Cyclacel Pharmaceuticals Inc (CYCC) 2014 Q4 法說會逐字稿

Good afternoon and welcome to the Cyclacel Pharmaceuticals fourth-quarter and full-year 2014 earnings conference call and webcast. Today's call is being recorded. (Operator Instructions) It is now my pleasure to turn the floor over to Bill Harris, Cyclacel's Corporate Controller. Sir, you may begin.

Thank you. Good afternoon and welcome to our quarterly conference call. During today's call, members of our senior management team will review Cyclacel's financial performance and business highlights for the fourth quarter and full year ended December 31, 2014.

Before turning the call over to senior management, I would like to remind everyone that during this conference call, any forward-looking statements made by management are intended to fall within the Safe Harbor provision 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 Form 10-K. These filings are available from the SEC or our website. All of our projections and other forward-looking statements represent our judgment as of today, and Cyclacel does not take any responsibility to update such information.

With us today are Spiro Rombotis, President and Chief Executive Officer; Paul McBarron, Executive Vice President, Finance and Chief Operating Officer; and Dr. Judy Chiao, Vice President of Clinical Development and Regulatory Affairs.

At this time I would like to turn the call over to Spiro Rombotis, our President and CEO.

Thank you, Bill, and good afternoon. 2014 has been a defining year for Cyclacel and for those patients and clinical investigators involved in our Phase 3 SEAMLESS study, as we completed enrollment in what is one of the largest trials in this patient population.

We would like to take this opportunity to thank patients, investigators and all those involved across the approximately 110 clinical trial sites in the US and Europe. I'll provide more details on this study later in my remarks.

We will also discuss today the progress of our cyclin-dependent kinase, or CDK, inhibitor program and particularly CYC065, our second-generation CDK inhibitor candidate, which is approaching an investigational new drug or IND submission. Firstly, let us review our SEAMLESS study which, as you will recall, is a Phase 3 study of oral sapacitabine as a front-line treatment in elderly patients with acute myeloid leukemia, or AML, who have refused or are not suitable for intensive chemotherapy.

The trial was sized for approximately 485 patients and was powered at 90% to detect an improvement of survival against an active control of intravenous decitabine. We achieved this significant milestone last December with the completion of patient enrollment in the study.

Also in December, the fourth independent Data and Safety Monitoring Board, or DSMB, safety review occurred, and they again determined that there were no safety concerns. After an interim analysis for futility, following observation of approximately half of the required events, the DSMB determined that the planned futility boundary has been crossed and that based on available interim data, it would be unlikely for the study to reach statistically significant improvement in survival.

However, the DSMB recommended that the trial should continue. In particular, they saw no reason why patients should discontinue treatment on their assigned arm and recommended that recruited patients stay on treatment. We remain blinded until data becomes available for final analysis.

Based on the DSMB's communication, we know that the interim analysis for futility was primarily driven by the deaths within the first six months of patients entering into the trial. Of the 247 events or deaths reviewed by the DSMB, 173 or 70% occurred within the first six months of the study. This means that the survival curves beyond six months are poorly estimated at the time of the review.

Furthermore, follow-up of European patients is much shorter than that of US patients because the study opened for European accrual in April 2014, and most European patients were recruited in the second half of 2014. It is important to have complete follow-up of all patients to ensure that a potential treatment effect beyond six months is not missed.

Such an effect at the tail of the survival curves requires that all patients are followed up, and that is what the DSMB recommended. After consulting with experts, we consider that absence of early benefit does not include emergence of a late benefit with longer follow-up. We will, therefore, follow up patients as recommended by the DSMB until the prespecified number of events occurs.

At present, approximately 28% of the prespecified events remain to be observed before data lockup and mature data becomes available for analysis. As the enrollment in SEAMLESS increased sharply in the third and final year of the study, it is difficult to make reliable estimates of when data maturity will be reached. At this point, we restate our estimation of announcing top-line data between the second half of 2015 and the first half of 2016.

Let us now briefly turn to regulatory matters. The decision to submit a dossier for regulatory approval will depend on the totality of the data. We consider that the case for submissibility will depend on an outcome of either superiority or equivalents versus decitabine that is clinically relevant.

Of particular relevance may be the case of decitabine's European approval as a front-line treatment for AML in a similar population, despite the fact that its Phase 3 trial called DACO-016 did not meet the primary endpoints of superiority versus chemotherapy.

Speaking about Europe, the European Medicines Agency, or EMA, requires sponsors to agree a pediatric investigation plan before a marketing authorization application, or MAA, can be accepted or validated by EMA. In light of the long leadtimes required, we plan to submit such a pediatric plan ahead of any MAA submission.

Currently available treatment options for elderly AML patients are either hospice care or nearly 50-year-old intensive chemotherapy, which is difficult for such patients to tolerate. AML patients' compliance with treatment protocols is challenging as they are often frail and suffer from other comorbid conditions in addition to their AML.

Sapacitabine is administered orally and is a low intensity therapy. Patients can take it home, sparing them from exposure to infectious pathogens in the hospital or infusion center environment.

If SEAMLESS data is submissible and the drug is ultimately approved, sapacitabine's overall profile could represent an important new treatment option for underserved elderly patients with AML.

Let me now turn to the second indication for sapacitabine of high-risk myelodysplastic syndromes, or MDS, after failure of front-line hypomethylating agents, or HMAs, azacitidine and/or decitabine. In a previously reported Phase 2 study, sapacitabine treated patients achieved nearly double the expected survival of patients after HMA failure that is reported in the literature.

We have recently completed enrollment of the patient cohort in an additional part of the ongoing MDS Phase 2 study in order to evaluate better dosing regimens. We will follow up these additional Phase 2 patients until mature survival becomes available.

In parallel, we have conducted a feasibility analysis in preparation for a Phase 2b randomized controlled trial, or RCT, of sapacitabine in this patient population which indicated that our proposed study design is feasible.

MDS is a heterogeneous disease of bone marrow failure and is very difficult to treat. There are currently no approved therapies for MDS after front-line HMA drug failure. There is a dearth of published data in this indication and we will proceed with caution. We expect to make a decision on the RCT in the second half of 2015.

Before making a decision on beginning an RCT in patients with MDS, we will take into account data from our ongoing Phase 2 study and views from key US and European opinion leaders on optimal drug regimens, as the understanding of this disease setting continues to evolve.

In parallel with sapacitabine, we have been progressing our earlier stage pipeline and in particular our CDK inhibitor program that we believe could become an important driver for the Company. As many of you know, the Company was founded by a professor, Sir David Lane, who is globally known for his discoveries in the area of cell cycle biology, and much of our research is based on his scientific vision of cell cycle control and inhibition of CDKs with small molecule pharmaceuticals.

Our scientists at Cyclacel have been able to build on his insights and our clinical experience with our first-generation CDK inhibitor seliciclib, in order to select CYC065, our second-generation CDK inhibitor, and develop it to the threshold of clinical investigation at a time when some have deferred or cancelled their CDK inhibitor programs.

In recent months, we believe that the pharmaceutical industry has been showing increased interest in CDK inhibitors, following the recent FDA approval of palbociclib, the first drug from this class, for a form of breast cancer. Professor Lane advocated targeting CDK2/9 as a promising anticancer strategy.

Our first-generation CDK2/9 inhibitor, seliciclib, has been administered to approximately 400 patients in various trials and demonstrated clinical evidence of anticancer activity. CYC065 also targets CDK2/9 and is mechanistically similar, but has much higher potency, improved pharmaceutical properties, and longer patent protection than seliciclib.

CYC065 has been shown to reverse resistance associated with the addiction of cancer cells to cyclin E, the partner protein of CDK2. CYC065 has also been shown to inhibit CDK9 dependent oncogenic and leukemogenic pathways, including malignancies driven by mixed lineage leukemia rearrangements, or MLLR.

We plan to submit an IND for CYC065 during the first half of 2015. Subject to acceptance of the IND, we plan to initiate Phase 1 clinical trials shortly thereafter. We intend to develop CYC065 both as an intravenous and an oral medication.

As a result of the recent financing activity, which Paul will discuss further in his remarks, we have the ability to drive the CYC065 program forward while SEAMLESS data continue to mature. We believe that the scarcity of clinical stage CDK inhibitor assets, such as CYC065, and the increased industry interest in the CDK drug class make investment in this program a potential value driver for the Company.

Finally, let me remind you of the potential therapeutic applications of CDK inhibitors outside oncology. In addition to Cyclacel-sponsored programs in oncology, we are supporting investigator sponsored trials, or ISTs, evaluating our other CDK drug, seliciclib, in endocrinologic and inflammatory indications in patients who have failed prior treatments. Specifically, a US IST is being proposed for seliciclib as a treatment for Cushing's disease and a European for rheumatoid arthritis. As with all ISTs, we will just control the timing or conduct of such studies and we will report updates as the investigators may notify us from time to time.

Before turning over the call to Paul, let me summarize our key upcoming milestones. For sapacitabine, continue to follow up, enroll patients in SEAMLESS until the prespecified number of events is observed, which is expected to occur between the second half of 2015 and the first half of 2016; submit a Pediatric Investigation Plan to the European Medicines Agency; continued follow-up of patients in an additional part of the ongoing Phase 2 MDS study evaluating better dosing regimens; make a decision on Phase 2b RCT in MDS, following review of all relevant clinical data with mature follow-up; report updated data for the Phase 1 study of sapacitabine in combination with seliciclib in solid tumor patients, in particular those carrying germline BRCA mutations.

For CYC065, our second-generation CDK inhibitor, submit IND to the US FDA during the first half of 2015, make multiple presentations at the American Association for Cancer Research 2015 Annual Meeting, and initiate a Phase 1 clinical trial in patients with advanced solid tumors subject to IND acceptance.

For seliciclib, our first-generation CDK inhibitor, support academic collaborators in investigator sponsored trials, or ISTs, of clip seliciclib in patients with Cushing's disease and rheumatoid arthritis who have failed prior treatments.

We will now review our financials. Paul?

Thank you, Spiro. Our cash position was $24.2 million at year-end 2014, and following the Company's public offering of common stock in March 2015, our pro forma cash and cash equivalents is approximately $34.6 million.

Grant revenue for the three months ended December 31, 2014 was $0.2 million compared to $0.3 million for the same period of the previous year. The revenue is related to previously awarded grants from the UK government being recognized over the period to progress CYC065, our CDK inhibitor, to IND, and to complete IND directed preclinical development of CYC140, a novel, oral-available polo-like kinase 1, or PLK 1, inhibitor.

Our research and development expenses increased to $4.4 million for the three months ended December 31, 2014, compared to $2.5 million for the same period in the previous year. The increase was primarily due to increased study and product costs associated with the expansion of the SEAMLESS Phase 3 trial into Europe, as well as increased expenditures related to grant funded research and development.

General and administrative expenses for the three month ended December 31, 2014, decreased to $1.6 million compared to $1.8 million for the same period in 2013. The decrease was primarily due to lower legal and professional fees during the quarter. Based on current plans, the Company estimates that it has capital resources to reach beyond the final analysis of SEAMLESS and continue existing programs through 2017.

Spiro?

Thank you, Paul. Operator, we are now ready to take questions.

(Operator Instructions) At this time, we have no questions. This does conclude today's conference. Thank you for your participation. You may now disconnect.