Biomx Inc (PHGE) 2023 Q1 法說會逐字稿

Good morning and welcome to the BiomX's first-quarter 2023 financial results and corporate update conference call. Currently, all participants are in a listen-only mode. There will be a question-and-answer session at the end of this call.

I would now like to turn the call over to Marina Wolfson, Chief Financial Officer of BiomX. Please proceed.

Thank you, and welcome to the BiomX first-quarter 2023 financial results and corporate update conference call. The news release became available just after 6:30 AM Eastern Time today and can be found in our website at biomx.com. A replay of this call will be available on the Investors section of our website.

Before we begin, I'd like to review the Safe Harbor provision. All statements on this call that are not factual, historic statements may be deemed forward-looking statements. For instance, we're using forward-looking statements when we discuss in the conference call potential market opportunity to design, aim, expected timing and interim and final results of our preclinical and clinical trials, the sufficiency of our existing cash, cash equivalents, and short-term deposits; and the potential benefits of our product candidate.

In addition, past preclinical and clinical results as well as compassionate use are not indicative and do not guarantee future success of our clinical trial. Except as required by law, we do not undertake to update forward-looking statements. The full Safe Harbor provisions, including risks that could cause actual results to differ from these forward-looking statements, are outlined in today's press release, which, as noted earlier, is on our website.

Joining me on the call this morning is Jonathan Solomon, Chief Executive Officer of BiomX. With that, I will turn the call over to Jonathan.

Thank you, Marina, and good morning, everyone. BiomX continues to make significant progress with the development of our lead product candidate, BX004, for the treatment of pseudomonas aeruginosa or PsA infections in patients with cystic fibrosis or CF.

In February 2023, we announced positive results from Part 1 of our ongoing Phase 1b/2a trial. These results were better than we had anticipated, particularly with respect to the notable reductions observed in PsA bacterial burden. Enrollment in Part 2 continues to progress well, and we expect to report results in the third quarter of 2023.

As a reminder, in Part 2 of the study, we're dosing CF patients with BX004 twice a day and over a longer 10-day treatment period compared to Part 1. Part 2 of the study is designed to find additional data on safety and reduction in PsA bacterial burden, along with other exploratory endpoints.

As a reminder, PsA infections are highly pathogenic and represent a leading cause of loss of lung function in people with CF. After we see a patient who has been infected with PsA in his or her lungs, it is exceptionally difficult to fully eradicate the infection even with multiple courses of antibiotic treatment. PsA infections often persist over a period of several years. Unfortunately, treatment with antibiotics begins to wane over time.

BX004 is a therapy that is designed to directly address the significant and unmet medical need in CF. I'm pleased to note that we had the opportunity to strengthen our balance sheet during this quarter after announcing Part 1 results.

On May 4, we closed the second part for the private placement, which altogether raised total gross proceeds of approximately $7.5 million. We would like to thank our existing shareholders, which include OrbiMed and the Cystic Fibrosis Foundation, who led this financing. As a result of this funding, together with our existing cash reserves, we expect that we'll remain well funded through the time period when we expect to announce Part 2 results.

In addition to strengthening our balance sheet, we also had the opportunity to expand our Board of Directors. Last Friday, we announced the appointment of Jason M. Marks and Michael E. Dambach to the Board of Directors of BiomX. Jason most recently served as Executive VP, Chief Legal and Compliance Officer, and Corporate Secretary with Amarin Corporation. And Michael is Vice President and Treasurer of Biogen.

Both of these highly accomplished individuals bring in depth corporate experience to our Board and seasoned executive leaders within the life science industry. As BiomX continues its plans to grow and expand the BX004 clinical program, Jason and Michael will undoubtedly bring invaluable perspective to help guide our decision-making on a wide range of financial, regulatory, and legal issues.

I'd now like to turn the call over to Marina to review our financial results for the first quarter of 2023.

Thank you, Jonathan. As a reminder, the financial information is available in the press release we issued earlier today, and also in more detail in our Form 10-Q, which we expect to file later today. I will walk you through some of our brief highlights.

As of March 31, 2023, cash balance and short-term deposits was $30.3 million compared to, say, $34.3 million as of December 31, 2022. The decrease was primarily due to net cash used in operating activities, partially offset by proceeds from the first closing of our PIPE financing.

Research and development expenses, net were $4.6 million for the three months ended March 31, 2023, compared to $4.9 million for the same period in 2022. The decrease was primarily due to reduced salaries and related expenses and stock-based compensation expenses resulting from a reduction in workforce as part of the corporate restructuring we announced in May of 2022, as well as de-prioritizing preclinical and clinical activities related to atopic dermatitis product candidate, BX005, partially offset by expenses related to conducting the Phase 1b/2a clinical trial of our CF product candidate, BX004.

General and administrative expenses were $1.6 million for the three months ended March 31, 2023, compared to $2.5 million for the same period in 2022. The decrease was primarily due to reduced salaries and related expenses, stock-based compensation expenses due to reduction of workforce as part of the corporate restructuring, as well as the decrease in the company's directors' and officers' insurance premiums.

Net loss was $6.4 million for the first quarter of 2023 compared to $8.2 million for the same period in 2022. Net cash used in operating activities was $5 million for the three months ended March 31, 2023 compared to $7.4 million for the same period in 2022. We estimate that existing cash, cash equivalents, and short-term deposits will be sufficient to fund the company's current operating plans into the third quarter of 2024.

And now I'll turn the call back over to Jonathan for his closing remarks. Jonathan?

Thank you, Marina. As we enter the second half of 2023, BiomX is well positioned to deliver on key clinical milestones in our BX004 program. We are obviously encouraged by the results from Part 1 of the trial, which we believe could serve as a positive indicator for the results we hope to achieve in Part 2 of the trial.

While great strides have been made over the last few decades to significantly increase life expectancies of CF patients, we also know that chronic and life-threatening infections remain the number-one cause of morbidity and mortality in this patient population. Our BX004 program is squarely aimed at addressing the significant unmet medical need. And we look forward to expanding this program to help bring forward an important new treatment option for the CF community.

With that, Marina and I would be happy to take your questions. Operator?

Thank you. We will now be conducting a question-and-answer session. (Operator Instructions)

Joe Pantginis, H.C. Wainwright.

Hey, everybody. Thanks for taking the questions. Good morning. Good afternoon. So a couple of questions, Jonathan. First, as we look towards the Part 2 data, it's longer dosing. Patients are getting a lot more from phage cocktail as well. So I guess how can we possibly link the anticipated bacterial load reductions with potential impacts on FVV -- FEV? Sorry. And is it long enough for Part 2 treatment to be able to see an impact?

Hi, Joe, and good morning. So I think you raised a really important question. The Part 1 was effectively only four days of twice-a-day dosing and Part 2 is 10 days of twice-a-day dosing. So Part 2 is definitely longer. I think, as you know, we kind of -- we're not expecting much of a signal in Part 1 and quite pleasantly surprised.

I think Part 2 was mostly designed actually to see that bacterial reduction. So I think in terms of our expectations, what we want to see is a replication of the significant effect that we've seen in Part 1 and kind of get a robust response of material reduction.

In terms of FEV1. It's still a relatively very short period of time and still very few patients. So I do think the expectations of (technical difficulty)

Ladies and gentlemen, please stand by for technical difficulties. Please standby.

Okay. Everyone, thank you for standing by. We do have the speaker line back in.

Hey, Joe. I'm sorry. I don't know if you missed my answer, so let me know if you want to repeat it or you want to go for the second part of your question?

Actually, can you hear me?

I can.

Okay. Great. No. So I lost you when you were talking about the relatively short time of treatment to be able to see a potential impact in FEV or not.

Yes. So I do think it's longer than Part 1, still rather short. We look at the -- when you want to see signals in FEV1, patients are dosed much longer. And you look at the antibiotic studies, they're usually months. So I do think you need a much longer period to see the effect. But we do know there is strong correlation between bacterial reduction and clinical improvements, but it usually takes longer. So I think we want to be driving that expectation around FEV1.

Of course, and that was the key thing I was hoping to ask about, and you hit it. So my second part, certainly, in the realm of the forward-looking statements. So I don't know if you would like to even take potential broad strokes with us today.

So assuming Part 2 is positive, can you give us a sense of what you might be considering -- I'm using my words carefully -- with regard to next steps? You know, clinical trial designs, regulatory steps. Would this be a potential candidate for things like breakthrough designation based on the unmet medical need?

So you know, it is a forward-looking statement, but I think the key -- I'll to venture where I can go without being given dirty looks from the account (multiple speakers)

We won't hold you onto anything right now.

(laughter) So I think it's -- as you said, the key is actually the dialogue with regulatory, with the agency as well as I think our strategic partnership with CF Foundation. I think these are the two key parties that we expect after the data that we'll receive in Part 2 to go hand-in-hand with the CF Foundation and talk to the agency. I do think it is an unmet need.

Remember, these patients, they are on the stream, they are already on chronic antibiotic treatment. They don't have any options. So I think, of course, with breakthrough orphan indication, accelerated approval, these are all things that we should consider. And again, we look forward to working hand-in-hand with the agency and the CF Foundation to try to pursue anything that gets us a faster to approval.

No. Completely fair. And then I guess you could call it a logistical question because, you know, especially in this day and age, everything still remains focused on resources and you guys have been very cognizant of this. So with that said, is it still just resource based and when you might look to ramp up your pipeline assets such as atopic or beyond?

Yes. It's exactly that. I think we're seeing more interest generally in phage. It was great to see The Economist run a piece on phage and Nature Biotech and seeing data from our peers. So it's kind of picking up. And with that, we're getting incoming from patients as well as interest in additional indications.

So I think we're also -- we want to pursue these additional indications because I think there is more interest, and again, more data coming from compassionate use. But you know, we need to be disciplined. So hopefully, if we make progress, we're Part 2. And with better finance, I think we'll eagerly kind of expand the pipeline.

Great. Thank you, Jonathan.

Pleasure as always.

Michael Higgins, Ladenburg Thalmann.

Thanks, guys, for taking the questions. Good afternoon to you, Jonathan. Congrats again on the Part 1 results. As we're looking to Part 2 coming up here in Q3, you talked a bit on the call here about the longer duration of treatment.

Can you walk us back through as to what we saw exactly in Part 1 with SAD/MAD? There's still an escalation part there and how that dose relate to what the patients are getting in Part 2. Is that at the highest dose? Any more detail on that? We're getting questions on that. The short answer would be helpful. Thanks.

Sure. First, good morning, and thanks for joining call, Mike. So in Part 1, the dosing was kind of short; it was a study that was plant safety. We had nine patients: seven were on treatment and two were on placebo.

Basically, all of the patients on treatment got the same regime: so they all gone on day one placebo; on the second day, they got a low dose; on the third day, they've got a high dose; and then they got four consecutive days of twice-a-day dosing.

And that sort of -- if you go back, we knew from the compassionate cases in the past that it was a roughly 10-day treatment twice a day that led to bacterial reduction. So that's why I think we had low expectations in the Part 1. You can say, look, it's only four days versus 10 days, not very many patients. So the likelihood of seeing an effect is low.

In Part 2, which is 24 patients randomized two-to-one dose, 10 days, twice a day was actually kind of the replication of the compassionate use cases. But we are expecting to see the robust signal in Part 2.

In Part 1, what we saw again was extremely encouraging and surprising, was an average of 1.4 log reduction. So that's like a 95% reduction baseline. We've seen one patient with a 3.3 log reduction back; that's like a 99.96% reduction.

Two account, we've seen two patients with a 2 log reduction, 99%; two patients with log reduction, 90%. Compared to the placebo, that was around 0.3 log, which is within what's accepted. We know as the noise of the assay (inaudible) log. So kind of it was a well-behaved placebo, quite dramatic effect in the treatment. So I think that's where we're very encouraged. And that kind of gives us confidence to move forward to Part 2, which is a longer duration, and that's where we're expecting a replication hopefully more robustly.

I guess part of the question, too, and thanks for all the detail there, is what you are guiding investors to look for from Part 2 where, as you said, it's BID 10 days. And you've had a couple of days in increasing the dose four days BID. So it's the same dose we're testing in 1 and 2 now.

But how do you -- how do we look for the efficacy of Part 2 more of those with the 2 or 3 log reduction, less of those with a 1 or a 0.3? We don't want to get out over our skis, but it's hard not to get excited about this theme. What happened to between four days?

So I think it is -- we are dosing for longer period of time. I think we don't understand completely the phage dynamics of this benchmark, same with antibiotics when they were effective in the '90s before the antibiotics resistant. We've gone back to like a 1.5 log to 2 logs.

So I think that's sort of what we want to see. I think we'll be content if we can kind of take back the clock to the times where the bacteria and these patients were actually responding well to antibiotics. So I think if we get a replication, hopefully with more patient of what we've seen in Part 1, we're already pretty happy. I think that's where want to put the threshold. Hopefully longer duration can get even greater effect.

Fair enough. We'll sit and wait. That was kind of one long question. I apologize.

No, no. But that is the big question, right?

Yeah.

You're totally spot on. I think that's a big question. Again, we weren't expecting to see this kind of data in Part 1. I think we're all kind of surprised, and I think we want to see that we can replicate the data. If we can, that's extremely encouraging. Because as we said, again, these are patients who have been chronically antibiotics. They're not really responding anymore. And the opportunity to kind of tick back the clock and have such dramatic reductions opens up a lot of optionality and hope for these patients.

Yeah. I'll just add in my color on this, is with proper phage identification and approach to the site of infection, which you've got here with this delivery system, it does happen pretty quickly. So I don't know if we're going to see that much of a difference here. But what we'll see over time, obviously.

In February, you mentioned possible changes to Part 2. Are there any there? And then at what points during Part 2 are you collecting the samples? Thanks.

Sure. So, so far, so good. I think we're proceeding as planned. Patient enrollment is going very well. I think there is broad appreciation in the community of the data that we had in Part 1. And in general, I think the potential of phage therapy. So we're keeping our guidance to as planned with data in the third quarter.

At what points during the Part 2 do you collect sort of samples? Obviously, baseline, but then how often and what points after that?

So we had -- it's a 10-day dosing so we do before and after treatment, and then do a week after treatment at 28 days after treatment. And then a longer duration after that, like a follow-up. We're mandated to have like a phone call it six months later after treatment.

Okay. So then during the 10 days, there's no additional samples collected, just baseline and data, correct?

Correct. I think we're also on -- let me be correct. I think we're also looking -- in terms of comparability, we're looking at day four as well, just kind of benchmark the Part 1.

Okay. Appreciate all the feedback. Thanks, guys.

Always a pleasure.

Thank you. There are no further questions at this time. I would now like to hand the call back over to Jonathan Solomon for any closing remarks.

Thank you. So I just wanted to thank you all for taking your time this morning and wish you all a good day and good luck to us all. Thank you.

Thank you. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time and enjoy the rest of your day.