Cyclacel Pharmaceuticals Inc (CYCC) 2017 Q3 法說會逐字稿

Good afternoon, and welcome to the Cyclacel Pharmaceutical's Third Quarter 2017 Results Conference Call and Webcast. (Operator Instructions) The company will also be accepting a limited number of questions submitted via e-mail to the address ir@cyclacel.com.

It is now my pleasure to turn the floor over to the company.

Good afternoon, everyone, and thank you for joining the conference call to discuss Cyclacel's third quarter results and business highlights for the quarter ended September 30, 2017.

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 provisions 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 Forms 10-Q and 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, Cyclacel's President and CEO. Spiro?

Thank you, Alex, and good afternoon, everyone. On today's call, we will provide our third quarter business update and review progress with our clinical development priorities, particularly, in our transcriptional regulation program with CYC065, our lead CDK inhibitor drug candidate.

Our business strategy has 2 thrusts. Firstly, using our CDK inhibitors to interfere with transcription and overcome resistance of cancer cells or break the addiction to oncogenes. We are executing on this strategy by achieving the objectives of part 1 of the Phase I study with CYC065, including determination of recommended Phase II dose. Initiating part 2 of the Phase I study, incorporating patients with solid tumors, including those with cyclin E, MYC or Mcl-1 amplification and planning a Phase I/II study for CYC065 in combination with venetoclax.

Secondly, employing our sapacitabine and CDK-inhibitor regimen to disrupt the ability of cancer cells to repair damage to the DNA, also called DNA damage response, and thus, restore their sensitivity to anticancer therapy.

We are currently evaluating this strategy as a non-PARP-based treatment alternative. In a Phase I/II of an all-oral regimen of sapacitabine administer sequentially with seliciclib, our first-generation CDK inhibitor in a targeted population of BRCA-positive patients.

At ASCO 2016, we reported promising clinical data from parts 1 and 2 of this study, including durable CR, PR and stable disease in patients with breast, ovarian and pancreatic cancers.

The CYC065, Phase I clinical results and establishment of a recommended Phase II dose provide the basis to progress clinical evaluation of the drug, alone and in combinations in both liquid and solid cancers.

We have evaluated CYC065 in an ongoing first-in-human, single agents, ascending dose Phase I study in patients with advanced solid cancers. The aims of the study are to assess safety, pharmacokinetics and pharmacodynamics, and identify a recommended Phase II dose, which was achieved in the sixth dosing level.

In part 1 of the study, for a long reduction of the Mcl-1 biomarker was observed in 11 out of 13 evaluable patients treated at the recommended Phase II dose, following a single intravenously administered dose of CYC065, which was generally well tolerated.

Although, in such early clinical studies, we typically do not expect to see much efficacy signal. We are encouraged to observe preliminary anticancer study in 5 patients. 4 of these patients were treated at the recommended Phase II dose and 3 out of 4 were reported by investigators to have molecular features of the cancers associated with the drugs mechanism of action. These included over expression or amplification of Mcl-1, MYC and/or cyclin E.

After achieving the goals in part 1 of the study. We're working with investigators to open part 2 with the objective of evaluating additional schedules in patients with advanced solid tumors and, in particular, cyclin E-amplified tumors.

Such tumor futures are frequently reported among others in patients with high-grade serous ovarian and uterine cancers. Of note, key opinion leaders have pointed out that patients with cyclin E-amplified tumors do not carry BRCA mutations. As such, they are not candidates for treatment with standard of care PARP inhibitors.

Our top clinical development priority is to finalize designs for a Phase I/II study, testing CYC065 in combination with venetoclax in relapse refractory chronic lymphocytic leukemia or CCL where we will believe that Mcl-1 suppression may be beneficial.

Venetoclax is a BCL-2 inhibitor approved for relapse refractory CLL. However, it has been reported that venetoclax does not affect levels of Mcl-1, which is often associated with the emergence or resistance to BCL-2 inhibitors.

Discussions with principal investigators and/or are progressing with the objective of evaluating CYC065 in both pediatric and adult patients in other indications supported by strong preclinical data.

One such study to be conducted as an investigator-sponsored trial will evaluate the drug in patients with leukemias, including AML, and in particular, those with mixed lineage leukemia rearrangements or MLLR.

In parallel, the company is discussing with investigators a potential evaluation of CYC065 in patients with neuroblastoma, a mostly pediatric, life-threatening malignancy, frequently associated with MYC amplification. There are no available drugs with significant activity against MYC.

We will report on the progress of these collaborations as they develop.

Turning to our DDR or DNA damage response program, enrollment has have been completed in an extension of the Phase I study, evaluating the combination regiment of sapacitabine and seliciclib, our first generation CDK inhibitor, in an enriched population of BRCA-positive patients with advanced breast cancer.

Part 3 of this study has been recently opened for enrollment with the objective of testing a revised dosing schedule in additional patients, including BRCA-positive ovarian and pancreatic cancer patients.

Finally, let us turn to the reports of the SEAMLESS Phase III data, which was accepted for an oral presentation at the 59th American Society of Hematology or ASH Annual Meeting on December 11, 2017. That presentation will include additional data from a comprehensive analysis of the SEAMLESS dataset with the objective of characterizing the prespecified subgroup of patients, e.g. those with low peripheral white blood cell count who appear to have clinically relevant benefit from the investigational treatment regimen.

As previously reported, in the intent-to-treat population, the investigational arm of the SEAMLESS study did not reach a specific significant improvement in median overall survival versus an active control. However, improvement in median overall survival was observed in a stratified subgroup of patients with low baseline peripheral white blood cell count.

The subgroup comprised approximately 2/3 of the study's population.

Following analysis of the full SEAMLESS dataset and database slot, the company is developing submission materials to support consultations with the European and the U.S. authorities with the objective of determining potential regulatory pathways.

Consistently with our CYC065 focused strategy, the company is not planning any additional studies with sapacitabine and AML at this time.

Our future catalysts include: initiate CYC065 Phase Ib in relapse refectory CLL in combination with venetoclax, a BCL-2 inhibitor. CYC065 Phase I data in solid tumors, update mature data from the part 1 extension sapacitabine, seliciclib DDR study in BRCA-positive breast cancer cohort. Complete part 3 in the sapacitabine, seliciclib DDR study in patient with BRCA-positive cancers, including ovarian and pancreatic.

Submit CYC140, PLK 1 inhibitor, IND application and conduct regulatory authority meetings regarding the SEAMLESS study of sapacitabine in AML.

Before handing over to Paul to take us through the financials, let us summarize the highlights of Cyclacel's business. CDK inhibitors are a validated drug class, generating sizable revenues and profits. We believe Cyclacel has in CYC065, a differentiated and promising candidate in this class. Cyclacel strategy is to target molecularly-defined patient populations, ensuring treatments administered to those patients more likely to benefit. Our compounds aim to overcome cancer cell resistance, addiction to oncogenes or interfere with the ability of cancer cells to repair damage to the DNA.

We believe our compounds are competitively positioned of the potential to address large markets. For those of you who are interested, further details and our strategy, pipeline and programs are described in the September 2017 Corporate Presentation available in the Investor Relations page of our website. We will now review our financials. Paul?

Thank you, Spiro. As you saw from our press release, for the quarter ended September 30, 2017, our cash and cash equivalents totaled $26 million compared to $13.6 million as of June 30, 2017. The large increase is due to the underwritten offering in July when we received net proceeds of approximately $13.7 million after adapting underwriting discounts and commissions and other estimated offering expenses including the full exercise of the underwriters' overallotment option.

Revenue for the 3 months ended September 30, 2017, was 0 compared to $0.2 million for the same period of the previous year.

Research and development expenses were $1 million in the quarter ended September 30, 2017, compared to $2.4 million for the same period in 2016.

General and administrative expenses for the 3 months ended September 30, 2016 and 2017 were $1.3 million and $1.2 million, respectively.

The U.K. government research and development tax credit for the quarter was $0.2 million. Net loss for the 3 months September 30, 2017 was $1.9 compared to $2.9 million for the same period in 2016.

After taking account of a $7 million charge in the quarter related to the accounting requirements for the Series A convertible preferred stock, which were issued in July financing, the net loss attributable to common stockholders was $8.9 million for this quarter compared to $2.9 million for the same period in 2016.

As of today, 11,904,521 (inaudible) stock and 264 or just 3% the initial issued shares of Series A preferred stock are outstanding. We expect our current cash to be able to fund the company's operations and planned clinical studies to the end of 2019.

Operator, we are now ready to take questions.

(Operator Instructions) There are no audio questions at this time.

Thank you, operator. And thank all of you for participating in our update call and your support of Cyclacel's efforts to serve patients in need. We look forward to updating you on our progress and meeting some of you at upcoming conferences. Operator, at this time you may and the call.

This does conclude today's conference call. You may now disconnect your lines.