Bio Green Med Solution, Inc. (BGMS) Q2 2015 Earnings Report, Transcript and Summary

Good afternoon and welcome to the Cyclacel Pharmaceutical’s Second Quarter 2015 Earnings Conference Call and Webcast. Today’s call is being recorded. At this time, all participants have been placed in a listen-only mode and the floor will be opened for questions following the presentation. [Operator Instructions] It is now my pleasure to turn the floor over to Bill Harris, Cyclacel’s Corporate Controller. Sir, you may begin.

Thank you, Christine. Good afternoon and welcome to our quarterly conference call. During today’s call, members of our senior management team will review Cyclacel’s financial performance and business highlights for the second quarter ended June 30, 2015. Before turning the call over to senior management, I would like to remind everyone that during this conference call, any 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 Form 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. For those of who are on the phone and listening webcast, please note that we will be accepting and answering a limited number of questions submitted email to the address ir@cyclacel.com. Once again we will be answering a limited number of questions submitted email to the address ir@cyclacel.com With us today are Spiro Rombotis, President and Chief Executive Officer; Paul McBarron, Executive Vice President, Finance and Chief Operating Officer; and Dr. Judy Chiao, Vice President of Clinical Development and Regulatory Affairs. At this time, I would like to turn the call over to Spiro Rombotis, our President and CEO.

Thank you, Bill. And good afternoon everyone. Today, I will provide an update on our lead drug candidate sapacitabine together with an update on our progress with our cycling dependent kinase or CDK inhibito programs where we have achieved certain milestones since our last quarterly call. First let me cover SEAMLESS, our phase 3 file evaluating sapacitabine in the firm line treatment setting of elderly patients with acute myeloid leukemia or AML. Patients eligible for SEAMLESS must be aged 70 years or older and the AML or have refused to receive an induction chemotherapy. The primary end point of the trial is overall survival. The trial was sized for approximately 485 patients and was powered at 90% to detect a 27.5% improvement in overall survival. The experimental arm is a drug regimen of orally dosed sapacitabine and intervenes decitabine and is compared to an active control arm of intervenes decitabine alone. The study fully enrolled at the end of 2014 in a110 U.S. and European sites and we are now in the follow up phase. The product requirement for breaking randomization code is after approximately 424 mortality events. As of this week, approximately 13% of the events remained to be observed. Although, it is difficult to assess when the pre-specified in VET number will be met, we estimate this to occur between the second half of 2015 and the first half of 2016. At that time an independent data management company will break randomization code and conduct initial analysis of the top-line results. We will them evaluate the data and determine their submissibility to regulatory authorities. We have previously discussed on these calls the outcome of the interim futility and now view that the decision to make submission for regulatory approval will depend on the parity of the data and their clinical relevance in this patient population. We have also previously indicate that decitabine's prior European approval as a firm line treatment in AML patients, age 65 years or older may have relevance to our assessment of submissibility of the SEAMLESS data. Recent use in a different AML patient population that is not overlapping with that of SEAMLESS that is patients with relapse of refractory AML may also potentially be relevant. In this situation, the sponsor reported that they have been encouraged to proceed with the marketing authorization application to the European Medicines Agency, despite the fact that their pivotal study did not achieve sophistically significant improvement in overall survival. Let us caution that it is inappropriate to suggest that such examples constitute president, not only are the investigational and control drugs and patient populations different, but so our protocols and the clinical setting suggesting that cross study comparisons could be misleading. At this point we would like to remind you of our strategy behind SEAMLESS. Elderly patients have limited options after an initial diagnosis of AML. Most of them are unfit or refuse to be treated with nearly 50-year old chemotherapy cocktail of two intravenous drugs. Faced with brick choices and therefore expected survival, they often leg to go to Hospice care. In recent years, investigators have been suggesting that for elderly AML patients low intensity therapy should be considered. The SEAMLESS study design is a rare example of low intensity triple alternative, which may explain the higher level of interest in the study from over 100 U.S. and European hospitals. SEAMLESS offsets AML patients hope of an improved outcome without a hospital admission to receive intensive treatment, which may also expose the compromise immune systems to infections. If there randomized to the sapacitabine arm of the study, they also benefit by staying in home, well receiving sapacitabine Cyclacel’s by mouth. Quality of life and avoiding exposure to infections are important issues for this patient population. If it reaches the market sapacitabine could become an attractive alternative for elderly patients with AML. While SEAMLESS patients are being followed up, we have continued our planning for potential regulatory submissions. This includes preparing a pediatric investigational plan for sapacitabine for submission to the European Medicines Agency or EMA. A pediatric investigational plan is required before MAA can be accepted or validated by the EMA. In addition to our focus on SEAMLESS, we have progress our sapacitabine and CDK programs during the quarter and I will summarize some key milestones. We recently provided updated data from our ongoing Phase 1 trial of an all oral combination of sapacitabine and seliciclib, our first generation CDK2/9 inhibitor in solid tumor patients. Initial data with Cyclacel drug regiment were reported at American Association for Cancer Research 2013 conference by Dr. Geoffrey Shapiro of Dana Farber Cancer Institute and included confirmed and durable partial responses in BRCA positive patients. In the data update an overall response rate of 55% was observed in heavily pretreated breast, pancreatic patients with BRCA mutations. The durability of responses has been very encouraging with some patients achieving PR and saying on study for more than 90 or 180 weeks. Although data are still maturing we and our clinical investigators have been impressed by the responses and we’ll continue to explore the sapacitabine and CDK inhibitor combination in relevant patient populations. In addition to our seliciclib CDK program, we also working with our second generation CDK2/9 inhibitor CYC065. CYC065 has much higher potency and a longer patient life than seliciclib and has a potential convenience of both intravenous and/or all dosing. During the quarter, the U.S. FDA clear our investigation new drug application for IND for CYC065 and we also received Institutional Review Board or IRB approval to begin a first in human Phase 1 study in patients with solid tumors and lymphomas. The objective of these double escalation study is to evaluate the safety, tolerability and pharmacokinetic profile of CYC065 as a single agent. Assuming this Phase 1 program is successful, the next stage of clinical development will be informed by translation biology and for clinical data which has shown that CYC065 have the potential to be efficacious in cancers that require sustain expression of CDK9 dependent transcripts or activation of CDK2. This include MCl-1 dependent malignancies, MLL or mixed lineage leukemia rearrangements and [indiscernible] or Cyclin E dependent breast or other gynecological cancers. In terms of its future prospects, CYC065 has been shown to act synergistically with selected DNA damaging or targeted agents. Similar to other CDK inhibitors such as Pfizer’s CDK4/6 drug palbociclib or Ibrance, we anticipate that CDK9 inhibitors such as CYC065 will be used in combination with other anti-cancer agents for example with anticipate areas of clinical exploration in patients with solid tumors to include Her2 positive breast cancer resistant trastuzumab or Herceptin. Triple-Negative breast cancer and/or Homologous Recombination deficient gynecological tumors including BRCA or BRCA positive breast, ovarian and uterine cancers. Before reviewing upcoming milestones I’d like to briefly return to Seliciclib and discuss its prospects and indications outside oncology. We have significant scientific and clinical experience with this drug, Seliciclib has been administered by month to over 400 patients with evidence of anti-cancer activity in non-small cell lung cancer, Nasopharyngeal and other cancers in both monotherapy and combination therapy regimes. Seliciclib mechanism of action oral dosing in our clinical database are attractive features for clinical investigators interested in studying the potential of CDK inhibition outside oncology. Last quarter we reported that the patient was dosed in a Phase 2 investigator sponsor trial or IST or Seliciclib in Cushing’s disease and endocrine disorder caused by pituitary tumors. There are limited therapeutic options for Cushing’s disease patients today and Seliciclib could be an important alternative if clinical development is successful. The primary end point of this IST trial is a number of Cushing disease patients with a normalized 24 hour free cortisal level following four weeks of daily oil dosing of Seliciclib. As this common with ISTs Cyclacel is providing drug clinical supplies, but is not responsible for the study operationally or financially. Additionally we recently signed a licensing and supply agreement with ManRos Therapeutics a French Biotech company for the development and commercialization of Seliciclib as a treatment for patients with cystic fibrosis. ManRos and academic collaborators have shown that Seliciclib acts through colorectal mechanisms that may confirm therapeutic benefit to cystic fibrosis patients as well as demonstrating anti-inflammatory properties. That will supply all Seliciclib with capsules to who will manage the clinical program and the drugs commercialization. We have received an upfront payment and we’ll receive milestone and royalty payments if the drug is successfully developed in this syndication. We and collaborating investigators are excited about our CDK programs and in particular the clinical potential of CYC065 as it possess a differentiate CDK inhibitor in mechanism. We look forward to keeping you updated on the progress of these programs. Before turning over the call to Paul, let me summarize our key upcoming milestones. For [indiscernible] continue to follow-up enroll patients in SEAMLESS until the pre-specified number of events is observed. Submit a pediatric investigation plan to the European medicine agency. Make a decision on a Phase 2b randomize control trial in MDS following review of all relevant clinical data with mature follow-up. For CYC065, dose the first station in the first of human Phase 1 clinical trial in patient with advanced solid tumors and lymphomas. For seliciclib, support collaborators in investigator, an industrial partner sponsor trials of seliciclib in patients with Cushing’s Disease and Rheumatoid Arthritis who have failed prior treatments and also in patients with cystic fibrosis. We will now review our financials. Paul?

Thank you, Spiro. As you saw from today’s press release regarding our consolidated financial statements for the quarters ended June 30, 2015 and June 30, 2014, our cash position was $26.9 million as of June 30, 2015 compared to $24.2 million at the end of 2014. The increase in the cash position was primarily due to approximately $9.2 million of net proceeds from the sale of common stock in this quarter, and approximately $2.9 million we see for 2014 R&D tax credits, partially offset by net cash utilized in operating activities. We have no debt. Revenue for the three months ended June 30, 2015 was $0.3 million compared to $0.4 million for the same period of the previous year. The revenue is related to previously awarded grants from United Kingdom government being recognized over the period to progress CYC065 to the clinic, and complete IND-directed preclinical development of CYC140, a Polo-Like Kinase 1 or PLK 1 inhibitor. Research and development expenses were $2.6 million for the three months ended June 30, 2015 compared to 4.5 million for the same period last year. The decrease was primarily as a result of reduced expenditure in the SEAMLESS phase 3 study this quarter compared to same period last year. General and administrative expenses for each of the three months ended June 30, 2015 and ‘14 remain relatively flat at $1.3 million for this quarter compared to $1.4 million for the same period of 2014. As we have previously reported the company was notify by NASDAQ on February 2, 2015 that it no longer satisfy the minimum bid price requirement of $1 per share for continued listing except for to the NASDAQ listing rules. Following approval from NASDAQ the company transfer the listing of its common stock for the NASDAQ global market to a NASDAQ capital market affected at the opening of business on August 6, 2015. The company’s common stock will continue to trade under the symbol CYCC. From past experience we expect no practical difference in the move to the capital market as many companies in the biotech sector including Cyclacel type companies are listed on the capital market. With the transfer the company is being afforded and additional 180-day grace period to February 2, 2016 to regain compliance with NASDAQ’s minimum bid price requirement. Based on current plans, the company estimate that its current cash provides resources to reach beyond the availability of mature data for final analysis of SEAMLESS. To continue to explore the oil ore combination of sapacitabine and Seliciclib and complete the first inhuman Phase 1 study of CYC065 in advanced solid tumors and lymphomas. The current cash balance includes any amounts available under the controlled liquidity offering sales agreement with [indiscernible] entered into last month. Spiro?

Thank you, Paul. Operator we’re now ready to take questions. End of Q&A: [Operator Instructions]. And this does conclude today’s conference call. You may now disconnect your lines.