PDS Biotechnology Corp (PDSB) 2022 Q1 法說會逐字稿

Hello and welcome to the PDS Biotechnology First Quarter 2022 Earnings Call and Webcast. (Operator Instructions) As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Gabby DeGravina. Please go ahead.

Good morning, and welcome to PDS Biotechnology first quarter 2022 earnings conference call and audio webcast. With me today from the company are Dr. Frank Bedu-Addo, Chief Executive Officer; Dr. Lauren V. Wood, Chief Medical Officer; and Matt Hill, Chief Financial Officer. Earlier this morning, PDS Biotech issued a press release announcing financial results for the quarter ended March 31st 2022. We encourage everyone to read the press release as well as PDS Biotech's report on Form 10-Q, which was filed with the SEC earlier this morning.

The company's press release is available on the PDS website at pdsbiotech.com and the 10-K should be posted later today. In addition, this conference call is being webcast and will be archived on the company website for future reference. Before we begin, we need to remind everyone that on today's call, the company will be making forward looking statements regarding regulatory and product candidate development plans, as well as research activities. These statements are subject to risk and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found on PDS Biotech's most recent filings with the SEC.

You are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date of this conference call. Except to the extent required by applicable law or regulation, PDSB undertakes no obligation to update the forward-looking statements included today to reflect subsequent events or circumstances. As you can see, we're using a different format for the earnings call today, relying on slides to help summarize programs and milestones and aiming to streamline the presentation of background information and updates. We know your time is a precious commodity and we want to leave as much time as possible for Q&A. Your feedback on this new structure would be welcomed. With that, I would now like to turn the call over to Frank. Frank?

Thank you, Gabby and thanks to all of you for joining us this morning. Before we get into the details of our recent achievements and financial results, we thought it would be helpful to give a brief review of our platforms and pipeline to put our accomplishments into context. We are also providing some visuals to aid our discussion. For those of you who may be new to the story, and as a quick refresher, our pipeline is built on 2 proprietary T-cell activating platforms Versamune on which an expanding pipeline of clinical and preclinical molecularly targeted immune-oncology candidates are based and Infectimune on which our advancing preclinical infectious disease pipeline is based.

The Versamune platform allows us to administer tumor specific proteins by subcutaneous injection resulting in powerful expedite killer T-cell responses against the cancer. The Infectimune technology is administered predominantly by intramuscular injection and results in both pathogen specific T-cell and antibody responses. PDS Biotech is developing multiple molecularly targeted cancer immunotherapy candidates, such as our lead product PDS0101. PDS0101 has been demonstrated in ongoing studies to target cancers that express or contain HPV and is agnostic to the anatomic location of the cancer. The Versamune based immunotherapies therefore have the potential to treat a broad range of cancer types.

With our Versamune platform, we seek to lead a transformation in the treatment of cancer to what's not only more effective, but also potentially safer therapies. We believe that we are well on our way to doing so. With our Infectimune technology, we seek to lead the development of more broadly protective vaccines, such as seen in the preclinical results supported with our universal flu vaccine. Here we provide a broad overview of ongoing studies with our lead Versamune based candidates Versamune which is being evaluated in 4 Phase II clinical trials as a combination treatment in advanced and refractory cancers and also in locally advanced cancer.

In early-stage cancer, PDS0101 is also being evaluated as a monotherapy. PDS0101 is a molecularly targeted immunotherapy that we're studying across the full spectrum of HPV related cancers. By this I mean that we are studying PDS0101 in all types of HPV associated cancers including anal, cervical, head or neck, penile, vaginal, and vulvar cancers. Secondly, we're studying these cancers at all stages of the disease from early-stage cancer in our new adjuvant trial, led by Mayo Clinic to advanced checkpoint inhibitor refractory cancer in our National Cancer Institute led trial. We estimate this could create an aggregate market potential of $5 billion to $6 billion in the United States and Europe for PDS0101.

We are conducting these trials in collaboration with some of the most renowned institutions in the field, the National Cancer Institute, Merck, MD Anderson Cancer Centre, and the Mayo Clinic. These strategic relationships have enabled PDS biotech to achieve our goal of broadly covering the HPV cancer space. These relationships have provided multiple additional benefits to PDF Biotech. Not only have they enhanced our expertise in the space, but we believe they have facilitated enrollment in the clinical trial and importantly, through cost sharing agreements, we have mitigated much of the financial burden of rapidly advancing our clinical studies.

We are very excited the data from the first 2 studies listed here, our National Cancer Institute led triple combination trial, and our Versatile-002 trial will both be presented at this year's American Society of Clinical Oncology annual meeting after occurring from June 3rd through the 7th.

We believe this is a real testament to the quality of work being done by our team and our partners, and we're very much looking forward to sharing these efficacy and safety results publicly. Do note that accepted abstracts are scheduled to be published on May the 26th. On Tuesday, June 7th at 8:00 a.m. After our presentations, we plan to host the conference call to further discuss the presented data from both trials. We'll issue a press release to announce this event.

Turning to trial updates. Let's first review our triple combination study. In this trial, we are evaluating PDS0101 in combination with bintrafusp alpha, a bifunctional checkpoint inhibitor, and M9241 also, known as NHS IL-12. 2 investigational immune modulating candidates owned by Merck KGaA. By combining 3 components that activate the immune system by complementary anti-tumor mechanisms, our goal is to generate cancer targeting killer T-cells, while successfully overcoming the immunosuppressive tumor environments. The triple combination has been evaluated across the range of HPV positive, advanced, relapsed and refractory cancers that are well documented to be extremely difficult to treat and for which more effective therapies are desperately needed.

The data from this trial to be presented at ASCO will be a continuation of the study and data that was presented at ASCO last year. In both checkpoint inhibitor naïve and checkpoint inhibitor refractory patients. We expect an update on how the patients whose data was presented have fared over the last year. Essentially how durable was the anti-cancer immune response and what fraction of the patients remain alive. Improving overall survival is one of the most important goals of cancer treatment. Secondly, what do the overall responses including the more recently enrolled patients look like?

We anticipate that in addition to the solid preclinical data demonstrating the key contribution of each of the 3 agents towards the observed strong anti-tumor results that the FDA may expect some demonstration of the clinical contribution of each of the agents in the combination. The role of PDS0101 was very clearly demonstrated in the early data. Study the contribution of NHS IL-12, the National Cancer Institute is evaluating high and low doses of the drug and we expect that some of this data may also be presented at ASCO. The preliminary efficacy data appears to support diversity and platform's potential unique ability to aid in the recruitment, training and activation of large numbers of critical cancer attacking killer T-cells in vivo, even in very ill patients.

We plan in the near future to initiate discussions with the FDA to align on the registrational path. Now turning to our Versatile-002 Phase II trial, which is studying PDS0101 in combination with Merck INCOSE checkpoint inhibitor, Keytruda or pembrolizumab in patients with HPV-16 positive metastatic and/or recurrent head and neck cancer. As with the triple combination trial, this trial has 2 study groups, checkpoint naïve patients and checkpoint refractory patients. In this trial, PDS Biotech is seeking to improve clinical benefit over that seen with Keytruda monotherapy. In addition to improve tumor shrinkage and overall survival, we believe that a significant treatment advantage will be achieved if enhanced clinical benefit is attained without compounding, or increasing the toxicity profile over what has been reported with Keytruda monotherapy.

In February of this year, promising preliminary safety data were presented at the multidisciplinary head and neck cancer symposium. None of the first 18 patients showed any treatment related grade #3 or higher toxicities. This is extremely unusual for any cancer therapy, and particularly for a combination therapy. To put the safety profile in perspective, I'll quickly refer to a news article in March out of the Hollings Cancer Centre at the Medical University of South Carolina, one of the top head and neck cancer centers in the country. The principal investigator on our study, Dr. Kasma had enrolled his first patient onto the study in August of 2021.

The patient had a tumor mass of about 8 centimeters and signs of spread. By March of 2022, the tumor had shrunk to 2 centimeters and the patient was reported to have continued to have a high quality of life through treatments. To quote Dr. Kasma, "The treatments involved in this trial so far have been very tolerable, which is nice because sometimes investigated treatments can produce some side effects. The main side effects of the study treatment we've seen are some pain and redness around the injection site and fatigue but we have reported a small patient size of 18. However, if this combination of efficacy and safety continues to be seen in a significant number of patients, this approach of using the Versamune immune T-cell activating technology could be transformative in cancer treatment. We look forward to presenting detailed efficacy data from the first arm of the first arm of the Versatile-002 trial at ASCO."

Next, let's spend a minute or 2 on our preclinical Versamune based oncology programs. PDS0103 targets mucin-1 or MUC1. Given the presence of MUC1 across several solid tumors, we believe PDS0103 could have utility in the treatment of a broad range of cancers including breast, ovarian, lung and colon cancers, a very substantial global market. We've previously discussed our positive preclinical data, which demonstrated PDS0103's ability to promote the induction of a large number of polyfunctional and highly potent MUC1 specific CD-8 killer T-cells.

The PDS0103 antigens have been successfully manufactured and preliminary stability and immunogenicity testing of the new clinical grade antigens is in progress by PDS Biotech as its process development for manufacture of the PDS0103 pharmaceutical product. Following a recent positive pre-IND meeting with the FDA, we continue to expect to file an IND for the program in the fourth quarter of 2022. We've also continued to make progress on our top program PDS0102.

As you know, late last year, we in licensed rights to the National Cancer Institute Proprietary T-cell receptor gamma alternate reading frame protein tumor antigen abbreviated T-A-R-P or TARP. Based on preliminary studies, we expect our candidates PDS0102 to facilitate the generation of TARP specific CD-8 killer T-cells and may have utility in the treatment of both solid and liquid tumors, including AML, prostate, and breast cancers. Manufacturing efforts here are ongoing. However, given all of our ongoing programs, we are not devoting significant resources to the TARP program and now expect clinical launch sometime in 2023.

Lastly, before passing it over to Matt, I'd like to briefly discuss our Infectimune based infectious disease preclinical pipeline. We believe that the key differentiating attributes of the infecting in platform technology are strong indication of strong induction of virus or pathogens, which can be leveraged to improve treatment and preventive options for several infectious diseases. In January of 2022, we announced preclinical data on our universal flu program sponsored by the NIAID demonstrating potential of infecting and technology with computationally designed influenza proteins developed by the laboratory of Dr. Ted Ross at the University of Georgia.

The universal seasonal flu vaccine PDS0202 generated broadly protective anti-influenza immune responses across multiple strains of influenza. These data as well as our COVID-19 data has provided a unique opportunity to highlight Infectimune's potentially transformative utility in the development of more broadly effective and longer lasting protective vaccines. We are hopeful that we could receive non-diluted financing from the NIH to progress our universal flu program into human clinical trials.

Based on the highly promising data recently announced with the universal flu vaccine, and the current focus of the NIAID on developing more effective flu vaccines, PDS Biotechnology has decided to strategically focus our near-term infectious disease activities to align with the interests of the NIAID to have a new term focus on influenza. This will involve development of the universal seasonal flu vaccine and also potential development of a universal pandemic influenza vaccine based on similar computationally designed antigens as what has shown promise with Infectimune.

The company had out licensed the COVID-19 vaccine PDS0103 to the Brazilian company, Pharmaco, specifically for development in Latin America. The progression of the Pharmaco development program was delayed in the fourth quarter of 2021. After review of the program by PDS Biotech and Pharmaco, the agreement with Pharmaco was extended through May 31st 2022 to provide additional time to Pharmaco to commence manufacturing and scale up of drug product for use in clinical trials. We have reevaluated the progress of the program, and as described above have determined to strategically focus our near-term efforts on the development of the universal flu vaccines. The licensing agreement with Pharmaco will expire on May 31st 2022. With that, I'll now turn it over to Matt for a review of our financial results. Matt.

Thank you, Frank, and thanks to all of you on the call today. In this challenging environment we currently find ourselves in, we're truly grateful to our investors and analysts for their support and continued interest in the PDS Biotech story. For the first quarter ended March 31, 2022 here are some of the financials. Research and development expenses increased to approximately $5.2 million for the 3 months ended March 31, 2022, from approximately $1.4 million for the 3 months ended March 31, 2021. The increase of approximately $3.7 million in 2022 was primarily attributed to an increase of $1.8 million in manufacturing services and quality costs a $1 million in clinical and regulatory costs and $0.8 million in personnel costs.

Generally, administrative expenses increased to approximately $3.3 million for the 3 months ended March 31, 2022 from approximately $1.6 million for the 3 months ended March 31, 2021. The increase of approximately $1.7 million is primarily attributed to an increase in $1 in personnel costs, $0.6 million in legal fees, and $0.1 million in marketing costs. In April, we were able to monetize our net operating loss carryforwards in the state of New Jersey, receiving $1.2 million from the net sale of tax benefits to an unrelated profitable New Jersey Corporation pursuant to the company's participation in the New Jersey technology business tax certificate transfer net operating loss program for state fiscal year 2021. We ended the quarter with $58.9 million in cash in strong position resulting from our partnering model and continuous financial discipline that we project will fund our operations into 2024. With that, why don't we open it up to questions? Operator.

(Operator Instructions) Our first question today is coming from Louise Chen from Cantor Fitzgerald.

Congratulations on the progress this quarter. So I have 2 questions for you. First one is you talked about a lot of different programs and initiatives. So what are the pushes and pulls on your cash runway that you mentioned that goes through 2024? And then secondly, as you think about allocating your resources and meaning both time and dollars, how do you think about how you're going to do that with oncology and infectious disease being on the front burner so to say?

Louise, thanks a lot for your questions. So addressing the first one in terms of where we allocate our resources as we look at both oncology and infectious diseases. With oncology SEC we have instituted a pretty aggressive partnering program. I think one of the things you'll probably realize compared to our peers is the quality of partners that we brought on to our programs, which we believe in addition to providing significant validation of the approach we've taken, as Matt also said, and as I said in the presentation is also very important in how we allocate our financial resources and the benefit that these partnerships have also provided to PDS in terms of our ability to broadly cover the HPV cancer space and actually perform 4 clinical trials with PDS0101 across all HPV cancer indications, right?

So this is really strategic. It was a very strategic approach for PDs very importantly addressing this question of allocation of financial resources. So other than the Keytruda trial, where we are responsible for financially managing that trial, our partners, there's a significant cost sharing benefit for each of the other clinical trials, right. So that approach is really what has allowed us to accomplish what we're doing today. As we look forward to going into pivotal trials, right part of what we will again do is determine how best and how financially, how financially efficiently we can perform those pivotal trials, right so 2 key pivotal trials that we would want to start talking about and start evaluating now are the Keytruda trial, as well as the triple combination trial, right.

So those are key things that we will continue to update folks on as we continue to progress those trials, but the partnership agreements and partnership arrangements have been very significant and very important in allowing us to accomplish what we are accomplishing today. And as we go into PDS0103 and 0102, we don't want to spread ourselves too thin, right. We also have to keep shareholders in mind and ensure that we actually utilizing our shareholders investments judiciously. And that's one key reason why we now focusing on going into PDS0103, which would be the first program beyond HPV cancer, and hopefully getting that IND filed by the end of this calendar year. And again, strategically, one of the key things we'd want to do is, again, understand exactly how we're going to do that in terms of reporting potential partnership, or if we decide to finance that ourselves, again, designing a very efficient clinical trial approach.

And then subsequent to that, looking at how best to progress PDS0102, which is also ready to go into human clinical trials, potentially also in partnership but these are key things that we're looking at very strategically, in just making sure that we're able to create the most value financially efficiently. And then as we progress into the infectious diseases with those activities, also one of the key things that you may notice is that we have really focused on utilizing non-dilutive financing to progress our infectious disease programs, right. The current program with the Infectimune was funded by the -- with the Infectimune and universal seasonal universal flu antigens were funded by the NIAID and we're also looking to hopefully obtain some additional NIAID or NIH funding to take that into human clinical trials.

So when it comes to our capital resources, our goal currently is really to dedicate those to the oncology programs, which we believe will provide the near-term value creation to our shareholders in the company and really to focus, focus non diluted funds on progressing the infectious disease programs. Louise did that answer your questions?

Yes, it did.

Next question today is coming from Leland Gershell from Oppenheimer.

As we look forward to the upcoming data at ASCO, just want to ask Frank, you know, longer term as we think about the development path for PDS0101 and any regulatory perspectives on how we should think about next steps for this development program on route to potential DLA filing.

Leland, thanks a lot for your questions. So for both programs, one of the key things that we would want to do would be to have discussions with the FDA sooner than later probably sometime early the third quarter to align on what the regulatory pathway would be for both programs. For the Keytruda program the goal here, as we mentioned, is to really move the needle significantly in terms of the clinical benefit and improving the clinical benefits over what we see with Keytruda and also, not compounding the toxicity. So the data we've seen really to date in the first 18 patients, we believe is very significant in allowing us to potentially achieve that goal of enhancing the clinical benefit without compounding the toxicities and that we believe would be very important in really positioning this combination.

Very importantly, in the eyes of the oncologist who will be treating a lot of these patients and what we found out from a lot of the market research we've done is how important safety is to these oncologists especially with the earlier stage cancer patients, right. So we believe if this continues and this progresses, it positions this combination very, very, very favorably but and we anticipate that we will have to perform a controlled study. And so those are some of the key things that we would want to discuss with the FDA in terms of what they would want to see in the control arm as we move into the pivotal trial.

With the triple combination one of the key things, we've done is really, if in this case, we're looking at 3 investigational agents and one of the key questions that people have asked is how quickly are we going to move this into a pivotal trial based upon the data that we've seen today, which is really unprecedented. And one of the key things I mentioned during the -- during my portion of the call was the fact that the NCI is looking at high and low dose NHS IL. The reason we're doing that is we believe very strongly, and that the FDA will want to understand the role that each of these components, each of these drugs is really playing and that each -- and confirmation that each of them has a significant role to play in contributing towards the clinical output that we're seeing.

And so, to avoid going into a pivotal trial where we'll be looking at multiple arms, looking at different combinations, we believe that it's prudent to understand sooner than later or to confirm sooner or later the role of each of these 3 components. So if you may recall, after the first, last year's ASCO, it became very clear the role that PDS0101 was playing in the combination. What the NCI is doing now is looking at high and low dose NHS IL-12 to try to tease out the role of NHS IL-12 and hopefully provide some confirmation of the important role that NHS IL-12 is playing.

With the Ventra it's already been evaluated as a monotherapy in this exact same patient population, right. So if we can go to the FDA showing very clearly that each of these 3 agents is contributing significantly to the clinical outcome that we're seeing. It hopefully allows us to go in and perform a very focused and very quick pivotal trial and get this to commercialization sooner than later. So that's the strategy that we're taking and the goal is, hopefully, shortly after ASCO to be able to sit down with the FDA and come to some alignment on what that regulatory strategy and pathway would look.

Great. We look forward to the ASCO presentations.

(Operator Instructions) Our next question is coming from Jim Molloy from Alliance Global Partners.

This is Laura Suriel calling in for Jim Molloy. So follow up on the last question that was asked regarding the Versatile and the triple combination trial of PDS0101. So when does a company have an overall idea of when the completed enrollment might be finished for these 2 trials? Will that follow up after the ASCO meeting that's coming up this summer or will that follow after the talks with the FDA that the company is planning to have? And as a second question, are there any updates regarding the immuno serve Phase II trial PDS0101 and is the company still in line to obtain preliminary data for this trial media?

Thanks a lot for your questions. So in terms of the first 2 trials and enrollments so starting with a triple combination trial. As of the last release we made regarding enrollment, the NCI had enrolled 45 patients and had achieved the goal of enrolling 30 in the checkpoint inhibitor refractory on. They have enrolled us much more quickly than they have enrolled in Avon and so what they're doing now is enrolling all comers, both checkpoint inhibitor, refractory and checkpoint inhibitor naïve in order to get to their goal of 56 total patients quickly.

The last guidance they gave us was that they anticipate to complete enrollment for that trial sometime during the summer, right and that's the last guidance that we received from the National Cancer Institute on that trial. With the Versatile-002 that's a larger trial. We anticipate based on the recruitment as you know is very difficult to predict. So we are hoping are hopeful that we should be able to at least get to the end of the stage, the first arm. So we have the checkpoint inhibitor naïve which started first and which we will be reporting on at ASCO and also the refractory arm.

We are hopeful that we can make significant progress towards getting to the end of the recruitment hopefully, early, sometime early next year I think it is in the first stage but what we want to do is to have discussions with the FDA. Based upon the current data that we have generated, get a good understanding from the FDA how much more data they would want us to collect or whether they want us to collect any more data and then make a decision as to what we do moving forward. We will not be able to even if we make a transition to go to a pivotal trial, we will probably still have to keep this trial going just for ethical reasons to make sure that all the patients get their full treatments.

So it's a very good question. These are some of the things we are currently evaluating internally and some of the discussions we will be having with FDA. So hopefully we will be able to provide you with some details and some more solid decisions probably sometime in the third quarter regarding how this is going to progress. And in terms of the immuno serve, the immuno serve is still on track. We still anticipate providing updates and preliminary data sometime early in the third quarter of this year. So that's still on track.

Next question is coming from Robert LeBoyer from NOBLE Capital.

My question has to do with the influenza program and I want to know if you have any timeframes for filing INDs or starting clinical trials.

Now so with the influenza program we have not received any details yet from the NIAID. We know Dr. Tedros is working with them and we are hopeful that we will be able to receive some funding to go into human clinical trials but until that, until we know for sure whether or not that's going to happen, it's very difficult to project any IND filing dates. A lot of it is really going to depend on whether or not we get the funding to take it into human clinical trials. I think in our in our minds, we've made the decision that our capital resources will be focused on the oncology programs and so we are really going to be depending or dependent on non-diluted financing to take that program into human clinical trial. We are quite hopeful but I think the moment we have some idea of whether that's going to happen or not and when it is going to happen, we will then be able to provide much more solid details on when the IND filing will occur.

Thank you, we reached the end of our question-and-answer session. I'd like to turn the floor back over to management for any further closing comments.

Again, thank you very much for joining us today. We continue to look forward to updating all of you on our clinical and preclinical progress throughout the year 9and we will certainly be in touch shortly with more details about our data presentations and events surrounding ASCO. In the meantime, we hope you have a great rest of the week and again, thank you very much for all your support the company and thank you again for joining us today. Have a great day.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.