Hello, and welcome to the PDS Biotechnology First Quarter 2021 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 Deanne Randolph. Please go ahead.

Good morning, and welcome to PDS Biotechnology's First Quarter 2021 Earnings Conference Call and Audio Webcast. With me today are Dr. Frank Bedu-Addo, Chief Executive Officer; Dr. Lauren B. Wood, Chief Medical Officer; and Dr. Seth Van Voorhees, Chief Financial Officer. Earlier this morning, PDS Biotech issued a press release announcing financial results for the quarter ended March 31, 2021. We encourage everyone to read the press release as well as PDS Biotech's quarterly report on Form 10-Q, which will be filed with the SEC later today. The company's press release is available on PDS Biotech's website at pdsbiotech.com, and the quarterly report will be posted later today. In addition, this conference call is being webcast through the company's website and will be archived there for future reference. Before we begin, I would like to caution listeners that comments made by management during this conference call will include forward-looking statements within the meaning of federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve material risks and uncertainties, and the company's actual results may differ materially. For a discussion of these risk factors, including, among others, the risks related to COVID-19, the impact such pandemic may have on the company's business operations, financial operations and results of operations and the company's ability to respond to the related challenges, including those noted in this morning's press release, please refer to PDS Biotech's SEC filings. Investors, potential investors and other listeners are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Please note that the content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, May 13, 2021. Except as required by law, the company undertakes no obligation to revise or update any statement to reflect events or circumstances that take place after the date of this call. Following today's prepared remarks, we will open the discussion for a question-and-answer session. With that, I would now like to turn the call over to Dr. Frank Bedu-Addo. Frank?

Thank you, Deanne, and thanks to everyone on the call today. 2021 has so far been an exciting year for PDS Biotech. The company has continued to advance clinical development of our Versamune-based immuno-oncology pipeline through key initiatives and we are making significant progress with our clinical trials. Since we last spoke to you on our fourth quarter call, we have made further progress with our ongoing Phase II clinical trials as well as with our preclinical pipeline products. Our lead oncology candidate, PDS0101, as you may recall, is currently being studied in 3 Phase II clinical trials in advanced HPV-associated cancer. The most advanced of these trials is a National Cancer Institute-led study evaluating a novel triple immunotherapeutic combination of PDS0101 with 2 of EMD Serono clinical-stage immunotherapies, bintrafusp alfa or M7824, which is a bifunctional checkpoint inhibitor and NHS IL-12 or M9241, which is an immuno cytokine. This triple combination is being evaluated in HPV16 positive relapsed or refractory advanced HPV-associated cancers. And these include anal, cervical, head and neck, vaginal and vulva cancers. This population is a well-documented and difficult-to-treat patient population in which more refractive therapies are desperately needed. In January, we announced that this National Cancer Institute-led trial have achieved its preliminary efficacy benchmark with 3 or more of the first 8 patients, which approximates at least 40% achieving tumor regression. This benchmark represents a doubling of the response rates seen in this population of refractory patients with standard-of-care checkpoint inhibitors and at least a 30% increase over the results reported with the most promising experimental agents in this population to date, which is bintrafusp alfa. As a result of the significant preliminary efficacy achievement, a second arm was opened up to study the combination in refractory HPV16 positive patients who have, in addition, also…

Thank you, Frank. And once again, thanks to all of you for joining us this morning. As Frank just detailed, we have made significant progress in our oncology pipeline since our fourth quarter call. I'll begin with our ongoing oncology clinical trials. The investigator-initiated study of PDS0101 in combination with bintrafusp alfa, also known as M7824, a first-in-class bifunctional checkpoint inhibitor and M9241, an antibody conjugated cytokine designed to facilitate entry of the cytokine IL-12 into the tumor microenvironment and to enhance the local T-cell response was initiated in June 2020 with encouraging and faster than projected initial approval despite the COVID pandemic. This NCI-led study was a result of independent preclinical animal studies conducted by the NCI, which showed strong synergy between the 3 agents. Specifically, the triple combination resulted in enhanced antitumor activity when compared to treatment with the individual agents or with dual combinations of these agents. The details and findings of these preclinical studies were published last year in the June 2020 issue of the Journal for ImmunoTherapy of Cancer, also known as JITC. We previously announced that this investigator-led study achieved both its initial safety benchmark, meaning that fewer than 2 dose-limiting toxicities were observed in the first 6 patients who received the triple combination and its initial efficacy benchmark. The initial observation of objective response in 3 or more of the initial 8 patients indicated that the triple combination was at least 2x more, 100% more effective in reducing tumor burden compared to the standard of care outcomes in this patient population to date. As a reminder, this patient population is very difficult to treat. The best objective responses reported to date in advanced HPV cancer patients who have failed prior therapies is 12% to 24%. Many of these patients have failed multiple treatments…

Thank you, Lauren, and good morning, everyone. I'd like to turn our discussion to a review of our financial results for the quarter ending March 31, 2021. For the first quarter of fiscal '21, our loss from operations was approximately $3 million versus a loss of approximately $4 million during the same period in 2020, or a net loss of $0.14 per basic and diluted share compared to a net loss of $0.39 per basic and diluted share for the first quarter of 2020. Research and development expenses totaled approximately $1.4 million in the first quarter of 2021 as compared to $2 million for the first quarter in 2020, a decrease of approximately $0.6 million or 28%. For the first quarter of 2021, general and administrative expenses were approximately $1.6 million compared to approximately $2.1 million for the same period in 2020, a decrease of approximately $0.4 million or 19%. From a cash flow perspective, we started 2021 with approximately $28.8 million of cash and used approximately $3.8 million in our operations in the first quarter of 2021, leaving us with a cash balance at the end of the period of approximately $25 million. Our business strategy allows us to keep our cash burn at relatively low levels as demonstrated by our first quarter results. This strategy utilizes the cash we raised from the capital markets on our oncology development programs, while continuing to develop our infectious disease products through non-dilutive financing sources or out-licensing agreements. In addition, 2 of the 3 oncology clinical trials, currently underway, are investigator-sponsored studies, which involve low levels of financial commitment from PDS, while at the same time, maintaining 100% ownership of the commercial rights of the Versamune products being investigated. As a consequence, we are able to utilize our cash resources in a most efficient manner to create value for our shareholders. Thank you for your time today. And I'd like now to turn the call back to Frank for final remarks.

Thank you very much, Seth and Lauren. Before we begin our question-and-answer session, I would like to thank our stellar team members here at PDS Biotech and all of our clinical partners for their untiring work. It is an exciting time at PDS Biotech with the potential of having some solid initial proof-of-concept data for our Versamune platform in oncology next month. It is through their dedication and the expertise of our team that we have been successful in significantly progressing 3 active PDS0101 Phase II clinical trials in oncology, while also continuing to develop our preclinical pipeline. The data now being generated from our ongoing clinical trial programs will serve as the foundation to allow us to build our Versamune-based pipeline into the next generation of cancer immunotherapies as well as novel vaccines that may induce a broader range of protection against infectious diseases. That concludes our prepared remarks. Operator, please begin our question-and-answer session.

[Operator Instructions]. Our first question today is coming from Joe Pantginis from H.C. Wainwright.

I have two sets of questions, and I'd like to start with the COVID platform, first. Obviously, you have a very defined program in Brazil and the funding to go along with it. And I guess, I wanted to approach my question this way. How can we view as the importance of T-cells continues to increase in visibility, further potential reach -- I'm sorry, geographical reach of the program. And I'm thinking specifically of all the volatile environments and the significant problems that India is having and discussions about freeing up intellectual property for other vaccines. It's just a very dynamic environment. So I guess I just want to get a sense of potential geographical reach that you might be working on.

Well, Joe, thank you very much for your question. This is Frank. And I think one of the -- I wouldn't call it a challenge, but one of the facts of the matter is that, this program, we anticipate, as it continues to build up, that it will become more and more visible. One of the key things that you did mention that's becoming very prevalent today is the key role or importance of T-cells in robust immunity against COVID-19. One of the things that we have mentioned quite often is the fact that we believe very strongly that the next generation of COVID-19 vaccines should be able to demonstrate robust T-cell responses, importantly, against conserved regions of the virus because we know today that this virus has a very high propensity for mutation, and therefore, being able to generate or develop a vaccine that can provide a broader range of protection becomes very important. Now we continue to focus on our oncology pipeline. We are providing support to Farmacore in terms of Versamune expertise, but they have the responsibility for developing this vaccine and performing the human clinical trials in Brazil, specifically. So in terms of the regional components, the trial now is really going to be performed in Brazil by Farmacore. However, I think once that data does become available, the initial data does become available, PDS retains the right to be able to develop the vaccine as we see fit, right? So we will continue to evaluate the situation as it progresses. And as data becomes available, hopefully, we will be making the appropriate decisions and determine where to go from there. And one of the things that we've also mentioned right from the start is our goal isn't really to rush to be one of the first to market, right? We've called this a second-generation COVID-19 vaccine. What we would like to do here is to develop a vaccine that has the attributes that are critical for a successful global COVID-19 vaccine. That means it must achieve or have certain critical characteristics. It should have induced a broad range of immune responses. So not only neutralizing antibodies, but very importantly, CD8 and CD4 T-cells as well as memory T-cells that recognize conserved regions of the virus. Secondly, it should be stable, should have long-term stability, overcoming the cold chain situation that we see with a number of the vaccines today. And very importantly, it should be safe and very well tolerated. And we believe the diverse immune-based COVID-19 vaccine checks each of these boxes. And so the goal is really to develop this and really make sure that we have something that is highly competitive in the global markets today.

That's actually really helpful. And thanks for reemphasizing having the second-generation and not necessarily rushing. So thanks for restating that again. My second question has to do with 0101. It's really 2 parts. The first part is a logistical question, saying, obviously, we'd love to know the data, but I can't wait till ASCO. But I guess, can you share with us sort of the general or range of number of patients that we can expect data on and any sort of translational data that might be presented as well, just the types of and scope of data.

Sure. So the abstract will be made available by ASCO on May 19. So you won't have to wait too long to get an insight into what the data looks like. But I think it's going to be in the range of, I would say, probably around 20 to 25 patients. So it will be at least, I would say, approximately midway through the full trial. So I think it will be a robust enough data package that would give us some very good insight into what's actually going on with the triple combination in these patients.

Got it. Got it. And then the second part is, and this goes to some of your prepared comments and also something that we've discussed before with you. And that is one of the key challenges in IO studies or IO combination studies is how to tease out the impact of a particular asset, in this case, Versamune. So with 0101, as part of your prepared comments, you certainly talked about the preclinical data and study that the NCI have done with regard to the significant increases in the CD8 T-cells. Now I guess, how does -- you guys have given some of your views, and I'd like for you to repeat it, but also how does the NCI view this? Like you said, these are patients that no longer have any options and the NCI's view of the true importance of the significant boost in CD8 T-cells that can infiltrate the tumor and any perceived risks around, again, the concept I started with about teasing out the individual contribution?

Right. No, that's a really good question, very important and something that we have spent a lot of time discussing. And so without really going into the specifics of the data, I think the way the trial was run and the patient population addresses some of these questions. And hopefully, in the next couple of weeks, we will be able to delve much deeper into the data and really answer some of those questions. But we are quite confident that a lot of these questions are addressed in the data package that will be released in the next few weeks.

And can I -- Joe. So the other thing that I'd like to add is, is that, your question is very timely. And we believe one of the strengths of the NCI trial is, is that this same group was responsible for conducting the Phase I/II study of bintrafusp alfa M7824 monotherapy in the HPV-advanced cancer population. And there, they saw objective response rate of approximately 30%. Importantly, this same group also conducted the Phase I trial of the immune targeting cytokine M9241, NHS IL-12. There, they saw 0 objective response rates in that human clinical trial. Although, they do see 5 or 6 patients that had stable disease. So I think the NCI Group is uniquely positioned to be able to evaluate the activity and the efficacy preliminarily of this triple combination because they did the monotherapy studies of the individual investigational immunotherapeutic agents, apart from PDS0101. And so again, as we highlighted earlier during our comments, it was quite impressive in terms of the preclinical data. Clearly, dual combination therapy was superior to monotherapy in the preclinical studies and clearly triple combination therapy was superior to the dual combination therapy. So in the context of that preclinical translational background, we anticipate that we will see more potent outcomes with the triple combination in humans and then have to evaluate those outcomes in the context of what's already been documented with treatment with the monotherapy agents. And the NCI Group is well-poised to be able to comment on that.

Got it. And what I think is a real important benchmarking and looking forward to the data.

[Operator Instructions]. Our next question is coming from Leland Gershell from Oppenheimer.

Congrats on all the great progress. I wanted to ask on the VERSATILE study, once we begin to see data from that and as you contemplate further development, sort of a regulatory question, how you would see a registration study design? I mean, would that be kind of KEYTRUDA plus/minus 0101? Would we need to have survival data for approval? Could you file off of response rate? Maybe just give us some color on your thoughts there for what that would look like? And then also a question on the COVID-19 side, just kind of maybe teeing off of dose question, just more in a focused way? Are there any gating factors that we're waiting for from ANVISA? Or is it just a process as a review and kind of complete their assessment for the trial to begin?

Lauren, do you want to take the VERSATILE question? And then after you're done, I'll address the COVID question.

Great. Yes. So thanks for your question. We do anticipate that the FDA would want to see a randomized Phase II trial that was blinded for a registrational trial. They made it pretty clear in the statement of July of 2018 that they really want to see randomized trials that definitively established activity of the agents. And so as you mentioned, it would likely be KEYTRUDA with and without PDS0101 in a randomized trial. We clearly would be going for primary endpoints of objective response rate, first and foremost. Our target objective response rate for the VERSATILE-002 study is 33%. So as people may be aware, with pembrolizumab monotherapy in the KEYNOTE-048 study, the objective response rate is approximately 20% and those who have adequate tumor marker expression of PD-L1. 20% is 1 in 5 patients. And the goal of the VERSATILE-002 study is to see objective response rates of 33% or more, which moves the needle from 1 in 5 patients responding to 1 in 3 patients responding. So objective response rates would be the primary outcome, probably also accompanied by duration of response as a key secondary endpoint and then subsequently overall survival. We believe those would be the 3 major endpoints in a randomized trial that the FDA would be considering. Of course, the design of any trial is going to be driven by the objective data that's observed in our VERSATILE-002 study. And so there may be flexibilities for adaptive trial designs, depending upon what the data should -- yes, would be the most efficient regulatory pathway to proceed with. But we believe...

So Leland, does that address your question before I move on to COVID?

That's helpful, Frank. Please go ahead.

Okay, thanks. So regarding any gating items that are necessary to get the trial going. So as I mentioned in my remarks that Farmacore is responsible for the manufacturing of the antigen that's going to be used in the trial. PDS will be providing Versamune. The Versamune is ready to go. And Farmacore is in discussions with ANVISA, which is their regulatory agency, regarding providing a final package prior to entering into human clinical trials. Completion of their manufacturing process is going to be important in the final documents that are provided to ANVISA. So as we -- as far as we understand it today, that would be a key gating item in their discussions with ANVISA, given them the green light to initiate human clinical trials, getting the manufacturing done and providing what we would call in the -- with the FDA, our CMC package or the IMPD package to allow them to initiate those clinical trials.

Got you. Okay. That's helpful. And then one last question, if I may. I mean given the potential for the Versamune platform and a lot more that could be done versus your bandwidth. Just kind of curious if you may see kind of partnerships or sort of deals with third-party companies materialize down the road, as others become more and more aware of the potential of the platform and what they may be able to bring to bear with regard to incorporating that with their own strategies as obviously, you move forward with your core programs.

Yes. No, that's very important. So as you may notice, our primary focus is immuno-oncology, right? And that's really one reason why our infectious -- the 2 infectious disease programs actually being run pretty much 100% by the partners. We will probably never have the resources we need to really develop all the products we could potentially develop with Versamune in immuno-oncology. Now our current Phase II clinical trials provide a very important proof of concept in immuno-oncology. And we believe that this is going to be very critical for our rapid expansion and growth in terms of developing these immuno-oncology products. This proof of concept, the first real proof-of-concept data is what's going to be presented at ASCO next month. And so we anticipate that, that would provide a springboard to really start the second portion of our business plan, which is to partner with other companies developing immunotherapy. So other companies will have suitable antigens that we could combine with Versamune to develop some of these more reflective T-cell activating immunotherapies. But what you said is absolutely correct. The proof-of-concept data that we are currently generating with these multiple Phase II clinical trials is really what the industry needs to see to confirm or validate the potency and the potential of this technology to be utilized in multiple immunotherapies and also, very importantly, in partnerships with other companies to build out these programs.

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

Thank you very much, and thank you very much to all for your continued interest in PDS Biotech. We believe that 2021 will continue to be an exciting year for the company. We have multiple ongoing clinical trials of PDS0101 in various advanced HPV-associated cancers. And as I mentioned, interim data from our most advanced proof-of-concept Phase II trial will be presented on June 7 at the ASCO Conference in an oral presentation. The presentation abstract will be made publicly available by ASCO on May 19. We anticipate that interim data will provide validation of Versamune and PDS0101's potential to overcome the critical limitation of immunotherapy by activating large numbers of potent tumor-targeting killer T-cells in vivo and therefore, facilitating more effective therapy. We anticipate that this will also provide a springboard to focus primarily on building out our oncology pipeline and also to partner with other companies to accomplish this goal. We appreciate your ongoing support in this pursuit. For more information about the company and our ongoing clinical trial, please visit our website at pdsbiotech.com. Thank you very much again.

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.