Cyclacel Pharmaceuticals Inc (CYCC) 2019 Q1 法說會逐字稿

Good afternoon and welcome to the Cyclacel Pharmaceuticals First Quarter 2019 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.

(Operator Instructions) Please note today's call is being recorded.

I would now like to turn the conference call over to the company.

Good afternoon, everyone, and thank you for joining today' s conference call to discuss Cyclacel's financial results and business highlights for the quarter -- first quarter of 2019.

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 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.

Spiro will begin with an overview of our business strategy and accomplishments on Cyclacel's multiple clinical programs, and Paul will provide financial highlights for the first quarter of 2019, which will be followed by a Q&A session.

At this time, I would like to turn the call over to Spiro.

Spiro?

Thank you, Alex, and thank you, everyone, for joining us today for our first quarter business update call.

2019 is an exciting year for the company as we're evaluating our 3 clinical-stage drugs led by CYC065, our CDK2/9 inhibitor, across a total of 6 clinical studies, 4 in patients with hematological malignancies and 2 in patients with solid tumors.

These studies are designed to deliver on our core business strategy to overcome cancer resistance.

We're also pleased to have reported data presented at last month's 2019 AACR Annual Meeting.

Let us start by explaining our scientific and business strategy.

Cancer resistance proteins are central to the ability of cancer cells to evade the treatment effect of anticancer drugs, which eventually lose their effectiveness.

They are often referred to as pro-survival proteins as they help cancer cells survive anticancer therapy and gain an advantage over normal cells.

Suppressing pro-survival proteins is therefore a promising therapeutic strategy to address the growing problem of resistance.

This is particularly true for recently approved targeted drugs as emergence of resistance is a major concern in new but expensive treatment plans for patients.

As new drugs stop working against cancer after early effectiveness, risk of disease progression, relapse and death increase, undermining society's return on investment.

Cyclacel's strategy addressing this problem is to target proteins whose aberrant expression correlates with resistance.

Such proteins include members of the Bcl-2 protein family such as Bcl-2 itself and Mcl-1 and also MYC and Cyclin E. Mcl-1 in particular is receiving wide attention in recent medical conferences.

Multiple preclinical studies show that simultaneous suppression of Bcl-2 and Mcl-1 restores sensitivity of cancer cells to drugs that target one of these proteins and have stopped working.

Venetoclax, the first approved Bcl-2 inhibitor, is indicated for first- or second-line chronic lymphocytic leukemia, or CLL, and first-line acute myeloid leukemia, or AML, in combination with hypomethylating agents or a nucleoside analog.

Venetoclax represents an important advance.

However, patients eventually stop responding.

These clinical findings have attracted a lot of attention in the scientific community, and a competitive race has ensued to bring to market drugs that inhibit Mcl-1 function with the aim of using them in combination with venetoclax.

Cyclacel is a leader in this race, having demonstrated in patients that CYC065 durably suppresses Mcl-1 at tolerable doses and recently started treating patients in a combination study with venetoclax in patients with relapsed/refractory CLL and soon also in AML and MDS.

An additional strategy is to enhance the efficacy of standard-of-care drugs by targeting inherited mutations in DNA damaged pathways such as homologous recombination-deficient cancers, which include those with BRCA mutations.

The modest duration of clinical benefit to PARP inhibitors, the standard of care approved for BRCA mutant gynecological cancers, suggest the need for novel drugs used in combination to improve disease control and extend survival.

Sapacitabine works by an HR-deficient relevant mechanism that is distinct from the mechanism of action of PARP inhibitors.

Sapacitabine has demonstrated activity in BRCA-positive breast cancer with one patient still on drug after 6 years.

Recent clinical data with sapacitabine reported at the 2019 AACR have provided the rationale for an ongoing combination study of orally dosed sapacitabine and olaparib, the leading PARP inhibitor approved for breast and ovarian cancer.

Let us now turn to the execution of our strategy.

We have recently opened for enrollment and are treating patients in 2 out of 4 studies under our collaboration with the MD Anderson Cancer Center with the other 2 studies to open shortly.

In CYC065-02, the Phase I combination study of CYC065 and venetoclax in relapsed/refractory CLL, 2 patients have been treated at MD Anderson without dose-limiting toxicity, or DLT, with the approved full dose of venetoclax and intravenously administered CYC065 at a dose of 64 mg per meter squared.

The first patient is continuing on cycle 4 and has experienced an improvement in platelet levels.

The second patient is on cycle 1. We have recently submitted to the IRB a protocol amendment to broaden the eligibility criteria.

In parallel with MD Anderson, we are also recruiting additional sites to join our study.

In CYC140-01, the first-in-human Phase I study of CYC140, a PLK1 inhibitor in advanced leukemias, the first 2 patients have been dosed, 1 at the starting dose of 16 milligrams per meter square administered intravenously and the second at 32 mg per meter square.

No dose-limiting toxicities have been observed thus far.

CYC140 is a small molecule selective PLK1 inhibitor that has demonstrated potent and selective target inhibition and high activity in xenograft models of human cancers.

Protocols for the other two Phase I studies in the MD Anderson alliance have been finalized and submitted to IRB.

These are CYC065-03 a combination of CYC065 and venetoclax and CYC682-11 a combination of sapacitabine and venetoclax both in patients with relapsed/refractory AML or MDS.

Both are expected to open shortly for enrollment.

We continue to enroll patients in Part 2 of the CYC065-01 Phase I trial of 065 in patients with advanced solid tumors.

Part 2 is evaluating the pharmacokinetic profile of a 1-hour infusion of CYC065 administered over 2 days per week, for 2 weeks out of a 3-week cycle.

Ten patients have been enrolled thus far, 3 at 90, 5 at 120 and 2 at 160 milligrams per meter square, respectively.

As a reminder, in Part 1, CYC065 was administered over a 4-hour infusion once every 3 weeks.

We made good progress with developing the oral formulation of CYC065 and capsules for oral administration are now available for clinical trial.

The CYC065-01 Part 3 protocol has been amended to evaluate dosing of oral CYC065 and its pharmacokinetics.

The protocol amendment is under institutional review at the Dana-Farber Cancer Institute and is expected to open for accrual shortly.

Let us now turn to the Phase Ib/II investigator-sponsored trial or IST of the combination regimen of sapacitabine and the PARP inhibitor olaparib or AstraZeneca's LYNPARZA.

In PARP inhibitor naive patients with BRCA mutant breast cancer.

Three patients have been dosed in this IST sponsored by the Department of Breast Cancer at Dana-Farber.

According to the investigators, the first two patients treated with 150 milligrams of sapacitabine and the approved dose of olaparib achieved tumor shrinkage with no safety concerns.

These patients are continuing treatment.

A third patient has recently been treated.

Cyclacel and AstraZeneca are supplying sapacitabine and olaparib respectively.

With capital on hand, estimated until the end of 2020, we have the resources to take us through key clinical milestones in our ongoing clinical studies.

In summary, as we continue to execute on our strategy and advance our clinical development plans, our key milestones include initiate CYC065-venetoclax Phase I study in patients with relapsed/refractory AML or MDS.

Initiate sapacitabine-venetoclax Phase I study in patients with relapsed/refractory AML or MDS.

Report initial data from the CYC065-venetoclax Phase I studies in leukemias.

Report initial data from the CYC140 Phase I first-in-human study.

Report initial data and bio availability from the Phase I study of oral CYC065.

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

Report data from the Phase Ib/II IST of sapacitabine-olaparib combination in patients with BRCA mutant metastatic breast cancer when reported by the investigators and determine regulatory pathway and submissibility of sapacitabine in elderly AML.

I would now like to turn the call over to Paul to review our first quarter 2019 financials.

Paul?

Thank you, Spiro.

As outlined in today's press release for the quarter ended March 31, 2019, our cash and cash equivalents totaled $17.9 million compared to $17.4 million as of December 31, 2018.

The increase of $0.4 million in the three months was primarily due to net proceeds from a common stock sales agreement with H.C. Wainwright of $4.1 million, offset by net cash used in operating activities of $3.7 million.

Research and development expenses were $1 million for the three months ended March 31, 2019, compared to $0.8 million for the same period in 2018.

General and administrative expenses were $1.2 million for the first quarter 2019, compared to $1.4 million for the same period in 2018.

Other income net for the three months ended March 31, 2019, was $0.1 million compared to $0.6 million for the same period of the previous year.

The United Kingdom research and development tax credit was $0.3 million for the first quarter 2019 compared $0.2 million for the same period in 2018.

Net loss for the three months ended March 31, 2019, was $1.8 million compared to $1.3 million for the same period in 2018.

With the projected cash sparing benefits accruing from the MD Anderson alliance, the company believes that cash and marketable securities, which were approximately $17.9 million as of March 31, will be sufficient to finance operations through the end of 2020.

Operator, we are now ready to take questions.

(Operator Instructions) And your first question comes from the line of Wangzhi Li with Ladenburg.

Maybe 2 questions.

First, I want to ask you about the time line for initiate the CYC065 with venetoclax in AML and also sapacitabine with venetoclax in AML.

So initial -- previously, I got the lines -- more in late 2019 or early 2020, but also you mentioned it's currently under IRB review.

So maybe the timing is earlier.

Just want to clarify that.

Wangzhi, thank you for your question.

Judy will answer that.

The 065 and venetoclax combination for AML -- relapsed/refractory AML and MDS has passed the scientific review committee, the MD Anderson, and is currently awaiting IRB approval.

So we expect IRB approval in general within 4 weeks.

And to the sapacitabine-venetoclax, well, it's also waiting for IRB approval similar to the 4-weeks time line.

So we would expect, Wangzhi, within the summer to enroll the first patient assuming IRB approval is forthcoming.

The first patient in the summer?

Okay.

Great.

And then also second question also.

To clarify, you mentioned the amendment for the part 3 of the CYC065 oral formulation monotherapy.

Just want to clear what exactly are you amending for because I saw that already in the plan.

Maybe I didn't -- I missed it, but can you clarify on that?

Yes, I think this is just a nomenclature question, Wangzhi, you're referring to Part 3, which is indeed the oral 065.

We are amending the existing 065-01 protocol, Part 1, we reported.

Part 2 is the additional schedule, and then Part 3 is the oral.

So it's just a question on nomenclature.

Yes, so but you said, you had amendment for the protocol, right?

What exactly you amended for the trial?

The amendment is to end the evaluation of oral capsules for 065.

So that's not in the previous protocol?

Okay.

It is the same study, different drug form but same population of patients, first-in-human for the oral dosing.

Okay.

That's why we had to amend.

Yes.

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

Thank you, operator, and thank you all for participating in Cyclacel's First Quarter 2019 Earnings Call and your ongoing support of our efforts to develop medicines to address cancer resistance and improve existing treatment options.

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.

Thank you.

This does conclude today's conference call.

You may now disconnect.