Cyclacel Pharmaceuticals Inc (CYCC) 2020 Q3 法說會逐字稿

Good afternoon, and welcome to the Cyclacel Pharmaceuticals Third Quarter 2020 Results Conference Call and Webcast.

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

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

Thank you, Erica.

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, 2020.

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, our newly appointed Senior Vice President and Chief Medical Officer.

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 third quarter of 2020, which will be followed by a Q&A session.

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

I think we just have some problems with the volume.

Just bear with us one moment while we get everyone reconnected.

Spiro, you are back on?

Yes, I am.

Okay.

You can kick off.

And we can now hear you, Spiro.

Spiro, can we hear you?

I'm still here.

Okay.

We're ready to go.

Has Eric finished his introduction?

Eric is, yes, I think you've got cut off just as Eric was coming through, so Eric's introduction over to you.

Okay.

My Apologies as I was disconnected.

So thank you, Eric, and thank you, everyone for joining us today for our third quarter 2020 business update call.

As announced earlier, we estimate that our cash and equivalents of $23.1 million as of September 30, 2020, will provide a cash runway for current spending plans to the end of 2022.

Before updating you on our programs, I have the pleasure of introducing you to Dr. Mark Kirschbaum, who joined us 2 weeks ago as Chief Medical Officer.

He was most recently Vice President, Hematology/Oncology, at ArQule, Inc., which was recently acquired by Merck, where he managed clinical developments of their BTK inhibitor for hematological indications, including CLL.

Prior to ArQule, he was Senior Medical Director with global clinical development responsibilities at 3 pharma companies where he led clinical developments of novel inhibitors of Ezh2, Hsp90, HER2 and BTK in various solid tumor and hematological malignancies.

Before working in the biopharma industry, Mark gained extensive hematology and oncology experience in academic clinical practice as Professor of Medicine and Director of New Drug Development at several medical centers across the United States and Israel.

Mark is completing a pipeline review before making his recommendations regarding optimal allocation of clinical resources and development plans.

This is timely as recently reported fadraciclib data from ongoing Phase I studies continue to show both antitumor and anti-leukemia activity and also good oral bioavailability.

Turning to our programs.

We'll first review fadraciclib, or fadra for short, our CDK 2/9 inhibitor.

Overall, fadra has demonstrated durable suppression of MCL1 and anticancer activity as monotherapy in heavily pretreated patients with solid tumors.

We have also observed anti-leukemia activity consistent with the drug's mechanism and as mentioned good tolerability.

We believe these findings make fadra a leader in the race to bring to market medicines that work on this cancer pathway.

Over-expression of cancer-resistance proteins such as MCL1 or amplification of onco proteins, such as cyclin E and/or MYC are associated with escape and continued growth of cancer cells.

MCL1 is a member of the BCCL2 protein family, including BCL2, BFL1, BCL-XL, et cetera.

These proteins act as pro-survival mechanisms for cancer.

Cyclin E, a protein encoded by the CCNE gene is over-expressed in several gynecological cancers, including breast, endometrial/uterine and ovarian.

Addiction to cyclin E enables cancer cells to escape death after anticancer therapy.

Suppressing these proteins forces aberrant cells into apoptosis or program cell death.

Cyclacel's therapeutic strategy with fadra is to suppress the expression of such proteins and reactivate the apoptotic machinery leading to cancer cell death.

A differentiating feature of fadra is that it targets both the CDK2 and CDK9 isoforms, which act as key components of the p53 pathway.

Activity against CDK2 results in reduction of cyclin E and CDK9 in reduced expression levels of MCL1, MYC and other short-lived transcripts.

Recent peer-reviewed publications in PLOS ONE and the Journal of Clinical Investigation by scientists from Cyclacel and the Institute of Cancer Research in London strengthen the mechanistic rationale for fadra's potential as an anti-cancer agent.

In particular, they highlight the benefits of inhibiting both CDK2 and CDK9 and elucidate the roles of cyclin E, MCL1 and MYC over-expression in the development of cancer resistance.

More recently, independent findings of synthetic lethal screening experiments from Duke University reported at the ASCO 2020 Virtual Scientific Program corroborated the attractiveness of this dual targeting approach against CDK2 and CDK9.

Fadra was the subject of an oral presentation last month at the plenary session of the 32nd EORTC-NCI-AACR or ENA Symposium 2020.

The presentation reported data from parts 2 and 3 of our ongoing Phase I dose escalation study evaluating single-agent fadra in patients with advanced solid tumors.

In part 2, fadra is administered intravenously to 24 heavily pretreated patients with various advanced solid tumors.

The study has reached the fourth dose level.

In terms of overall efficacy to date, one confirmed partial response, or PR, and 4 stable diseases, or SD, have been observed.

Out of 11 patients treated at the fourth dose level, one achieved confirmed PR and 2 SD.

The PR was observed after 1.5 months on fadra in a patient with MCL1-amplified endometrial cancer, who had failed 7 lines of prior therapy.

The patient remains on treatment after 16 months with 92% reduction in target tumor lesions.

The 2 SD were observed in patients with cyclin E amplified ovarian cancer to achieve 29% shrinkage in target tumor lesions after 2.5 months and a patient with fallopian tube adenocarcinoma with undetermined protein level, respectively.

In part 3, we enrolled 5 patients who were treated with an oral capsule formulation of fadra as a single agent, using the same dosing schedule as intravenously administered part 2. Analysis of biospecimens from the first 3 evaluable patients showed high oral bioavailability and overlapping pharmacokinetics with Part 2. Based on the findings, we plan to expand development of oral fadra, initially in solid tumors and later on in hematological malignancies.

Let us now turn to our hematological malignancies program.

We have opened 2 Phase I dose escalation studies to test the hypothesis that suppressing MCL1 and BCL2 can result in anti-cancer activity against relapsed or refractory leukemias.

We are, therefore, evaluating a fadra and venetoclax combination in patients with relapsed or refractory CLL in the 065-02 study and relapsed or refractory AML or MDS in the 065-03 study.

The primary endpoint of each study is the termination of recommended Phase II dose and safety.

In CYC065-02, 5 patients with relapse/refractory CLL have been treated in 4 dose levels up to 150 milligrams per meter squared of IV fadraciclib in combination with oral venetoclax.

Fadraciclib is administered after completion of venetoclax ramp.

Anti-leukemia activity was observed in 3 patients who achieved MRD negativity on the combination, 1 in bone marrow and 2 in bone marrow and peripheral blood.

The latter 2 patients have also demonstrated continued shrinkage of lymph nodes on the combination.

In one patient, all target lesions and then the other 2 out of 4 lesions have shrunk below 1.5 centimeters.

Both are waiting for confirmation of response.

The clinical data support a dual targeting strategy of both BCL2 and MCL1 in CLL.

In CYC065-03, 14 heavily pretreated patients with relapsed or refractory AML were treated in 5 dose levels up to 200 milligrams per meter squared of IV fadraciclib in combination with venetoclax.

Anti-leukemia activity has been observed in 4 out of 12 patients available for assessment.

Pre-clinical data in AML suggests that targeting both MCL1 and BCL2 maybe more beneficial than inhibiting either protein alone.

Both of these studies are part of our risk-sharing alliance with the University of Texas, MD Anderson Cancer Center, whereby MD Anderson assumes patient costs for all studies, and we provide investigational drugs and other limited support.

The MD Anderson Alliance also includes clinical trials with our 2 other programs, CYC140 and sapacitabine.

In our anti-mitotic program, we're evaluating CYC140, a Polo-like or PLK1 inhibitor, which like fadraciclib was discovered in-house.

7 patients with advanced leukemias have been recruited to 140-01, our first-in-human, single-agent dose escalation study.

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.

In response to investigator demand, we are progressing our plans to study CYC140 in patients with solid tumors.

In our DNA damage response program, 682-11 were evaluating the safety and effectiveness of an oral combination of Cyclacel's nucleoside analog sapacitabine with venetoclax in patients with relapsed or refractory AML or MDS.

This is a dose escalation study with 12 patients enrolled to date.

2 patients previously treated with combination therapies, including hypomethylating agents, have achieved 5 and 6 cycles of treatment, respectively.

In addition, an investigator-sponsored trial, or IST, is enrolling at the Dana-Farber Cancer Institute, evaluating in combination of sapacitabine with olaparib, AstraZeneca's Lynparza in patients with BRCA-mutant breast cancer.

7 patients have been enrolled with 2 partial responses and prolonged stable diseases observed.

Turning to our other ISDs.

We are collaborating with an international cooperative group to evaluate fadra in the aggressive childhood cancer neuroblastoma, where MYC over-expression is prevalent.

We will provide updates once this study is open for enrollment.

During the quarter, we continued to move our programs forward to multiple data outcomes over the next 2 years.

Our upcoming key milestones include treat first patient with orally-administered fadraciclib in Phase I/II advanced solid tumor study; report initial data from fadraciclib/venetoclax Phase I study in relapsed/refractory AML or MDS and CLL; report safety and PK data from Phase I study of fadraciclib oral formulation; report initial data from CYC140 Phase I, first-in-human study in relapsed/refractory leukemias; and report initial data from sapacitabine/venetoclax Phase I study in relapsed/refractory AML or MDS.

With capital on hand estimated through the end of 2022, we have the resources to deliver key milestones in our clinical studies.

I would now like to turn the call over to Paul to review our second quarter 2020 financials.

Paul?

Thank you very much, Spiro.

As outlined in today's press release, for the quarter-ended September 30, 2020, cash and cash equivalents totaled $23.1 million compared to $11.9 million as of December 31, 2019.

The increase of $11.2 million was primarily due to net proceeds of $18.3 million from an equity financing in April 2020, offset by net cash used in operating activities of $6.8 million.

We estimate that cash resources as of September 30, we'll fund currently planned programs to the end of 2022.

Research and development expenses were $1.1 million for each of the 3 months ended September 30, 2020, and 2019.

Research and development expenses relating to the transcriptional regulation program increased by almost $0.1 million for the 3 months ended September 30, 2020, as we continue to progress the clinical evaluation of fadraciclib.

General and administrative expenses for the 3 months ended September 30, 2020, $1.5 million compared to $1.3 million for the same period of the previous year.

Increase of $0.2 million for the 3 months ended September 30, 2020, is due to increased professional costs.

Total other income net for the 3 months ended September 30, 2020, was $35,000 compared to $174,000 for the same period of the previous year.

With decrease of approximately $140,000 for the 3 months ended September 30, 2020, is primarily related to a reduction in foreign exchange gains and interest income.

United Kingdom Research and Development tax credits were $0.3 million for each of the 3 months ended September 30, 2020 and 2019.

Our net loss for the 3 months ended September 30, 2020 was $2.3 million compared to $1.9 million for the same period in 2019.

Operator, we are now ready to take questions, please.

(Operator Instructions)

And your first question is from Jonathan Aschoff with ROTH Capital Partners.

If oral fadraciclib continues to deliver like intravenous therapy, at which point do you switch completely to oral?

Will you start any new intravenous trials, given a similar PK between oral and IV with each gentleman at 150.

Have you compared doses higher than 150 or versus any...?

Thank you, Jonathan.

I appreciate your question.

The short answer is that we are very much aware of the value that patients and physicians ascribed to oral therapy, especially during an unveiling global pandemic still evolving, and we're, therefore, very keen to begin oral evaluation of fadraciclib.

In regard to the dosing schedule, clearly, it's an oral drug that gives us more flexibility in being able to dose at different dosing schedule that an IV therapy would permit, and therefore, we treat the results of the IV program as supportive, but not relevant necessarily with what we could achieve with oral dosing other ones or twice a day for continuous days.

That schedule is yet to be refined upon initiation of relevant studies, but we are clearly responding to also the nation's requests for oral therapeutics, and the drug has high overlapping PK, which clearly does.

And since you said that there were no DLC with oral.

Does that mean that there was also no fadraciclib?

Well, we are still early in escalation in the oral therapy, and therefore, it's too early to call where we might max out.

The ongoing Phase I program will inform probably the next 2 to 3 months where we might max out.

We're clearly close to the equivalent dose in other schedule we've tested so far.

So we don't expect it would take very long to get a clear idea.

But again, as we dose sequentially on daily schedules with the oral therapy, it may be that these observations are not necessarily relevant because we may find out the cancer activity sooner.

So this is still the work in progress.

Okay.

And there is no update at ASH, correct?

Well, we do not have any submission that the cutoff ASH was in August, and the studies are still enrolling.

Your next question is from Kumar Raja with Brookline Capital.

With regard to the dose escalation studies, with regard to the analysis with white blood cells, what proteins are being analyzed there?

What is the timeline to get data from those?

And how do you think that is going to influence the dosing with the future studies?

Right.

First of all, we have said that we're interested in the 3 relevant proteins with the drugs mechanism, which are MCL1, MYC and cyclin E. So we certainly want to get that information from future studies and perhaps, ongoing studies, if it is available, if patients are willing to give specimens.

I think the question on white blood cell levels is clearly important.

We have seen WBC lysis early after fadraciclib treatment, but there appears to be a phenomenon where continued therapy is possible, and this phenomenon declines.

Evidently one patient that achieved the PR is on therapy, one-single-agent fadraciclib for more than 1.5 years, which also makes the point it's well tolerated.

So this is still a work in progress.

Clearly, in solid tumor patients, WBC lysis, if it is a short-term phenomenon, could lead to eventual turnover of cancer cells.

But at this point, this is an unknown, Kumar.

We need to oversee.

Find out more as we escalate further in the ongoing Phase I or additional studies that are in planning.

Okay.

You mentioned about this a little bit in your remarks with regard to the studies being done at Duke.

There was recently a paper published with regard to CDK 2/9 in colorectal cancer.

Are you guys planning to conduct some studies based on whatever the results from the Duke University is?

Yes.

You're correct to mention Professor David Hsu's team's work in this field, especially what they have done in models of colorectal cancer is a synthetic lethal screen, where the effect of different inhibitors of different CDKs and came to the conclusion that inhibiting both CDK2 and CDK9 is important.

I'm not sure that we can necessarily use this preclinical experiment as predictive of human disease activity, such as in specific tumor histologies, but we are certainly interested in certain solid tumors we intend to explore those in the upcoming solid tumor studies.

We have not yet made a decision whether metastatic CRC will be one of them.

Your next question is from Wangzhi Li with Ladenburg.

Hello, could you hear me?

We can hear you now, Wangzhi.

Okay.

Good.

So my question is about fadraciclib.

You recently visited data and looks like you are exploring the 160-milligram dose.

And just wondering any kind of -- on that dose, do you think that it would be sufficient?

Or you can still push him into (inaudible) milligram dose?

I think you're referring -- first of all, to make sure our audience is able to follow the question.

Correct me if I'm wrong, but I think you're speaking about the ongoing Phase I study, where 160 milligrams per meter squared was considered, is that correct?

Yes.

All right.

So first of all, it's a flat dose.

And first of all, we're not sure that this schedule, which was designed as a proxy for the oral drive to test PK and then apples-to-apples comparison is going to be the one that would be commercially relevant for this drug if it reaches the market.

As I mentioned, the recent results with good oral availability have motivated us to move our program into the oral formulation.

And that will, therefore, as I mentioned previously, I don't know if you were on the line a few minutes ago, would require the oral drug to be developed and perhaps different strategies that we might use for an IV agent in the middle of pandemic.

Our goal is to use the oral formulation on a daily schedule to the extent this is tolerated.

We intend to sign that out in the immediate next program that we intend to begin.

And this would, therefore, make the question of where the IV day 1 to 8 and 9 schedule ends up in terms of RP2D largely not relevant.

I hope I have given you some color on it, I think.

Wangzhi, are you there?

I didn't hear a response.

I didn't hear response if we asked one of these questions.

No further question, perhaps, at this time, I could ask Dr. Kirschbaum to maybe say a few words about what he's covered upon joining the company, and what his thoughts for our plans for the future.

Mark, over to you.

Hi, everyone.

I just joined the company roughly 3 weeks ago.

I can say at this point that it is a great honor to have joined Cyclacel and to be working with the strong executive group to help unlock the full potential of its promising pipeline.

Fadraciclib, CYC140, our agents with a strong preclinical story.

The question is not whether they will be effective, but how to make them most effective in the clinical setting.

I look forward to working with the team, and our investigators in taking our compounds forward.

Thank you very much.

And thank you all for participating in Cyclacel's third Quarter 2020 Earnings Call.

We appreciate your support of our efforts to fulfill our strategy and realize stockholder value by demonstrating safety, efficacy and cost effectiveness of our medicines.

We look forward to updating you on our progress and meeting some of you in upcoming conferences either virtually or hopefully, in-person.

Please stay safe and well.

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

Ladies and gentlemen, this concludes today's conference call.

Thank you for participating.

You may now disconnect.