Cyclacel Pharmaceuticals Inc (CYCC) 2018 Q1 法說會逐字稿

Good afternoon, and welcome to the Cyclacel Pharmaceuticals First Quarter 2018 Results Conference Call and Webcast.

(Operator Instructions) The company will 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 first quarter results and business highlights for the quarter ended March 31, 2018.

Before turning the call over to 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 form 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 first quarter business update and review progress with our clinical development programs.

In our transcriptional regulation program with CYC065, our lead CDK inhibitor, we are pleased to highlight 2 presentations at the recent American Association for Cancer Research, or AACR, 2018 annual meeting, which confirmed a strong rationale for advancing our clinical development plans for CYC065 in certain liquid and solid cancers.

We have also achieved another key objective in our department pipeline by submitting an IND for CYC140, and internally discovered a novel exhibitor for Polo-like Kinase, or PLK 1. We have sufficient capital resources to fund commonly planned programs through the first quarter of 2020.

Turning to the AACR meeting and the oral presentation of clinical data from our ongoing first-in-human single-agent dose escalation Phase I study of CYC065.

The data presented by Dr. Khanh Do of the Dana-Farber Cancer Institute in Boston demonstrated prolonged reduction of Mcl-1 expression in 11 out of 13 patients treated at the recommended Phase 2 dose, or RP2D, following a single dose of CYC065, which was generally well tolerated.

Preliminary anticancer activity was observed in 6 patients, of which 5 were treated at the RP2D.

Generic data was available for 3 out of 6 patients and all 3 were reported by investigators to have molecular features of the cancers associated with CYC065's mechanism action, including amplification of Mcl-1, MYC or cyclin E. Reduction of Mcl-1 expression is a competitive area in cancer research and several companies are pursuing this target in both the clinical and clinical studies.

We believe that the results reported at AACR represent the first time the durable suppression of Mcl-1 have been reported in patients, and we are keen to build on our lead in this important field.

In addition to the clinical data, results from the clinical studies with CYC065 were also reported at the AACR.

In a poster titled "Strategic combination of the cyclin-dependent kinase inhibitor CYC065 with venetoclax to target anti-apoptotic proteins in chronic lymphocytic leukemia," investigators led by Dr. William Plunkett, Professor and Deputy chair, Department of experimental therapeutics, the University of Texas MD Anderson Cancer Center, highlighted data that showed synergy of CYC065 in combination with the approved Bcl-2 inhibitor venetoclax in chronic lymphocytic leukemia, or CLL samples obtained from patients, including those with 17p deletions.

The CYC065 venetoclax combination was also active in 2 CLL samples, which were resistant to either agent alone.

These findings support the hypothesis that dual targeting of the Mcl-1 and the CO2-dependent mechanisms could induce synergistic cell death.

Let us discuss this treatment strategy in more detail.

CDK 2/9 inhibitors are designed to lower the threshold for killing cancer cells, which have become resistant to current treatment.

Resistant cancer cells often overexpress BCL 2 family proteins such as BCL-2, BCL-XL or Mcl-1.

These proteins play a central role in ensuring survival and ultimate immortality of these malignant cells.

In other words, these cancer cells are very hard to kill with available therapies.

Although venetoclax, a drug that suppresses BCL-2, was recently approved by FDA for CLL, it does not suppress Mcl-1.

To make matters worse, there are no drugs reported in the literature which have demonstrated durable suppression of Mcl-1 in the clinic.

Consequently, an intensely competitive race is ongoing among several biopharmaceutical companies to address this major challenge in oncology therapeutics.

Based on our own data and the supportive data from MD Anderson, we believe that CYC065 may represent a solution to this problem when given in combination with venetoclax.

Such a 2-hit strategy have been proven to work with other cancer drugs such as the combination of BRAF and MEK inhibitors.

We are about to test this strategy in the clinic, and have recently submitted to FDA a protocol for evaluating CYC065 in combination with venetoclax in patients with relapsed/refractory CLL and expect to start enrolling soon after IRB approval.

In parallel to our activities in CLL, part 2 of the Phase I first-in-human study is now open for enrollment of patients with advanced solid tumors and, in particular, those with amplification of Mcl-1, MYC M or cyclin E. In this part of the study, we'll be evaluating a more frequent schedule of CYC065 those 2 days per week for the first 2 weeks of the 3-week cycle.

The objectives of the study are to evaluate safety, pharmacokinetics and pharmacodynamics, including correctional patient specimens for assessment of biomarkers related to the drug's mechanism action.

Discussion with principal investigators and our cooperative groups have progressed with the objective of evaluating CYC065 in both pediatric and adult patients with solid tumors.

The company is discussing with an investigator cooperative group the potential evaluation of CYC065 in patients with neuroblastoma and mostly pediatric, life-threatening malignancy frequently associated with MYC and amplification.

Pediatric neuroblastoma with MYC and amplification has a poor prognosis and there is a need for new treatments for these children.

CYC065 may work in neuroblastoma because inhibition of CDK 2/9 is synthetically lethal with MYC and amplification.

In other words, MYC and amplified cancer cells have been shown to be very sensitive to the drug's mechanism.

There is a strong but clinical rationale for the evaluation of CYC065 in neuroblastoma, including improved survival in MYC and amplified animal models.

In another study to be conducted as an investigator-sponsored trial, or IST, CYC065 will be evaluated in adult and pediatric patients with leukemias, including acute myeloid leukemia or AML, acute lymphocytic leukemia or ALL.

In particular, those with mixed-lineage leukemia rearrangements, or MLL-R.

This IST is undergoing additional review, and is expected to open later this year.

Cyclacel will provide CYC065, and will not be paying for the costs of patient enrollment.

Let us now turn to our DNA Damage Response or DDR program with sapacitabine.

We have jointly developed in collaboration with an academic center and a pharmaceutical company a protocol for a clinical study that will evaluate the combination regimen of sapacitabine and an approved PARP inhibitor.

This will be a Phase Ib/II investigator-sponsored trial administrating the combination regimen to patients with the BRCA-mutant breast cancer.

In this case, Cyclacel will provide sapacitabine investigation on drug product and will not be responsible for patient equipment costs.

We will provide more details once this IST gets underway.

PARP inhibitors given a single agents are standard of care in homologus recombination deficient or HR-deficient breast and ovarian cancers.

HR-deficient cancers include those that are positive for BRCA mutations.

Preclinical evidence and early clinical data also support investigational use of PARP inhibitors in HR-deficient pancreatic and prostate cancers.

There are no other approved drugs for HR-deficient cancers and the unmet medical need exists to improve on the standard of care.

Sapacitabine works by an HR-deficient relevant mechanism action and has shown promising and durable clinical activity in BRCA positive patients with breast, ovarian and pancreatic cancers.

In parallel, as part of our DDR program we are studying a sequential regimen of sapacitabine and seliciclib, our first generation CDK inhibitor in BRCA-positive patients.

The aim of this strategy is to disrupt the ability of cancer cells to repair damage to the DNA and thus restore the sensitivity during the cancer therapy.

Promising and durable antitumor activity has been observed in parts 1 and 2 of the study and, in particular, a subgroup of 45 patients with breast, ovarian and pancreatic cancers who tested positive for BRCA mutations.

An extension of part 1 of the study has enrolled a further 20 BRCA-positive patients with breast cancer and is now in the follow-up stage.

Based on these results and investigator encouragement we are enrolling a part 3 to expand in observations and pass a revised dosing schedule in BRCA-positive patients with advanced breast, ovarian and pancreatic cancers.

Turning to our newest program in mitosis control.

We have filed an IND for CYC140, our PLK 1 inhibitor in preparation for a first-in-human study.

This is an exciting moment for this internal discovery compound, the target of which was discovered by Professor David Glover, Cyclacel's Chief scientist, who will provide more details on CYC140 and its development strategy once the Phase I study gets underway.

Let us now turn to sapacitabine in AML.

As many of you know, data from our SEAMLESS Phase III study were presented by the studies chair at the American Society of Hematology, or ASH, annual meeting last December.

Although the study did not reach its primary endpoint of statistically significant superiority in overall survival, we are encouraged by the higher completed remission rate on the sapacitabine alternating with decitabine investigational arm.

A large prespecified group with low peripheral white blood cell count, comprising about 2/3 of the study's population, showed improved overall survival and complete remission rate.

The ASH presentation included additional data from prespecified and exploratory analysis of subgroups that may benefit from treatment with the sapacitabine-decitabine alternating regimen.

The company believes that the subgroup results have defined a patient population for whom the sapacitabine regimen may represent an improvement over low-intensity therapy by decitabine alone.

After completing further sophistical and exploratory analyses of the SEAMLESS Phase III results, we have prepared briefing documents for submission to regulatory authorities with the objective of determining a potential regulatory pathway for sapacitabine in AML.

We will be making submissions to certain European national authorities during the second quarter and, depending on their availability, expect to have obtained initial feedback starting in the third quarter on the basis of which the company will determine next steps.

We're looking forward to an exciting future for Cyclacel.

Following encouraging Phase I data, we're advancing our clinical programs led by CYC065 in selected patient populations informed by our scientific expertise in cancer biology.

Before handing the call over to Paul for review of the financials, let me review our goals for the rest of 2018.

Report updated CYC065 Phase I data in patients with advanced cancers.

Initiate CYC065 Phase Ib in relapsed/refractory CLL in combination with venetoclax.

Start enrollment in a Phase Ib/II IST or CYC065 in pediatric patients with neuroblastoma.

Start enrollment in a Phase Ib/II IST of the combination regimen of an approved PARP inhibitor and sapacitabine in patients with BRCA-mutant breast cancer.

Conduct regulatory authority meetings regarding the SEAMLESS study of sapacitabine and AML.

Update mature data from the part 1 extension of the sapacitabine and seliciclib regimen in BRCA-positive patients with advanced breast cancer and complete part 3 enrollment in BRCA-positive breast, ovarian and pancreatic cancer patients and IND review for CYC140 PLK 1 inhibitor.

We will now review our financials.

Paul?

Thank you, Spiro.

As you saw from our press release for the quarter ended March 31, 2018, our cash and cash equivalents totaled $21.7 million compared to $23.9 million as of December 31, 2017.

The decrease is primarily due to $2.2 million of net cash used in operating activities.

Research and development expenses were $0.8 million compared to $1.3 million compared in 2017.

General and administrative expenses for the 3 months ended March 31, 2018 and 2017, were $1.4 million.

The U.K. government research and development tax credit for the quarter was $0.2 million.

Other income, net for the 3 months ended March 31, 2018, was $0.6 million compared to $0.8 million in the same period in 2017.

The $0.6 million is primarily related to income received on an asset purchase agreement with ThermoFisher Scientific Company, formerly Invitrogen Corporation, in respect of certain assets and intellectual property related to chimeric antigen receptor T cell, or CAR T, manufacturing technology sold by the company to ThermoFisher Scientific Company in December 2005.

Net loss for the 3-month March 31, 2018, was $1.3 million compared to $1.6 million for the same period last year.

As of March 31, 2018, 11,997,447 shares of common stock and 264 shares of Series A preferred stock, or 3% of the class, are outstanding.

We expect current cash to be able to fund operations and plan the clinical programs through the first quarter of 2020.

Operator, we are now ready to take questions.

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

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 needs.

We look forward to updating you on our progress and meeting some of you at upcoming conferences.

Operator, at this time you may end the call.

Ladies and gentlemen, this does conclude today's call.

You may now disconnect.