Lisata Therapeutics, Inc. (LSTA) Q4 2020 Earnings Report, Transcript and Summary

Welcome to the Caladrius Biosciences Fourth Quarter and Year End 2020 Financial Results and Business Update Conference Call. [Operator Instructions] As a reminder, this call is being recorded today, Thursday, February 25, 2021. I will now turn the call over to John Menditto, Vice President of Investor Relations and Corporate Communications at Caladrius. Please go ahead, sir.

Thank you, operator and good afternoon everyone. Welcome to Caladrius’ fourth quarter and year end 2020 conference call to discuss our financial results and provide a business update. Joining me today is Dr. David Mazzo, the company’s President and Chief Executive Officer. Earlier today, we issued a press release announcing our fourth quarter and year end 2020 financial results, which is available under the Investors section of our company website. If you have not received this news release or if you would like to be added to the company’s e-mail distribution list please e-mail me at jmenditto@yahoo.com. Before we begin, I will remind you that comments made by management during this conference call will contain forward-looking statements that involve risks and uncertainties regarding the operations and future results of Caladrius. I encourage you to review the company’s filings with the Securities and Exchange Commission, including, without limitation its Forms 10-K, 10-Q and 8-K, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Furthermore, the content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, Thursday, February 25, 2021. Caladrius Biosciences undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. Please keep in mind that the company continues to conduct calls from different locations during the COVID-19 pandemic. So, we appreciate your patience should we have any technical difficulties. With that, I will now turn the call over to Dr. Mazzo. Dave?

Thank you, John, and good afternoon, everyone. Thank you for joining us on our call today to discuss our fourth quarter and year end 2020 financial results and recent business highlights. Before I get into the prepared text, however, I again want to extend the best wishes of the entire Caladrius staff to you and yours, hoping that you are well and coping with the challenges that COVID-19 has brought us all in our professional and personal lives. Now to business, despite the continued hurdles of the global pandemic, Caladrius closed 2020 with strong momentum across our development programs, which has allowed us to strengthen our financial position, giving us the confidence and means to fund operations for the next several years in the context of our current development plans, while exploring additional pipeline expansion opportunities. Over the course of 2020, we delivered on a number of strategic priorities in support of our robust autologous CD34+ cell technology based clinical programs. I will further expand on this in a few minutes following my review, then comment on the financial results. Before that though, I will take a moment to acknowledge the hard work, focus, creativity and perseverance of the entire Caladrius staff throughout the pandemic, this because of their dedication, individual contributions and teamwork that we have done so well as a company during 2020. And with that, I will now review our fourth quarter and year end financial results, starting with our operating expenses. Research and development expenses for the fourth quarter of 2020 were $2.9 million, a 5% increase compared with $2.8 million for the fourth quarter of 2019 and $9.3 million for the year ended December 31, 2020 compared to $10.8 million for the year ended December 31, 2019, representing a decrease of approximately 14%. R&D expenses in both the current year and prior year periods focused on the advancement of our ischemic repair platform and related to the following. Expenses associated with CLBS119, CD34+cell therapy concept program for repair of COVID-19 induced lung damage targeting patients with severe SARS-CoV-2 infection that required ventilatory support due to respiratory failure. This program has been indefinitely postponed due to the ever changing characteristics of patients who require chronic therapy post-COVID-19 infection as well as our inability to identify investigators and/or institutions with the capacity to take on the clinical study of this type. Ongoing expenses for HONEDRA in critical limb ischemia in Japan, for which we continue to focus spending on patient enrollment and Japanese NDA preparation. Expenses associated with the proof-of-concept ESCaPE-CMD study for CLBS16 in coronary microvascular dysfunction, for which study enrollment was completed in the second quarter of 2019 and full results reported in May 2020 as well as expenses associated with the preparation and initiation of a Phase 2b study for CLBS16, the FREEDOM trial in the second half of 2020. And finally, expenses associated with the ongoing dialogue with FDA regarding design and execution of a confirmatory Phase 3 study of OLOGO, CLBS14, in NORDA. General and administrative expenses, which focus on general corporate related activities, were $2.5 million for the 3 months ended December 31, 2020 compared to $2.3 million for the 3 months ended December 31, 2019 and $9.9 million for the full year ended December 31, 2020 compared to $9.3 million for the full year ended December 31, 2019, representing an increase of 6%. Overall, net losses, excluding the benefit from income taxes that is the proceeds from sales of New Jersey NOLs were $19 million and $19.4 million for the full years ended December 31, 2020 and December 31m 2019 respectively. Turning now to our balance sheet and cash flow, as of December 31, 2020, Caladrius had cash, cash equivalents and marketable securities of $34.6 million, which consisted of the $10.9 million of non-dilutive proceeds received from the sale of our qualified New Jersey NOLs as well as two registered direct offerings that weighs the total of $9.3 million in gross proceeds. In July 2020, we increased our cash position, with the closing of a $2 million private placement. It is noteworthy that the two registered direct offerings and the July private placement were all priced at the then market. During 2020, the company also raised $8.5 million in gross proceeds through its common stock aftermarket sales agreement with H.C. Wainwright & Company, of which $7.2 million was raised in July and August of 2020. Subsequent to the close of the fourth quarter, we were able to take advantage of investor demand for Caladrius shares and successfully completed two strategic capital raises in close proximity. In January 2021, we announced that we had closed on $25 million capital raise through the sale of the company’s common stock to several institutional and accredited investors in a private placement priced at-the-market under NASDAQ rules. Shortly thereafter, in February 2021, the company announced that it closed a $65 million capital raise through the sale of its common stock to several institutional and accredited investors in two registered direct offerings priced at-the-market under NASDAQ. In total, and despite the current economic environment and growing challenges, Caladrius successfully secured approximately $90 million in new capital year-to-date in 2021 and approximately $120 million over the last 12 calendar months. As of February 25, 2021, we have cash, cash equivalents and marketable securities of approximately $116 million. And based on existing programs and projections, we remain confident that our current cash balances will provide operations for the next several years, notably through the completion of the Phase 2b FREEDOM study of CLBS16 through the registration eligible study completion for HONEDRA in Japan and through the Phase 1/2 proof-of-concept study for CBS201 while still providing capital to explore additional pipeline expansion opportunities. That completes the financial overview. And now we will move on to our exciting clinical development pipeline. As I have done on previous calls, I will begin by providing a high level summary of what we are doing at Caladrius and why we believe our development programs are an increasingly relevant and attractive investment opportunity. Caladrius is focused on the development of autologous cellular therapies designed to reverse disease. And we have late stage clinical programs underway based on a large database of human clinical data. To-date, our therapies have shown strong signs of effectiveness and durability with a pristine safety profile unlike many allogeneic therapies and present the possibility of substantial pharmacoeconomic benefit. Most importantly, we remain focused on the development of personalized curative cell therapy products that will restore human health and improve quality of life with a single administration of the therapy rather than one that requires frequent readministration. Our CD34+ cell therapy technology has led to the development of therapeutic product candidates designed to address diseases and conditions caused by ischemia, a condition in which the supply of oxygenated blood to healthy tissue was restricted. Previously published preclinical and human clinical studies have demonstrated that the administration of CD34+ cells induces angiogenesis of the microvasculature that is that these cells prompt the development of new blood capillaries, thereby contributing to the prevention of tissue death by facilitating blood flow to the area of ischemic insult. We believe that several chronic conditions caused by underlying ischemic injury can be improved through the application of our CD34+ positive cell technology, including but not limited to coronary microvascular dysfunction, or CMD, critical limb ischemia, or CLI, pre-dialysis chronic kidney disease, or CKD, and no option refractory disabling angina, or NORDA. I will now speak to the specifics of each of our development programs kicking off with CLBS16, our promising CD34+ positive cell therapy product candidate for the treatment of coronary microvascular dysfunction. Like all of our CD34 cell therapy product candidates. CLBS16 uses a proprietary and patented formulation of CD34+ cells specifically designed for an injection at or near the site of ischemic insult which in the case of CMD is an infusion into a coronary artery. CLBS16 is the subject of the completed ESCaPE-CMD trial, a 20-patient proof-of-concept clinical trial evaluating CLBS16 as a treatment for coronary microvascular dysfunction, a disease involving damage to the tiny arterial blood vessels and microcirculation in the heart, with no accompanying discernible large vessel blockages. Despite the absence of large vessel disease, CMD patients have an equally poor prognosis related to major adverse cardiac events and death as do patients who have identifiable large vessel blockages. Notably, people living with CMD are often under diagnosed, misdiagnosed, and/or untreated because there are no large artery blockages to visualize. It is especially important to recognize that CMD is more prevalent in females than males, making this an important emerging women’s healthcare issue. CLBS16 is designed to address and reverse the underlying pathology of CMD by employing the CD34+ cells innate ability to increase microcirculation and thereby hopefully improve the long-term outcomes and quality of life of those living with CMD. In May of 2020, the company announced the full data results from the ESCaPE-CMD trial at the Society for Cardiovascular Angiography and Interventions, or SCAI 2020 Scientific Sessions Virtual Conference. As predicted by preliminary results announced at the American Heart Association Scientific Sessions in November 2019, data showed highly statistically significant improvement in coronary flow reserve correlating with symptom relief of patients with CMD after a single intra-coronary injection of CLBS16. We remain committed to raising awareness of women’s heart health issues in general and in particular CMD. And CMD is increasingly cited as a growing women’s health crisis and we are working diligently to find an effective treatment for it. Consequently, the company recently initiated a rigorous Phase 2b clinical trial known as the FREEDOM trial, which is currently recruiting and treating patients and is targeted to complete enrollment by the end of 2021 with top line data anticipated for the third quarter of 2022. There seems to be some confusion around the size and scope of the FREEDOM trial based on a recent analyst report. So to be clear, the FREEDOM trial is a 105 patient, double-blind, randomized placebo-controlled Phase 2b trial, which will evaluate the efficacy and safety of delivering autologous CD34+ cells in subjects with CMD and without obstructive coronary artery disease. To our knowledge, FREEDOM is the first controlled regenerative therapy study in CMD. And in support of the FREEDOM trial, the company is engaging with the American Heart Association for a variety of initiatives designed to raise awareness of this debilitating condition. Turning now to HONEDRA, or CLBS12 our product candidate for the treatment of critical limb ischemia in Japan. As I have described previously, CLI is characterized by severe obstruction of the arteries that significantly reduces blood flow to the lower extremities, principally the feet and legs and represents the end stage of peripheral arterial disease. CLI patients often experience severe rest pain, limited mobility, non-healing skin ulcers, and if not successfully treated, eventual amputation. HONEDRA was awarded a Sakigake designation from the Japanese regulatory authorities for the treatment of CLI. The Sakigake designation is akin to an RMAT designation in the United States, and affords the recipient prioritized regulatory consultation a dedicated review system to support the development and review process, including the option of a rolling registration submission as well as reduced review time of 6 months for the CLBS12 registration application once filed. HONEDRA is also eligible for early conditional approval and possibly fill approval in Japan based on the compelling nature of the complete dataset from our ongoing prospective randomized controlled open label multi-center study in CLI patients, which was designed in direct collaboration with the Japanese PDMA. Note that conditional approval of a Sakigake product only requires demonstration of a trend towards therapeutic effect, along with acceptable safety requirements that our current study should be able to meet. The ongoing study in Japan comprises subjects divided into two cohorts, totaling 37 patients a number agreed to with the Japanese regulatory authorities. The aforementioned inaccurate research report states that there are only a handful of patients in this study. Specifically, there is a 30 subject group with traditional atherosclerotic no-option CLI and a 7 subject group with Buerger’s disease, a subcategory of CLI that is often in size and is often associated with heavy smoking. Those subjects who are allocated to treatment are dosed with our CD34+ cell therapy in a single treatment through a series of intramuscular injections in addition to receiving standard of care pharmacotherapy. Subjects randomized to the control arm only receive standard of care with drugs approved in Japan, including anti-platelet agents, anticoagulants and vasodilators, the choice of which is made by the investigators according to the protocol. The study allows for the rescue of subjects in the control arm by indicating the crossover to treatment if their CLI is deemed to be progressing. The primary objective of this study is to show that HONEDRA can prevent the serious consequences of CLI by reverting the patients to a CLI-free condition through improved blood flow in the affected limb. CLI-free status is defined as two consecutive monthly visits in which rest pain is absent and previous non-healing skin ulcers are completely healed, as determined by independent adjudication committee. As previously reported and as you can review, in our corporate presentation on our company website, the Buerger’s disease cohort is completely enrolled and the results from that group are very positive and consistent with a beneficial therapeutic effect and safety profile as reported by previously published clinical trials in Japan and the United States. For patients with Buerger’s disease, amputation and even death are likely outcomes and no available pharmacotherapies prevent amputation. However, subjects in the Buerger’s disease cohort in-house study have achieved a remission rate of approximately 60% meaning that 4 out of 7 subjects have met the primary endpoint and are CLI-free. This is an outstandingly positive result for these patients who normally see continued progression leading to amputation. We are very encouraged by the study results to-date and believe that they suggest a positive outcome for the overall trial recognizing however that the final conclusions of the trial will be dependent on the full dataset from all subjects. Of all of our clinical programs, the HONEDRA study has been the most impacted by the COVID-19 pandemic. In Japan, as a result of the pandemic, a state of emergency was in effect for most of 2020, which effectively prevented patient recruitment into clinical studies like [indiscernible]. Since the onset of the New Year and despite a new state of emergency in Japan, being implemented from January 7 to March 7, we are encouraged by the patient pre-screening pipeline that has been identified. We have only a small number of patients remaining to be enrolled and expect to conclude trial enrollments during the second quarter of 2021, leading to top line data for the full study in the second quarter of 2022. Regarding commercialization, our strategy remains to license our partner, HONEDRA in Japan. And to that end, our conversations continue with prospective partners and we continue to seek to consummate a deal in concert with the completion of the study, if not before. Moving on to CLBS201 for the treatment of pre-dialysis chronic kidney disease or CKD, our most recently proposed development program, CLBS201, is designed to assess the safety and efficacy of CD34+ cell therapy as a treatment for pre-dialysis CKD. Based on a wealth of published preclinical and early clinical data, it appears that the innate ability of the CD34+ cell to promote the growth of new microvasculature could be a means to attenuate the progression of the disease or even reverse the course of CKD. The company plans to file an IND for this program in the second quarter of 2021 and to initiate a proof-of-concept study of CLBS201 in a moderate-to-severe pre-dialysis CKD population shortly thereafter. Chronic kidney disease remains a largely underserved medical need, especially at the general population ages and the incidence of diabetes and hypertension increases. And lastly, OLOGO, or CLBS14, for the treatment of no-option disabling angina. As communicated on previous quarterly calls, Caladrius acquired the rights to data and regulatory filings for CD34+ cell therapy program for HONEDRA that had been advanced to Phase 3 by a previous sponsor. Based on the clinical evidence from the completed studies that a single administration of OLOGO reduces mortality, improves angina, and increases exercise capacity in patients with otherwise untreatable angina, this product received regenerative medicine advanced therapy, or RMAT designation from the FDA. We remain in discussion with the FDA regarding the size and scope of a Phase 3 trial, which in combination with previously filed Phase 1, 2 and Phase 3 data would be considered for the registration of OLOGO. Notably, the RMAT designation affords the product a 6-month review time for our Biologics License Application or BLA, once submitted. So in closing, we are very pleased with the corporate and development achievements made throughout 2020, which attests to our ability to successfully navigate the current global economic landscape with agility and to deliver on key strategic initiatives. We expect to build on this momentum as we further advance and expand our clinical development pipeline. We are working to achieve a number of important upcoming development milestones. And with that over to you, operator, we are now ready to take questions.

[Operator Instructions] Your first question is from the line of Emanuela Branchetti.

Good afternoon, guys and thank you for taking my questions. Congratulations on all the progress. Just a couple of questions for me. So for NORDA, I am not sure how much you can disclose obviously, but can you give us a sense of what is on your wish list for the discussion with the FDA? Like I guess like what would be an acceptable patient population in your opinion in terms of the size given the fact that you have accumulated the asset that accumulated a large amount of clinical data already?

Well, thanks Emanuela for your nice words and also for your question. We appreciate your interest. So I will be very careful with my words, because we are in an ongoing discussion with FDA and that discussion is constantly evolving. But our position has been, from the beginning that this RMAT designated program should be considered perhaps eligible for conditional approval based upon the completed datasets already available. And that if that is not the case, certainly a Phase 3 confirmatory size trial should be of such size and scope that it shouldn’t take 39 months and more than $70 million to complete registration requirements. Those latter numbers 39 months and $70 million are our estimates of the protocol cost and duration for the trial that FDA has to-date asked us to complete. So, our wish list is to reduce that size and scope and to be in a position to do a trial that is affordable and sure enough in timeline that it makes sense competitively to execute.

Sure. And thank you for that. And if I remember correctly that trial was designed to include 400 patients or more than 400 patients, right?

That’s correct.

Okay, got it. Thank you. And for CLI, switching over, can you help us like you mentioned in your prepared remarks that for conditional approval, it will be sufficient to see positive trends in the patient population, but like can you give us more color on that and maybe help us in setting our expectation? Also, based on the positive data, you obtained in Buerger’s disease patients, what would make you happy as an outcome and what would you say is the data for conditional approval?

Again, thank you. I appreciate the opportunity to clarify that, a number of people continued to either believe and even communicate to others that it would be necessary for us to demonstrate a positive p value that is a p value of less than 0.05 to achieve approval for this product in Japan. And then they go on to indicate that, a trial of the size that we are conducting is not going to be large enough to ever achieve such a p value. And I want to be very, very clear that the ability to achieve conditional approval for Sakigake designated product in Japan in no way depends on the calculation of a p value. In fact, there are no p value requirements for this particular study. And it’s important to note that I have stated multiple times today and in the past that the study size was determined in direct collaboration with the Japanese regulatory authority. So, they have determined what is sufficient in terms of the number of patients to demonstrate a trend. And really, what we need to do is to show that there is the possibility, let’s say, of a therapeutic effect without the ability to do any harm and the product would be eligible for conditional approval. And depending upon the compelling nature of that trend, the authorities have it at their discretion to actually grant a full approval. So, there have been a number of products that with Sakigake designations that have actually achieved approval over the last several years in a variety of indications. And I would suggest that you go back and look at some of them. And you will recognize that many of them were not necessarily providing p values and that really, the safety issue was primarily the reason why they were approved that is the ability to be safe with the promise of a future therapeutic effect and those that received full approval already demonstrated some level of therapeutic effect during the smaller trials. So, I hope that clarifies the situation.

Sure, it does. Thank you. It’s very helpful. And lastly for me, you mentioned first of all, congratulations on the CMD progress. And I know you mentioned top line data are expected in the third quarter of 2022, but are you planning to present some of the data, let’s say from some of the patients, why you are accumulating them, for instance, at upcoming conferences, VHA or the VHC conference?

Yes. At this time, the trial does not have a prescribed information interim analysis. And so it is a placebo-controlled, randomized double-blinded trial. So, we will not be breaking the blind until the end of the trial, unless at some point we are motivated to amend the protocol to include an interim analysis. But unfortunately, in blinded trials, we are in the same position and wait until the end of the trial before we can divulge any of the results.

Got it. Thank you very much.

Thanks, Emanuela.

Your next question is from the line of Pete Enderlin.

Thank you. Hi, guys.

Hey, Pete.

How are you?

I am well.

First question, how much did you spend on 119 last year you mentioned as your first item of R&D expenditures?

Yes, we spent a little under $2 million last year on 119.

Okay. And so looking back at that, there was a commentary going along that there could be thousands of patients and then the problem was really with that specific the hospital site, not so much with the overall potential. So, what have you learned about the decision-making process and the fact that you jumped in quickly and then jumped out quickly, but there is still a large potential?

Well, myself specifically and many of the people who work at Caladrius have a foundation from big pharma. And most successful big pharma and even small pharma companies espouse a philosophy that basically says rapid scale or rapid decision. You don’t want to continue to spend money on things that aren’t going to go anywhere, just simply because you think it’s a good idea. So, we think that the decision-making process was actually quite good. We had a strong scientific rationale and a strong engagement from a very reputable investigator and research institution, right here in our backyard in New York that indicated to us at the time that they had more than 400 patients available that would qualify for this study. Now, as we went through the process of filing the IND getting the emergency use authorization, preparing, manufacturing, getting things approved through their site, IRB, etcetera, they have contracting offices probably because like so many institutions in New York at the time they were feeling the effects of many people being out sick and also the inefficiencies of having to work remotely, they weren’t able to turn over the contracts quickly. And so by the time we got everything approved, so that we could actually involve patients at their institution, it was late summer. And at that point in time, the 400 patients that they had originally defined evaporated and they couldn’t find anymore patients with the profile that they had originally described. Part of that was simply because of the timing of the situation and the pandemic at that point was the seeing an ebbing in New York, but mostly it was because as the disease became apparent during the course of the early spring and then into the summer, the treatments that were used for patients with the disease, especially those who had the serious cases of disease were evolving extremely rapidly. And so what was in the early stages of the disease, standard protocol, serious patients got put on ventilators later became something that was actually contraindicated. You put patients on ventilators as a last resort, because it was determined that you were actually making patients worse in that case, that coupled with antibiotic and monoclonal cocktails and all sorts of other things changed the profile of the patient and the chronic patient profile. While that chronic patient still exists, the profile is extremely heterogeneous, because all those patients have received different types of treatments based upon at what point since last February, they received the disease. And in fact, the type of treatment and the treatment paradigms continue to evolve. So until we can actually define a profile for chronic patient that is constant is that trying to hit a moving target. And for us, it didn’t make any sense to keep chasing that moving target, because of spending a lot of money and basically, what we are doing is getting nowhere. So we decided to take a pause. And now we sit back and wait and see if at some point that patient population becomes stabilized and in fact, has characteristics that we believe we can treat with our technology then we will revisit the rationale for doing that at that time.

Thanks for clarifying that. And then can I get back to CLI12 and that is the Buerger’s component of that, which I think it’s been stated as basically 4 out of 7 achieved successful results since maybe almost a year ago. So, what happens with the other three people, I know one didn’t make it, but I mean, is there just no further progress, no treatment or change in the other two people or what’s happening with them?

No, the other three people did not achieve a positive.

Okay, positive…

Following the 12 months of the study and that’s the data that we report.

Fair enough. And then on 201, is there some simple way to say how sick the people have to be, because chronic kidney disease has a lot of different shades?

So, these looked very right. They are going to be what we call moderate-to-severe CKD, so most people would characterize them as Stage 3b or 4 patients. So these are patients...

In creatinne or eGFR rate reading for that level…

But I am not going to quote that just yet, because we are still working on that. Well, actually, give me a moment here, I will give you some information in that regard that will help you identify that, just bear with me one second, I want to be sure I quote the right numbers. So, for patients who are in Stage 3b of CKD, their GFRs are generally considered in the area of 44 to 30. And for those in Stage 4, the GFRs are in the area of 15 to 29. So we are going to pick a group of patients who have GFRs that span sort of 15 to the low 40s. The exact range is going to be defined in the protocol, which will be obviously available on clinicaltrials.gov once it’s finalized. So it will be those patients, they also will have to be patients who are demonstrating rapid progression. So, these are sick patients who are quickly getting sicker.

And is there some sense of how many people in the overall target population could be available as patients long-term?

Yes, the current – let’s see, let’s see in the census from 2015 and 2016, it was reported that about 15% of all U.S. adults had evidence of CKD Stages 1 through 4, so 15% of the entire U.S. population, that reduces to about 15 to 18 million people with Stage 3 or 4 CKD. So, it’s a huge population.

Okay, thank you. And then I just had one kind of outside the box off the wall question.

Okay.

I am sure nobody has asked you this question before. Given the efficacy of CD34+ cells for regenerating vasculature, is there any potential not necessarily for you guys, because you don’t need a whole lot more stuff to work on, but as a potential with a partner perhaps or something to apply that technology to cerebral vasculature?

There are some considerations. In fact, we had explored at one point a number of years ago, the application of our trial in stroke, but there are several problems that come with this one is you have to ensure that the cells can cross the blood brain barrier and can end up becoming integrated into the brain in order to grow the microvasculature there and that you can do it in the right places and that takes a much more preclinical work that we haven’t done. So I think CNS applications of the technology are on the list of hypothetical possibilities. But as you said, we have got enough on our plate right now. And I think just to be candid until we demonstrate some more positive data from some of these cardiovascular indications, I think it would be unlikely that a CNS company would try to take this up on their own.

Okay, thanks. I will get back in line. Thank you.

Alright. Thank you. Thanks, Pete.

Your next question is from the line of [indiscernible].

Hi, I am [indiscernible] from Brookline here on behalf of Kumar – Kumar Raja.

Hi, [indiscernible]. Thank you.

Hi. Thanks for the presentation and discussing the progress with us. I have a question with regard to the CLBS16 study. So I was wondering what kind of background medication would the placebo-controlled patients be on? I mean like, would they be on an ACE inhibitor or high intensity statins or something like that?

They will likely be on – and it’s the full range of products that they are on or actually, I am not going to try to quote them by memory, but the protocol is posted on clinicaltrials.gov. So, you can look it up there and it will give you the exact background medications that are allowed.

Got it. Okay, thank you. Another quick question, so what is the expectation with respect to angina frequency for the study and you are going to measure it, but just wondering what’s the – what are we looking at?

Well, I mean, we are looking at something that would be a clinically meaningful reduction. Now remember, the purpose of this Phase 2b study is not to generate p values toward a registration with the FDA. The purpose of this trial is, in fact, to give us a good definition of effect sizes, so that we can appropriately size a Phase 3 trial for registration using endpoints that the regulatory authorities traditionally require and angina frequency is among them, but so is exercise tolerance and a few others. I think, if you look at the data that was presented in the ESCaPE-CMD trial from angina frequency, we were able to reduce daily angina frequency from 4.2 – excuse me 4.42 episodes a day per patient to around 2 episodes a day per patient. So, that’s more than a 50% reduction in angina frequency. Now, I don’t know that we will be able to replicate that magnitude of reduction in this larger trial. But whatever that magnitude is, it will give us a sense of how many patients will be necessary if we choose to use that as the primary endpoint in Phase 3.

Right. Thank you. Another follow-up question. So, you have the data by the end of 2022, so what do you think would be the thoughts to potential approval?

Well, I mean, right now our thought process is probably obvious to most people. We expect that data in the third quarter of 2022 from this Phase 2b study, which will give us the opportunity to do two things in parallel. One with the control data from this trial, we can file an application for an RMAT designation for CLBS16, which would then afford us a certain number of regulatory benefits, which should accelerate the potential approval of the product. And in parallel, we will then go to FDA with a proposed protocol using traditionally accepted endpoints for angina trials and get their agreement that has ended Phase 2 meeting on the path to registration hopefully with an RMAT designation and compelling results coming out of Phase 2b, we will be able to convince the agency that two large Phase 3 trials will not be necessary and one trial can be agreed to as being sufficient, but all this remains to be discussed, but that’s the regulatory strategic thinking at the moment.

Thank you so much. That would be all. Thank you.

Okay, thank you.

This concludes the question-and-answer portion of the presentation. And now I will turn the call back to Dr. Mazzo for closing remarks.

Thanks, operator. Again, thank you all for participating on today’s call. We look forward to speaking with you again during our next quarterly conference call and to continuing to provide updates on our achievements and progress and we remain grateful for your continued interest in and support of Caladrius Biosciences. Stay well and have a great evening.

This concludes the fourth quarter and year end 2020 financial results and business update conference call. Thank you for participating. You may now disconnect.