Cyclacel Pharmaceuticals Inc (CYCC) 2021 Q3 法說會逐字稿

Good afternoon, and welcome to the Cyclacel Pharmaceuticals Third Quarter 2021 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 third quarter ending September 30, 2021.

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. Mark Kirschbaum, Senior Vice President and Chief Medical Officer.

Spiro will begin with an overview of our business strategy and progress on Cyclacel's clinical programs, and Paul will provide financial highlights for the third quarter of 2021, which will be followed by a Q&A session.

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

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

I would like to begin the call by providing an update on the progress we are making across our 2 programs, our oral CDK2/9 inhibitor, fadraciclib, or fadra, and our oral PLK1 inhibitor, CYC140 or 140.

The third quarter was characterized by a continued execution of our operating plan with opening of 2 Phase I/II studies for oral fadra and filing an IND for a Phase I/II study of our 140.

We have now enrolled a total of 6 patients across 2 dosing levels in our fadra study, designated 065-101, in patients with solid tumors and lymphomas.

More recently, we announced dosing the first patient in our 065-102 study of fadra in patients with leukemia.

We have also filed with FDA an IND submission for an oral 140 Phase I/II study in patients with solid tumors.

While waiting for FDA review of the IND, we are preparing to open this study, which is supported by ongoing preclinical experiments, supporting our choice of certain cancer histologies for the proof-of-concept part of this study.

It has been a busy year for the company, but we are pleased to be on track to deliver as many as 15 outcomes or shots on goal from different cohorts in the 2 fadra studies next year.

And we are funded to deliver on these potential outcomes with cash projected through early 2023.

Let me now review the fadra program.

We are building a specialized global network of world-renowned cancer treatment centers for both the solid tumor and leukemia studies.

In addition, multiple preclinical collaborations are providing strong evidence in support of our choice of treatment cohorts in the proof-of-concept stages of the 2 Phase I/II fadra studies.

Both of these studies are registration-directed and use a streamline design with an initial stage to determine the recommended Phase II dose, or RP2D, of oral fadra in solid tumors and separately in leukemias.

Once RP2D has been established, the studies will immediately enter into proof-of-concept cohort stage using a Simon 2 statistical rule to assess efficacy in individual cohorts.

If sufficient efficacy at tolerable doses is observed, the relevant cohort will enter an expansion prior to possible presentation of the data to regulatory authorities.

In addition to 7 solid tumor in 065-101 and 6 leukemia cohorts in 065-102, the fadra studies contain a basket cohort in which patients can enroll based on biomarkers relevant to fadra's mechanism of action.

Initial cohorts will receive fadra as a single agent, with subsequent cohorts designed to treat fadra in combination with available or emerging standard of care.

In total, we expect to report outcomes from 15 cohorts or 15 shots on goal, 8 in solid tumors and lymphoma and 7 in leukemia.

In the 065-101 solid tumor and lymphoma study, we have dosed orally-administered fadra to 6 patients in the first 2 dosing levels or DLs.

3 patients were treated at the starting DL1 level at 50 milligrams BID for 3 days a week.

In DL2, patients are being dosed at 50 milligrams BID for 5 days a week.

We believe that daily dosing is important for drugs-enabling apoptosis like fadra.

Oral fadra is well tolerated thus far, and patients are being followed up for initial assessment of efficacy.

As a reminder, durable partial response was observed with intravenously administered fadra at 200 milligram 2 days a week.

We are pleased with the pace of recruitment in the 065-101 study, which is currently enrolling at City of Hope and MD Anderson Cancer Centers.

Two additional internationally recognized cancer centers located in Asia and Europe, respectively, have been added to 065-101, with one already open for enrollment.

Both sites were selected for their expertise with tumor types of interest to fadra.

With a total of 4 sites, we expect to rapidly determine RP2D and move into the cohort stage.

Although expectations of clinical efficacy are low in the dose-escalation stage, as specific histologies of interest are not required in the protocol, investigators are permitted to enroll patients with relevant tumor types.

In the 065-102 study of oral fadra in leukemias, we have dosed the first patient in the dose-escalation part and will update our progress as dose escalation continues.

Details of this study were described in our recent press release.

To summarize, similar to the solid tumor 065-101 study, the initial dose-escalation stage of the leukemia trial will determine the recommended Phase II dose, followed by a proof-of-concept or cohort stage.

Oral fadra will be evaluated in patients with various hematological malignancies and leukemia subtypes.

These include AML, CLL, MDS and also specific leukemia subtypes dependent on the FLT3, KIT or MAPK pathways.

In 065-102, 3 cohorts will receive oral fadra as a single agent and the rest in combination with venetoclax or hypomethylating agent or low-dose ara-C.

The basket cohort can enroll patients with biomarkers relevant to fadra's mechanism, but diagnosed with different hematological malignancies or benign hematological conditions characterized by uncontrolled proliferation.

The protocol allows for expansion of the cohort based on efficacy, which may allow for acceleration of the clinical development and registration plan for fadra.

As a reminder, encouraging anti-leukemic activity and good tolerability in AML and CLL patients were observed with the IV formulation of fadra, dosed intermittently in combination with venetoclax.

Let us now turn to 140, our novel orally available PLK1 inhibitor.

Having filed the IND with the FDA, we expect to open a Phase I/II study for treatment of solid tumors in early 2022.

We will provide details of the cohorts to be included in the study at that time, along with our dosing strategy for 140 as a single agent.

This strategy is strongly supported by preclinical data, which show that 140 is biologically differentiated from the other PLK1 inhibitor in development.

Specifically, preclinical studies by Cyclacel and collaborating investigators have demonstrated sensitivity of certain tumor types in patient-derived specimens to 140 monotherapy given as daily oral dosing.

If these findings are produced in the upcoming clinical studies, 140 could emerge as a promising alternative in multiple solid and liquid cancers.

The expansion of clinical programs for our 2 lead candidates is building up to a very exciting period for Cyclacel.

By the end of the first quarter of 2022, we expect to have 3 ongoing Phase I/II clinical trials, which, taken together, should result in one of the most data-rich periods in our company's history.

As these data sets begin to mature, the positioning of fadra, relative to other development stage CDK inhibitors, is worth considering.

The success of first-generation CDK drugs such as Pfizer's IBRANCE have attracted the attention of both drug developers and investors.

Several new therapies are now in clinical development, targeting a variety of CDK enzymes.

We thought it was important to discuss on today's call how fadra is differentiated.

Effective anticancer drugs must be capable of durable target engagement.

While our previous intravenous formulation of fadra clearly demonstrated strong single-agent activity, we also recognized that intermittent or weekly dosing of an IV-administered drug would not be convenient for patients, especially in the midst of an ongoing pandemic.

We, therefore, invested a considerable time and resource studying the pharmacokinetic relationship between oral and intravenous fadra.

These data were presented in October 2020 and showed that our oral formulation had similar bioavailability to the IV formulation, including half-life, maximal concentration and area under the curve.

This led us to conclude that fadra could be optimally dosed as an oral daily schedule therapy.

With the 4-hour half-life and once- or twice-daily dosing, we believe oral fadra is capable of durable target engagement but with the added benefit of oral dosing convenience for patients.

As a highly selective inhibitor of both CDK2 and CDK9, fadra can help restore apoptosis within a cancer cell in 2 important ways.

By targeting CDK9, fadra inhibits the transcriptional regulation of anti-apoptotic proteins such as MCL1 and MYC.

By targeting CDK2, fadra addresses an escape mechanism when CDK9 is inhibited and also directly inhibits self-proliferation by preventing overexpression of cyclin E. When it is abnormally elevated, cyclin E contributes to resistance of several tumor types, mostly in the women's cancers, to various anticancer therapies.

We believe that fadra's dual targeting, both within the cell cycle pathway, may confer a competitive advantage in the clinic.

In the months ahead, we hope to formally present many of these exciting findings featuring our 2 lead drug candidates.

Having reviewed the progress with our clinical programs and ongoing research activities, I would like now to turn the call over to Paul McBarron for a review of Cyclacel's third quarter financials.

Paul?

Thank you, Spiro.

As of September 30, 2021, cash and cash equivalents totaled $40.2 million compared to $43.6 million as of June 30, 2021.

The decrease of $3.4 million was primarily due to $6.3 million net cash used in operating activities, offset by $2.9 million cash provided by financing activities.

Research and development expenses were $4.2 million for the 3 months ended September 30, 2021, as compared to $1.1 million for the same period in 2020.

R&D expenses relating to fadra increased by approximately $2.5 million for the 3 months ended September 30, 2021, due to the opening of the 2 Phase I/II clinical studies and clinical supply manufacturing.

Additionally, R&D expenses related to CYC140 increased $0.5 million for the quarter, as a preclinical evaluation and clinical trial supply manufacturing of CYC140 progressed.

General and administrative expenses for the 3 months ended September 30, 2021, were $1.8 million compared to $1.5 million for the same period of the previous year due to increased legal and professional expenses and recruitment costs relating to the expansion of the clinical team.

United Kingdom research and development tax credits were $1 million for the 3 months ended September 30, 2021, as compared to $0.3 million for the same period in 2020 due to the increase in R&D expenditure eligible for the tax credit.

Net loss for the 3 months ended September 30, 2021, was $5 million compared to $2.3 million for the same period in 2020.

The company estimates that the cash resources will fund currently planned programs through early 2023.

Operator, we are now ready to take questions.

(Operator Instructions) We'll take a question from Jonathan Aschoff of ROTH Capital.

Congrats on the clinical progress, and I have a couple of questions.

What must you first learn in the fadraciclib solid tumor and leukemia programs to know if the pivotal trials must be randomized or single arm?

And would that just be something entirely learned from your own trials?

Or could there be something from competing drugs, something they could deliver that would influence an FDA opinion on that?

Jonathan, thank you for your question.

I think, Mark, you will be the best person to answer that, single-first randomized study signal, please.

Yes.

That's a fine question that I'm looking forward to having to deal with.

Essentially, that means that we have enough activity in a given tumor type to go for a pivotal trial, which I believe is possible.

I think it really -- the answer to your question really depends on which tumor responds.

So it depends on the type.

We are kind of biasing the trial towards relapsed/refractory disease.

So for most of these situations, we believe that the single arm trial will be adequate to go for a break -- for rapid breakthrough designation.

If it is a space we're going earlier or more upfront in terms of lines of therapy, then we would probably be required to do a randomized trial.

But right now, our focus is on a number of potential areas where it would be a single-arm study.

Okay.

And I'm guessing the answer is going to be the same if I were to ask the same question for 140.

I guess it makes sense.

Guys, any better sense other than first half of 2022, which was as per your last slide deck for when we might see the first solid tumor data for oral fadra?

Yes.

I think we can speculate on that.

Obviously, we'll be keen to report responses with durability, which needs a certain type of follow-up.

We are very optimistic about that and the proof-of-concept study, but you may be surprised to the upside, if this were to occur in the dose escalation phase.

As I mentioned in my prepared remarks, it is not our expectation since 80% of the patients in dose escalation get the drug below RP2D typically to see response.

And it also hinges on the physicians enrolling patients with tumors of interest.

Should that happen and we see a response, of course, that would be very exciting for both the company and the drug, and we would certainly wish to announce that at the appropriate time.

(Operator Instructions) We'll move next to Kumar Raja of Brookline Capital.

Congratulations on all the progress.

With regard to the sites, it looks like you have 4 sites on board.

So will some of these additional sites be participating in the dose-escalation phase?

And also how quickly you think you can start enrolling patients in the proof-of-concepts once you have a sense of the effective dose?

Thanks for your question.

Mark, would you like to take that as well, please?

Yes, sure.

So these 4 sites are actually for the Phase I portion of the trial.

There will be additional sites added to increase the numbers and speed for the Phase II studies.

So we anticipate this to move along very quickly.

There is very high investigator enthusiasm.

As you can see from the time lines here, all of our cohorts accrue pretty much the moment they open.

Things are looking very good.

And depending on how well the drug is tolerated, that will determine the number of dose levels that we have.

But the way the trial is designed is that immediately, when we reach our Phase II dose, we will roll right into the various Phase II trials.

So as we said, we have 4 trials -- we have 4 sites now that are in the United States and global.

And we're adding -- we'll be adding a number more for when we get to the Phase II component of the study, also high-level sites IPs.

Okay.

And also in the proof-of-concept trial, if one of the indications, there are more patients showing up for some of the indications, you will continue to enroll them and follow them?

Or is there a cutoff in terms of how many patients you're going to enroll in terms of each of these indications?

Well, I think that's the beauty of this design.

We'll also see that information as we accrue.

So in the sense they will vote with their feet.

I think some arms will obviously accrue better than others, certainly areas where responses are seen.

And of course, part of the advantage of this is that the investigators already know in Phase I what we're thinking about in the Phase II.

So we really will get some preliminary proof-of-concept in the Phase I because some of those types of tumors will be accrued.

So I think that will -- the responses will drive the accrual.

So we have that flexibility to add other arms if we need to, if things respond in the basket, for example, and we will go from there.

Let me, Kumar, add some color, if I may, to Mark's reply so that the audience -- I know you are more familiar, but the audience needs to understand some of the dynamics driving enrollment, which is obviously critical.

First of all, it's not just 4 site, actually 6 groups pursuing the few available slots in the dose-escalation study for which we're about halfway through now.

There are the 2 Phase I units, at City of Open and MD Anderson as well as the 2 lymphoma departments who are part of this study.

These are all open.

We have just mentioned that we opened a fifth group in our third site Phase I unit as well as a final site -- final Phase I group who will join towards the end of the year.

The last 2 non-U.

S. centers were picked because of their expertise in specific cancer types that are part of the Phase II design.

So in some ways, the way I would like to answer your question was that we're already jumping ahead to starting in a way and enrolling tumors of interest by definition of who these people typically get to see in their practices.

The reason we took him into the Phase I portion was a strong desire to get into the study early, which I think underlines Mark's remark about excitement from the investigators.

We typically assume half a patient per center per month in the industry is a typical benchmark.

Here, we enrolled 6 patients since July, which suggests to us that this is going to go quite faster than the typical benchmark.

So for all these reasons, we feel that once we know the recommended Phase II dose, things will move very fast into the middle stage where proof-of-concept can be expected.

Very exciting times.

Yes, that's great.

And in terms of CYC140, you are just waiting for the 30 days to pass.

What is need to be done to start the trials there?

That's essentially correct, Kumar.

I think the FDA would review the file.

If they have no questions at 30 days, we will then open the study for enrollment.

We already have the sites lined up.

I believe there are already patients being proposed for the study, which means that once we open, we should be able to enroll.

We have a lot to learn about 140, but it was a similar experience with fadra.

Both INDs went through the FDA review with no questions.

So if we have a similar experience, we should expect towards the turn of the year to start enrollment.

(Operator Instructions) And we'll move next to Kevin DeGeeter of Oppenheimer.

This is actually Susan calling in for Kevin DeGeeter.

I have just 2 questions.

The first question on fadraciclib.

So you mentioned that you will need to follow the patients for a certain period of time potentially to show their ability of response.

What do you think is the minimum follow-up period to demonstrate this?

Mark, I think -- thank you for your question, Susan, first of all.

Mark, there's a question that you perhaps can deal with in terms of the different histologies.

Well, it's hard to say.

The minimum is defined by the protocol, right?

So they need to go for a month in order to fully establish the toxicity question.

So the minimum cycle -- the minimum amount of time is 28 days.

If they have a response at that point in time, which is potentially possible for some of these disease types that we're looking at, I mean, that can happen.

We usually anticipate it to be a little bit longer.

But either way, as long as they tolerate the drug, they can receive it.

So we don't have a -- there's no set time limit on the amount of the drug they can get.

So if it takes them several months to have a full response, we are providing drug for that.

But the minimum time for treatment to be eligible in the study is 28 days.

Got it.

That makes sense.

And my second question is actually on Cyclacel 140.

How are the histologies of interest selected for the collaborative preclinical studies?

Did you guys have other evidence prior to initiating these studies?

First of all, we have not initiated the 140 oral program yet.

That will happen, as I said, very shortly after the NDA review.

But Mark can certainly address the question of how the prospective histologies, of which only 2 have been disclosed publicly, this is breast and colorectal have been -- or will be selected.

Mark, over to you.

Yes.

In very brief answer, we look through -- extensively to the biology.

I mean some background on me.

I was -- actually was an investigator in academia in this field back in my days at the City of Hope.

So I know this area very, very well, published on it.

So there are a number of tumors that are driven by PLK1.

It's either amplified or it is believed to be part of the activity pathways that drive the tumor.

So looking at the known biology there, there's also preclinical data that this group has done and published in the past that suggests certain tumors are more sensitive than others.

Some are very sensitive to this mode of action.

So I think between that and getting -- we have very high-level team of investigators who are working with us, both preclinically and clinically.

So between all of them, that's the trial design that we have that we've just submitted to the FDA.

And I think that we have an optimal group of potential tumors that will respond.

But most importantly, as the science develops, as it often does, we have a basket arm built in to the study.

So that if new tumors are identified that may be sensitive to this mechanism, they can be enrolled into the basket arm.

And if the response is seen in the basket, then those tumors come out as an individual cohort towards the registration pathway.

So we pretty much cover all bases.

I think in summary, we have many in mind that we think will respond and have preclinical data for.

And then we are open for other ones, should they in the future come out to support that pathway.

Susan, let me add a bit more color to Mark's reply to your question, which may also be helpful for the audience.

As we mentioned earlier in our quarterly remarks, we believe there is a biologically different implication for how 140 works.

It does hit PLK1 as its primary target as other drugs have or had in the past, but it does work very differently, it appears.

And as Mark explained just now, once this information is publicly disclosed, we will be providing additional color on the selection of tumor types as that mechanism is quite well understood in biology as well as clinical practice and, therefore, would guide us to select additional tumor types at the time that this study is open.

So we're very much looking forward to that.

It's only a few weeks away.

If things go according to plan, we should be able to have this discussion again, if not sooner, then certainly at our next quarterly call.

And at this time, I'd be happy to return the call to management for closing remarks.

Thank you, Leo, and thank you all for participating in Cyclacel's third quarter 2021 call.

I think it is evident that we are building significant momentum across our clinical programs with ongoing enrollment in our Phase I/II study of fadra in solid tumors and the initiation of the Phase I/II trial for fadra in leukemia.

We remain on track to achieve our milestones and deliver on the 15 shots on goal over the coming quarters.

In addition, we plan to initiate the Phase I/II study of 140 in solid tumors in early 2022, followed by 140 in leukemias.

Ahead of these events, we would like to thank our shareholders for their continued support, and we look forward to updating you on our progress and meeting some of you at upcoming conferences, either virtually or in person.

Operator, at this time, you may end the call.

This does conclude today's conference call.

You may now disconnect your lines.

And everyone, have a good day.