFS data readout in the second half of 2022. Our next milestone for Oval is the upcoming DSMC review expected this quarter. This time, it will include review of 75% of the study population. That is about 300 patients. To date, we have had three successful DSMC reviews of the study. The most recent one was in February of this year. Following the review, which looked at 200 patients, the DSMC again gave us a green light to proceed as planned. In the second quarter, we also significantly strengthened our cash position. Earlier in the quarter, we closed a public equity offering at market price to raise net proceeds of $26.4 million from existing shareholders as well as institutional funds from the U.S. and Israel. Together with the additional of $12.3 million that was injected into the company during the first quarter, mostly through the existing of warrants that were issued in 2020, we now have more than $57 million on hand. These funds are expected to cover the company until the year end 2023, which is beyond clinical readout in Oval and the potential BLA submission of the VB111 in ovarian cancer. As VBL prepares for success and potential commercialization of VB111, we had a few changes to our board of directors. We are happy to welcome Alison Finger and Michael Rice to our board. Alison was previously the chief commercial officer at Bluebird Bio and has extensive experience in global product commercialization, including commercialization of gene and cell therapy products at Bluebird. Michael's experience in healthcare capital markets will be critical to VBL as we approach the disclosure of top-line data from Oval and as we plan to execute our strategic and operational objectives in bringing VB111 to patients. Finally, our planned succession for the chairmanship of our board was recently completed. Mark Ozin, who joined our board as vice chairman last October, is now our chairman. Dr. Bennett Shapiro stepped down as a chairman but will continue to contribute to VBL as a member of our board. Before I hand the call over to our Chief Financial Officer Amos Rohn, I would like to say that we have continued our momentum from 2020 into the first half of 2021 and are optimistic about the second half of this year. We are encouraged by the significant investments of VB111 and I look forward to sharing updates on our ongoing programs through the rest of the year. With that, I will hand off the call to Amos, who will discuss the financial results for the second quarter. Thank you.
spk06: Thank you, George, and good morning, everyone. As of June 30, 2021, we had cash, cash equivalents, short-term bank deposits, and restricted bank deposits totaling $57.2 million. and working capital of $49.2 million. We expect that our cash and cash equivalent and short-term bank deposits will be sufficient to fund operating expenses and capital expenditure requirements until year-end 2023. Revenues for the second quarter were $188,000 as compared to $158,000 for the comparable period in 2020. R&D expenses net was $6.6 million for the fiscal year compared to $4.7 million in the same period in 2020. General and administrative expenses was $1.5 million for the second quarter compared to $1.3 million in the same period in 2020. And finally, comprehensive loss for the second quarter was $8 million or 12 cents per basic share compared to $5.8 million or 14 cents per basic share in the comparable period in 2020. With that, I will return the call back to the operator for the Q&A portion of this morning call. Thank you.
spk03: Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the queue. You may press star 2 if you would like to remove your line from the queue. And for participants using speaker equipment, it may be necessary to pick up the handset before pressing the start keys. Our first question is from with Guggenheim. Please proceed.
spk01: Great. Thanks for taking questions. Just a couple on sort of VB111. I guess the first is, does the precautionary pause of US patients, does that change the nature of the update in the third quarter by the DSM-B And I guess, similarly, with respect to sort of the investigator glioblastoma trial, if there's sort of any impact on that study sort of, you know, concerning sort of the batches for that study. Thanks.
spk00: Thank you, Hector. Actually, the post that we were voluntarily took not to recruit researchers new patient in the United States, or not to screen for a new patient in the United States. It was done mainly because we know that there are patients on the trial right now using the batches that are already approved by the FDA for this study, and we don't want to be in a position that the patient is responding to VB111, and we know that some patients are actually staying on the drug for quite a long time, and we will be in a position that we won't have a supply to give to these patients. And therefore, we voluntarily took this step. But this step is not going to affect the DSMC review, because the DSMC review was a cutting point date that was not affected at all by this. And if any, just when we announced to the centers that we are going to stop screening, you can imagine that they had a list of patients that they wanted to recruit to the trial, and they actually recruited quite significant amount of patients. The review is going to be done of a bit over 300 patients, which is about 75% of the patient population of the trial. Regarding the other two trials that we are running, the one that we are running with the NCI in colon cancer is not affected in any way by this event because they have enough supply for what they need for the trial. But in the GBM trial, we're also not screening for new patients because we just were in a position that we were about to open more centers, and we didn't want to open them before we know that we have the batches approved to go. Now, the drug is already in the U.S. waiting for the final approval from the CMC, and the moment that we will get it, we will be able to open back both recruitment for the OVAL and for the GBM trial.
spk01: Great. Thank you.
spk03: Our next question is from Kevin with Oppenheimer. Please proceed.
spk04: Hi. Good morning. This is Susan on for Kevin. Just a couple of questions. First, just a modeling question. Is the step-up in R&D expected to last for the rest of the years, you know, 6.6 million new baseline?
spk00: Can you repeat the question? We couldn't hear you well.
spk04: Sorry, let me try again. Is the R&D spent for this quarter the new baseline for the remainder of the year?
spk00: Is that clear?
spk06: Are you referring to the increase in R&D expenses for the quarter? Yes. Okay, so we do not expect the current or this quarter burn rate to continue for the full year. We expect to be in line with our average of about $2 million or a little less per month. rate on the year and the total R&D expenses for the year will be a bit higher than last year because we are advancing the VB601 and the overall study is gearing up but not in the portion that was evident this quarter.
spk04: A follow-up question on VB111 enrollment. So I think in June you guys had enrolled 300 patients. Can you provide an update on the number of patients enrolled?
spk00: We don't provide it on a regular basis. Usually we provide it when we get to significant numbers. So I would prefer not to say the number right now, but we keep on progressing, of course. We are not screening now in the U.S., so the pace is a bit slower, but we believe that we can actually, if things will work well with CMC, we will be able to meet the timeline of finished recruiting by year end or beginning of next year.
spk04: Great. Thank you. And just one last question. Did the FDA provide any guidance on the review process? And my follow-up to that is, is there any kind of on-site inspection that might delay timelines?
spk00: No, we don't expect any on-site inspection. You know that usually the on-site inspection is coming when you submit a BLA. Of course, the FDA wanted to know a lot of information In our case, before we submit the BLA, and I believe that one of the reasons is because we were shortening the time for potential BLA, but it's all done in data that we are sending them and documentation. There is no on-site visit. The FDA actually guided us quite thoroughly on what exactly they need to to see in these status that we are sending them and we believe that we send them all this information at the beginning of the month. We know that they are working on it right now and reviewing it and we've been assured that they will come back to us the moment that they will review this data.
spk04: Thank you. That's all the questions from us.
spk00: Thank you very much.
spk03: Our next question is from RK with HC Wainwright, please proceed.
spk05: Thank you. Good afternoon, Rohr and Ramos. Regarding, you know, the precautionary pause that you're taking in the U.S. sites in terms of enrollment, do you, you know, what commentary do you have on you know, if there is a potential impact on the statistics or in the population mix when you get to the final analysis of the oval study?
spk00: I don't think, that's a very good question, but I don't think that it will have an effect on either the statistics or the oval population. When we took this step, we already had the majority of patients coming from the U.S., so there won't be an issue of where the majority of patients are coming from because you know that that's part of the thing that the FDA will want to see, and they know that the majority of patients are coming from the U.S. anyway. The second thing is that there is no real big change in the pace of recruitment because just before this post, As I was saying before, we had quite significant amount of patients that were screened. So our plan was all of the time, our statistical plan was all the time assuming that we will be fully recruited by first quarter 2022. And because we knew that we are recruiting better than anticipated, we were saying year end. So I don't think it would change any of the statistic or it would change any of the mix of population that we will have.
spk05: Thank you for that. And then for the people that you're already recruited in the U.S., is the shelf life of the drug long enough in case some of these patients need to stay on the drug for longer than anticipated.
spk00: Shelf life that we have for VB111 now, if I recall right, is about five years. That's a very long shelf life, and we don't have any issue. I believe it was four and a half, and we are extending it right now, but we have no issue with shelf life. And by the way, we have no issue with production. We are making more batches, and some of the batches will be already for the commercial. and the badges all look very well. So it was only the issue of showing that the new facility and the release lab are actually comparable to what was done in the other site.
spk05: Thank you for that. My last question is, any commentary on the colorectal cancer and the recurrent GBM studies? in terms of the progress and also any update on the timelines at all in terms of data expectations.
spk00: So the colon cancer is a continue as planned. And as you all know, we agreed with the National Cancer Institute doctors that we will actually look at the biopsies to see if indeed we are turning the cold tumor of the colon into a hot tumor and meaning that we have inflammation there and a lot of CD4 and CD8 cells. For that, we need enough biopsies where the patients are on VB111 alone and when they are on combined therapy. As you can imagine, patients that are going on trial like this at NCI are quite advanced in their disease, and we are collecting enough patients and enough biopsies for that. And the moment that we will have it and that we will have data on the histology, of course, we will share it with the market. The point that the study is ongoing and the point that it takes time, I don't think that that's a bad signal, but I don't have more information about that. Regarding the GBM trial, some centers are open, some centers are ready to open, but again, for the sake of the patients that are on the oval trial, We didn't want to use any of the material that is already approved by the agency to use in the U.S. for clinical trials, for any trial except for the patients that are on the oval trial and getting VB111, because there are a significant amount of patients that are actually on the drug, and we have to make sure that we have enough supply for them.
spk05: Thank you. Thanks for taking my questions, Joe. Talk to you soon.
spk00: Thank you.
spk03: As a reminder, this is Star 1 on your telephone keypad if you would like to ask a question. Our next question is from Sumit Roy with Jones Trading. Please proceed.
spk07: Hi, everyone. Congrats on the progress. If you could just give us a little... color on what percent of patients are from the U.S. versus ex-U.S. and how many sites U.S. versus ex-U.S. And second is if you have any idea on what the patients are, what kind of treatment they would undergo post relapse, and if there is a possibility of redosing a stable patient, if that's mechanistically it makes sense. Thank you.
spk00: Yes, so thank you Sumit for the question. In the US, we do have over 200 patients out of these 300 patients. So the majority are coming from the US. There is no question about it. There are about 64 sites in the U.S. alone, so we are talking about majority of sites coming from the U.S., as can you imagine. We also have a significant number of sites in Israel, in Japan, and in Europe, but the study was planned from the beginning to have the majority of patients from the U.S. What was your second question?
spk07: does it make sense mechanistically to be able to redose these patients for stable disease patients, or that's not something you, you know, because of vector or antibody development won't allow?
spk00: No, no. Actually, the antibodies does not prevent the drug from working because it takes about a few cycles of the drug in the blood to get into the endothelial cells, and they just stay actually quite protected and the gene is there for a very long period of time and we showed it both in animal models and in human beings when we had a chance to biopsy it from tumors. The expression of the drug is quite significant for a long period of time and we could see responses in recurrent dosing. So there is no question that you can give it in recurrent dosing and actually that's why we are treating the patient every eight weeks until progression and we allow in the oval trial to actually treat beyond progression until we are sure that this is real progression and not a pseudo progression. And in the colon study, we giving the drug every six weeks, not every eight weeks. So we are giving the drug in as a repeated dosing until the patient progressed. When they progressed, theoretically I think that what should be given is checkpoint inhibitors because maybe one of the reasons theoretically that the patient will progress is that we induced the immune system there or brought it there, but then the checkpoint inhibition by the tumor is start working. But we cannot control it because it's not part of the trial of the oval trial. It is part of the colon study at NCI where we combined it with checkpoint inhibitors. So if you ask me what the doctors do and the patient progress, As far as I know, they go on chemotherapy. They try to put them sometime radiation, but there is no real treatment for a platinum-resistant ovarian cancer.
spk07: Got it. Thank you so much, and congrats on the progress.
spk00: Thank you very much.
spk03: Thank you. This does conclude our question and answer session. I would like to turn the conference back over to the BBL team for closing comments.
spk00: So thank you all for joining us on today's call and have a wonderful day. Thank you.
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