Vascular Biogenics Ltd (VBLT) 2015 Q1 法說會逐字稿

Good morning and welcome. A press release of the Company's first-quarter 2015 financial earnings became available at 8:00 AM Eastern Time today and can be found on the investor section of the Company's website at ir.vblrx.com.

Before we begin, I would like to remind callers that the information discussed on the call today is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that VBL's management will be making forward-looking statements. Actual results could differ materially from those stated or implied by VBL's forward-looking statements, due to risks and uncertainties associated with VBL's business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and VBL's SEC filings.

The content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 12, 2015. VBL undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call.

We will begin with prepared comments from VBL and then we will open the call for your questions. I would now like to turn the call over to Dr. Dror Harats.

Thank you, Hannah. Good morning, everyone, and thank you for joining us on today's conference call.

VBL made important progress in the first quarter and I am pleased to review our significant achievements year to date and to preview upcoming 2015 milestones as we continue to pursue our mission to discovering, developing, and commercializing first-in-class treatment for cancer.

VB-111, let me begin by discussing VB-111, our late-stage gene-based biologic for the treatment of cancer. As you know, VB-111 is an intravenously administrated anti-antigenic agent for the treatment of solid tumor indications and is currently being evaluated in recurrent glioblastoma, or recurrent GBM, ovarian cancer, and thyroid cancer.

We have received orphan drug designation for the treatment of recurrent glioblastoma in both the United States and Europe and fast-track designation in the US.

Glioblastoma is a devastated, rapidly growing brain tumor that affect 10,000 to 12,000 Americans each year, with a median time from patient diagnosis to patient death of 12 to 15 months and the median survival from time of recurrence of six months only. In recurrent GBM, existing treatment regimens consist of both symptomatic and palliative therapies. However, with currently available treatments, recurrent GBM remains fatal. There is a clear and compelling need for new and effective medicines.

Given this treatment landscape, we are particularly exciting by the interim data collected to date for our Phase II study of VB-111. In March, we announced topline results demonstrating a statistically significant improvement in overall survival in patients with recurrent GBM who received VB-111 as a standalone drug and who, upon final progression, were treated with VB-111 in combination with bevacizumab, compared to patients who received VB-111 as a standalone drug and who, upon further progression, were treated with bevacizumab alone.

Even though this trial was not powered to show difference in overall survival, VB-111 in combination with Avastin demonstrated statistically significant improved medical median overall survival of 414 days, compared to 235 days in patients on Avastin alone, with a p-value of 0.05. We look forward to presenting the full details of this analysis at our investors' event that we are hosting in conjunction with ASCO scheduled for Monday, June 1, where we will include a more mature curve and an update to median overall survival figures.

The data built on the initial set of early results that we presented at the SNO conference in November. There, we announced interim data showing important trends toward improved overall survival. Tumor response data available was also favorable, with 80% of available patients showing a clinical benefit of stable disease or better, 60% showing at least a 25% reduction in RANO score and 20% showing tumor reduction by at least 50%. VB-111 was also well tolerated and safe, both as a monotherapy and in combination with Avastin.

We are particularly excited by the Phase II results to date as they support the design of our pivotal Phase III study, which we intend to begin in mid-2015 under a special protocol assessment agreement with the FDA. We look forward to initiating this randomized, controlled double-arm study later this year and expect to report interim data in the second half of 2016 and final data in the second half of 2017.

VB-111 is also being studied in an investigator-initiated Phase I/II open-label clinical trial in Mullerian, or ovarian cancer, under VBL's IND. We look forward to reporting interim results from this study at next month's ASCO conference.

We're also encouraged by this data as VB-111 is the lead compound to emerge from our Vascular Targeting System, or VTS, our platform technology, enabling the systemic administration of gene therapy to either destroy or promote angiogenic blood vessels.

Our VTS platform is both tissue and condition specific, which allows for the targeted and limited gene expression in the endothelial cells.

The VTS platform is made up of three components -- a viral vector, a promoter, and a transgene, which works in tandem to destroy the angiogenic blood vessels that feed solid tumors. Once a gene therapy has reached the angiogenic blood vessels, our proprietary genetically modified promoter, PPE-1-3X, activates transgene expression to produce a desired protein in the endothelial cells of those vessels.

In cancer applications, the targeted selected is designed to destroy angiogenic blood vessels that feed solid tumors. We are also continuing to explore the potential of our VTS platform in indications beyond recurrent GBM and ovarian cancer.

Turning now to Lecinoxoids, our platform technology of small molecules designed to modulate the antibodies' immune inflammatory response. As a reminder, Lecinoxoids are a novel class of small molecules which we designed to modulate the body's immune inflammatory response. Lecinoxoids work through inhibition of monocytes' migration, regardless of the chemo attractant identity, and can also inhibit certain toll-like receptors.

We still believe that VB-201, our lead Lecinoxoid candidate, has therapeutic potential, as was demonstrated in our previous Phase II for vascular inflammation in which VB-201 met the primary endpoint as measured by PET-CT. We continue to review the large body of data collected on VB-201 and additional Lecinoxoids molecules and we will provide more clarity on our path forward during the next quarters.

On the corporate side, we further strengthened our Board of Directors in the first quarter and were pleased to welcome both Dr. Ron Cohen and Philip Serlin to our Board of Directors in February 2015. Both are leaders of leading public traded biotechnology companies, Dr. Cohen at Acorda and Mr. Serlin at BioLine, and their industry experience and broader insight will be invaluable as we continue to move forward.

I will now turn the call over to Amos Ron, our Chief Financial Officer. Amos?

Thank you, Dror.

Earlier this morning, we issued a press release detailing our financial results for the first quarter of 2015. I will review the financial highlights and also speak to our cash position and our financial guidance.

We ended the quarter with $34.4 million in cash, cash equivalents, and short-term deposits, compared to $36.8 million as of December 31, 2014. Research and development expenses were $2 million, compared to $2.3 million for the same period in 2014. G&A expenses were $800,000 for the quarter ended March 31, 2015, compared to $580,000 for the same period in 2014.

Net loss for the quarter was $3 million, compared to $5.1 million for the same period in 2014.

In summary, we continue to have resources in place to execute on our corporate objectives. We expect that our cash and cash equivalents will be sufficient to meet the estimated working capital requirements, fund planned operations, and support the advancement of our development plan with both the Vascular Targeting System and Lecinoxoid platform technologies through the first quarter of 2017.

Now, I would like to turn the call over to the operator for any questions and answers.

(Operator Instructions). Mike King, JMP Securities.

Thanks for taking my question. Congrats on the progress. I just had a quick question about just last steps that need to be taken, Dror, prior to initiation of the registration-directed trial.

Actually, now we are dealing just with technical issues. There are no -- any regulatory steps that need to be taken. We already selected the CRO as PPD and we're working now towards investigators initiating meetings.

Do you have your site selected (multiple speakers)? I'm sorry?

Yes, we selected a lot of the sites and we are now in a process that we are negotiating on the terms, and of course, we will submit very soon to the IRBs.

Okay, great. And then, just a quick follow-up. I'm not sure, I may have missed it, but if you spoke to the financial runway. Have you stated explicitly what the $34.4 million gets you to or how long it lasts or what your expectations for year-end cash or anything like that are concerned?

Those funds are expected to take us through the end of first-quarter 2017.

2017, okay. Thanks again for taking my questions.

(Operator Instructions). Alethia Young, Deutsche Bank.

This is [Allie] on for Alethia. Thanks for taking our questions. My first question is, what procedures are you doing or thinking about putting in place at the site level in Phase III to ensure success?

Can you please repeat the question?

So our first question is, what procedures are you doing or thinking about putting in place at the site level in Phase III to ensure that you guys have a successfully run trial?

Okay, so, first, we finalize the protocol with FDA under an SPA and, of course, we will submit to the IRBs and have an investigator meeting.

We are planning to have at ASCO a meeting with all the investigators planned to be or potential investigators on the trial. Of course, we're going to go through a protocol and make sure that the patients are recruited in the right way and that we don't have any problems there.

I think it is quite a straightforward protocol because it is actually takes all patients in recurrent GBM after the first or second recurrence that are all Avastin naive, so I don't see any specific issues that might happen here. We are -- actually, all these patients are taking care in referral centers, so it's all going to be actually -- all the centers are going to be very sophisticated centers.

Okay, great, thanks. And then, just a follow-up, can you give us a little bit more color on what your thoughts are in the program in thyroid cancer and moving it forward? Do you have plans to pick this up at a later point or maybe partner in this indication?

And then, along these lines, if the ovarian cancer data is positive at ASCO, will you decide to pursue this program or maybe put it on the back burner until you wait to finish the Phase III in GBM?

So regarding the thyroid cancer, because thyroid is a slow-growing tumor anyway, so a controlled next trial is going to be a long trial. And as we said before, we are going to go ahead and do the trial only with a strategic partner, and, of course, we are talking to some strategic partners right now.

But regarding the ovarian cancer if the results indeed are positive, as we hope, at ASCO, then the next step will be to make a decision to go for a controlled trial, and that's -- we're going to pursue most probably ourself with or without a strategic partner.

Okay, great. Thanks.

(Operator Instructions). We currently have no further questions.

Thank you for your participation in today's call. We look forward to updating you again soon and I hope to see you at our analyst and investor breakfast Monday, June 1, in Chicago. Thank you very much.